Friday, May 30, 2014

Ellis Act reform bill passes in State Senate

Posted By on Fri, May 30, 2014 at 4:00 AM

click to enlarge State Sen. Mark Leno, D-San Francisco, calls for passage of his measure to modify a state law that would restrict the mass evictions of recently acquired rental properties in San Francisco, during the Senate session at the Capitol in Sacramento, Calif., Wednesday, May 28, 2014. - AP PHOTO/RICH PEDRONCELLI
  • AP Photo/Rich Pedroncelli
  • State Sen. Mark Leno, D-San Francisco, calls for passage of his measure to modify a state law that would restrict the mass evictions of recently acquired rental properties in San Francisco, during the Senate session at the Capitol in Sacramento, Calif., Wednesday, May 28, 2014.
Legislation proposed by State Senator Mark Leno to limit Ellis Act evictions in San Francisco passed the Senate today in a 21 - 13 vote, after falling three votes shy of passage yesterday. The bill gained the imperative votes after Leno promised to draft amendments differentiating between small family holdings and speculators who abuse the Ellis Act.

Leno's proposed legislation, Senate Bill 1439, would require new property owners in The City to wait five years before invoking the Ellis Act to remove tenants, and restrict landlords from invoking the Ellis Act more than once.

The bill will go before the State Assembly this summer.

“Today’s vote is a significant victory for San Francisco, which is facing an affordable housing crisis,” said Leno. “The Ellis Act was intended to apply to landlords who want to go out of the rental business, but it is now being abused by speculators who quickly vacate properties and resell them for a profit. Many of the displaced tenants are seniors, disabled people and low-income families with deep roots in their communities and no other local affordable housing options available to them. Our bill gives San Francisco an opportunity to stop the bleeding and save the unique fabric of our City.”


SB 1439 is co-sponsored by Mayor Ed Lee and renters advocacy organization Tenants Together. It is also supported by tech companies Salesforce, Twitter, Zynga, and others, which are members of sf.citi.

 “I am grateful to the Senate for moving Senate Bill 1439 one step closer to the Governor’s desk, so that we can stand up for working families and longtime San Franciscans," said Lee.

A recent report from Tenants Together revealed that most Ellis Act evictions in San Francisco were initiated by investors, not landlords.

The bill was opposed by the California Apartment Association, which argued that the legislation would force landlords to operate at a loss, and the California Chamber of Commerce. "Under Leno’s bill, San Francisco would have been authorized to place the Ellis Act out of reach for newer property owners. After purchasing rental property in The City, the owner would have been forced to wait at least five years before removing his or her rental units from the market — even if losing money month after month," the Association wrote in a statement.

 The Association successfully opposed a similar Ellis Act reform bill, authored by Assemblyman Tom Ammiano, in April. 

Some moderate Democrats who receive campaign contributions from a political action committee tied to the realtors' association were among those who opposed the bill.

Sen. Norma Torres, D-Pomona, said San Francisco failed to build sufficient affordable housing, and "asking private owners to foot the bill for something that they have neglected is inappropriate."

Republican lawmakers also were opposed.

Sen. Mike Morrell, R-Rancho Cucamonga, called the legislation "a slide towards socialism." He said San Francisco should loosen regulations and lower building permit fees to solve its housing problem.

The Associated Press contributed to this report.

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