Mayor Proposes Plan for Easier Demolition of Rent Controlled Housing
The “Constraint Reduction” legislation is sponsored by Mayor Breed, Joel Engardio, and Matt Dorsey. The legislation is being sold as a way to speed up housing production by eliminating planning staff review to make many permits automatic with no public objection allowed. It streamlines demolition of sound rent controlled units as long as the owner declares that either: 1) there have been no records of buyouts or evictions in the last 5 years, and tenants currently do not inhabit the unit; or 2) if tenants currently occupy the unit, displacement will be granted but they have a “right of return” when and if their units are rebuilt. The demolished units must be replaced and increase in number but there is no requirement that the new units are actually rental units – more likely they will become ownership “Tenancy-In-Common” units. This trend is already playing out at the Planning Commission where they still hold hearings and vote on demolition projects for now.
The legislation eliminates hearings where an affected tenant or a neighbor who knows the history of the building could be heard, object, and possibly get a vote of disapproval from the Planning Commission.
Shockingly, the Mayor’s legislation eliminates an existing but pathetically short 1-year ownership requirement in order to qualify for streamlining. Eliminating this requirement opens the floodgates for speculators to buy rent controlled buildings and fast-track their demolition with existing tenants barely able to protest their own displacement. New buyers of buildings, in our experience, are the most ruthless although they hide behind the lore of “mom-and-pop” landlords.
There are two major pitfalls with this proposal – FRAUD and FANTASY
FRAUD
Whether tenants currently occupy the units or the units even exist (in the case of illegal units) relies on self-attestation by landlords. Unscrupulous landlords have a HUGE incentive to lie on their applications, because if they are truthful the replacement units will come with restrictions.
Many vulnerable tenants, especially in illegal units, are asked to pay rent in cash so will not be able to prove their occupancy nor understand where to do so.
San Francisco has many, many in-law units that were built without permits so exist in a gray market outside of planning maps. These units are still covered by rent control and can use the Rent Board services, but tenants are especially vulnerable because both owners and tenants have an incentive to fly under the radar and hide these illegal spaces so the Planning Department doesn’t know they exist and would require replacement.
The legislation incentives pressuring tenants to “voluntarily” move out in order to deliver the unit vacant before applying for permits. There are many ways besides buyouts and evictions to convince tenants to leave when profits are at stake.
FANTASY
In our experience, when a tenant is displaced by fire, flooding, or major rehabilitation work, they almost never return despite their right to. Reconstruction is dragged on and the tenants either move on signing long leases elsewhere and typically give up.
Planning Staff (who support this legislation) could not answer simple questions about which department would track these Right of Return tenants and enforce if an owner simply neglected to inform the former tenants reconstruction was over.
A larger threat is that the speculator can simply rebuild and offer the new units for sale separately – “tenancy-in-commons” – so a tenant wishing to assert their right to return would have no unit available to return to. We believe this is the most likely outcome as older rent controlled buildings are typically cheaper to buy so the profit margin to turn them into condo opportunities will be huge. It will result in the loss of rent controlled units from the market.
Tenants will find it hard to fight their displacement as the demolition of their units has been condoned by the Planning Department and sold as good housing policy by developers who could care less about the effects on tenants.
HOW DID WE GET HERE?
The legislation was written by Housing Action Coalition and SPUR for the Mayor’s office. The main authors and proponents are Annie Fryman (former aide to Scott Wiener), Corey Smith, Lisa Gluckstein who works for the Mayor’s office, with plenty of input from the Planning Department leadership.
The Planning Department’s heavily put their thumb on the scale supporting this legislation in their supposedly neutral staff reports and hearings. The legislation was heard and approved by the Planning Commission in a hearing which could best be described as a Kangaroo Court.
In a sense, we agree with the sentiment of the Mayor’s legislation that planning department hearings are often a waste and time and useless – but we have very different reasons. Four of the seven commissioners are appointed by the Mayor and do what they are told in important policy choices. Examples of the Mayor’s power over the commission include when a commissioner changed her vote on regulating Airbnb after Mayor Lee’s Office texted her during a meeting, or when it was revealed Mayor Breed was forcing commissioners sign Letters of Resignation in order to be appointed. The Mayor’s Four predictably rubber-stamped this very flawed legislation despite major opposition from tenant advocates and community members. Board of Supervisors-appointed commissioners Theresa Imperial and Kathrin Moore did their best to ask challenging questions to Planning Staff and voted to reject the legislation but the fix was in from the start.
Commissioner Imperial asked staff how the Right of Return will be tracked, how future tenants will know their units are rent-controlled, and what will happen when applicants lie? Planning staff stumbled through unconvincing answers and President Tanner mercifully intervened and moved to approve without those answers.
