CAA to keep fighting anti-Ellis Act bill

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The California Apartment Association is continuing its fight against an anti-Ellis Act bill that Senate Democratic leadership resuscitated May 29 after it sank on the Senate floor.

Sen. Mark Leno’s SB 1439 certainly appeared dead Wednesday, May 28, when it received just 18 of the 21 votes needed to reach the Assembly. On Thursday, however, the bill made an astounding comeback amid vigorous political CPR.

In its weekly newsletter, the Civil Justice Association of California dubbed the legislation a “zombie” bill for its surprising resurrection.

“A last-ditch effort by the author offering vague amendments and ‘considerations’ with considerable arm-twisting by leadership allowed the bill to get out of the Senate by a vote 21-13,” CJAC observes.

CAA remains determined to defeat this legislation, which poses a great threat to property rights both in San Francisco, and ultimately, elsewhere in the state.

While not specific, Leno, D-San Francisco, offered conceptual wording he says would:

  • Differentiate speculators from landlords. Leno offered no specifics. Currently, this is defined as owning property less than five years.
  • Exempt small-property owners; Leno offer two units as an example.
  • Add a sunset provision, although he gave no time limit.

Talk of these amendments came Thursday, a day after Leno’s SB 1439 fell three votes short of passage.

As Leno worked to change the minds of three colleagues, Senate President Pro Tem Darrell Steinberg and others stretched out the floor session. At one point, Steinberg jokingly offered to tell his life story. At another, Sen. Hannah-Beth Jackson, D-Santa Barbara, read poetry by the late Maya Angelou.

In the end, Sen. Jerry Hill, D-San Mateo; Sen. Ben Hueso, D-San Diego; and Sen. Ed Hernandez, D-West Covina, changed their votes to ayes.

Lawmakers sticking with their original no votes included Sen. Norma Torres, D-Pomona.

“This is a San Francisco problem created by San Francisco because of ‘nimbyism’ and the lack of will to build affordable housing,” Torres told her Senate colleagues, as reported in this San Francisco Chronicle story.

Despite Leno’s offer of amendments, his legislation would greatly weaken the Ellis Act, a landmark law that bars local governments from making property owners stay in the rental housing industry.

Passed by the Legislature in 1985, the Ellis Act particularly helps owners of properties in rent-controlled cities, where landlords can find themselves operating at a loss.

Sen. Mark Leno

Sen. Mark Leno

Under Leno’s current version of the bill, San Francisco would be authorized to place the Ellis Act out of reach for newer property owners.

Leno’s bill would force an owner of rental property in San Francisco to wait at least five years before removing his or her rental units from the market — even if losing money month after month. It’s not immediately clear whether Leno’s amendments would change this assault on property rights.

In the past weeks, CAA members have sent hundreds of letters to lawmakers to stop SB 1439. Stay tuned for future calls to action as Leno’s bill moves to the lower house of the state Legislature.

Background stories

Tagged: San Francisco Apartment Association

  • Mr. Leno indicated that there are already safeguards that property owners are protected by the Ellis Act. In theory Mr. Leno is correct, but in reality it’s a total nightmare in enforcing the safeguards. It’s ridiculously expensive to vacate a unit as the Ellis payouts run into the tens of thousands, easily 30 to 50 thousand per unit plus attorneys fees. The tenant has the right to fight the Ellis by obtaining free attorney the eviction takes 3-5 months if not more. If the landlord wins, owner still must pay all the relocation fees even though tenant fought the eviction and kept occupying the unit without paying the monthly rent.
    Senator Norma Torres hit it on the button when she said that this is a problem that the S.F. bureaucracy has created. The City of S.F. has passed the problem to the owners as being the evil landlords.