Posted by Brett Gladstone, Esq. on Wednesday, January 11, 2017
Removal of Housing Units Becomes Harder
Under a new law effective in March 2016, conditional use
approval by the Planning Commission is now required for the
removal of most housing units even if the unit is illegal. Under the
former law, conditional use approval was required only for
removal of legal units, and only if they existed in certain zoning
districts, or if three or more units were proposed for removal.
For units that are discovered to be illegal, the Building
Department will now issue a Notice of Violation ordering the
property owner to file a building permit application to legalize the
unauthorized unit unless it can be shown it is "infeasible" to do so
under the Building Code, or a serious and imminent hazard exists
on the property due to the illegal unit.
A property owner is now required to obtain a building permit to
legalize the unit unless the removal is proven to be “infeasible.”
The term “infeasable” has not been clearly defined as of yet. But
certainly an inability to provide even one window in a bedroom, or
to provide the Building Code required ceiling height, would be
good examples of infeasibility. The need to spend a considerable
amount of money would not generally show infeasibility. The
Building Department is the agency that will decide.
Exceptions that used to allow Planning Department staff to
approve the removal of a unit without a hearing also have been
narrowed under the new ordinance. Approval by Staff without a
Planning Commission hearing is now permitted only if the
property owner can prove the illegal unit cannot be legalized (see
above) or in the case of demolition, if the owner can show the unit
is “unaffordable”, which means it has a value of $1,630,000 or
higher. (The least expensive unit must meet the threshold
regardless of the number of units in the building.) Under the new
law, the approval by Staff for these “unaffordable units” is limited
to properties in single family zoning districts.
Decisions made by the Planning Commission on Conditional Use
Applications may be appealed to the Board of Supervisors.
The law is yet another device that the City is starting to use to
reduce the number of residential tenant evictions in the City.
Proponents of the new ordinance point out that illegal units often
are occupied by tenants at below market rents who, after evictions,
are typically unable to find replacement housing at the same rental rate.
They conclude that restricting the removal of units will protect the less expensive
housing stock. Although illegal units tend to be at lower rents, those who promote
the new required legalization should keep in mind that once an owner
pays the City fees, building code upgrades, consultants fees and more to legalize units,
rent may have to go up.
Those who are in favor of producing badly needed new housing have concerns about
the ordinance's impact on the production of new housing by slowing down removal of
housing for construction of a higher number of housing units. Most importantly, even
though the City may force an owner to legalize a unit, it cannot require someone to rent it out.
Brett Gladstone, Esq. Brett focuses on land use and real estate, and condominium subdivision law at Hanson Bridgett. Additionally, Brett represents investors and developers in land-use proceedings and CEQA compliance with respect to residential and mixed use development throughout the Bay Area.