Last night, the San Francisco Board of Supervisors passed a series of amendments to the Chapter 37 of the San Francisco Administrative Code. People around here know that better as the San Francisco Residential Rent Arbitration and Stabilization Ordinance (or as I like to call it "RRASO").
Now, I like rent control. I think it evens the playing field between landlords and tenants. Tenants, as you might have guessed from my leanings in other postings on this blog, are people I represent. Unlike their landlords, they don't have, usually, equal bargaining power. The RRASO evens the playing field a bit.
Talk to a landlord attorney in this town, and they will claim (before yesterday of course), that rent control is the worst thing in the world. That all it does it penalize those poor, hard-working landlords who are barely eaking out a profit because of the meddling of the city. Unfortunately, the San Francisco Supervisors just handed them a new issue to litigate.
Superviso Daly has attempted to make this legislation more palatible by including some provisions limiting the effect of the amendments. According the legislation in its current form, it would only apply where the tenant had lost their job, had their income decreased, or been on a government assistance program for which no cost of living increase has been given in the past year. He also attached a sunset provision to the amendments. The sunsets on the amendment when San Francisco's unemployment drops below 5%. Now, that seems reasonable, it last happened in 2007. However, if you look further, and take the numbers from 2000, it seems that of the last ten years, its dropped below 5% only twice (it tends to hover a little over 5% according to the data the state puts on its website.) So really, its just a guarrantee that this temporary "crisis" will become long term.
So what did the Supervisors do? They passed a series of measures last night. If the new amendments are finalized, then they will do the following:
- Prevents landlords from increasing the rent of tenants to any amount that would exceed 33% of their income.
- Limits the so-called "banked" rental increases to 8%
- Allows roommates to be added without landlord approval so long as the total roommates does not exceed the maximum allowed by city ordinances
- Prevents Landlords from raising rents when additional roomates are added.
Now, the only one that makes sense to me is the last one. If you are renting by person for a rental unit, you are a fool in my opinion. You should be doing by square footage.
So why is this bad? Well, let's start with the first one (preventing landlords from raising rents beyond 33% of someone's income). First, it imposes a lot of work on the landlords. Now they have to do somethign which HUD and local housing authorities have to do with rather larger staffs, namely monitoring people's incomes. Second, the only way it works is if the tenants turn over private information to the landlord. Because as we all know, that just such a good thing to do.
Third, when did we start penalizing people for doing well? I am not a fan of many landlords. However, I do respect those that are savy enough to turn a profit in a down market, and do it ethically and without resort to less than permissible means. But now, Supervisor Daly, who was a prime supporter of this legislation, wants to penalize them in favor of supporting those who make less. If you want to do that, you shoudl put together a fund from the City and County to support their rents. You should not do it by enacting a taking that even a first semester Con law student would be able to recognize.
Simply put: ITS JUST NOT FAIR.
I am so busted if my tenant attorney friends find out about this. But then I've said that before.
But anyways, that brings us to the fourth reason: giving the libertarian landlords another shot at the RRASO in the courts. I guarrantee that if this gets passed, then there is going to be a court challenge. Given the way that the California appellate and supreme courts have been viewing rent control, why would a supervisor who seems so committed to rent control want to give the courts a chance to prune it back. Or evicerate it.
What this really amounts to is an added tax on the landlords. Yes, it may be a little hypocritical the position that I am staking out. But basically I think controlling the increase in rents to be one thing, but limiting rents entirely is something else.
Fortunately, it looks like this is going to be vetoed by Newsom. That is if he can tear himself away from his gubenotorial campaign.
I'm all in favor of tenant's rights. I am not in favor of penalizing people for working hard. And that is what I see this legislation doing.