Prop. M will make more rental units available in our city and will likely raise new funds for low-income renters and for low-income housing projects. It is a targeted measure, seeking to tax only those owners of residential units in larger buildings (three or more units) who have kept their units vacant and unused for long periods of time — without justification. If those owners want to avoid the tax, they can; they need only rent out or otherwise end the prolonged vacancies in their units.
A letter submitted to this paper in September contained erroneous and misleading claims about Proposition M, referred to as the Empty Homes Tax [“Should the Board of Supervisors control your home?” Marina Times, September 2022 ]. This letter attempts to set the record straight.
The September letter opposing Prop. M asserted that the ordinance will give “extraordinary control over your home” to the Board of Supervisors and places “rigid parameters on how” we use our homes. In fact, the Empty Homes Tax is a reasonable and targeted measure applicable only in limited circumstances. The Empty Homes Tax contains many exemptions that cover acceptable, permitted vacancies: the tax does not apply to vacancies when the unit is the primary residence of the owner, when the unit is subject to a valid lease, when construction permits have been sought or work is ongoing, when a new unit is being rented or sold, and various additional circumstances. Only when the unit is kept vacant by the owner for reasons other than the many permitted vacancies AND for a prolonged period of time (more than 182 days in a year) does the Empty Homes Tax potentially apply to that owner. The Empty Homes Tax also applies only to residential units with prolonged vacancies located in buildings with three or more units.
The letter opposing Prop M claimed that Prop M punishes “small mom-and-pop homeowners and multigenerational households” and that “fully occupied” homes containing family members will be subject to the tax. To the contrary, the ordinance does not apply to “occupied” units, only to vacant units, and Prop M defines “vacant” as “unoccupied, uninhabited, or unused.” Admittedly, the ordinance’s language is not a model of clarity when it comes to family members. However, a close reading reveals the following: When a close family member (such as a spouse, child, sibling, or parent) OR a more distant family member (such as a cousin, niece, or grandparent) occupies a unit, the days of occupancy are not “vacant” under the ordinance and cannot be counted for purposes of the 183 days of vacancy. In addition, if the more distant relatives are subject to a valid lease agreement, then under the lease period exemption mentioned above, the entire term of the lease is exempt, whether the rented unit is occupied or not. See Prop. M, section 2953(j).
The opposition letter stated that a unit owner “is subject to punitive fines” if absent for more than six months “for any reason,” including such reasonable absences as hospitalization or work travel. This is a serious misreading of the ordinance. An owner can be absent from her principal place of residence for as long as she wishes and for whatever reason; Prop. M does not apply in any way to principal places of residence. See Prop. M, section 2952. Similarly, if a unit is under a valid lease, the owner is not subject to the Empty Homes Tax for any absence on the part of the tenant for any reason or length of time. These are simply not the kinds of vacancies to which Prop. M applies.
The opposition letter incorrectly asserted that Prop. M “eliminates voter rights” by giving the Board of Supervisors the ability to amend the ordinance without voter input. However, Prop. M expressly states that the Board of Supervisors’ amendment power is limited by Article XIII A and C of the California Constitution (requiring a supermajority vote of the people for special tax increases). See Prop. M, section 2961.
The opposition letter complained that the figure for vacant homes in San Francisco — 40,000 — is exaggerated and misleading. However, Prop. M does not purport to cover 40,000 units, but only the limited number which satisfy Prop. M’s rigorous requirements. Even with a reduced number of taxed units, the tax would generate funds urgently needed for rent subsidies for seniors and low-income households (keeping people in their homes), and for acquiring, rehabilitating, and operating affordable housing. According to the Controller’s Statement on M, if the tax does not result in owners’ deciding to lease currently vacant units, Prop. M could raise $20 million in 2024, $30 million in 2025, and $37 million in 2026. Alternatively, the tax measure will encourage owners who keep units vacant for prolonged periods to lease those units and thus avoid the tax — another desired result that will increase our housing supply. (In Vancouver, where a similar Empty Homes Tax is in effect, vacancies dropped by more than 25 percent in three years. Vancouver Sun, 4/14/22.)
Prop M is a reasonable and well-considered measure designed to increase the leasing of long-vacant residential units, thus adding to San Francisco’s housing stock and providing people with homes. At the same time, the ordinance will raise funds from those landlords unwilling to lease units or otherwise end their prolonged vacancies — funds for helping seniors and low-income families make their rent payments, and for facilitating the purchase, rehabilitation, and operation of much needed low-income housing in our city. Please vote YES on Prop M.
Betsy Dodd
Lower Pacific Heights
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