Restricted to multi-unit buildings built before 1979 and limited by state law, rent control is a non-renewable resource in San Francisco.
That means rent-controlled housing stock is lost, not made. But newly seated Supervisor Aaron Peskin is exploring a plan to expand rent control to new construction — he just needs to find a way to do it that doesn't violate state law or piss off too many people.
The idea hinges on a narrow exception in state law. Under the state Costa-Hawkins Act, the city may not impose rent control on housing units built after 1995. (The city's own rent control law is less ambitious, applying only to multi-unit rentals built before June 1979.)
However, a property owner may agree to have new units subjected to rent control via a contractual agreement, either as bargaining leverage or simply out of pure kindness. (You can guess which is the more likely.)
So, what if the city offered incentives to developers — extra floors and units above height limits — if they agree to rent control for some of those new units?
“We're upzoning massive chunks of the city,” Peskin says. “In cases where we're conferring a benefit, can we say, 'Will you enter into this contractual agreement?'”
In theory, everyone wins: Developers get some sugar, housing advocates get rent-controlled stock, and at least a few renters get peace of mind. And Peskin himself pulls off the neat trick of doing a favor for landlords and tenants.
Right now, the City Attorney is vetting the idea for legal problems. If the city's lawyers give the scheme the legal green light, the real work begins.
“We'll need input from the Tenants Union, the Apartment Association, everyone,” Peskin says. “I'm not a Pollyanna who thinks we'll all be rowing in the same direction.”
Oars are already flying every which way. The politically influential Apartment Association is dead-set against rent control in any form. Housing activist Tommi Avicolli Mecca says the risk of a landlord lawsuit that could undo Peskin's plan makes him “queasy.”
Playing it down the middle, landlord attorney Andrew Zacks thinks property owners could be swayed — if they were allowed to subject certain units to rent control in lieu of existing affordable housing requirements. That would, in turn, draw the ire of housing activists.
However, “If [Peskin] can put it together, there are probably six votes for it [at the Board of Supervisors],” predicts Mecca.
Zacks goes further: “If Peskin can build a consensus on this, he could be the next mayor.”
But one step at a time.