San Francisco County Municipal Code Ch. 41 Residential Hotel Unit Conversion and Demolition

Sec. 41.1. Title. Sec. 41.2. Purpose. Sec. 41.3. Findings. Sec. 41.4. Definitions. Sec. 41.5. Applicability of this Chapter. Sec. 41.6. Initial Status Determination. Sec. 41.7. Statements of Exemption; Applicability of this Chapter. Sec. 41.8. Requirements for Nonprofit Organizations. Sec. 41.9. Records of Use. Sec. 41.10. Annual Unit Usage Report. Sec. 41.11. Administration. Sec. 41.12. Permit to Convert. Sec. 41.13. One-for-one Replacement. Sec. 41.14. Mandatory Denial of Permit to Convert. Sec. 41.15. Approval and Issuance of Permit to Convert. Sec. 41.16. Appeal of Denial or Approval of Permit to Convert. Sec. 41.17. Rights of Permanent Residents. Sec. 41.18. Demolition. Sec. 41.19. Temporary Change of Occupancy. Sec. 41.20. Unlawful Conversion; Remedies; Fines. Sec. 41.21. Annual Review of Residential Hotel Status. Sec. 41.22. Report of Residential Hotel Status Prior to Sale or Transfer.

Sec. 41.23. Amortization. Sec. 41.24. Construction.

This Chapter shall be known as the Residential Hotel Unit Conversion and Demolition Ordinance. (Added by Ord. 121-90, App. 4/12/90)

It is the purpose of this ordinance to benefit the general public by minimizing adverse impact on the housing supply and on displaced low income, elderly, and disabled persons resulting from the loss of residential hotel units through their conversion and demolition. This is to be accomplished by establishing the status of residential hotel units, by regulating the demolition and conversion of residential hotel units to other uses, and by appropriate administrative and judicial remedies. (Added by Ord. 121-90, App. 4/12/90)

A permit to convert shall be denied by Director of the Department of Building Inspection if: (a) The requirements of Sections 41.12 or 41.13, above, have not been fully complied with; (b) The application is incomplete or contains incorrect information; (c) An applicant has committed unlawful action as defined in this Chapter 41 within 12 months prior to the filing of a permit to convert application; or (d) The proposed conversion or the use to which the unit would be converted is not permitted by the Planning Code. (Added by Ord. 121-90, App. 4/12/90; amended by Ord. 134-01, File No. 001926, App. 7/6/2001; Ord. 38-17,* File No. 161291, App. 2/17/2017, Eff. 3/19/2017; Ord. 56-20, File No. 191258, App. 4/10/2020, Eff. 5/11/2020) *Editor’s Note: Ord. 56-20 repealed Ord. 38-17, restoring the text of this Section as it existed prior to adoption of that ordinance, and then enacted amendments to that text.

The Director of the Department of Building Inspection shall issue a permit to convert, provided that: (a) The requirements of Section 41.12 have been met; (b) Evidence of compliance with the requirements of Section 41.13 has been submitted. Satisfactory evidence of compliance may be: (1) A certification of final completion or permit of occupancy on the replacement housing; or (2) A receipt from the City Treasurer that the in-lieu payment determined by the Department of Real Estate has been received; and (3) Evidence of compliance with the requirements of Section 41.17 herein. (c) The proposed conversion or the use to which the unit would be converted is permitted by the City Planning Code. (d) Concurrent with the issuance of a permit to convert, the Director of the Department of Building Inspection shall issue a new certificate of use which shall state the newly certified number of residential units and tourist units. (Added by Ord. 121-90, App. 4/12/90; amended by Ord. 134-01, File No. 001926, App. 7/6/2001)

(a) Denial or approval of a permit application may be appealed to the Board of Permit Appeals, pursuant to Sections 8 et seq. Part III of the San Francisco Municipal Code. (b) The owner or operator shall submit a statement under the penalty of perjury that he has notified all the affected permanent residents of his appeal and of the date, time and place of the hearing before the Board of Permit Appeals, seven calendar days prior to the scheduled hearing. (c) The appellant shall have the burden of proving that the determination of the Director of the Department of Building Inspection is invalid.

(Added by Ord. 121-90, App. 4/12/90; amended by Ord. 134-01, File No. 001926, App. 7/6/2001)

(a) A hotel owner or operator may seek a reasonable extension of the time during which the term “Tourist or Transient Use” means “any use of a guest room for less than a 7-day term of tenancy by a party other than a Permanent Resident” for a period longer than the two-year period set forth in Section 41.4, through the process described in subsections (b) and (c), below. (b) The owner or operator may initiate an extension by submitting a request to the Building Inspection Commission (“Commission”) six months prior to the expiration of the two-year period set forth in Section 41.4. Commission staff shall amply publicize this deadline, to give notice to interested hotel owners of the provisions of this Section 41.23. (c) The Commission shall consider the request at a public hearing and decide whether an extension (for the time requested, or for a different period of time) would be reasonable, according to the following factors: (1) Total cost of the hotel owner or operator’s investments in the hotel; (2) Length of time those investments have been in place; (3) Suitability of the investments for residential hotel use; and (4) Any other factors relevant to determining the owner or operator’s reasonable return on investments. (Added by Ord. 36-23, File No. 220815, App. 3/24/2023, Eff. 4/24/2023)

(a) Nothing in this Chapter may be construed to supersede any other lawfully enacted ordinance of the City and County of San Francisco, except that definitions provided in this Chapter shall govern the enforcement of this Chapter. (b) Clauses of this Chapter are declared to be severable and if any provision or clause of this Chapter or the application thereof is held to be unconstitutional or to be otherwise invalid by any court of competent jurisdiction, such invalidity shall not affect other provisions of this Chapter. (Added as Sec. 41.22 by Ord. 121-90, App. 4/12/90; ; redesignated as Sec. 41.23 by Ord. 99-19, File No. 170416, App. 5/24/2019, Eff. 6/24/2019; redesignated by Ord. 36-23, File No. 220815, App. 3/24/2023, Eff. 4/24/2023) CHAPTER 41A:

RESIDENTIAL UNIT CONVERSION AND DEMOLITION Sec. 41A.1. Title. Sec. 41A.2. Purpose. Sec. 41A.3. Findings. Sec. 41A.4. Definitions. Sec. 41A.5. Unlawful Conversion; Remedies. Sec. 41A.6. Administrative Enforcement Procedures. Sec. 41A.7. Office of Short-Term Residential Rental Administration and Enforcement. Sec. 41A.8. Construction.

This chapter shall be known as the Residential Unit Conversion Ordinance. (Added by Ord. 331-81, App. 6/26/81; amended by Ord. 224-12, File No. 120299, App. 11/1/2012, Eff. 12/1/2012)

It is the purpose of this ordinance to benefit the general public by minimizing adverse impacts on the housing supply and on persons and households of all income levels resulting from the loss of residential units through their conversion to tourist and transient use. This is to be accomplished by regulating the conversion of residential units to tourist and transient use, and through appropriate administrative and judicial remedies. (Added by Ord. 331-81, App. 6/26/81; amended by Ord. 224-12, File No. 120299, App. 11/1/2012, Eff. 12/1/2012)

The Board of Supervisors finds that: (a) There is a severe shortage of decent, safe, sanitary and affordable rental housing in the City and County of San Francisco. (b) The people of the City and County of San Francisco, cognizant of the housing shortage in San Francisco, on November 4, 1980, adopted a declaration of policy to increase the City and County's housing supply by 20,000 units. (c) Many of the City and County's elderly, disabled and low-income persons and households reside in affordable residential units. (d) As a result of the removal of residential units from the housing market, a housing emergency exists within the City and County of San Francisco for its elderly, disabled and low-income households. (e) The Board of Supervisors and the Mayor of the City and County of San Francisco recognized this housing emergency and enacted an ordinance which established a moratorium on the conversion of residential units to tourist and transient use. (f) The conversion of residential units to tourist and transient use impacts especially on persons seeking housing in the low to moderate price range. (g) It is in the public interest that conversion of residential units be regulated and that remedies be provided when unlawful conversion has occurred, in order to protect the residents and to conserve the limited housing resources. (Added by Ord. 331-81, App. 6/26/81; amended by Ord. 224-12, File No. 120299, App. 11/1/2012, Eff. 12/1/2012)

Whenever used in this Chapter 41A, the following words and phrases shall have the definitions provided in this Section: Booking Service. A Booking Service is any reservation and/or payment service provided by a person or entity that facilitates a short- term rental transaction between an Owner or Business Entity and a prospective tourist or transient user, and for which the person or entity collects or receives, directly or indirectly through an agent or intermediary, a fee in connection with the reservation and/or payment services provided for the short-term rental transaction. Business Entity. A corporation, partnership, or other legal entity that is not a natural person that owns or leases one or more residential units. Complaint. A complaint submitted to the Department alleging a violation of this Chapter 41A and that includes the Residential Unit's address, including unit number, date(s) and nature of alleged violation(s), and any available contact information for the Owner and/or resident of the Residential Unit at issue. Conversion or Convert. A change of use from Residential Use to Tourist or Transient Use, including, but not limited to, renting a Residential Unit as a Tourist or Transient Use. Department. The Planning Department. Director. The Director of the Planning Department, or his or her designee. Hosting Platform. A person or entity that participates in the short-term rental business by providing, and collecting or receiving a fee for, Booking Services through which an Owner may offer a Residential Unit for Tourist or Transient Use. Hosting Platforms usually, though not necessarily, provide Booking Services through an online platform that allows an Owner to advertise the Residential Unit through a website provided by the Hosting Platform and the Hosting Platform conducts a transaction by which potential tourist or transient users arrange Tourist or Transient Use and payment, whether the tourist or transient pays rent directly to the Owner or to the Hosting Platform. Interested Party. A Permanent Resident of the building in which the Tourist or Transient Use is alleged to occur, any homeowner association associated with the Residential Unit in which the Tourist or Transient Use is alleged to occur, the Owner of the Residential Unit in which the Tourist or Transient Use is alleged to occur, a Permanent Resident or Owner of a property within 100 feet of the property containing the Residential Unit in which the Tourist or Transient Use is alleged to occur, the City and County of San Francisco, or any non-profit organization exempt from taxation pursuant to Title 26, Section 501 of the United States Code, which has the preservation or improvement of housing as a stated purpose in its articles of incorporation or bylaws. Owner. Owner includes any person who is the owner of record of the real property. As used in this Chapter 41A, the term "Owner" includes a lessee where the lessee is offering a Residential Unit for Tourist or Transient use. Permanent Resident. A person who occupies a Residential Unit for at least 60 consecutive days with intent to establish that unit as his or her primary residence. A Permanent Resident may be an owner or a lessee. Primary Residence. The Permanent Resident's usual place of return for housing as documented by at least two of the following: motor vehicle registration; driver's license; voter registration; tax documents showing the Residential Unit as the Permanent Resident's residence for the purposes of a home owner's tax exemption; or a utility bill. A person may have only one Primary Residence. Residential Unit. Room or rooms, including a condominium or a room or dwelling unit that forms part of a tenancy-in-common arrangement, in any building, or portion thereof, which is designed, built, rented, leased, let or hired out to be occupied for Residential Use as defined in the San Francisco Housing Code. Residential Use. Any use for occupancy of a Residential Unit by a Permanent Resident. Short-Term Residential Rental. A Tourist or Transient Use where all of the following conditions are met: (a) the Residential Unit is offered for Tourist or Transient Use by the Permanent Resident of the Residential Unit; (b) the Permanent Resident is a natural person; (c) the Permanent Resident has registered the Residential Unit and maintains good standing on the Department's Short-Term Residential Rental Registry; and (d) the Residential Unit: is not subject to the Inclusionary Affordable Housing Program set forth in Planning Code Section 415 et seq.; is not a residential hotel unit subject to the provisions of Chapter 41, unless such unit has been issued a Permit to Convert under Section 41.12; is not otherwise a designated as a below market rate or income-restricted Residential Unit under City, state, or federal law; has not been the subject of an eviction pursuant to the Ellis Act and Administrative Code Section 37.9(a)(13) within the five year period prior to applying for the Registry if such eviction occurred after November 1, 2014; and no other requirement of federal or state law, this Municipal Code, or any other applicable law or regulation prohibits the permanent resident from subleasing, renting, or otherwise allowing Short-Term Residential Rental of the Residential Unit. Short-Term Residential Rental Registry or Registry. A database of information maintained by the Department that includes a unique registration number for each Short-Term Residential Rental and information regarding Permanent Residents who are permitted to offer Residential Units for Short-Term Residential Rental. Only one Permanent Resident per Residential Unit may be included on the Registry at any given time. The Registry shall be available for public review to the extent required by law, except that, to the extent permitted by law, the Department shall redact any Permanent Resident names and street and unit numbers

esidents who are permitted to offer Residential Units for Short-Term Residential Rental. Only one Permanent Resident per Residential Unit may be included on the Registry at any given time. The Registry shall be available for public review to the extent required by law, except that, to the extent permitted by law, the Department shall redact any Permanent Resident names and street and unit numbers from the records available for public review. Tourist or Transient Use. Any use of a Residential Unit for occupancy for less than a 30-day term of tenancy, or occupancy for less

than 30 days of a Residential Unit leased or owned by a Business Entity, whether on a short-term or long-term basis, including any occupancy by employees or guests of a Business Entity for less than 30 days where payment for the Residential Unit is contracted for or paid by the Business Entity. (Added by Ord. 331-81, App. 6/26/81; amended by Ord. 74-98, App. 3/16/98; Ord. 224-12 , File No. 120299, App. 11/1/2012, Eff. 12/1/2012; Ord. 218-14 , File No. 140381, App. 10/27/2014, Eff. 11/26/2014, Oper. 2/1/2015; Ord. 130-15 , File No. 150363, App. 7/30/2015, Eff. 8/29/2015; Ord. 104-16 , File No. 160423, Eff. 7/24/2016; Ord. 178-16 , File No. 160790, Eff. 9/10/2016)

(a) Unlawful Actions. Except as set forth in subsection 41A.5(g), it shall be unlawful for (1) any Owner to offer a Residential Unit for rent for Tourist or Transient Use; (2) any Owner to offer a Residential Unit for rent to a Business Entity that will allow the use of a Residential Unit for Tourist or Transient Use; or (3) any Business Entity to allow the use of a Residential Unit for Tourist or Transient Use. (b) Records Required. The Owner and Business Entity, if any, shall retain and make available to the Department records to demonstrate compliance with this Chapter 41A upon written request as provided herein. (c) Determination of Violation. Upon the filing of a written Complaint that an Owner or Business Entity has engaged in an alleged unlawful Conversion or that a Hosting Platform is not complying with the requirements of subsection (g)(4)(A), the Director shall take reasonable steps necessary to determine the validity of the Complaint. The Director may independently determine whether an Owner or Business Entity may be renting a Residential Unit for Tourist or Transient Use in violation of this Chapter 41A or whether a Hosting Platform has failed to comply with the requirements of subsection (g)(4)(A). To determine if there is a violation of this Chapter 41A, the Director may initiate an investigation of the subject property or Hosting Platform's allegedly unlawful activities. This investigation may include, but is not limited to, an inspection of the subject property and/or a request for any pertinent information from the Owner, Business Entity, or Hosting Platform, such as leases, business records, or other documents. The Director shall have discretion to determine whether there is a potential violation of this Chapter 41A. Notwithstanding any other provision of this Chapter 41A, any alleged violation related to failure to comply with the requirements of the Business and Tax Regulations Code shall be enforced by the Treasurer/Tax Collector under the provisions of that Code. (d) Civil Action. (1) The City may institute civil proceedings for injunctive and monetary relief, including civil penalties, against an Owner, Business Entity, or Hosting Platform for violations of this Chapter 41A under any circumstances, without regard to whether a Complaint has been filed or the Director has made a determination of a violation. (2) Private Rights of Action. (A) Following the filing of a Complaint and the final determination of a violation by the Director, any Interested Party may institute civil proceedings for injunctive and monetary relief against an Owner or Business Entity. (B) An Interested Party who is a Permanent Resident of the building in which the Tourist or Transient Use is alleged to occur, is a Permanent Resident of a property within 100 feet of the property containing the Residential Unit in which the Tourist or Transient Use is alleged to occur, or is a homeowner association associated with the Residential Unit in which the Tourist or Transient Use is alleged to occur may institute a civil action for injunctive and monetary relief against an Owner or Business Entity if (i) The Interested Party has filed a Complaint with the Department; (ii) The Director has not made a written determination pursuant to subsection 41A.6(a) that there is no violation of this Chapter 41A or basis for an investigation for an unlawful activity; (iii) An administrative hearing officer has not issued a final determination pursuant to subsection 41A.6(c) regarding the Complaint within 135 days of the filing of the Complaint with the Department; (iv) After such 135-day period has passed, the Interested Party has provided 30 days' written notice to the Department and the City Attorney's Office of its intent to initiate civil proceedings; and (v) The City has not initiated civil proceedings by the end of that 30-day notice period. Under this subsection 41A.5(d)(2)(B), the prevailing party shall be entitled to the costs of suit, including reasonable attorneys' fees, pursuant to an order of the Court. (3) Civil Penalties. If the City is the prevailing party in any civil action under this subsection (d): an Owner, Hosting Platform, or Business Entity in violation of this Chapter 41A may be liable for civil penalties of not more than $1,000 per day for the period of the unlawful activity. Interested Parties other than the City may not seek or obtain civil penalties. (4) Attorneys' Fees and Costs. If the City or any other Interested Party is the prevailing party, the City or the Interested Party shall be entitled to the costs of enforcing this Chapter 41A, including reasonable attorneys' fees, pursuant to an order of the Court.

(5) Any monetary award obtained by the City and County of San Francisco in such a civil action shall be deposited in the Department to be used for enforcement of Chapter 41A. The Department, through the use of these funds, shall reimburse City departments and agencies, including the City Attorney's Office, for all costs and fees incurred in the enforcement of this Chapter 41A. (e) Criminal Penalties. Any Owner or Business Entity who rents a Residential Unit for Tourist or Transient Use in violation of this Chapter 41A, or any Hosting Platform that provides a Booking Service for a Residential Unit to be used for Tourist or Transient Use in violation of the Hosting Platform's obligations under this Chapter 41A, shall be guilty of a misdemeanor. Any person convicted of a misdemeanor hereunder shall be punishable by a fine of not more than $1,000 or by imprisonment in the County Jail for a period of not more than six months, or by both. Each Residential Unit rented for Tourist or Transient Use shall constitute a separate offense. (f) Method of Enforcement, Director. The Director shall have the authority to enforce this Chapter against violations thereof by any or all of the means provided for in this Chapter 41A. (g) Exception for Short-Term Residential Rental. (1) Notwithstanding the restrictions set forth in this Section 41A.5, a Permanent Resident may offer his or her Primary Residence as a Short-Term Residential Rental if: (A) The Permanent Resident occupies the Residential Unit for no less than 275 days out of the calendar year in which the Residential Unit is rented as a Short-Term Residential Rental or, if the Permanent Resident has not rented or owned the Residential Unit for the full preceding calendar year, for no less than 75% of the days he or she has owned or rented the Residential Unit; (B) The Permanent Resident maintains records for two years demonstrating compliance with this Chapter 41A, including but not limited to information demonstrating Primary Residency, the number of days per calendar year he or she has occupied the Residential Unit, the number of days per calendar year the Residential Unit has been rented as a Short-Term Residential Rental, and compliance with the insurance requirement in Subsection (D). These records shall be made available to the Department upon request; (C) The Permanent Resident complies with any and all applicable provisions of state and federal law and the San Francisco Municipal Code, including but not limited to the requirements of the Business and Tax Regulations Code by, among any other applicable requirements, collecting and remitting all required transient occupancy taxes, and the occupancy requirements of the Housing Code; (D) The Permanent Resident maintains liability insurance appropriate to cover the Short-Term Residential Rental Use in the aggregate of not less than $500,000 or conducts each Short-Term Residential Rental transaction through a Hosting Platform that provides equal or greater coverage. Such coverage shall defend and indemnify the Owner(s), as named additional insured, and any tenant(s) in the building for their bodily injury and property damage arising from the Short-Term Residential Use; (E) The Residential Unit is registered on the Short-Term Residential Rental Registry; (F) The Permanent Resident includes the Department-issued registration number on any Hosting Platform listing or other listing offering the Residential Unit for use as a Short-Term Residential Rental; (G) For units subject to the rent control provisions of Section 37.3, the Permanent Resident complies with the initial rent limitation for subtenants and charges no more rent than the rent the Permanent Resident is paying to any landlord per month; and (H) The Permanent Resident can demonstrate to the satisfaction of the Department that the Residential Unit and the property on which it is located is not subject to any outstanding Building, Electrical, Plumbing, Mechanical, Fire, Health, Housing, Police, or Planning Code enforcement, including any notices of violation, notices to cure, orders of abatement, cease and desist orders, or correction notices. The Department shall not include a property that is subject to any such outstanding violations in the Registry. If such a violation occurs once a Residential Unit has been included in the Registry, the Department shall suspend the Residential Unit's registration and registration number until the violation has been cured. (2) Additional Requirements. (A) Offering a Residential Unit for Short-Term Residential Rental, including but not limited to advertising the Residential Unit's availability, while not maintaining good standing on the Registry shall constitute an unlawful conversion in violation of this Chapter 41A and shall subject the person or entity offering the unit in such a manner to the administrative penalties and enforcement procedures, including civil penalties, of this Chapter. (B) Only one Permanent Resident may be associated with a Residential Unit on the Registry, and it shall be unlawful for any other person, even if that person meets the qualifications of a "Permanent Resident," to offer a Residential Unit for Short-Term Residential Rental. (C) A Permanent Resident offering a Residential Unit for Short-Term Residential Rental shall maintain a valid business registration certificate. (D) A Permanent Resident offering a Residential Unit for Short-Term Residential Rental shall post a clearly printed sign inside his or her Residential Unit on the inside of the front door that provides information regarding the location of all fire extinguishers in the unit and building, gas shut off valves, fire exits, and pull fire alarms. (3) Short-Term Residential Rental Registry Applications, Fee, and Reporting Requirement. (A)

for Short-Term Residential Rental shall post a clearly printed sign inside his or her Residential Unit on the inside of the front door that provides information regarding the location of all fire extinguishers in the unit and building, gas shut off valves, fire exits, and pull fire alarms. (3) Short-Term Residential Rental Registry Applications, Fee, and Reporting Requirement. (A) Application. Registration shall be for a two-year term, which may be renewed by the Permanent Resident by filing a completed renewal application. Initial and renewal applications shall be in a form prescribed by the Department. The Department shall determine, in its sole discretion, the completeness of an application. Upon receipt of a complete initial application, the Department shall send mailed notice to the owner of record of the Residential Unit, informing the owner that an application to the Registry for the unit has

been received. If the Residential Unit is in a RH-1(D) zoning district, the following additional requirements shall apply: the Department shall also send mailed notice to any directly associated homeowner association that has previously requested such notice and to any owners and occupants within 300 feet of the property; the Department shall hold the application for 45 days after sending such notice; and the Department shall review and consider any information submitted by any such homeowner association, neighboring owner or occupant, or member of the public regarding the eligibility of the permanent resident and/or the residential unit for listing on the Registry received during the 45-day hold period. Both the initial application and any renewal application shall contain information sufficient to show that the Residential Unit is the Primary Residence of the applicant, that the applicant is the unit's Permanent Resident, and that the applicant has the required insurance coverage and business registration certificate. In addition to the information set forth here, the Department may require any other additional information necessary to show the Permanent Resident's compliance with this Chapter 41A. Primary Residency shall be established by showing the Residential Unit is listed as the applicant's residence on at least two of the following: motor vehicle registration; driver's license; voter registration; tax documents showing the Residential Unit as the Permanent Resident's Primary Residence for home owner's tax exemption purposes; or utility bill. A renewal application shall contain sufficient information to show that the applicant is the Permanent Resident and has occupied the unit for at least 275 days of each of the two preceding calendar years. Upon the Department's determination that an application is complete, the unit shall be entered into the Short-Term Residential Rental Registry and assigned an individual registration number. (B) Fee. The fee for the initial application and for each renewal shall be $50, payable to the Director. The application fee shall be due at the time of application. Beginning with fiscal year 2014-2015, fees set forth in this Section may be adjusted each year, without further action by the Board of Supervisors, as set forth in this Section. Within six months of the operative date of this ordinance* and after holding a duly noticed informational hearing at the Planning Commission, the Director shall report to the Controller the revenues generated by the fees for the prior fiscal year and the prior fiscal year's costs of establishing and maintaining the registry and enforcing the requirements of this Chapter 41A, as well as any other information that the Controller determines appropriate to the performance of the duties set forth in this Chapter. After the hearing by the Planning Commission, but not later than August 1, 2015, the Controller shall determine whether the current fees have produced or are projected to produce revenues sufficient to support the costs of establishing and maintaining the registry, enforcing the requirements of this Chapter 41A and any other services set forth in this Chapter and that the fees will not produce revenue that is significantly more than the costs of providing such services. The Controller shall, if necessary, adjust the fees upward or downward for the upcoming fiscal year as appropriate to ensure that the program recovers the costs of operation without producing revenue that is significantly more than such costs. The adjusted rates shall become operative on July 1. (C) Reporting Requirement. To maintain good standing on the Registry, the Permanent Resident shall submit a quarterly report to the Department beginning on January 1, 2016, and on January 1, April 1, July 1, and October 1 of each year thereafter, regarding the number of days the Residential Unit or any portion thereof has been rented as a Short Term Residential Rental since either initial registration or the last report, whichever is more recent, and any additional information the Department may require to demonstrate compliance with this Chapter 41A. (4) Requirements for Hosting Platforms. (A) All Hosting Platforms shall provide the following information in a notice to any user listing a Residential Unit located within the City and County of San Francisco through the Hosting Platform's service. The notice shall be provided prior to the user listing the Residential Unit and shall include the following information: that Administrative Code Chapters 37 and 41A regulate Short-Term Rental of Residential Units; the requirements for Permanent Residency and registration of the unit with the Department; and the transient occupancy tax obligations to the City. (B) A Hosting Platform shall comply with the requirements of the Business and Tax Regulations Code by, among any other applicable requirements, collecting and remitting all required Transient Occupancy Taxes, and this provision shall not relieve a Hosting Platform of liability related to an occupant's, resident's, Business Entity's, or Owner's failure to comply with the requirements of the Business and Tax Regulations Code. A Hosting Platform shall maintain a record demonstrating that the taxes have been remitted to the Tax Collector. (C) A Hosting Platform may provide, and collect a fee for, Booking Services in connection with short-term rentals for Residential Units located in the City and County of San Francisco only when the Hosting Platform exercises reasonable care to confirm that those Residential Units are lawfully registered on the Short-Term Residential Rental Registry at the time the Residential Unit is rented for short-term rental. Whenever a Hosting Platform complies with administrative guidelines issued by the Office of Short-Term Residential Rental Administration and Enforcement to confirm that the Residential Unit is l

orm exercises reasonable care to confirm that those Residential Units are lawfully registered on the Short-Term Residential Rental Registry at the time the Residential Unit is rented for short-term rental. Whenever a Hosting Platform complies with administrative guidelines issued by the Office of Short-Term Residential Rental Administration and Enforcement to confirm that the Residential Unit is lawfully registered on the Short-Term Rental Registry, the Hosting Platform shall be deemed to have exercised reasonable care for the purpose of this subsection (g)(4)(C). (D) Commencing November 5, 2016, and on the fifth day of every month thereafter, a Hosting Platform shall provide a signed affidavit to the Office of Short Term Rentals verifying that the Hosting Platform has complied with subsection (g)(4)(C) of this Section 41A.5 in the immediately preceding month. (E) For not less than three years following the end of the calendar year in which the short-term rental transaction occurred, the Hosting Platform shall maintain and be able, in response to a lawful request, to provide to the Office of Short Term Rentals for each short-term rental transaction for which a Hosting Platform has provided a Booking Service: (i) The name of the Owner or Business Entity who offered a Residential Unit for Tourist or Transient Use, (ii) The address of the Residential Unit, (iii) The dates for which the tourist or transient user procured use of the Residential Unit using the Booking Service provided by the Hosting Platform,

(iv) The registration number for the Residential Unit, and (v) The affidavit required in subsection (g)(4)(D). (5) The exception set forth in this subsection (g) provides an exception only to the requirements of this Chapter 41A. It does not confer a right to lease, sublease, or otherwise offer a residential unit for Short-Term Residential Use where such use is not otherwise allowed by law, a homeowners association agreement or requirements, any applicable covenant, condition, and restriction, a rental agreement, or any other restriction, requirement, or enforceable agreement. All Owners and residents are required to comply with the requirements of Administrative Code Chapter 37, the Residential Rent Stabilization and Arbitration Ordinance, including but not limited to the requirements of Section 37.3(c). (6) The Department shall designate a contact person for members of the public who wish to file Complaints under this Chapter 41A or who otherwise seek information regarding this Chapter or Short-Term Residential Rentals. This contact person shall also provide information to the public upon request regarding quality of life issues, including, for example, noise violations, vandalism, or illegal dumping, and shall direct the member of the public and/or forward any such Complaints to the appropriate City department. (7) Notwithstanding any other provision of this Chapter 41A, nothing in this Chapter shall relieve an individual, Business Entity, or Hosting Platform of the obligations imposed by any and all applicable provisions of state law and the Municipal Code including but not limited to those obligations imposed by the Business and Tax Regulations Code. Further, nothing in this Chapter shall be construed to limit any remedies available under any and all applicable provisions of state law and the Municipal Code including but not limited to the Business and Tax Regulations Code. (Added by Ord. 331-81, App. 6/26/81; amended by Ord. 74-98, App. 3/6/98; Ord. 224-12 , File No. 120299, App. 11/1/2012, Eff. 12/1/2012; Ord. 218-14 , File No. 140381, App. 10/27/2014, Eff. 11/26/2014, Oper. 2/1/2015; Ord. 130-15 , File No. 150363, App. 7/30/2015, Eff. 8/29/2015; Ord. 104-16 , File No. 160423, Eff. 7/24/2016; Ord. 178-16 , File No. 160790, Eff. 9/10/2016; Ord. 89-17, File No. 170158, App. 4/14/2017, Eff. 5/14/2017)

• Editor's Note: The reference in Sec. 41A.5(g)(3)(B) to "the operative date of this ordinance" was added to the Code as part of the amendments included in Ord. 218-14 , Oper. 2/1/2015.

(a) Determination and Notice of Violation. (1) After the Director has determined that a violation of this Chapter 41A exists, the Director shall notify the responsible Owner, Business Entity, or Hosting Platform of the determination of violation by certified mail and shall post the notice of violation in a conspicuous location on, or if access to the property is not available in a conspicuous location as close as practicable to, the building or property where the Residential Unit is located. (2) Once a Complaint has been filed or once the Director has made a determination of violation in the absence of a Complaint, the Department shall include information regarding the Complaint or violation, including whether the Complaint is pending or resolved and, if resolved, any final determination, on the Department's website. (3) Contents of Notice. The notice shall cite to this Chapter 41A and describe the violation(s) with specificity. The notice of violation shall: state that the responsible party shall immediately correct all violations; and assess any applicable administrative penalties as set forth in Subsection 41A.6(d)(1). The notice of violation shall also inform the responsible party of the right to request a Director's hearing under Subsection 41A.6(b) to appeal the determination of violation and any assessed administrative penalties. (4) If the Director finds there is no violation of this Chapter or basis for an investigation for an unlawful activity, the Director shall so inform the complainant within 60 days of the filing of any Complaint. (b) Request for Hearing. Within 30 days of the notice of violation, the responsible party may request a Director's hearing to appeal the determination of violation and any assessed administrative penalties. The Director shall send a notice of the date, hour, and place of the hearing to the responsible party at the address specified in the request for hearing and to any member of the public who has expressed an interest in the matter. (c) Administrative Review Hearings. The Director may designate a member of Department staff to act in his or her place as the hearing officer. The Director's appointed hearing officer shall hold an administrative review hearing within 45 days of the request for hearing to review all information provided by the Interested Party, members of the public, City staff, and the Owner, Business Entity, or Hosting Platform for the investigation, and the hearing officer shall thereafter make a determination whether the Owner, Business Entity, or Hosting Platform has violated this Chapter 41A. (1) Pre-hearing Submission. No less than ten days prior to the administrative review hearing, parties to the hearing shall submit written information to the Director including, but not limited to, the issues to be determined by the hearing officer and the evidence to be offered at the hearing. Such information shall be forwarded to the hearing officer prior to the hearing along with any information compiled by the Director. (2) Hearing Procedure. If more than one hearing is requested for Residential Units located in the same building at or about the same time, the Director shall consolidate all of the hearings into one hearing. The hearing shall be recorded. Any party to the hearing may at his or her own expense cause the hearing to be recorded by a certified court reporter. Parties may be represented by counsel. All

testimony shall be given under oath. Written decisions and findings shall be rendered by the hearing officer within 30 days of the hearing. Copies of the findings and decision shall be served upon the parties by certified mail. A notice that a copy of the findings and decision is available for inspection between the hours of 9:00 a.m. and 5:00 p.m. Monday through Friday shall be posted by the Owner or the Director in the building in the same location in which the notice of the administrative review hearing was posted. (3) Failure to Appear. In the event the Owner, authorized Hosting Platform representative, or an interested party fails to appear at the hearing, the hearing officer may nevertheless make a determination based on the evidence in the record and files at the time of the hearing, and issue a written decision and findings. (4) Finality of the Hearing Officer's Decision and Judicial Review. The decision of the hearing officer shall be final. Within 20 days after service of the hearing officer's decision, any party may seek judicial review of the hearing officer's decision. (5) Hearing Officer Decision and Collection of Penalties. Upon the hearing officer's decision, or if no hearing is requested upon the expiration of the appeal period, the Director may proceed to collect the penalties and costs pursuant to the lien procedures set forth in Subsection 41A.6(e), consistent with the hearing officer's decision or the determination of violation if no hearing is requested. (6) Remedy of Violation. If the hearing officer determines that a violation has occurred, the hearing officer's decision shall: (A) Specify a reasonable period of time during which the Owner, Business Entity, or Hosting Platform must correct or otherwise remedy the violation; (B) Detail the amount of any administrative penalties the Owner or Hosting Platform shall be required to pay as set forth in Subsection 41A.6(d); and, (C) For violations by Owners, state that if the violation is not corrected or otherwise remedied within this period, the Department shall remove or prohibit the registration of the Residential Unit from the Short-Term Residential Registry for one year even if the Residential Unit otherwise meets the requirements for Short-Term Residential Rental. (7) If the hearing officer determines that no violation has occurred, the determination is final. (d) Administrative Penalties for Violations and Enforcement Costs. (1) Administrative Penalties. Administrative penalties shall be assessed as follows: (A) For the initial violation by an Owner or Business Entity, not more than four times the standard hourly administrative rate of $121 for: (i) each unlawfully converted unit per day from the notice of violation until such time as the unlawful activity terminates; or (ii) the initial failure of a Hosting Platform to comply with its obligations under subsection 41A.5(g)(4). (B) For the second and any subsequent violation by the same Owner(s), Business Entity, or Hosting Platform, not more than eight times the standard hourly administrative rate of $121 for: (i) each unlawfully converted unit per day from the notice of violation until such time as the unlawful activity terminates; or (ii) the second and any subsequent failure of a Hosting Platform to comply with its obligations under subsection 41A.5(g)(4). (2) Prohibition on Registration and Listing Unit(s) on Any Housing Platform. In the event of multiple violations of any Owner's or Business Entity's obligations under this Chapter 41A, the Department shall remove the Residential Unit(s) from the Registry for one year and include the Residential Unit(s) on a list maintained by the Department of Residential Units that may not be offered for Tourist or Transient Use until compliance. Any Owner or Business Entity who continues to offer for rent a Residential Unit in violation of this Section 41A.6 shall be liable for additional administrative penalties and civil penalties of up to $1,000 per day of unlawful inclusion. (e) Notice of Violation and Imposition of Penalties. The Director shall notify the Owner or Hosting Platform by certified mail of the violation and that administrative penalties shall be imposed pursuant to this Chapter 41A. The notice shall state the time of the existence of the violation and the resulting imposition of penalties. Payment of the administrative penalties and enforcement costs shall be made within 30 days of the certified mailed notice to the Owner or Hosting Platform. If the administrative penalties and enforcement costs are not paid, the Director shall refer the matter to the Treasurer/Tax Collector and/or initiate lien procedures to secure the amount of the penalties and costs against the real property that is subject to this Chapter, under Article XX of Chapter 10 of the Administrative Code to make the penalty, plus accrued interest, a lien against the real property regulated under this Chapter. Except for the release of the lien recording fee authorized by Administrative Code Section 10.237, all sums collected by the Tax Collector pursuant to this ordinance shall be deposited as set forth in subsection (f) below. (f) Deposit of Penalties. Any fees and penalties collected pursuant to this Chapter 41A shall be deposited in the Housing Trust Fund for use by the Small Sites Program, which shall reimburse City departments and agencies, including the Department and the City Attorney's Office, for all costs and fees incurred in the enforcement of this Chapter 41A. (Added as Sec. 41A.8 by Ord. 74-98, App. 3/6/98; redesignated and amended by Ord. 224-12 , File No. 120299, App. 11/1/2012, Eff. 12/1/2012; amended by Ord. 218-14 , File No. 140381, App. 10/27/2014, Eff. 11/26/2014, Oper. 2/1/2015; Ord. 130-15 , File No. 150363, App. 7/30/2015, Eff. 8/29/2015; Or

nd the City Attorney's Office, for all costs and fees incurred in the enforcement of this Chapter 41A. (Added as Sec. 41A.8 by Ord. 74-98, App. 3/6/98; redesignated and amended by Ord. 224-12 , File No. 120299, App. 11/1/2012, Eff. 12/1/2012; amended by Ord. 218-14 , File No. 140381, App. 10/27/2014, Eff. 11/26/2014, Oper. 2/1/2015; Ord. 130-15 , File No. 150363, App. 7/30/2015, Eff. 8/29/2015; Ord. 104-16 , File No. 160423, Eff. 7/24/2016; Ord. 178-16 , File No. 160790, Eff. 9/10/2016) (Former Sec. 41A.6 added by Ord. 331-81, App. 6/26/81; repealed by Ord. 224-12, File No. 120299, App. 11/1/2012, Eff. 12/1/2012)

ENFORCEMENT. (a) The Mayor shall establish an Office of Short-Term Residential Rental Administration and Enforcement, which shall provide a single location to receive and process applications for the Registry and Complaints regarding violations of this Chapter 41A. This office shall be staffed by the Department and other departments as appropriate, with participation from the Department of Building Inspection, the Treasurer/Tax Collector's Office, and other departments as needed, to process applications for the Registry and enforce the requirements of this Chapter 41A in a timely and efficient manner. It is the intent of this Board of Supervisors in directing the establishment of this office to streamline both the process of administering the Registry and enforcing the requirements of this Chapter 41A to protect residential housing from unlawful conversion to Tourist or Transient Use. The Office of Short-Term Residential Rental Administration and Enforcement shall promulgate rules and regulations to simplify and streamline the application process and to minimize the time between the filing of applications and their final approval. (b) Monitor Hosting Platforms. In addition to the administrative enforcement duties outlined in Section 41A.6, the Office of Short- Term Residential Rental Administration and Enforcement shall actively monitor Hosting Platform listings. Within 15 business days of the effective date of Ordinance No. 104-16, the Office of Short-Term Residential Rental Administration and Enforcement shall complete a comprehensive review of active Hosting Platform listings and produce an inventory of potentially non-compliant listings discovered during the review. Subsequent reviews of Hosting Platform listings shall be performed on at least a monthly basis. (1) The Office of Short-Term Residential Rental Administration and Enforcement shall, upon completion of a Hosting Platform review or discovery of a potentially non-compliant listing, immediately provide notice to Hosting Platforms by electronic mail of all listings that do not have valid registration numbers or are otherwise not in compliance with this Chapter 41A. These notices shall be provided to the City Attorney's Office. (2) The Office of Short-Term Residential Rental Administration and Enforcement shall have the power to issue and serve administrative subpoenas as necessary to determine whether Owners, Business Entities, and Hosting Platforms have complied with Administrative Code Chapter 41A. The Office of Short-Term Residential Rental Administration and Enforcement shall issue and serve subpoenas to the Hosting Platforms to obtain information necessary to determine whether violations of Administrative Code Chapter 41A have occurred within a reasonable time not to exceed 30 days of discovering potential violations through a monthly review or other investigation effort. Owners, Business Entities, and Hosting Platforms shall have a reasonable opportunity to challenge the administrative subpoena by seeking judicial review before suffering any penalties for refusing to comply. (c) Reporting to Board of Supervisors. (1) Annual Reports. The Office of Short-Term Residential Rental Administration and Enforcement shall provide a report to the Board of Supervisors regarding the administration and enforcement of the Short-Term Residential Rental program on an annual basis. The report shall make recommendations regarding proposed amendments to this Chapter 41A necessary to reduce any adverse effects of the Short-Term Residential Rental program. (2) Quarterly Reports. The Office of Short-Term Residential Rental Administration and Enforcement shall provide quarterly reports to the Board of Supervisors summarizing the Host Platform monitoring activities during the preceding quarter. The periods covered by the quarterly reports shall commence on January 1, April 1, July 1, and October 1, respectively. At a minimum, each report shall include the number of notices sent to Hosting Platforms, the total number of listings included in those notices, the number of any administrative subpoenas issued upon discovery of potentially non-compliant listings, and the number and amount of penalties imposed on Owners, Business Entities, or Hosting Platforms for violations of their respective obligations under this Chapter 41A. Each report shall break down information by zip code, supervisorial district, and any other criteria as may be requested by the Board of Supervisors. (Added by Ord. 130-15 , File No. 150363, App. 7/30/2015, Eff. 8/29/2015; amended by Ord. 104-16 , File No. 160423, Eff. 7/24/2016; Ord. 178-16 , File No. 160790, Eff. 9/10/2016) (Former Sec. 41A.7 added by Ord. 331-81, App. 6/26/81; repealed and reenacted by Ord. 224-12 , File No. 120299, App. 11/1/2012, Eff. 12/1/2012; redesignated as Sec. 41A.8 and amended by Ord. 130-15 , File No. 150363, App. 7/30/2015, Eff. 8/29/2015)

(a) Nothing in this Chapter 41A may be construed to supersede any other lawfully enacted ordinance of the City and County of San Francisco. (b) Clauses of this Chapter 41A are declared to be severable and if any provision or clause of this Chapter 41A or the application thereof is held to be unconstitutional or to be otherwise invalid by any court of competent jurisdiction, such invalidity shall not affect other provisions of this Chapter 41A. (Added as Sec. 41A.7 by Ord. 331-81, App. 6/26/81; repealed and reenacted by Ord. 224-12 , File No. 120299, App. 11/1/2012, Eff. 12/1/2012; redesignated and amended by Ord. 130-15 , File No. 150363, App. 7/30/2015, Eff. 8/29/2015) (Former Sec. 41A.8 added by Ord. 74-98, App. 3/6/98; redesignated as Sec. 41A.6 and amended by Ord. 224-12 , File No. 120299, App. 11/1/2012, Eff. 12/1/2012) CHAPTER 41B:

COMMUNITY OPPORTUNITY TO PURCHASE ACT Sec. 41B.1. Findings and Purpose. Sec. 41B.2. Definitions. Sec. 41B.3. “Sale of a Multi-Family Residential Building” Defined. Sec. 41B.4. Qualified Nonprofits. Sec. 41B.5. General Provisions. Sec. 41B.6. Right of First Offer. Sec. 41B.7. Right of First Refusal. Sec. 41B.8. Preservation as Rent-Restricted Affordable Housing; Tenant Protections. Sec. 41B.9. Incentives. Sec. 41B.10. Enforcement. Sec. 41B.11. Implementation. Sec. 41B.12. Undertaking for the General Welfare. Sec. 41B.13. Construction with Other Laws. Sec. 41B.14. Severability.

(a) The City faces a severe and continuing housing crisis. Many City residents are unable to obtain or retain affordable housing. (b) This crisis has profoundly negative effects on the City. It causes dislocation, which frays the social ties that bind our neighborhoods and communities together. It forces vulnerable residents to leave their home, the City, for new communities where they are strangers. And it contributes to homelessness—which is itself a severe and continuing crisis in the City. (c) The City’s housing crisis is caused, in large part, by a shortage of affordable rental housing. The creation and preservation of such housing is therefore of paramount public concern. (d) Obstacles to the creation and preservation of affordable rental housing include off-market sales, the transfer of multifamily residential building by foreclosure or deed in lieu of foreclosure, and rapid turnover in the City’s real estate market. Nonprofit organizations seeking to create and preserve affordable housing may be willing and able to pay market prices to purchase residential buildings for sale, but nevertheless find themselves often unable to purchase such buildings before they leave the market. Nonprofit organizations serving the broader public interest must often move more deliberately and borrow purchase money from non-traditional lenders in such real estate transactions than private entities concerned solely with profit. Nonprofit organizations may also have access to public funds dedicated to acquire multifamily residential buildings under the threat of foreclosure or subject to foreclosure proceedings, but such nonprofit organizations sometimes do not have the benefit of notice that such multifamily residential buildings are available for purchase. (e) The purpose of this Chapter 41B (which may be referred to as the “Community Opportunity to Purchase Act”) is to enhance nonprofit organizations’ ability to purchase multi-family residential buildings, at market prices, within a reasonable period of time, and to thereby promote the creation and preservation of affordable rental housing. (f) This Chapter 41B is intended to complement existing anti-displacement and preservation programs administered by the Mayor’s Office of Housing and Community Development (the “Agency”). In particular, this Chapter is intended to complement the Small Sites Program and Preservation and Seismic Safety (“PASS”) program. (1) The Small Sites Program was created to establish and protect long-term affordable housing in smaller properties throughout the City, particularly at sites were1 market pressures may otherwise result in tenant evictions and rising rents. By January 2019, the Small Sites Program had empowered local nonprofit housing organizations to preserve 28 buildings, containing 205 residential units and 13 commercial spaces. (2) The PASS program provides low-cost, long-term senior financing to fund the acquisition, rehabilitation, seismic retrofitting, and preservation of affordable multi-family housing, funded through bond revenues previously approved by City voters. It is anticipated that the PASS program will preserve up to 1,400 units of affordable housing in the City. (Added by Ord. 79-19, File No. 181212, App. 5/3/2019, Eff. 6/3/2019; amended by Ord. 228-20, File No. 200948, App. 11/13/2020, Eff. 12/14/2020; Ord. 88-24, File No. 240262, App. 5/3/2024, Eff. 6/3/2024) CODIFICATION NOTE

1. So in Ord. 79-19.

For purposes of this Chapter 41B, the following definitions apply: “Agency” means the Mayor’s Office of Housing and Community Development, or any successor agency, department, or office. “Area Median Income” means the Unadjusted Area Median Income published by the U.S. Department of Housing and Urban Development for the geographic area that includes the City. “City” means the City and County of San Francisco. “Fee Interest” means ownership of real property in fee simple absolute. “Multi-Family Residential Building,” or “Building,” means any privately-owned real property in San Francisco improved with three or more residential rental units (whether or not the property also includes non-residential uses), any privately-owned real property on which three or more residential units are under construction, and any privately-owned vacant lot on which the Planning Code and other applicable laws would permit the construction of three or more residential rental units. “Notice of Special Restrictions” means an agreement executed by a Qualified Nonprofit and recorded against a Multi-Family Residential Building Purchased by such Qualified Nonprofit, substantially in the form published by the Agency. “Purchase of a Multi-Family Residential Building,” or “Purchase,” means to acquire any interest that is transferred pursuant to the Sale of a Multi-Family Residential Building. “Purchaser” means the individual, individuals, entity, or entities engaged, or seeking to engage, in the Purchase of a Multi-Family Residential Building. “Sale of a Multi-Family Residential Building,” or “Sale,” is defined in Section 41B.3. “Sell” means to engage in the Sale of a Multi-Family Residential Building. “Seller” means the individual, individuals, entity, or entities engaged, or seeking to engage, in the Sale of a Multi-Family Residential Building. “Qualified Nonprofit” is defined in Section 41B.4(a). (Added by Ord. 79-19, File No. 181212, App. 5/3/2019, Eff. 6/3/2019)

(a) General Definition. As used in this Chapter 41B, “Sale of a Multi-Family Residential Building,” or “Sale,” means any of the following: (1) The transfer, in exchange for money or any other thing of economic value, of a present interest in the Multi-Family Residential Building, including beneficial use, where the value of the present interest is the Fee Interest in the Multi-Family Residential Building, or substantially equal to the value of that Fee Interest; or (2) If an interest in the Multi-Family Residential Building is held by a trust, the transfer, in exchange for money or any other thing of economic value, of a beneficial interest in the trust, where the value of the beneficial interest in the trust is substantially equal to the value of the Fee Interest of the Multi-Family Residential Building; or (3) If an interest substantially equal to the value of the Fee Interest of the Multi-Family Residential Building is held by any kind of corporate entity or partnership (including, but not limited to, a corporation, limited liability company, general partnership, limited partnership, or limited liability partnership), and if that interest is substantially equal in value to the total value of assets held by the corporate entity or partnership, the transfer, in exchange for money or any other thing of economic value, of a controlling interest in the corporate entity or partnership; or (4) The transfer of the Fee Interest or other beneficial interests of the Multifamily Residential Building made under a deed in lieu of foreclosure and/or related agreement related to the repayment of a loan and avoidance of foreclosure. (b) Multiple Owners. For purposes of this Section 41B.3, in any instance in which multiple entities (whether those entities are natural persons, trusts, corporate entities, partnerships, or any other kind of entity, or any combination of different kinds of entities) hold interests in a Multi-Family Residential Building, the transfer of multiple interests by or in those entities shall be considered the transfer of a single interest, if the transfers are made in connection with substantially the same transaction or set of transactions. (c) Exclusions. Notwithstanding subsections (a) and (b), “Sale of a Multi-Family Residential Building,” or “Sale,” does not include any of the following: (1) Any transfer made under a mortgage or deed of trust; or (2) Any transfer made in connection with any bankruptcy proceeding (including, but not limited to, any transfer made by a

bankruptcy trustee); or (3) Any transfer of an interest in real property held by the Federal government, by the State government, or by any special district created by State law (including, but not limited to, any transfer of any such interest held because of a taxpayer’s nonpayment of tax); or (4) Any transfer by devise or intestacy, or any other transfer made in connection with a bona fide effort to pass an interest in real property to one’s devisees or heirs (including, but not limited to, such transfers made in connection with a living trust); or (5) Any transfer between or among spouses, domestic partners, siblings (including, but not limited to, half-siblings, step-siblings, and adoptive siblings), parents (including, but not limited to, step-parents and adoptive parents) or guardians and their children, grandparents and their grandchildren, aunts or uncles and their nieces or nephews, great-aunts or great-uncles and their grand-nieces or grand-nephews, or first or second cousins, or any combination thereof; or (6) Any transfer of an interest in a Multi-Family Residential Building income-restricted at or below an average of 80% of Area Median Income for a minimum of 10 years, if such transfer is to an entity controlled by a California public benefit corporation, and that entity also participates in the management, direction, or control of the Building; or (7) For the purpose of a land dedication under the Planning Code or a development agreement or similar agreement approved by the Board of Supervisors, any transfer to the City or its designee of an interest in any privately-owned lot on which the Planning Code and other applicable laws would permit the construction of three or more residential rental units. (Added by Ord. 79-19, File No. 181212, App. 5/3/2019, Eff. 6/3/2019; amended by Ord. 228-20, File No. 200948, App. 11/13/2020, Eff. 12/14/2020; Ord. 88-24, File No. 240262, App. 5/3/2024, Eff. 6/3/2024)

(a) Annual Selection of Qualified Nonprofits. The Agency shall establish a process for certifying nonprofit organizations that meet the following criteria: (1) The organization is a bona fide nonprofit, as evidenced by the fact that it is exempt from federal income tax under 26 U.S.C. § 501(c)(3); (2) The organization has demonstrated a commitment to the provision of affordable housing for low- and moderate-income City residents, and to preventing the displacement of such residents; (3) The organization has demonstrated a commitment to community engagement, as evidenced by relationships with neighborhood- based organizations or tenant counseling organizations; (4) The organization has demonstrated the capacity (including, but not limited to, the legal and financial capacity) to effectively acquire and manage residential real property at multiple locations in the City; and (5) The organization has, within the previous five years, acquired or partnered with another housing development organization to acquire at least two residential buildings using funding provided by the Agency, or has acquired or partnered with another nonprofit organization to acquire at least two residential buildings under this Chapter 41B. Nonprofit organizations that the Agency certifies as having met these criteria shall be known as “Qualified Nonprofits.” An organization’s certification as a Qualified Nonprofit shall be valid for three years. The Agency shall solicit new applications for Qualified Nonprofit status at least once each calendar year, at which time existing Qualified Nonprofits shall be eligible to apply for renewed certification as Qualified Nonprofits. In the absence of new information raising doubts about whether the organization qualifies as a Qualified Nonprofit, an existing Qualified Nonprofit’s application for renewed certification as a Qualified Nonprofit shall be routinely and swiftly granted. (b) Existence and Publication of Qualified Nonprofits List. The Agency shall publish on its website, and make available upon request, a list of Qualified Nonprofits. In addition to such other information as the Agency may include, this list shall include contact information for each Qualified Nonprofit. This contact information shall include, but need not be limited to, a mailing address, an e-mail address that the Qualified Nonprofit monitors regularly, and a telephone number. (c) Disqualification of Qualified Nonprofits. The Agency shall promptly investigate any complaint alleging that a Qualified Nonprofit has failed to comply with this Chapter 41B. If, after providing the Qualified Nonprofit with notice and opportunity to be heard, the Agency determines that a nonprofit organization listed as a Qualified Nonprofit has failed to comply with this Chapter, the Agency may suspend or revoke that nonprofit organization’s certification as a Qualified Nonprofit. (Added by Ord. 79-19, File No. 181212, App. 5/3/2019, Eff. 6/3/2019)

(a) First Right to Purchase Conferred. This Chapter 41B shall be construed to confer upon each Qualified Nonprofit a first right to

purchase any Multi-Family Residential Building for Sale in the City. This first right to purchase shall consist of both a right of first offer, as set forth in Section 41B.6, and a right of first refusal, as set forth in Section 41B.7. (b) Confidential Information Protected. With the exception of the notice to Sell a Building under Section 41B.6(b), any information obtained from a Seller by a Qualified Nonprofit under this Chapter 41B—including, but not limited to, disclosures made under Section 41B.6(c) and (e), and terms and conditions of an offer of Sale made under Section 41B.7(b)—shall be kept confidential to the extent required by law, except that a Qualified Nonprofit may, if otherwise permitted by law, share such information with other Qualified Nonprofits to facilitate Qualified Nonprofits’ exercise of the rights conferred by this Chapter. Nothing in this Chapter permits or requires the disclosure of information where such disclosure is otherwise prohibited by law. (c) Preexisting Rights Unaffected. This Chapter 41B shall not be construed to impair any contract, or affect any property interest held by anyone other than the Seller of a Multi-Family Residential Building (including, but not limited to, any interest held under a mortgage, deed of trust, or other security interest; any option to purchase; or any right of first offer or right of first refusal), in existence before the effective date of this Chapter. (d) Notice of Default. All owners of a Multifamily Residential Building shall provide written notice to each Qualified Nonprofit and the Agency of a non-judicial foreclosure or a judicial foreclosure related to an owner’s Multifamily Residential Building. Within two business days of receipt of any of the following documents, an owner of a Multifamily Residential Building shall deliver to each Qualified Nonprofit and the Agency, via e-mail, a copy of: (1) a notice of default related to such Multifamily Residential Building under California Civil Code Section 2924b(b), or successor provision; (2) a civil complaint filed in superior court of a judicial foreclosure action related to such Multifamily Residential Building under the California Code of Civil Procedure Sections 725a – 730.5, or successor provisions; (3) a notice of sale related to such Multifamily Residential Building under California Civil Code Section 2924f(b)(4), or successor provision; (4) a notice of levy related to such Multifamily Residential Building under the Code of Civil Procedure sections 699.540 and 700.015, or successor provisions; (5) a notice of sale related to such Multifamily Residential Building under the Code of Civil Procedure section 701.540; (6) any other notice of default or notice of sale related to a judicial foreclosure or a non-judicial foreclosure of such Multifamily Residential Building under California law. (Added by Ord. 79-19, File No. 181212, App. 5/3/2019, Eff. 6/3/2019; amended by Ord. 228-20, File No. 200948, App. 11/13/2020, Eff. 12/14/2020; Ord. 88-24, File No. 240262, App. 5/3/2024, Eff. 6/3/2024)

(a) General Construction. This Section 41B.6 shall be construed to confer upon each Qualified Nonprofit a right of first offer with respect to any Multi-Family Residential Building for Sale in the City, as set forth in this Section. (b) Opportunity for Qualified Nonprofits to Submit Offers. Before the Seller of a Multi-Family Residential Building may (1) allow any prospective Purchaser, other than a Qualified Nonprofit, to view that Building in person or physically inspect that Building, (2) offer that Building for Sale to any prospective Purchaser other than a Qualified Nonprofit, or (3) otherwise solicit any offer to Purchase that Building from any Purchaser other than a Qualified Nonprofit, the Seller shall notify each Qualified Nonprofit, via e-mail, of its intent to Sell the Building, and shall provide each Qualified Nonprofit with an opportunity to make an offer to Purchase the Building as set forth in subsections (d)–(f). The Seller shall submit this notification on the same calendar day and, to the extent possible, at the same time, to each of the e-mail addresses included on the Agency’s list of Qualified Nonprofits pursuant to Section 41B.4(b). If, within one year of providing the notification required under this subsection (b), the Seller does not execute a written and binding purchase and sale agreement for the Sale of a Multi-Family Residential Building or complete the Sale of a Multi-Family Residential Building, but still intends to Sell the Building, the Seller shall provide each Qualified Nonprofit with a new notification under this subsection (b) of the Seller’s continued intent to Sell the Building, and at that time shall provide each Qualified Nonprofit with a new opportunity to Purchase the Building under this Chapter 41B. Every year thereafter, on the anniversary of the first required notification under this subsection (b), if the Building remains for sale, the Seller shall provide each Qualified Nonprofit with a new notification under this subsection (b) of the Seller’s continued intent to Sell the Building, and at that time shall provide each Qualified Nonprofit with a new opportunity to make an offer to Purchase the Building as set forth in subsections (d)-(f), until the Building is Sold to a Qualified Nonprofit or a Purchaser, as applicable. If the Seller elects to not Sell the Building, the Seller shall provide each Qualified Nonprofit with written notice that the Seller no longer has intent to Sell the Building, but the Seller shall continue to comply with this Chapter 41B before the Sale of the Building. (c) Related Disclosures. When the Seller, pursuant to subsection (b), notifies each Qualified Nonprofit, via e-mail, of its intent to sell a Multi-Family Residential Building, the Seller shall also provide each Qualified Nonprofit with the following information: (1) The number of rental units in the Building; (2) The address or location of each rental unit; and

(3) The rate of rent due for each unit. (d) Time for Qualified Nonprofits to Express Interest. No later than 11:59 p.m. on the fifth full calendar day after a Seller has, pursuant to subsection (b), notified each Qualified Nonprofit, via e-mail, of its intent to Sell a Multi-Family Residential Building, each Qualified Nonprofit shall notify the Seller and every other Qualified Nonprofit, via e-mail, as to whether or not the Qualified Nonprofit wishes to further consider whether to make an offer to Purchase the Building. If, after 11:59 p.m. on the fifth full calendar day after a Seller has notified each Qualified Nonprofit of its intent to Sell the Building, no Qualified Nonprofit has notified the Seller that it wishes to further consider whether to make an offer to Purchase the Building, the Seller may immediately proceed to offer the Building for Sale to, and to solicit offers of Purchase from, prospective Purchasers other than Qualified Nonprofits, subject to the right of first refusal set forth in Section 41B.7. If, at or before 11:59 p.m. on the fifth full calendar day after a Seller has notified each Qualified Nonprofit of its intent to Sell the Building, each Qualified Nonprofit has notified the Seller that the Qualified Nonprofit does not wish to further consider whether to make an offer to Purchase the Building, the Seller may likewise immediately offer the Building for Sale to, and solicit offers of Purchase from, prospective Purchasers other than Qualified Nonprofits, subject to the right of first refusal set forth in Section 41B.7. (e) Additional Disclosures. If, no later than 11:59 p.m. on the fifth full calendar day after a Seller has notified each Qualified Nonprofit of its intent to Sell a Multi-Family Residential Building, any Qualified Nonprofit has, consistent with subsection (d), notified the Seller that the Qualified Nonprofit wishes to further consider whether to make an offer to Purchase the Building, the Seller shall disclose to each such Qualified Nonprofit, via e-mail, the following additional information regarding the Building: (1) the name or names of any tenant or tenants in each rental unit, as well as any available contact information for each tenant, (2) the number of bedrooms and bathrooms in each rental unit, (3) each tenant’s move-in date, (4) base rent for each rental unit, (5) Building costs passed through to each tenant, if any, (6) whether each tenant has a written lease or rental agreement, and (7) the annual expenses for the Building, including, but not limited to, management, insurance, utilities, and maintenance. Concurrently with the release of this additional information, the Seller shall provide to each tenant in the Building an information sheet, prepared by the Agency, containing a brief overview of the Community Opportunity to Purchase Act and the Agency’s Small Sites Program. (f) Time for Qualified Nonprofits to Make Offer. Upon receipt, via e-mail, of the disclosures described in subsection (e), each such Qualified Nonprofit (that is, each Qualified Nonprofit that has, consistent with subsection (d), notified the Seller that the Qualified Nonprofit wishes to further consider whether to make an offer to Purchase the Building) shall have 25 additional calendar days to decide whether to make an offer to Purchase the Building, and to submit any such offer to the Seller. Any such offer of Purchase shall be presumed to be contingent upon the Qualified Nonprofit’s ability to conduct due diligence and secure financing in a manner consistent with subsection (h), unless the Seller and the Qualified Nonprofit expressly agree otherwise in writing. (g) Seller Free to Accept or Reject Offer. The Seller is free to accept or reject any offer of Purchase submitted by a Qualified Nonprofit under subsection (e). Any such acceptance or rejection shall be communicated in writing. If the Seller rejects all such offers of Purchase, or if the 25-day period described in subsection (e) has elapsed and no Qualified Nonprofit has submitted an offer of Purchase, the Seller may immediately offer the Building for Sale to, and solicit offers of Purchase from, prospective Purchasers other than Qualified Nonprofits, subject to the right of first refusal set forth in Section 41B.7. (h) Seller’s Acceptance of Offer. If the Seller accepts an offer of Purchase submitted by a Qualified Nonprofit, the Qualified Nonprofit shall have 60 days to conduct due diligence and secure financing related to the Purchase, unless the Seller and the Qualified Nonprofit have expressly agreed otherwise in writing. At the end of this 60-day period (or any other period to which the Seller and the Qualified Nonprofit have expressly agreed in writing), the Seller shall proceed to Sell the Multi-Family Residential Building to the Qualified Nonprofit in a manner consistent with the Qualified Nonprofit’s offer of Purchase. (Added by Ord. 79-19, File No. 181212, App. 5/3/2019, Eff. 6/3/2019; amended by Ord. 228-20, File No. 200948, App. 11/13/2020, Eff. 12/14/2020)

(a) General Construction. This Section 41B.7 shall be construed to confer upon each Qualified Nonprofit a right of first refusal, as set forth in this Section, with respect to any Multi-Family Residential Building which that Qualified Nonprofit has previously made an offer of purchase under Section 41B.6(f), or for which that Qualified Nonprofit was not previously given the opportunity described in Section 41B.6(b). (b) Written Offer of Sale to Qualified Nonprofits; Terms and Conditions Set by Market. Except as provided in subsection (f), whenever the Seller of a Multi-Family Residential Building receives from a Purchaser other than a Qualified Nonprofit an offer to Purchase the Multi-Family Residential Building that the Seller wishes to accept, and whenever the Seller of a Multi-Family Residential Building makes an offer to Sell the Multi-Family Residential Building that a Purchaser other than a Qualified Nonprofit expresses a desire to accept, the Seller shall, before any such offer of Purchase or Sale may be accepted, offer to Sell the Building to any Qualified Nonprofit that has previously made an offer of purchase under Section 41B.6(f) with respect to that Building, or that was not previously given the opportunity described in Section 41B.6(b) with respect to that Building. Any such offer of Sale to a Qualified Nonprofit shall contain the same terms and conditions (including, but not limited to, price, time frame to close the Sale, and commission to the Purchaser’s broker) as the offer of Purchase previously received by the Seller which the Seller wishes to accept or the offer of Sale previously made by the Seller which a Purchaser has expressed a desire to accept, except that the terms and conditions in the offer of Sale to a Qualified Nonprofit shall not be inconsistent with the applicable timeframe described in subsection (c) or (d). The Seller shall submit such an offer of Sale in writing, as well as all terms of the offer and all disclosures provided to the Purchaser, to a Qualified Nonprofit on the same calendar day (and, to the extent possible, at the same time) to each of the e-mail addresses for any Qualified Nonprofits that have previously made an offer of purchase under Section 41B.6(f) with respect to the relevant Building, or that were not

previously given the opportunity described in Section 41B.6(b) with respect to that Building. If in the past year the Seller has not previously made the disclosures set forth in Section 41B.6(c) and Section 41B.6(e) with respect to the Multi-Family Residential Building, the Seller shall include those disclosures with any offer of Sale required by this subsection (b). (c) Time for Qualified Nonprofits to Accept Offer, in General. Except as provided in subsection (d), no later than 11:59 p.m. on the fifth full calendar day after a Seller has submitted an offer of Sale under subsection (b) to a Qualified Nonprofit via e-mail, that Qualified Nonprofit shall notify the Seller and every other Qualified Nonprofit, via e-mail, of its decision to accept or reject the Seller’s offer of Sale. If, during this time period, any Qualified Nonprofit that has received such an offer of Sale decides to accept the Seller’s offer of Sale, that Qualified Nonprofit shall immediately notify the Seller and every other Qualified Nonprofit of that decision, via e- mail. After a Qualified Nonprofit notifies the Seller of its decision to accept the Seller’s offer of Sale, and notwithstanding any defect in that Qualified Nonprofit’s notice to other Qualified Nonprofits, that Qualified Nonprofit shall be deemed to have accepted the offer of Sale, and no other Qualified Nonprofit may accept the Seller’s offer of Sale, whether or not the time period described in this subsection (c) has elapsed. (d) Time for Qualified Nonprofits to Accept Offer, Absent Prior Opportunity to Exercise Right of First Offer. Notwithstanding subsection (c), if Qualified Nonprofits have not previously had an opportunity to exercise the right of first offer set forth in Section 41B.6 with respect to the Sale of a Multi-Family Residential Building (because, for example, the Seller of the Building has received an unsolicited offer to Purchase the Building), each Qualified Nonprofit shall notify the Seller and every other Qualified Nonprofit, via e- mail, of its decision to accept or reject the Seller’s offer of Sale no later than 11:59 p.m. on the 30th full calendar day after the Seller has, pursuant to subsection (b), notified the Qualified Nonprofit of its intent to Sell a Multi-Family Residential Building. The Seller shall provide to each Qualified Nonprofit, via e-mail, the terms and conditions of such offer of Sale and the disclosures required by Section 41B.6(c), Section 41B.6(e), and Section 41B.7(b). Upon request, the Seller shall exhibit the Building to each Qualified Nonprofit that has expressed interest in the Building and cooperate with efforts to inspect the condition of the Building. If, during this time period, any Qualified Nonprofit decides to accept the Seller’s offer of Sale, that Qualified Nonprofit shall immediately notify the Seller and every other Qualified Nonprofit of that decision, via e-mail. After a Qualified Nonprofit notifies the Seller of its decision to accept the Seller’s offer of Sale, and notwithstanding any defect in that Qualified Nonprofit’s notice to other Qualified Nonprofits, that Qualified Nonprofit shall be deemed to have accepted the offer of Sale, and no other Qualified Nonprofit may accept the Seller’s offer of Sale, whether or not the time period described in this subsection (d) has elapsed. (e) Qualified Nonprofit’s Acceptance of Offer. If, in accordance with subsection (c) or (d), as applicable, a Qualified Nonprofit notifies the Seller that the Qualified Nonprofit has decided to accept the Seller’s offer of Sale, the Seller shall proceed to Sell the Multi- Family Residential Building to that Qualified Nonprofit in a manner consistent with the offer of Sale. A Qualified Nonprofit that so notifies the Seller (that is, before any other Qualified Nonprofit so notifies the Seller) shall be obliged to Purchase the Multi-Family Residential Building in a manner consistent with the offer of Sale. (f) Qualified Nonprofits’ Rejection of Offer. If, at or before the deadline set forth in subsection (c) or (d), as applicable, each Qualified Nonprofit that has received an offer of Sale has notified the Seller that it does not wish to accept the Seller’s offer of Sale, the Seller may immediately proceed with the Sale of the Multi-Family Residential Building, consistent with the offer of Purchase or offer of Sale that the Seller previously received from, or made to, a Purchaser other than a Qualified Nonprofit, as described in subsection (b). If, after the deadline set forth in subsection (c) or (d), as applicable, no Qualified Nonprofit has notified the Seller that it has decided to accept the Seller’s offer of Sale, the Seller may likewise immediately proceed with the Sale of the Multi-Family Residential Building, consistent with such offer of Purchase or offer of Sale. If, however, the Seller does not proceed with the Sale of the Building in a manner consistent with such offer of Purchase or offer of Sale, and instead receives from a Purchaser other than a Qualified Nonprofit a materially different offer to Purchase the Multi-Family Residential Building that the Seller wishes to accept, or makes a materially different offer to Sell the Multi-Family Residential Building that a Purchaser other than a Qualified Nonprofit expresses a desire to accept, that materially different offer of Purchase or offer of Sale shall be considered a new offer of Purchase or offer of Sale for purposes of subsection (b). (g) Conditional Third-Party Sales Agreements Permitted. If, as described in subsection (b), the Seller of a Multi-Family Residential Building receives from a Purchaser other than a Qualified Nonprofit an offer to Purchase the Multi-Family Residential Building that the Seller wishes to accept, or if the Seller of a Multi-Family Residential Building makes an offer to Sell the Multi-Family Residential Building that a Purchaser other than a Qualified Nonprofit expresses a desire to accept, that of

ller of a Multi-Family Residential Building receives from a Purchaser other than a Qualified Nonprofit an offer to Purchase the Multi-Family Residential Building that the Seller wishes to accept, or if the Seller of a Multi-Family Residential Building makes an offer to Sell the Multi-Family Residential Building that a Purchaser other than a Qualified Nonprofit expresses a desire to accept, that offer of Sale or offer of Purchase may be accepted subject to the contingency that no Qualified Nonprofit exercises the right of first refusal conferred by this Section 41B.7. In such a circumstance, the Seller and the Purchaser shall each expressly acknowledge, in writing, that the Purchaser’s Purchase of the Multi-Family Building will not occur if a Qualified Nonprofit exercises the right of first refusal conferred by this Section. (Added by Ord. 79-19, File No. 181212, App. 5/3/2019, Eff. 6/3/2019; amended by Ord. 228-20, File No. 200948, App. 11/13/2020, Eff. 12/14/2020)

PROTECTIONS. Any Multi-Family Residential Building Purchased by a Qualified Nonprofit under the first-right-to-purchase conferred by this Chapter 41B shall be maintained as rent-restricted affordable housing in perpetuity. For purposes of this Section 41B.8, “rent-restricted affordable housing” shall mean that the mean value of all rents paid by residential tenants in the Building shall not exceed 80% of Area Median Income, and that the gross household income of new tenants in the Building shall not exceed 120% of Area Median Income. A Qualified Nonprofit may convert such Multi-Family Residential Building maintained as rent-restricted affordable housing into a limited equity housing cooperative under Subdivision Code Division 11, provided that such Qualified Nonprofit shall fully comply with the

requirements of Subdivision Code Division 11 and such Multi-Family Residential Building shall remain restricted as affordable housing consistent with this Section in perpetuity under a new Notice of Special Restriction. The Agency shall establish procedures to ensure that each Building acquired under this Chapter is subject to a Notice of Special Restrictions that: (a) sets forth the manner in which that Building shall be preserved as rent-restricted affordable housing, and (b) provides that no existing residential tenants at the time of the Purchase or new residential tenants following the Purchase may be evicted without just cause consistent with the substantive provisions of Administrative Code Section 37.9(a). (Added by Ord. 79-19, File No. 181212, App. 5/3/2019, Eff. 6/3/2019; amended by Ord. 228-20, File No. 200948, App. 11/13/2020, Eff. 12/14/2020)

(a) Access to Buyers. The Agency shall endeavor to maintain and publicize the list of Qualified Nonprofits described in Section 41B.4 in a manner that, to the maximum extent feasible, promotes the existence of the Qualified Nonprofits as a readily accessible pool of potential buyers for Multi-Family Residential Buildings. The Agency shall, to the maximum extent permitted by law and otherwise feasible, publicize the existence of this list in a manner intended to facilitate voluntary sales to Qualified Nonprofits in a manner that avoids or minimizes the need for a broker, other search costs, or other transaction costs. (b) Partial City Transfer-Tax Exemption. As set forth in Section 1108.6 of the Business and Tax Regulations Code, the increased tax rate imposed by subsections (d), (e), and (f) of Business and Tax Regulations Code Section 1102 shall not apply with respect to any deed, instrument or writing that effects a transfer under Section 41B.6 of this Administrative Code, as Administrative Code Section 41B.6 exists as of the effective date of the ordinance in Board File No. 181212. (c) Potential Federal Tax Benefits. Any Qualified Nonprofit that Purchases a Multi-Family Residential Building under the right of first offer set forth in Section 41B.6 shall, to the maximum extent permitted by law and otherwise feasible, be obliged to work with the Seller in good faith to facilitate an exchange of real property of the kind described in 26 U.S.C. § 1031, for the purpose of facilitating the Seller’s realization of any federal tax benefits available under that section of the Internal Revenue Code. (d) Information to Sellers. The Agency shall produce an information sheet describing the benefits of a Seller’s decision to accept a Qualified Nonprofit’s offer of Purchase made in connection with the right of first offer set forth in Section 41B.6. The information sheet shall further explain that, even if a Seller does not accept a Qualified Nonprofit’s offer to Purchase a Multi-Family Residential Building pursuant to the right of first offer set forth in Section 41B.6, the Building will still be subject to the right of first refusal set forth in Section 41B.7. The information sheet shall contain a field in which the Seller may acknowledge, in writing, that the Seller (or the Seller’s authorized representative) has read and understood the information sheet. A Qualified Nonprofit that makes an offer to Purchase a Multi-Family Residential Building under the right of first offer set forth in Section 41B.6 shall include a copy of, or link to, this information sheet with that offer of Purchase, but any failure to comply with this Section 41B.9(d) shall have no effect on a Qualified Nonprofit’s exercise of the right of first offer set forth in Section 41B.6. (Added by Ord. 79-19, File No. 181212, App. 5/3/2019, Eff. 6/3/2019)

New Ordinance Notice Publisher's Note: This section has been ADDED by new legislation (Ord. 79-19 , approved 5/3/2019, effective 6/3/2019). The text of the section will be included below when the enacting legislation is effective. (a) Seller Certification. Every Seller of a Multi-Family Residential Building in the City shall, within 15 days of the Sale of that Building, submit to the Agency a signed declaration, under penalty of perjury, affirming that the Sale of that Building substantially complied with the requirements of this Chapter 41B . Each such declaration shall include the address of the relevant Building; the Agency shall publish all such addresses on its website at least once per week. Failure to file the declaration required by this subsection (a) shall be an infraction punishable to the maximum extent provided by Section 36900(b) of the California Government Code. (b) Civil Action. In the event that a Seller Sells a Multi-Family Residential Building without substantially complying with the requirements of this Chapter 41B , a Qualified Nonprofit may institute a civil action, in a court of competent jurisdiction, to remedy that violation of this Chapter, in a manner consistent with subsections (c) and (d).

(c) Remedies. Remedies in a civil action brought under this Section 41B.10 shall include, but need not be limited to, the following, which may be imposed cumulatively: (1) Damages in an amount sufficient to remedy the harm to the Qualified Nonprofit. There shall be a rebuttable presumption that this amount is equal to the difference between the price of the relevant Multi-Family Residential Building at the time of the Sale made in violation of this Chapter 41B, and the price for which the Qualified Nonprofit could purchase that Multi-Family Residential Building at the time when damages are awarded; (2) If the Seller’s violation of this Chapter was knowing or willful, mandatory civil penalties in an amount proportional to the culpability of the Seller and the value of the relevant Multi-Family Residential Building. There shall be a rebuttable presumption that this amount is equal to 10% of the Sale price of the Multi-Family Residential Building for a first willful or knowing violation of this Chapter, 20% of the Sale price for a second willful or knowing violation, and 30% of the Sale price for each subsequent willful or knowing violation. Civil penalties assessed under this subsection (b)(2) shall be payable to the Citywide Affordable Housing Fund established by Section 10.100-49 of the Administrative Code; (3) Reasonable attorneys’ fees; and (4) Such other remedies as might be available under State law, except to the extent that any such remedies would be inconsistent with subsection (d). (d) Limitation on Remedies. Any remedy imposed in a civil action under this Section 41B.10 shall be imposed only against the Seller or a party that has willfully colluded with the Seller to violate this Chapter 41B . In no event shall any such remedy deprive the Purchaser of a Multi-Family Residential Building of any interest in that Multi-Family Residential Building, or otherwise affect any property interest held by the Purchaser, unless the Purchaser willfully colluded with the Seller to violate this Chapter. (Added by Ord. 79-19, File No. 181212, App. 5/3/2019, Eff. 6/3/2019)

The Agency shall have the power to interpret and implement this Chapter 41B. The Agency shall, within 90 days of the effective date of this Chapter, promulgate appropriate rules or regulations interpreting and implementing this Chapter, including the establishment of procedures to implement this Chapter, in a manner that the Agency deems most appropriate. The Agency may thereafter revise those rules or regulations from time to time. (Added by Ord. 79-19, File No. 181212, App. 5/3/2019, Eff. 6/3/2019)

In enacting and implementing this Chapter 41B, the City is assuming an undertaking only to promote the general welfare. It is not assuming, nor is it imposing on its officers and employees, an obligation for breach of which it is liable in money damages to any person who claims that such breach proximately caused injury. (Added by Ord. 79-19, File No. 181212, App. 5/3/2019, Eff. 6/3/2019)

Nothing in this Chapter 41B shall be construed to conflict with any State or Federal law, or with any provision of the Charter. (Added by Ord. 79-19, File No. 181212, App. 5/3/2019, Eff. 6/3/2019)

If any section, subsection, sentence, clause, phrase, or word of this Chapter 41B, or any application thereof to any person or circumstance, is held to be invalid or unconstitutional by a decision of a court of competent jurisdiction, such decision shall not affect the validity of the remaining portions or applications of the Chapter. The Board of Supervisors hereby declares that it would have passed this Chapter and each and every section, subsection, sentence, clause, phrase, and word not declared invalid or unconstitutional without regard to whether any other portion of this Chapter or application thereof would be subsequently declared invalid or unconstitutional.

(Added by Ord. 79-19, File No. 181212, App. 5/3/2019, Eff. 6/3/2019)