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Why do California legislators allow elderly, disabled and other long-term tenants to be evicted by real estate speculators?

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By Randy Shaw, Special to CalMatters

Randy Shaw is the director of the Tenderloin Housing Clinic, He is also the author of “Generation Priced Out: Who Gets to Live in the New Urban America” (UC Press 2020).

Maria Gala is a 91-year-old Latina who has lived in San Francisco’s Mission District for 50 years. But Gala now faces the loss of her home after speculators bought the six-unit property and then issued Ellis Act eviction notices to all of the tenants. 

Virginia Leyva, a 66-years-old blind Latina, has lived for nearly 40 years in a three-unit building near Gala. Her neighbor is a multigenerational Vietnamese family whose 87- and 71-year-old seniors have lived there for 37 years. The third unit was also occupied for 40 years. All of the tenants face displacement after speculators bought their building and promptly issued Ellis Act eviction notices.

I could tell many more stories of vulnerable rent-controlled tenants losing their homes for speculator profits. The organization I head, the Tenderloin Housing Clinic, currently represents 252 tenants facing Ellis evictions. And it’s not just happening in San Francisco: according to a report by the Coalition for Economic Survival and the Anti-Eviction Mapping Project, Los Angeles, with the nation’s worst homelessness crisis, has lost 27,000 rent-controlled units due to Ellis evictions.

Why do California legislators allow elderly, disabled and other long-term tenants to be evicted by real estate speculators? What policy goal is served? These evictions cause untold human misery and worsen California’s affordability crisis. 

California allows the Ellis Act to undermine the state’s progressive ideals because legislators believe Big Real Estate will defeat any Ellis Act reforms. But sweeping reforms were enacted in the past, and a bill to stop speculator evictions under Ellis can pass in 2021. Here’s why.

Political challenges 

The 1985 Ellis Act allowed landlords to “go out of the rental housing business” by evicting tenants and keeping their building vacant. But court rulings in the 1990s expanded the act to allow speculators to buy rent-controlled housing units and convert them to ownership via tenancies in common. This put a bullseye on the backs of long-term tenants paying below-market rents, as speculators could buy their buildings cheap and quickly sell their units for a huge profit. 

I worked with former state Sen. John Burton, a Democrat from San Francisco, in the late 1990s to pass sweeping Ellis Act reforms. These reforms overturned multiple court rulings and extended the Ellis Act notice period for senior and disabled tenants to one year. In 2003, I worked with then Assemblymember Mark Leno, a Democrat from San Francisco, to pass a bill exempting San Francisco’s single room occupancy hotels from the Ellis Act. These victories show that common sense Ellis Act reforms can be won.

In 2014 as a state senator, Leno introduced a bill imposing a five-year holding period before the Ellis Act could be invoked. This would stop speculators from buying buildings one day and “going out of the rental housing business” soon after. Leno’s bill passed the Senate but lost by one vote in an Assembly committee. A Los Angeles area legislator voted no, claiming the bill only solved a San Francisco housing problem; Los Angeles’ dramatic increase in Ellis Act evictions destroys such arguments.

Leno failed to get the missing votes in 2015 and there has not been a major campaign to reform the Ellis Act since then. Ellis Act evictions were not even included in the statewide pandemic moratorium, or in the pending bill to extend it. President-elect Joe Biden is expected to extend the nonpayment of rent eviction moratorium beyond Jan. 3, 2021, but that won’t protect tenants from Ellis Act evictions. 

So, even though California’s enactment of a statewide just cause eviction law in 2019 opens the door to Ellis Act evictions in non-rent controlled cities across California, we still lack a sponsor for an Ellis Act reform bill to protect the state’s most vulnerable tenants.

Will any legislator rise to the challenge before the Jan. 21 deadline for introducing new legislation? We will soon find out.


Related article: Here’s what you need to know about California’s eviction protections

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