The Ellis Act, an owner’s perspective: Jerry Jacoby

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Jerry Jacoby is a fourth-generation San Franciscan who lives on Filbert Street in the Russian Hill neighborhood. He was born and raised off of San Bruno Avenue and attended Lowell High School.

As a younger man, Jerry worked hard, saved, and began to look for a home for himself and his growing family in the early 1980s.

Aside from serving two years in the Army in the Vietnam War, Jerry has spent his entire life in The City. He raised his four children in San Francisco and spent his working life at a number of jobs as an engineer, consultant and analyst for local firms from Levi’s to Fibreboard Paper to Matson. Jerry now survives on $12,000 each year in Social Security payments.

As a younger man, Jerry worked hard, saved, and began to look for a home for himself and his growing family in the early 1980s. The only property he could afford in Russian Hill was a two-unit property on the 1300 block of Filbert Street. It had two legal, detached cottages, one built pre-earthquake around 1906, and the other by the previous owner in 1975.

Jerry purchased the property in 1984, hoping to offer stability to his family through homeownership. They lived in one of the homes and relied on rental income from the other to help pay their mortgage, becoming “accidental landlords” in the process. At the time Jerry purchased his property, all two-unit owner occupied properties like his were exempt from the rent control ordinance.

Nearly 10 years later, Prop I included all post-1979 rental property under rent control. At the time, his property’s inclusion under rent control seemed irrelevant. Jerry valued his relationship with his tenant and went eight years without raising rents, even granting two years of rent decreases to accommodate a change in his resident’s income.

In recent years, though, Jerry has had to confront the infirmities of age, undergoing two hip replacements, multiple minor surgeries, and infections that required hospitalization. With the related financial burdens, Jerry could no longer afford to rent to his tenant, who grosses more than 10 times what he does annually.

In case of a medical emergency, Jerry Jacoby, almost 80, reluctantly concluded his daughter needed to live in an adjacent cottage on his property . He turned to his only legal resource to quit renting out the unit: The Ellis Act.

Still concerned for his tenant, however, he pledged to go beyond any minimum requirement of Ellis and Rent Board regulations. He offered six months of free rent instead of the required 60 days, and considerably more than the $15,000 in relocation fees the law requires.

His actions, although ethical and necessary, left him threatened with multi-million dollar lawsuits, demonized as a slumlord and dragged before the Rent Board, which retroactively re-classified his property as rent-controlled. The board awarded a rent refund of $22,600 and a punitive penalty of $25,000.

Despite the legal costs and hassles Jerry endured, the Ellis Act gave him the freedom to exercise his property rights — rights that must be protected.

Tagged: San Francisco Apartment Association

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