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Thursday, October 23, 2014

San Francisco's Rental Ordinance Unconstitutional

Our friends at Inversecondemnation.com recently posted about a case striking down San Francisco's rental ordinance as violating the Takings Clause of the U.S. Constitution: Federal Court: San Francisco's Housing ExactionViolates Nollan-Dolan-Koontz

San Francisco had enacted an ordinance that required property owners who rent their properties to get a permit before they could stop renting their property out to tenants.  The ordinance also required the owners to pay cash to any displaced tenant in the amount of 24 times the difference between the tenant's current rent and the fair market value of a comparable unit in San Francisco. The plaintiffs, property owners who wanted out of the rental business were subject to "relocation payments" amounting to $118,000 for one owner and more than $1 million for another property owner, sued the City to challenge the rental ordinance as unconstitutional.

The district court agreed with the owners, finding San Francisco's ordinance unconstitutional because the relocation payments did not meet either the "essential nexus" or the "rough proportionality" test established by the U.S. Supreme Court in Nollan-Dolan-Koontz.  You can read more about the case and a more detailed summary of the rationale behind the district court's decision here.

Post Authored by Julie Tappendorf


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