“Consultants presenting information at [a city-sponsored] workshop said that under state law, landlords are allowed to pass on 10 percent of a tenant’s rent in perpetuity to pay for the cost of a retrofit [which typically runs around $100,000], even if they are in a rent-controlled unit – of which the city has 180,000.
Conversely, if a rent-controlled building destroyed in an earthquake is replaced, its units are no longer subject to rent control.”
S.F. ‘soft-story’ buildings at risk in quake [SFGate]

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Comments from “Plugged-In” Readers

  1. Posted by Eoral

    What does “In perpetuity” mean? The rental increase would be permanent?

  2. Posted by Live Smart

    ^^^^ – yes, the 10% increase will be built in, on top of any annual rent control increases allowed.

  3. Posted by soft story owner

    I read the article and it didn’t contain any more information on the 10% increase. Does anybody have more information about the state law referenced?

  4. Posted by Eoral

    Interesting – a typical pass through has a sunset date which if yous miss can cause bokoo problems at the rent board. A permanent increase, if that is what this is, is not bad. Still, no way to truly recoup the cost of the siesmic retrofit unless something else was tossed in.
    Anyone care to write a tax break or a rebate of some kind into local law? =)

  5. Posted by Dede

    Here’s some information from the rent board website. Not entirely clear but a starting point. Note that how much you can pass through depends on the size of the building (number of units) and type of work.
    http://www.sfgov.org/site/rentboard_page.asp?id=54507

  6. Posted by cse

    It’s been my understanding that seismic improvements are treated like other capital improvements for pass-through purposes. I too would be interested to learn about any state law that signles them out for special treatment.
    NB: pass-thrus are generally subject to hardship exemption. I imagine that this applies to seismic improvements too.

  7. Posted by Eoral

    Unless state law trumps local rent board ordinances as it does in the case of Ellis Act Evictions

  8. Posted by anon

    State law always trumps local laws.

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