Dennis Richards should resign from the Planning Commission.
Richards made news this month for threatening to sue the city Department of Building Inspection (DBI) agency, as reported by Mission Local.
The current controversy is that nine building permits for a building Richards owns were revoked in October. DBI says that the documents Richards and his co-owner submitted when applying for the permits were inaccurate and that they were doing more work on the property than was originally approved.
Richards says DBI is retaliating against him and holding him to a double standard. He has criticized the agency in his role as a planning commissioner.
But the real story here isn’t about building permits or allegations of a government conspiracy.
There are ethical issues with Richards’ current project that extend far beyond his legal infractions.
Richards and his business partner, “luxury” realtor Rachel Swann, acquired 3426-32 22nd St. in June 2018 for $2.7 million. The building contained four tenant-occupied, rent controlled units.
Richards and Swann then used the “buyout” program to get rid of the tenants. In a buyout, tenants are offered cash upfront if they agree to give up their home. The two subsequently failed to report these buyouts to the San Francisco Rent Board for sixteen months. Paperwork was finally filed in October of this year, the same month that questions about Richards’ building permits arose.
With tenants gone, the pair started renovations on the building and listed it for sale at almost $5 million more than they bought it for.
Richards defends himself by saying that all four households had expressed interest in this arrangement before he bought the building.
But this glosses over the inherent power dynamic between a tenant and their landlord.
Buyouts are a bad deal for tenants in rent controlled housing. The short term cash gain pales in comparison to the long term savings and housing security offered through rent control.
Vulnerable tenants are often pressured into taking buyouts by their financial situation; a cash advance to the tune of tens of thousands of dollars can be hard to turn down for a tenant living paycheck to paycheck. Other tenants accept a buyout because they worry they will be evicted if they decline.
Due to rent control and the longevity of their tenancies, it’s likely that all of Richards’ tenants were paying less than market rate for their homes. Two of the tenants at 3426-32 22nd St. had been in their homes for longer than I’ve been alive. A family of Mexican immigrants who had lived in the building for fifty years rented a one-bedroom apartment for just $600—over $3000 below market rate.
Whether or not his tenants were enthusiastic about the situation, Richards wielded his power as their landlord to buy them out and eliminate four naturally affordable homes. When these homes are put back up for rent, they will be significantly more expensive.
So why did he do it? Richards claims that his motivation behind buying and renovating 3426-32 22nd St. wasn’t to flip the home.
“House flipping to me is, buying a place, putting an IKEA kitchen and bathroom in, and selling it at a ridiculous profit,” Richards told my fellow Examiner columnist Joe Fitzgerald Rodriguez. “This isn’t house flipping. This is improving the housing stock.”
This claim is laughable. Richards and Swann’s $5 million upcharge for 3426-32 22nd St. is surely worth more than any IKEA furniture.
Richards has a reputation for being a progressive vote on the planning commission, where he’s railed against tenant buyouts and speculation. In other words, Richards knows better. His hypocrisy is staggering.
As of yet, the political pressure for Dennis Richards to resign has been limited. With few exceptions, public criticism of Richards has come from the moderate wing of San Francisco politics. One group leading this call has been YIMBY Action.
But YIMBY leadership’s outrage seems hollow and politically motivated when one considers that just a few months ago they refused to rescind their endorsement of former Supervisor Vallie Brown after news broke that she lied about evicting low income black tenants.
The selective outrage isn’t limited to San Francisco’s moderates.
While the San Francisco Tenants Union and long time tenant attorney turned Supervisor Dean Preston were quick to call out Vallie Brown’s wrongdoing, they have yet to take a stance on Richards buyout.
“It’s concerning whenever buyouts are involved,” Preston told the Examiner. “I’m not going to comment on his situation until I’m up to speed.”
Supervisor Hillary Ronen introduced legislation this week to regulate tenant buyouts, but she too has also been silent on Richards’ house flipping. I have yet to see any supervisor make a statement condemning the commissioners’ actions.
The progressive supervisors have no reason to worry about losing a progressive voice on the commission. Were Richards to resign, it’s the supermajority progressive Board of Supervisors that would pick his successor.
There are no shortage of qualified candidates for the role.
Just last month, organizers of color spoke before the rules committee about the lack of diversity on the planning commission. Despite the racial contours of the city’s housing crisis, a minority of planning commissioners are people of color.
Rumor has it these activists have some names in mind of potential appointees who haven’t flipped any homes recently.
Voters made the right call in ousting Supervisor Vallie Brown after news broke about her eviction. We have an opportunity now to call on Board President Norman Yee to either pressure Richards to resign or explore unseating him from the commission. (You can literally give him a call at (415) 554-6516 or send an email to email@example.com!)
In a city serious about tenants rights, there is no room for speculators, house flippers, or predatory landlords in public office.
Sasha Perigo is a data scientist and fair housing advocate writing about the San Francisco housing crisis. You can follow her on Twitter at @sashaperigo. She is a guest columnist and her point of view is not necessarily that of The Examiner.