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Court orders San Francisco landlords to accept Section 8 vouchers

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Appeals court rules for city in longstanding suit about “source of income discrimination”

Photo by Coolcaesar/Wikicommons

The First District Court of Appeal in San Francisco ruled in favor of the city on Wednesday in a longstanding argument over a law that prevents landlords from rejecting Section 8 housing vouchers.

Section 8 is one way the federal government assists low-income renters. The San Francisco Housing Authority explains:

The housing choice voucher program is the federal government’s major program for assisting low-income families, the elderly, and the disabled to afford decent, safe, and sanitary housing in the private market. […]

A housing subsidy is paid to the landlord directly by the PHA on behalf of the participating family. The family then pays the difference between the actual rent charged by the landlord and the amount subsidized by the program.

In 2015, City Attorney Dennis Herrera sued Lem-Ray Properties and local broker Chuck Post, alleging the defendants violated the city’s voucher laws by refusing to accept Section 8 payments.

While the case is still pending, in 2016 a Superior Court judge ordered Lem-Ray to start accepting vouchers in the meantime. The landlords extended the conflict by appealing that preliminary decision.

According to the appellate ruling this week, Lem-Ray and Post don’t dispute the accusation that they refused Section 8 vouchers. Instead they argue that a state law trumps San Francisco’s ban on the exclusion:

In 1998 the San Francisco Board of Supervisors outlawed discrimination against tenants who pay a portion of their rent with a Section 8 or similar housing voucher. [...]

The following year the California Legislature also expanded the state’s Fair Employment Housing Act [FEHA] to prohibit discrimination based on a tenant’s source of income, but the legislature defined the term narrowly so that it does not reach rent subsidies like Section 8. [...] This case poses the question of whether FEHA preempts San Francisco’s ordinance.

The city argues that FEHA doesn’t bring up the issue of federal vouchers, so it’s up to individual cities to decide whether or not to regulate them. The court agreed with San Francisco in a unanimous decision:

The practice of refusing to rent to Section 8 participants is one that FEHA does not address, so FEHA does not preempt an ordinance addressing this practice, the People argue. [...] We think the People have the better argument in narrowly defining FEHA’s field of exclusivity.

In a press release, Herrera trumpeted the ruling as a win for renters, stating, “The landlord and real estate broker in this case thumbed their noses at the law. The courts, however, have made it crystal clear that San Francisco’s protection for low-income renters is valid and enforceable.”

Of course, declarations of victory are premature; it remains to be seen whether or not courts side with the city in the suit itself and in any further appeals appeals. In the meantime, it looks like the city and Section 8 renters will both get their way for now.