An angry group of San Francisco landlords and property owners are taking legal action against the city's recently passed "Empty Homes Tax" (Proposition M) to try to get it overturned, court records show.
The new lawsuit comes from a handful of San Francisco property owners, including Eric Debbane and Andrew Debbane, brothers who own several residential buildings in the city; Robert Friedland, who owns a NOPA apartment building; and Natasa Zec, who owns a Divisadero condo; as well as the San Francisco Apartment Association, the Small Property Owners of San Francisco Institute, and the San Francisco Associaiton of Realtors. It is suing the city and tax collector Jose Cisneros over the legality of the vacancy tax, the SF Standard reported.
The tax measure was approved by 54.5% of voters in November last year, and starting in 2024, charges property owners for each unit left unoccupied for more than 182 days annually — only for buildings with three or more units, not single-family homes or duplexes. The tax ranges from $2,500 for less than 1,000-square-feet units and goes up to $5,000 for units over 2,000 square feet, with increases for inflation over time.
Its goal was to put pressure on landlords to rent out vacant properties and help stabilize rent prices, and the revenue generated fom the tax would go towards rent subsidies for seniors and low-income households, plus developing affordable housing projects, according to the Chronicle.
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Reports estimating how many units would be subject to the tax have differed, with the Budget and Legislative Analyst counting about 40,000 units, but the Controller’s Office saying there are only about 4,000 units subject to it.
However, the lawsuit claims that the new tax violates the law and is unconstitutional. The legal filing says that that “the government cannot compel a property-owner to rent his or her property to third parties without violating” the Takings Clause of the U.S. Constitution,” the Chronicle also reported.
Supervisor Dean Preston, who was a proponent of Prop M, said on Twitter called the group behind the lawsuit “real estate industry lobbyists.”
These real estate industry lobbyists are fighting for the nonexistent constitutional right to keep housing units vacant with no consequence. Imagine fighting for that while people are homeless. https://t.co/273cBnBACA— Dean Preston (@DeanPreston) February 11, 2023
Spokesperson from the city attorney’s office, Jen Kwart, said that the office hasn’t been served with the lawsuit, according to the Standard.
Image via Unsplash/@nahshabear.