San Francisco Rent Board News Archive: 2014

December 31, 2014

  1. New Ordinance Amendment Regulating Buyout Agreements
  2. Annual Rent Increase for 3/1/15 – 2/29/16 Announced
  3. Federal District Court Strikes Ordinance Amendment re Increased Relocation Payments to Tenants in Ellis Evictions
  4. Temporary Severance of Specified Housing Services During Mandatory Seismic Retrofit
  5. New Ordinance Amendment Re Increased Ellis Relocation Payments to Tenants (6/1/14)
  6. Investigative Hearings On Tenant Allegations Of Landlord Attempts To Evict Through Harassment Of Tenant
  7. Affordable Housing Assistance for Certain Tenants Subject to an Ellis Act Eviction
  8. Return

Sections

  1. New Ordinance Amendment Regulating Buyout Agreements
  2. Annual Rent Increase for 3/1/15 – 2/29/16 Announced
  3. Federal District Court Strikes Ordinance Amendment re Increased Relocation Payments to Tenants in Ellis Evictions
  4. Temporary Severance of Specified Housing Services During Mandatory Seismic Retrofit
  5. New Ordinance Amendment Re Increased Ellis Relocation Payments to Tenants (6/1/14)
  6. Investigative Hearings On Tenant Allegations Of Landlord Attempts To Evict Through Harassment Of Tenant
  7. Affordable Housing Assistance for Certain Tenants Subject to an Ellis Act Eviction
  8. Return
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New Ordinance Amendment Regulating Buyout Agreements

Rent Ordinance Section 37.9E, effective March 7, 2015, is a new provision that regulates "buyout agreements" between landlords and tenants under which landlords pay tenants money or other consideration to vacate their rent-controlled rental units. An agreement to settle a pending unlawful detainer action does not constitute a "buyout agreement" for purposes of Section 37.9E.

Starting March 7, 2015, Section 37.9E requires landlords to provide tenants with a Rent Board-approved Disclosure Form and to file a Rent Board-approved Notification Form with the Rent Board before beginning buyout negotiations. The Rent Board will make this information publically available (except for information regarding the identity of the tenants). Section 37.9E also requires that all buyout agreements be in writing and contain certain disclosures, including a tenant's right to rescind the agreement within 45 days of execution. For buyout agreements executed on or after March 7, 2015, the new law requires the landlord to file a copy of the buyout agreement with the Rent Board within 46 to 59 days after execution. The Rent Board will post all such buyout agreements in a searchable database that is available to the public at the Rent Board's office. Before posting a copy of a buyout agreement on its database, the Rent Board will redact all information regarding the identity of the tenants.

If a landlord begins buyout negotiations before March 7, 2015, but those negotiations result in a buyout agreement executed after March 7, 2015, the Disclosure and Notification Forms are not required, but the buyout agreement must still be filed with the Rent Board. Any dispute about when buyout negotiations began must be resolved in court and not at the Rent Board.

Section 37.9E also specifies various remedies and penalties against a landlord for violation of the above requirements that can be enforced in a civil action in state court. In addition, Subdivision Code Section 1396(e)(4) was amended to provide that buyout agreements with certain tenants after October 31, 2014 shall be the basis to deny an application for condominium conversion of the building.

A copy of Ordinance No. 225-14 amending Rent Ordinance Section 37.9E and Subdivision Code 1396 is provided here for your convenience.

 

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Annual Rent Increase for 3/1/15 – 2/29/16 Announced

Effective March 1, 2015 through February 29, 2016, the allowable annual increase amount is 1.9%. In accordance with Rules and Regulations Section 1.12, this amount is based on 60% of the percentage increase in the Consumer Price Index (CPI) for All Urban Consumers in the San Francisco-Oakland-San Jose region for the 12-month period ending October 31, which was 3.2% as posted in November 2014 by the Bureau of Labor Statistics.

To calculate the dollar amount of the 1.9% annual rent increase, multiply the tenant's base rent by .019. For example, if the tenant's base rent is $1,500.00, the annual increase would be calculated as follows: $1,500.00 x .019 = $28.50. The tenant's new base rent would be $1,528.50 ($1,500.00 + $28.50 = $1,528.50).

 

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Federal District Court Strikes Ordinance Amendment re Increased Relocation Payments to Tenants in Ellis Evictions

The Board of Supervisors amended the Rent Ordinance effective June 1, 2014 to require landlords to pay increased relocation payments to tenants evicted under the Ellis Act. On October 21, 2014 the U.S District Court found the new amendment unconstitutional on its face and enjoined the City from enforcing the new law. (The court's order in Levin v. CCSF, District Court Case no. 03352, is available here.)  The prior Ellis relocation benefits set forth in Rent Ordinance Section 37.9A remain in effect.

The City is appealing the ruling to the Ninth Circuit Court of Appeals. Pursuant to the District Court's order, the Rent Board will take no action to enforce the increased relocation payment while the court's injunction remains in effect. Any questions concerning the legal effect of the court's ruling on private parties should be directed to private counsel. 

 

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Temporary Severance of Specified Housing Services During Mandatory Seismic Retrofit

Effective August 30, 2014, Rent Ordinance Section 37.2(r) was amended to allow a landlord to temporarily sever specified housing services from the tenancy, including parking and storage, without a "just cause" reason in order to perform the mandatory soft-story seismic retrofit work required by Chapter 34B of the Building Code. Tenants will not be entitled to a rent reduction for the temporary loss of the housing service, but will be entitled to either compensation or a substitute housing service as provided in Administrative Code Chapter 65A.

Chapter 65A was added to the Administrative Code effective August 30, 2014 to provide a process by which a specified housing service may be temporarily severed from a rent-controlled tenancy in order to perform the mandatory soft-story seismic retrofit work required by Chapter 34B of the Building Code.

Section 65A.2 requires the landlord to provide the tenants in each affected unit with a 30-day written notice to temporarily sever the specified housing service. The notice must include the length of time the housing service will be temporarily severed. Prior to serving the notice, the landlord must obtain all necessary permits for the mandatory seismic retrofit work.

Section 65A.3 sets forth the calculation and distribution of landlord compensation payments to tenants of affected units. One-half of the compensation payment is due upon service of the notice to temporarily sever the housing service; the remaining one-half is due on the date that the temporary severance actually commences.

Section 65A.4 allows a landlord to choose to provide a comparable housing service that is reasonably near the affected unit ("substitute housing service") as an alternative to paying compensation.

Section 65A.5 permits either a landlord or a tenant to file a petition with the Rent Board to determine the amount of compensation or sufficiency of the substitute housing service under Chapter 65A. The filing of a petition shall not operate to delay the required payment of compensation or provision of a substitute housing service to the tenants of the affected unit.

A copy of Rent Ordinance Section 37.2(r) and Administrative Code Section 65A is provided here for your convenience.

 

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New Ordinance Amendment Re Increased Ellis Relocation Payments to Tenants (6/1/14)

Effective June 1, 2014, Rent Ordinance Section 37.9A(e)(3) was amended to require a landlord to pay the greater of the existing Ellis relocation payment amount or the "Rental Payment Differential" defined as "the difference between the unit's rental rate at the time the landlord files the notice of intent to withdraw rental units with the Board, and the market rental rate for a comparable unit in San Francisco as determined by the Controller's Office, multiplied to cover a two-year period, and divided equally by the number of tenants in the unit". The Controller has established a San Francisco Rental Payment Differential Schedule which will be updated each subsequent year by March 1. The schedule will also be available to the public at the Rent Board's office.

Landlords must pay one-half of the Rental Payment Differential at the time of service of the Ellis eviction notice and the other half when the tenants vacate the unit. Elderly and disabled tenants still separately qualify for the additional payment amounts.

The amendment applies to any tenant who "has not vacated the unit" by June 1, 2014. Any such tenant is therefore entitled to the Rental Payment Differential upon vacating the unit, reduced by relocation payments already received from the landlord in the case.

Landlords may file a written request for a hearing at the Rent Board to determine either of the following claims:

1. Whether payment of the Rental Payment Differential constitutes an undue financial hardship for the landlord in light of all the resources available to the landlord, with the exception of retirement accounts and non-liquid personal property such as clothing, cars, jewelry and art. The burden of proof is on the landlord. After a hardship hearing, the Rent Board's Administrative Law Judge may order a payment plan or a reduction of the relocation payment amount or any other relief that is justified based on the evidence.

2. Whether the Controller's Rental Payment Differential Schedule does not reasonably reflect the market rent for a comparable unit in the City. The burden of proof is on the landlord. Based on the evidence at a hearing, the Administrative Law Judge may affirm the Controller's Schedule as reasonable or order a downward adjustment of the relocation payment amount due.

A "Hardship Adjustment Request" form (to be accompanied by a Landlord Hardship Application) and a "Rent Differential Recalculation Request" form  (to be accompanied by supporting evidence of comparable rents) will be available on our website and at the Rent Board office on June 1, 2014. Such hearings will be given priority in scheduling to the extent possible.

 

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Investigative Hearings On Tenant Allegations Of Landlord Attempts To Evict Through Harassment Of Tenant

Effective 2/14/14, Rent Ordinance Section 37.9(l) authorizes the Rent Board to conduct an investigative hearing after a tenant files a Report of Alleged Wrongful Eviction which claims that the landlord has endeavored to recover possession of the tenant's rental unit through harassment of the tenant. For purposes of Section 37.9(l), harassment includes but is not limited to the types of harassment defined in Ordinance Section 37.10B. (Note: if the landlord has filed an unlawful detainer (eviction) action in court against the tenant, the Rent Board will not conduct an investigative hearing in the case.)

If an investigative hearing is scheduled, both the tenant and the landlord may appear at the hearing and make oral and/or written presentations, including presentation of witnesses. Investigatory hearings are not tape recorded, but testimony is given under oath.

Following an investigative hearing, the Administrative Law Judge will prepare a summary of the evidence and a recommendation as to whether or not further action should be taken by the Rent Board. If the Administrative Law Judge (ALJ)  recommends further action, such as referral of the case to the District Attorney or City Attorney, the Rent Board Commission will review the ALJ's recommendation and decide by majority vote whether to take further action.

 

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Affordable Housing Assistance for Certain Tenants Subject to an Ellis Act Eviction

San Francisco residents who received a notice on or after January 1, 2012 that his or her landlord plans to withdraw the tenant's rental unit from the rental market under the Ellis Act may be eligible for a Certificate of Preference under all affordable housing programs administered or funded by the City if the tenant lived in their rental unit for at least ten (10) years, or at least five (5) years if the tenant is suffering from a life threatening illness or is disabled. For more information about such assistance, contact the Mayor’s Office of Housing and Community Development at (415) 701-5613.


Amendments to Planning Code Section 24.8 and Administrative Code Section 37.6, effective January 18, 2014

 

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