Action/Alerts

SPOSFI has filed suit challenging the recent Vacancy Tax - Prop. M.

The Small Property Owners of San Francisco Institute (SPOSFI) has filed suit challenging the recent Vacancy Tax, Prop. M, that was approved by a narrow margin of voters. We are joined by co-plaintiffs, the San Francisco Apartment Association (SFAA), and the San Francisco Association of Realtors (SFAR), and several small property owners who would be literally forced out of their homes if they had to pay the tax on units that they use, but not exactly in the manner that Supervisor Dean Preston believes.

The tax is very punitive, beginning at $2,500 and $5,000 per unit per year, depending on the size of the unit, and would top off at about $10,000 or $20,000 per year per unit, plus increases for inflation in the future. It now applies only to buildings with three units or more, but it could be extended by a 2/3 vote of the Board of Supervisors to single-family and two-unit buildings. A representative of Supervisor Preston stated publicly that it is their intention to push for this extension.

The suit challenges Proposition M as a violation of clauses of both the California and United States Constitutions, a violation of the state Ellis Act, and a violation of equal protection and due process insofar as it exempts units from taxation when rented to strangers but not to close family members, and as a violation of the rights of privacy of property-owners who live on the property and do not wish to share their homes with others but would face dramatic penalties if they decline to do so.

We, of course, will continue to keep you updated on this important lawsuit. We are very pleased to be a part of this challenge.