The Daily Journal - February 22, 2006
Price Is Right for Relocating S.F. Tenants
By Leslie Simmons

What's the cost of taking property off the competitive San Francisco rental market and displacing its occupants? At least $4,500 per tenant, the 1st District Court of Appeal ruled Tuesday.

The three-judge panel unanimously upheld a San Francisco ordinance that requires property owners looking to withdraw from the rental market to pay relocation costs to each evicted tenant. Pieri v. City of San Francisco, A110571.

The decision reverses San Francisco Superior Court Judge James Warren, who sided with landlords when he found that state law allows relocation assistance only for low-income tenants.

The landlords and Warren relied on case law that found the Ellis Act's intent was to protect lower income tenants.

But the appellate panel said the Legislature was well aware of prior court interpretations of the Ellis Act when it amended the law in 2003.

"The Legislature has shown that it can draft language intended to protect only lower income tenants," Justice Maria P. Rivera wrote. "In eliminating such language, and in including 'persons displaced by reasons of the withdrawal from rent or lease of any accommodations,' [emphasis added by Rivera] we can only conclude the Legislature meant what it said."

The court also noted that the required payments of $4,500 per tenant or $13,500 per unit "is not so disproportionately higher - especially in light of intervening inflation - that it is necessarily beyond that contemplated by the Legislature in enacting and amending [the Ellis Act]."

Justice Patricia K. Sepulveda and Judge John E. Munter, sitting on assignment from the San Francisco Superior Court, concurred.