1980-1991: RENT CONTROL WARS

From FoundSF

Historical Essay

by Randy Shaw

Image:housing1$eviction-grafitti.jpg

Eviction Grafitti; the zig-zag arrow through the circle is symbol for squatting in Europe and the US. This was on Polk Street in 1993.

Photo: Yurrinder

Proposition R's staggering defeat (in November 1979) changed the course of the San Francisco tenant movement. The election also revealed deep divisions among groups seemingly unified in their agenda for attacking the urban crisis. The broad, diverse San Franciscans for Affordable Housing (SFAH) coalition initially splintered during the Proposition R campaign over a slow-growth measure (Proposition O) on the same ballot. SFAH's supporters in the building trades and janitors' unions actively opposed the measure (their members built and cleaned office buildings) and diverted potential resources from Proposition R to the No on O effort. But SFAH's neighborhood activists and the San Francisco Bay Guardian strongly supported Proposition O, viewing "Manhattanization" as causing the housing crisis Proposition R was designed to address. The result: Organized labor left the San Francisco tenant movement after the election, and some unions, including the powerful building trades, came to actively oppose the tenant agenda.

Proposition R's urban crisis coalition also fell prey to bitter infighting between leaders of the city's tenant organizations and representatives of other groups. Tenant leaders complained that the broader coalition reduced their control over their own agenda; this tension was heightened when Proposition R's labor backers strongly opposed the slow-growth measure that tenant groups saw as critical to stemming rising rents. As internal bickering came to dominate Proposition R campaign meetings, many organizational representatives became tired of the infighting associated with the tenant campaigns. Proposition R's defeat led many organizations to return to working on their own specific agendas, having had their fill of tumultuous tenant politics.

Tenants won significant gains in 1979 in addition to rent control. The rising real estate values that spawned gentrification also created touristification in the form of the conversion of residential hotels (SROs) to tourist lodgings. From 1975 to 1979, thousands of SROs were converted or demolished, thus contributing to the exodus of poor and working people from the city. When the elderly tenants at the Tenderloin's Dalt Hotel faced the forced displacement from their homes in 1979, the massive shift in tenant consciousness since the I-Hotel debacle only two years earlier became clear. Where the earlier tragedy led to no official intervention, media outrage over the Dalt tenants forced politicians to act. A citywide moratorium on hotel conversions was imposed in 1979, which was followed by legislation in 1981 that, like the moderate rent control, had many loopholes but gave tenants unprecedented safeguards. The city's Residential Hotel Ordinance became an ongoing battleground, with tenants successfully strengthening the law with legislative reforms in 1985, 1987, and 1990. The Residential Hotel Ordinance is arguably the most successful land-use regulation in the city's history, having accomplished its goal of preserving the city's largest supply of low-cost housing. The law's broad political support is a legacy of the I-Hotel struggle.

As a result of divisions that emerged during the Proposition R campaign, San Francisco's tenant movement failed to become a broad-based vehicle for addressing the city's problems. Instead, Proposition R's defeat led many to return to non-housing activism, while those still focused on the housing crisis established new tenant organizations.

The Catholic Archdiocese, which greatly assisted Proposition R, continued its strong support for tenants in 1980 by creating a parish-based housing organization at Old St. Mary's Church. The Old St. Mary's Housing Committee brought white middle-class retired and working people into active involvement in citywide tenant issues. The Tenderloin Housing Clinic was also formed in 1980 and joined with the recently created North of Market Planning Coalition to greatly increase tenant activism in one of the city's poorest neighborhoods. The San Francisco chapter of the Gray Panthers began to focus extensively on tenant issues in 1980, and the San Francisco chapter of the New American Movement (NAM), a democratic socialist organization, create a pro-tenant advocacy group called the Affordable Housing Alliance. NAM viewed the urban housing crisis as the central arena for progressive political struggle, and brought committed young activists with a broad political analysis to the city's tenant movement. The creation of these new tenant organizations in 1980, along with the San Francisco Tenants Union (founded in 1970), paved the way for increasing tenant activism.

As rents rose and gentrification and displacement worsened, tenant activists unified around a common goal: strengthening rent control. While Proposition R represented a comprehensive response to all aspects of city housing policy, since 1980 the tenant movement has been a series of campaigns designed to improve the very weak 1979 rent control ordinance. This exclusive focus on rent control had positive and negative implications. The 1979 laws clearly provided tenants with inadequate legal protections against eviction, and permitted automatic 7% annual rent raises, an amount well in excess of inflation. Moreover, San Francisco's rent control law allowed unlimited rent increases on vacant apartments. This gave landlords an economic incentive to evict, and meant that the housing stock would, as tenants vacated, become increasingly unaffordable. As a result, rent control on vacant apartments (i.e., vacancy control) became the chief goal of tenant groups throughout the 1980s.

Tenants' exclusive focus on strengthening rent control, however, had a major downside: the movement became divorced from the larger urban crisis agenda. Tenant-landlord and rent control fights were no longer surrounded by discussions of class, economic unfairness, and redistribution of wealth. The broader context of rent control as akin to progressive taxation was replaced by debates whose dialogue excluded the tax benefits offered to landlords, their superior wealth, and the conflict between Democratic Party politicians who espoused Republican, free-market principles when rent control was involved. The tenant movement was increasingly comprised of people whose involvement arose from negative personal experiences with their landlords rather than from a broader political outlook. Progressive activists who came to tenant issues in response to an urban crisis were not drawn to tenant organizations whose only response to the crisis was stronger rent control.

The exclusive focus on rent control also isolated the tenant movement from other progressive constituencies. For example, even though downtown Manhattanization fueled rising rents, tenant organizations in the 1980s were not involved in slow-growth campaigns. Nor were they involved in neighborhood rezoning battles, even though the downzoning of residential neighborhoods forestalled tenant displacement by commercial development. This isolation deprived the tenant movement of valuable political allies, and limited activists' participation in rent control issues.

Through the 1980s, the negative impact of the tenant movement's narrow focus on rent control was masked by incremental successes in this arena. During the decade, tenants achieved a reduction in the annual rent increase from 7% to 4%, greater restrictions on evictions, and some curtailment of the land-lord's ability to obtain rent increases above the automatic annual limit. Tenants also won Board of Supervisors passage of the chief item on their agenda vacancy control, only to have Mayor Feinstein, herself a landlord, twice veto it.

By 1986, tenant organizations saw themselves as a politically powerful constituency whose failure to obtain its main goal, vacancy control, was entirely attributable to an unsupportive mayor. The election of a pro-tenant mayor in November 1987 would remedy this. Tenants strongly backed candidate Art Agnos, who professed to support vacancy control. Soon after Agnos's landslide victory, however, the tenant movement's political isolation and weakness became evident. Agnos refused to move quickly on vacancy control and instead told tenants to sit down with their longtime adversaries (wealthy landlords) to resolve their differences. Fearful of disagreeing with the newly elected "pro-tenant" Agnos, tenant organizations capitulated to the mayor's demand. Thus began a four-year odyssey of tenant subservience to Agnos' political agenda. This submission was premised on the mistaken but widespread belief that Agnos would ensure city adoption of a vacancy control measure that would slow rising rents on much of the city's rental housing supply.

Why did tenant groups err in assuming that Agnos could ensure vacancy control? The answer appeared when Agnos's signature on vacancy control legislation in 1991 was immediately followed by a landlord-initiated referendum. The referendum showed that vacancy control had always depended upon winning a popular vote, and could not be achieved simply by electing sympathetic politicians. While such politicians could raise funds to help the referendum campaign (Agnos broke his promise to do this), the tenant movement's achievement of its long-sought goal ultimately required a yes vote from a majority of the electorate. Winning this majority would require the type of broad-based progressive coalition that the tenant movement had abandoned with its exclusive focus on rent control.

The tenant movement's electoral base in 1991 was also weakened by the evaporation of the underlying economic conditions that initially gave rise to demands for vacancy control. The 1986 tax reform measure repealed the generous real estate tax shelters created five years earlier, and immediately reduced real estate values in San Francisco and throughout the country. As potential buyers seeking tax shelters suddenly disappeared, speculators holding properties when the law changed were unable to obtain the expected quick sale and profit and faced foreclosure. The absence of buyers caused real estate values to plummet, and savings and loans to go bankrupt due to insolvent borrowers. The type of speculative gentrification schemes that had greatly increased rents in San Francisco and other cities steadily declined. The downturn of the real estate market contributed to and coincided with California's broader economic slowdown. As a result, the five-year period prior to San Francisco's 1991 vacancy control vote saw average rents on vacant units rise dramatically less than in the 1979-85 period, and even less than would be permitted under the vacancy control ordinance.

Whether vacancy control could ever have prevailed at the polls is unclear; it is certain, however, that November 1991 was the worst of all possible times for a vacancy control election. In addition to the tenant movement's narrowed electoral base and the weakening pressure on rents, the lack of competing state or federal elections in November 1991 brought real estate money from throughout California into San Francisco's anti-vacancy control campaign. The landlords spent nearly one million dollars defeating vacancy control, and these funds had the auxiliary benefit of electing the pro-landlord candidate Frank Jordan as mayor. Commentators saw San Francisco's 1991 election results as the demise of Agnos and the city's tenant movement. The experts were only half right.

In retrospect, the tenant movement's best opportunities for winning a vacancy control ballot measure occurred in 1986 or 1990, during electoral cycles that consistently produce particularly progressive voter turnouts. Even during these years, however, the fundamental flow in a vacancy control electoral strategy would have emerged: vacant units do not vote. A political agenda that delivers no immediate benefits to voters and which offers only the prospect of reward (i.e., a voter who moves may pay a lower rent on their new home due to vacancy control) is always susceptible to defeat by a well-funded opposition campaign.

--Randy Shaw (the story continues in TENANT POLITICS: 1992-1996


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