Update, June 18: Despite amendments to address concerns from small property owners, state Sen. Mark Leno's bill failed by one vote in the Assembly Housing Committee. It may be reconsidered, though.
"I am profoundly disappointed," Leno said in a statement. “It is unfortunate that some of my colleagues in the Assembly did not recognize the importance of this bill for the residents of San Francisco.” According to the Sacramento Bee, Leno may still have a chance to get it through:
Whether the decision stands is uncertain, since Leno was granted "reconsideration" - in effect at least a few more days to persuade one of the no-voting Democrats, Cheryl Brown of San Bernardino or Sharon Quirk-Silva of Fullerton, to switch before the June 27 deadline for committee approval of bills. Or, it's possible that the provisions of SB 1439 could be amended into another bill and bypass the committee later in the session.
SB1439 would modify the Ellis Act, which allows landlords to evict all tenants in a building when they want to sell a property and get out of the rental business. Under the new law, landlords in the city would need to own a building for at least five years before they could invoke the Ellis Act.
The measure aims to cut down on investors who are using the Ellis Act to buy inexpensive property, evict tenants, renovate the property and sell it for a profit. Ellis Act evictions in the city have tripled to more than 300 in the past year, and about half were initiated by owners who’d held the property for less than a year, according to Leno. “When you buy properties solely to evict long-term tenants, and to flip those at extraordinary prices, that is the wrong message,” Mayor Ed Lee said in February. “That is not what the Ellis Act was created for, and it’s certainly opposite of our values in this city.” The bill originally failed to pass Wednesday, so Leno agreed Thursday to make changes to differentiate between family owners and big business interests. From the San Francisco Chronicle:
The yet-to-be-written amendments would exempt one or two small properties owned by "mom-and-pop" landlords from new Ellis Act restrictions and may also include a sunset date for the bill.
Leno told lawmakers that if they passed his bill on to the Assembly while he worked on the amendments, he understood they may not support the legislation when it returns for a Senate vote to approve the changes. He said the bill would be just as effective with the amendments.
"Although there has been concern about protecting 'mom-and-pops,' the data I've seen shows they aren't the ones doing the Ellis Act evictions," Leno said.
SB1439 passed with the bare minimum votes needed, 21-13, with some Democrats still opposed. The bill now heads to the Assembly.