Judge tosses S.F. law meant to shield evicted tenants

The San Francisco Chronicle reports:

San Francisco apartment owners scored a major victory Tuesday when a federal judge declared unconstitutional the city’s attempt to shield evicted tenants from soaring rents by substantially increasing the relocation fees the tenants must be paid by landlords who decide to get out of the rental business.

The law, which took effect in June, requires property owners to pay displaced tenants the difference for two years between the current rent and the amount needed to rent a comparable unit in the city at market rates — more than $100,000 in most cases. That violates property rights, said U.S. District Judge Charles Breyer, because it requires owners to pay for conditions they didn’t cause — the skyrocketing prices of rental housing, and the gap between market rates and maximum charges under the city’s rent-control law.

The ordinance “seeks to force the property owner to pay for a broad public problem not of the owner’s making,” said Breyer, who held a one-day trial in the case this month. “A property owner did not cause the high market rent to which a tenant who chooses to stay in San Francisco might be exposed, nor cause the lower rent-controlled rate the tenant previously enjoyed.”

He said the city’s claim of a causal link between a landlord’s actions and the relocation fees was further weakened by the fact that the ordinance did not require tenants to spend the fees on replacement housing in San Francisco, or anywhere else.

Property rights victory update.