On February 8, over 600 people attended a citywide tenants convention focused on stopping Ellis Act evictions from displacing San Francisco’s working and middle-class. The day before, Mayor Lee announced plans to build 30,000 housing units, with “a majority of those within financial reach of working, middle income San Franciscans.” A political consensus supports keeping the middle-class in the city---the challenge is doing it.
It was reported last week (“Middle-Class Leaving San Francisco, Census Says
”) that Census data found that “about 5,075 individuals earning between $35,000 and $74,999 annually moved out of San Francisco between 2007 and 2011. “ That is roughly “40 percent more than the 3,654 people in the same income bracket that moved into the city during those years.”
Putting aside whether those earning $35,000 in SF are actually “middle-class” (their median earnings are in the “low-income” category), the data is alarming for two reasons.
First, this major out migration from San Francisco preceded the tech boom. It also occurred when Ellis evictions were at a low, and when the city’s unemployment was over 10%.
Second, a major reason for this out-migration was steeply escalating rents on vacant apartments in San Francisco despite the economic downturn. Even accounting for some leaving the city during 2007-2011 because they lost their job, the out-migration numbers from 2012-2016 will be much worse.
So San Francisco faces a situation where rents on vacant units sharply rise in good times and bad, and single-family home prices are entirely unregulated--- is it realistic to believe San Francisco can really save its working and middle-classes?
My answer is yes. Here’s how.
Stop Ellis Evictions
Media coverage of skyrocketing rental prices for vacant apartments obscures a fundamental fact: this does not displace working and middle-class San Franciscans from their homes. It's the Ellis Act that causes nearly all of this displacement. Without the Ellis Act, tenants living in below-market rent apartments would be free to remain in their homes, and in San Francisco, for the balance of their lives.
That’s why changing the Ellis Act to require a five-year holding period before it can be invoked is essential. It is far and away the single most important action that can be taken to slow the forced out migration of longtime working and middle-class San Francisco tenants.
Some say Ellis reform is only one of many strategies for addressing San Francisco’s housing crisis. But Ellis reform is the only strategy that stops the displacement of longterm tenants. San Francisco’s rent and eviction laws are sufficiently strong that virtually all tenants who pay their rent and are not engaging in nuisance activities are otherwise protected..
I also know that people hope that local strategies, such as Supervisor John Avalos’ merger legislation or Supervisor David Campos’ pending measure to sharply increase Ellis relocation costs, will deter Ellis evictions and help keep those evicted under Ellis in the city. But even the strong Campos measure---which requires a tenant get paid a two year rent differential between their current and market rent---does not mean that such tenants will be able to qualify for a much more expensive apartment than their income can support.
That’s why the next critical step for those trying to keep working and middle-class tenants in San Francisco is to attend Tenant Together’s February 18 Sacramento march and rally
. And it’s not just tenants and their advocates who understand the importance of Ellis reform. Salesforce’s Marc Benioff recently told
the Wall Street Journal
that "The first thing is you can’t be throwing all these people out of their homes. They are using the Ellis Act during this unbelievable boom time, to toss everyday residents out of their homes. I think is unfair and I think it has to change. I think that our government, our industry leaders and everyday citizens — all three stakeholders — need to come together in a conversation and change that.”
Build More Affordable Housing
Stopping the displacement of working and middle-class tenants does not make vacant units in the city affordable to these income levels. The longstanding progressive solution---build more nonprofit affordable housing---now falls short due to the lack of public money
and rising construction costs.
Mayor Lee proposes to build 30,000 housing units, of which at least a third will be affordable to low and moderate-income levels. This will not satisfy those who oppose any new market rate housing, but since for-profit development is becoming the chief engine of affordable housing through the city’s inclusionary program---and Mayor Lee just upped the required percentages
last week--- banning new developments would only reduce future housing options for the working and middle-class.
When I think back on how close we came in the late 1990’s working with Senator John Burton on getting an Ellis Act holding period, I regret that we did not assemble the broad coalition currently being put together that might have made the difference. But when 600 people come out on the rainiest day of the year----and that’s 400 more than attended our 1992 Tenants Convention that led to tenants winning their first local ballot initiative, Prop H---it’s clear that the political momentum for Ellis reform is far greater today than in the past.
The combination of stopping Ellis Act evictions and building more affordable housing will not return San Francisco to the 1960’s era of low rents and home prices. But it will slow the exodus of working and middle-class from the city, and create new opportunities for the non-wealthy to live in San Francisco.
Randy Shaw is Editor of Beyond Chron.