Court upholds San Francisco Relocation Assistance law

By Julia Cheever, Bay City News Service

February 21, 2006

SAN FRANCISCO (BCN) - A state appeals court today upheld San Francisco's so-called "universal relocation assistance" law.

The measure, passed by the city's Board of Supervisors in 2005, requires property owners who are evicting tenants under the state's Ellis Act to pay each tenant $4,500 in relocation assistance, regardless of the tenant's income.

There is a cap of $13,500 per household.

A three-judge Court of Appeal panel in San Francisco rejected arguments in which two residential property owners and an organization called Small Property Owners of San Francisco argued that the Ellis Act provides for relocation payments only to low-income tenants.

The appeals court said that an amendment to the Ellis Act passed by the state Legislature in 2003 removed language allowing payments only to low-income tenants and gave local governments the flexibility to require aid to all tenants.

Justice Maria Rivera wrote, "We can only conclude the Legislature meant what it said."

The plaintiffs, landowners Jackie Pieri and Lavinia Turner and the property owners group, argued that the San Francisco measure made it prohibitively expensive for landlords to withdraw property from the rental market, in violation of the Ellis Act.

The Ellis Act, enacted by the Legislature in 1985, provides that local governments cannot force property owners to stay in the rental business, except in cases of certain types of residential hotel units. The law also allows local governments to pass measures to mitigate the impact of evictions on tenants.

The appeals court overturned a decision in which San Francisco Superior Court Judge James Warren last year ruled in favor of the property owners.

Andrew Zacks, a lawyer for the property owners, said his clients will ask the appeals court to reconsider the case and will appeal to the state Supreme Court if necessary. Zacks said, "We don't believe that requiring property owners to make large payments to tenants is consistent with the statute, which is designed to enable landowners to get out of the rental market."

City Attorney Dennis Herrera said, "Today's ruling is an important win for San Francisco tenants and vindication for our argument that San Francisco correctly interpreted state law in enacting its universal relocation assistance program."

Board of Supervisors President Aaron Peskin said, "Our law is a reasonable step that provides a basic level of protection for tenants who are subject to the increasing epidemic of Ellis Act evictions."

The appeals panel said the San Francisco measure did not "on its face" violate the Ellis Act, meaning that the text of ordinance did not conflict with the law.

But the panel said that individual property owners might be able to argue in future cases that the measure's requirements were prohibitively costly in a particular situation. Zacks said, "We're happy they left that open," but said it would be a burden for individual property owners to file lawsuits against the city to challenge the application of the measure in individual situations.

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