Supervisor Peskin’s rent‑control‑on‑upzonings proposal draws legal and fiscal scrutiny

Chair Aaron Peskin introduced a charter amendment to set city policy that when the city amends the planning code to allow additional residential density or height (an upzoning), the new units created would be subject to the San Francisco rent stabilization ordinance (Chapter 37) by contract — using the Costa‑Hawkins exception that permits local waiver when public assistance is conferred.

Peskin framed the measure as a tenant‑protection tool to ensure that when the city expands development capacity (a public benefit), residents also receive rent stabilization that prevents displacement. He cited national examples and research he said supported the measure’s displacement‑reduction goals.

Deputy City Attorney Andrea Ruiz Esquivere and the Controller cautioned the committee about legal and fiscal questions. Ruiz Esquivere noted the draft exempts projects already receiving a density bonus (e.g., HOME SF projects) but is silent on inclusionary units under section 415, suggesting the Board may need amendments to clarify inclusionary and fully affordable projects’ treatment. The Controller’s Office warned the charter change could reduce property tax revenue and make some projects financially less feasible.

Public comment was sharply divided: tenant advocates and school board members urged the Committee to protect renters; developers and building‑trades speakers raised concerns about feasibility and unintended consequences. Committee members discussed a potential phased‑in “stabilization period” and a grace window for project financing; staff said technical language will be brought back.

After discussion, the committee continued the item to July 6 to allow for drafting technical amendments, including clarifying how the charter interacts with state housing law, inclusionary rules, and possible phase‑in periods for new projects.