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San Jose considers new law barring Section 8 voucher discrimination

After years of debate, San Jose is set to adopt a new ordinance that tenant advocates say will make it easier for low-income residents to find housing.

The new rule, set to come before the City Council Tuesday afternoon, would bar landlords from rejecting would-be tenants because they pay rent with the help of a housing voucher, such as Section 8.

But landlords and property managers say the ordinance could leave them waiting weeks or months to get a rent check as they wade through the bureaucratic inspection and compliance process around vouchers.

In a new memo suggesting city leaders adopt the ordinance, Housing Director Jacky Morales-Ferrand and Budget Director Jim Shannon point out that as of mid-July, nearly 1,000 voucher holders in the county were looking for housing, with more than 4,000 languishing on a voucher waitlist. Yet according to a 2018 survey conducted by the city’s housing department, most landlords in the city won’t accept vouchers, with 27 percent explicitly advertising “no vouchers.”

Such advertisements are not unique. According to a national 2018 study by the Urban Institute, an average of just one in 40 advertised apartments was potentially open to Section 8 voucher holders.

State lawmakers are considering a statewide policy to bar Section 8 discrimination, but none exists yet. But if San Jose enacts an ordinance, it will follow a number of cities, such as Berkeley, East Palo Alto and Los Angeles in enacting such protections at the local level.

The proposed San Jose ordinance would cover all rentals — including single-family homes, duplexes, multi-family units, co-living spaces, accessory dwelling units, guest houses and mobile homes — with one exception: rooms in single-family homes where the landlord lives in the house, too. Landlords could still evaluate things like credit and criminal history, but they could not screen out applicants just because a prospective tenant holds a voucher.

While city leaders agree on the basics, elements of the proposed ordinance have split the council down the middle.

In a memo, Mayor Sam Liccardo, Vice Mayor Jones, Councilwoman Magdalena Carrasco and Councilwoman Sylvia Arenas called for a report in six months on the number of new landlords participating, along with the number of warnings and citations issued.

“Homelessness in San Jose has increased dramatically, and our crisis has deepened,” the group wrote. “We critically need to explore innovative new ideas, to bolster the effectiveness of existing programs, and to remove barriers to getting people housed.”

But business allies on the council — Johnny Khamis, Pam Foley, Dev Davis and Lan Diep — said in their own memo that the ordinance should not take effect until a year after passage to allow time to educate landlords. And, they argued, it should allow a month-long “right to cure” period before any civil legal action can be taken against a landlord.

While they supported the overall ordinance, the group added, “The city also has an interest in ensuring that we are not overburdening rental providers with onerous mandates in which they are not educated, we do not discourage their participation in the rental market, we avoid opening them up to frivolous lawsuits, we don’t discourage rental housing investment and construction – especially of the ADUs we’ve been encouraging people to build – and that the rental property providers don’t lose revenue when they rent to a Section 8 voucher holder instead of a renter without a Section 8 voucher.”

Landlords and property managers agreed, writing in letters to the city that when vouchers are involved, inspection requirements kick in that can extend a move-in timeline by several weeks, meaning a renter can be left without income for long periods of time.

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