Residential vacancies have risen sharply in San Francisco in recent years, from 26,000 in 2013 to more than 40,000 — 10% of all homes in the city — in 2019. In response, Supervisor Dean Preston and his allies have put forward a ballot initiative, the Empty Homes Tax, that would assess an escalating fee on housing units left vacant at least six months out of the year. The tax could incentivize some property owners to put their vacant homes back on the market, either for rent or sale. It’ll also raise millions of dollars in revenue from those who would rather just pay the fee.

Pointing to similar policies in Oakland, Washington, DC, and Vancouver, British Columbia, Preston says the tax could generate $38 million per year and put 4,500 homes back on the market. He has also claimed that vacancies are “overwhelmingly” concentrated in the sleek new condo and apartment buildings in the city’s eastern and northeastern neighborhoods. The initiative itself says the tax applies only to larger buildings because they’re “more likely to include one or more units held vacant by choice.”

The problem is when it comes to long-term vacancies, large condo and apartment buildings aren’t the worst offenders — it’s two-unit homes, and they’re exempt.

The initiative’s proponents might be forgiven for the misconception. Before 2020, detailed data on the duration of vacancies wasn’t available: We knew why a unit was vacant — because it was for sale or rent, rented or sold but not yet occupied, or being used as a vacation home, for example — but the Census Bureau didn’t distinguish between units vacant for a week, a month or a year. That distinction is critical because short-term vacancies are a natural part of the housing market: When someone moves out of a rental, the landlord has to clean it up, put it back on the market and find a new tenant. An owner might vacate a home for renovations before listing it, or a buyer might spend several months on renovations before moving in. We could look to cities like Vancouver and Oakland and make inferences about long-term vacancies in San Francisco, but no one really knew.

But now we do.

In 2020, for the first time, the Census Bureau estimated vacancy duration alongside vacancy type and building size in its American Community Survey. And while the overall case for a vacancy tax looks strong, its exemptions are critical, unforced errors, according to my analysis of census data.

Vacancies continued their rise in 2020, to more than 56,000 units, or 14% of the overall stock. Given the disproportionate impact of COVID-19 on the San Francisco housing market, this shouldn’t be too surprising. Of those 56,000 empty homes, nearly 20,000 were vacant for at least six months. But roughly 8,200 — 41% of long-term vacancies — are in buildings of one or two units. They won’t be subject to the tax, and they’ll be more likely to remain empty.

Long-term vacancies in the biggest buildings — those with 50 units or more — are surprisingly rare: Only 5.5% were empty for at least six months. Two-unit homes, with a rate of 11.9%, have the most long-term vacancies by a wide margin. About 9% of homes with three or four units were vacant for at least half the year, and the rate was under 6% for all other building types.

What can this vacancy data tell us about the likely impact of the San Francisco tax?

Vancouver’s experience may be instructive. Its tax went into effect in 2017, and that year the owners of nearly 2,200 homes were required to pay it. Another 5,500 long-term vacancies were exempted, mostly because of property transfers and renovations or redevelopments. By 2020, the number of taxed properties fell by nearly 600 and exempt properties declined by 1,250 — about a 25% drop in both cases. The tax generated nearly $34 million in 2018, according to the city’s annual Empty Homes Tax Report, though collections had fallen to $21 million by 2021, as vacant homes were returned to market.

In San Francisco, up to 12,000 homes could be eligible for the vacancy tax. If two-thirds are exempt, as in Vancouver, roughly 4,000 might actually pay it. This won’t amount to much revenue. In the first year of vacancy, owners will pay between $2,500 and $5,000, depending on the size of their unit. Homes in larger buildings tend to be smaller, on average, and buildings with one and two units are exempt, so most homeowners will pay the smaller amount.

Vancouver, meanwhile, assesses a tax equal to 1.25% of a property’s assessed value, or roughly $16,000 per vacant unit. Vacant one- and two-unit homes pay a disproportionate share of revenue — $31,000 each, on average — because their typical values ​​($2.5 million) are double those of condos ($1.26 million). All told, San Francisco’s tax might generate $10 million to $15 million in its first year, a far cry from Preston’s estimate of $38 million. It could have doubled that amount, or more, if one-unit and two-unit homes weren’t exempt.

In a nod to the important role of supply in the price of housing, the primary goal of the tax isn’t to raise revenue, but to turn vacant homes into occupied homes. If San Francisco’s tax is as successful as Vancouver’s, it could put around 3,000 homes back on the market within several years. Given that the proposed San Francisco tax is substantially lower, however, this might be optimistic. It’s also less than the 4,000 units built in the city each year, on average, from 2015 to 2020. In Vancouver, the average value of vacant homes is higher than their occupied counterparts, so the homes that return to market may not be particularly affordable , either.

These criticisms don’t mean that a vacancy tax is a bad idea. Especially in a hot housing market like San Francisco’s, it’s better to have houses occupied than not, and revenue generated from units that remain vacant can be put to good use. Long-term vacancies are also a bigger problem in San Francisco — in 2020, at least — where 4.9% of units have been vacant six months or more, compared with 4.3% in Oakland and 2.4% in Los Angeles. But by exempting one- and two-unit buildings, the initiative’s authors have left thousands of empty homes and millions of dollars on the table — and for what?

Political concerns shouldn’t have been an issue: Oakland’s vacancy tax, put on the ballot in 2018, didn’t include these exemptions and it passed easily, with 70% support. The tax raised nearly $10 million last year. Vacant single-unit properties paid twice as much as owners of vacant condo, duplex and town home units. This is a good thing. One- and two-unit homeowners tend to be higher-income and have higher home values, so fairness and equity would suggest heavier penalties, not a special dispensation.

In the end, unfounded biases against new, higher-density housing seem to have won the day in San Francisco. City residents want to be the ones to lose out.

Shane Phillips manages the UCLA Lewis Center Housing Initiative and is author of “The Affordable City.”

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SALISBURY – To eliminate lead in drinking water in the Dukeville area, the county government is considering completely replacing the plumbing in several homes in their Northeast Rowan Water System.

District manager Aaron Church will ask for approval during Monday’s commissioners’ meeting to launch an advertisement for a contractor overseeing replacements in homes where lead levels are above the EPA’s action level of 10 parts per billion.

The Northeast Rowan Water System serves 162 connections and several hundred residents. It is owned by the county but the water is treated by Salisbury-Rowan Utilities. The county has been working to resolve the water quality issue since sampling in 2020 showed elevated levels of lead. The county noted that the contamination was due to the solder in some customers’ house lines, rather than the water system itself.

If lead levels in water exceed the EPA’s current action level of 15 parts per billion, the water system will need to inform the public of steps to protect their health and possibly replace lead lines under their control. Rowan County has distributed Brita filters to customers in the Northeast Rowan Water System, encouraging customers to run the taps for a few minutes before use, clean the water aerators in their taps, and only boil with cold water.

The county has been given until Saturday June 12th to obtain EPA compliance through the NC Department of Environmental Quality. Church said the county and the SRU were able to meet this deadline by following the recommendation by Virginia Tech researchers and switched from using a polyphosphate blend to treat utility water to zinc orthophosphate.

The county also decided to build a $ 742,900 chemical booster pumping station on Long Ferry Road that will inject additional zinc orthophosphate into the Northeast Rowan Water System. NCDEQ approved the county’s treatment plan in April.

The switch to zinc orthophosphate took place on June 4th, but construction of the chemical pumping station will not begin until October. Even after the booster station has been completed by the beginning of 2021, it will still take some time for a protective zinc orthophosphate barrier to form in the pipes and prevent lead from penetrating.

“It takes a while for this barrier to be built,” said SRU Director Jim Behmer. “Even if you switch chemicals, it’s not an overnight solution.”

While the county is counting on the zinc orthophosphate and chemical booster station solution to work, Church said changing the plumbing in certain homes will eliminate the lead.

“If we do this, as I understand the science, it should make sure that the drinking water is safe even if the booster chemical pumping station does not work or takes longer than expected,” Church said.

The county has partnered with 120Water to test customer water in the system. So far, 119 samples have been collected, according to Church. Of these, 31 had lead levels in excess of 1.01 parts per billion, with eight exceeding the EPA’s current level of action of 15 parts per billion.

The district has already notified customers via the system who have taken part in the sampling of their lead levels. Now it will contact customers who could be candidates for new plumbing. To be eligible, a customer must go through two additional water tests that show the lead content in their water exceeds the threshold of 10 parts per billion. Customers who are entitled to new sanitary installations receive completely new pipes, taps and shower heads.

Church said he anticipates around 15 customers will be eligible, but that could change as more samples are completed. The county is still offering customers a $ 72 credit on their monthly water bill for doing the sampling at home. You can find more information about the water test online at rowancountync.gov/1662/Water.

The cost of replacing piping in the system’s homes is difficult to pinpoint right now, but it could cost the county hundreds of thousands of dollars. Church said the county will consider funding the project through the US rescue plan.

Church’s request to apply for a contractor for the pipeline renovation project is listed on the approval agenda for the committee meeting on Monday. If approved, Church said the county will likely hire a contractor by August and replace the plumbing work by late spring next year.

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