San Francisco real estate industry and landlord groups have filed a lawsuit seeking to overturn a recently signed law that permanently bans landlords from evicting tenants who are financially impacted by the coronavirus pandemic and unable to pay rents.
The San Francisco Association of Realtors on June 29, 2020, said they filed a lawsuit challenging the legality of COVID-19 Tenant Protections Ordinance stating that the law went "too far," the San Francisco Chronicle reported. The other associations who joined the real estate group in filing the lawsuit include the San Francisco Apartment Association, Coalition for Better Housing, and Small Property Owners of San Francisco Institute.
The group also seeks to have the ordinance, which permanently bans pandemic-related residential evictions, suspended because it violates state and constitutional law and runs in conflict with Governor Newsom's Executive Order regarding evictions. The law they say would lead to more evictions once enacted.
San Francisco Association of Realtors president and CEO Walt Baczkowski said that because of the ordinance, some renters would inevitably stop paying rent without making an effort to budget so they can repay their rent once the pandemic is over.
While the ordinance bans eviction for non-payment of rent due to financial hardship caused by the pandemic, it does not at all waive the owed rent, San Francisco Examiner reported. Landlords have the option to pursue any back rent through the courts, but such legal proceedings can take years and do not assure that landlord will be able to recoup their costs, the real estate industry group said.
The pandemic has also financially impacted property owners as they are not able to collect rent on commercial and residential spaces, the association of realtors explained. In particular, more than half of commercial tenants have altogether stopped paying rent after they are forced to close due to the lockdown restrictions.
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Small Property Owners of San Francisco Institute president, Noni Richen said that the ordinance would allow a tenant to remain in the property rent-free from March to possibly beyond September. And that leaves landlords with no legal recourse to recoup losses.
Supervisor Dean Preston, one of the legislation's sponsors, said he was not surprised about the lawsuit. At the same time, he calls it as disgraceful as many individual landlords have been working their tenants, but "these groups have their own agenda," the San Francisco Chronicle report said.
The San Franciso Examiner furthered that Preston questions the judgment and motive of those seeking to derail the law banning eviction when everyone should be coming together on solutions amid the coronavirus pandemic.
In early June, Preston mentioned that he would be working on setting up legislation that includes a rent relief fund to aid small landlords, in particular, to enable them to offset uncollected rent. The majority of the funding, between $100 million and $150 million, could come from November ballot measure - transfer tax on real estate transactions of $10 million or more - if voters approve.
