Last year, the San Diego City Council approved a ban on discrimination against recipients of Section 8 Housing Vouchers.  The measure passed on a 6:1 vote with two councilmembers absent.  For those of you with residential rental properties within the City of San Diego, you cannot say “no” to an applicant based solely on whether they pay rent with a government subsidy.  This is a blow to San Diego City rental property owners who formerly had the freedom as to whether to participate in the Section 8 Program or not.

Advocates of the ban claim it was necessary.  In pushing the Council to pass this measure, pro-tenant groups suggested that the current policy of “allowing legal discrimination of Section 8 Voucher holders in the private rental market actually exacerbates the homeless problem, because people are unable to use it.”  

The measure ignores the fact that it is a risky proposition to accept a tenant who qualifies for Section 8.  There is a huge bureaucratic process that can delay the receipt of rent checks.  Allowing the tenant to receive Section 8 Housing Assistance is an indirect way of saying that the landlord will take welfare as the source of income.  It has long been understood and required that discrimination based on income is not allowed.  But, requiring the landlords to take Section 8 Housing, is much more than it’s Assistance Housing coming in for rent, it includes the risk that the tenant has no other or limited means.  Also from the eviction attorneys’ standpoint, the Section 8 Housing evictions are much more complicated and procedural than your ordinary termination of a regular month-to-month tenancy.  

It is very frustrating for the rental owner to have to work with a case worker and the response time in getting the Housing Commission’s approval for certain things.  For example, rental increases must be approved.  You may terminate the Section 8 tenancy at any time unless you have a material violation or other good cause. All of these good and sound reasons fell on deaf ears with the City Council of San Diego.  Therefore, effective August 1, 2019, it will indeed be discriminatory for the City of San Diego rental owners to say no to the Section 8 Program. 

That said, keep in mind that you have the right to screen the Section 8 participant on the other issues that are commonly done with all applicants – a review of rental history and a credit check. 

A List of Do’s and Don’ts

  • Don’t do any advertising or marketing stating that Section 8 recipients are not accepted. 
  • Don’t tell any perspective applicant that it is your policy not to accept Section 8 tenants. 
  • Don’t discriminate in any way solely by virtue of the fact that the applicant is a participant in the Section 8 Program. 
  • Do, upon inquiry by the tenant, agree that you will take Section 8 subject to your usual screening requirements that apply to all prospective residents. 
  • Do carefully evaluate the Section 8 tenant’s rental history and credit report. 

Allowing Section 8 does not necessarily rule out your ability to deny rental based on a FICO Score that’s supplied across the board.  There should be no double standards in favor of Section 8.  Only that they be treated equally with other residents. 

Our office has some clients that extol in a positive way the virtues of Section 8 Program in that the Housing Commission’s portion of rent comes in like clockwork.  Others say it’s not worth the risk.  With this rental market, the landlord does not want to add a layer of bureaucracy to an otherwise positive rental market. 

We encourage you to go online and read the Ordinance enacted by the City of San Diego for yourself.  The text of the Ordinance can be found at Chapter 9, Article 8, of the San Diego Municipal Code.  It adds a new Division 8, Sections 98.0801, 98.0802, 98.0803, 98.0804, 98.0805, and 98.0806.  In these sections, the drafter of the Ordinance lays out the purpose and intent of the Ordinances, definitions addresses prohibited activity, states the exceptions for owner-occupied rental units, describes the effect on other laws, and sets forth the enforcement and remedies available to the aggrieved perspective or existing resident who has suffered discrimination based on denial of the Section 8 Program. If you would like a free copy of the new Ordinance, please contact our office.

Effective August 1, 2019, owners of residential rental properties located within city limits of San Diego will be prohibited from discriminating against an applicant solely by virtue of the fact that he or she is a participant in the Section 8 Housing Assistance Program with the San Diego Housing Commission and HUD.

Before this, many landlords have exercised their right to not accept the Section 8 program for a variety of reasons.  They include failure to allow rental increases and difficulty in contacting Section 8 advisors. 

In looking into this issue in detail, we have been able to determine that screening rules still apply for Section 8 applicants, but you must not have a blanket prohibition against acceptance of the Section 8 participant. 

So What About Verification of Income?  

Here’s the way that Legal Aid explains this to us:  Your policy regarding minimum income is still enforceable.  Having said that, it must be based on the tenant’s portion to be paid under the Section 8 program and take into the consideration the Section 8’s portion of contribution -in other words, if the rental portion is $500.00 per month for the tenant (their income).  If you have a three times rent standard for income, will be $1,500.00.  That would include the Housing Commission’s portion in assessing gross income. 

Indeed, the income requirements are stretched when it comes to that component of the screening process.   Credit and rental history are still allowed for the Section 8 applicant.  You may still screen based on those standards, evenly applied across the board as with other perspective tenants.  

Ted Smith has been exclusively representing rental owners and property managers since 1978.  Speedy evictions with reasonable prices.  Free telephone consultations. Contact our office today! 619-610-9332; Evict@TedSmithLaw.Info