Topic No. 406: Financial Hardship Appeals

In general, appeals based on financial hardship must be filed within 15 days after the decision is mailed. However, there is no time limitation for a tenant hardship appeal from a decision based on a capital improvement petition filed after February 20, 2003. A tenant need not pay the approved rent increase while his or her hardship appeal is being processed and considered. If the appeal is denied, the tenant will have to pay the rent increase going back to the effective date.

Financial hardship appeals must include a Hardship Application form, in addition to the regular Appeal form. A Hardship Application form must be completely filled out for each adult in the household. To receive a copy of the Hardship Application form, you can fax it to yourself by calling 252-4660 or visit our website at www.sfgov.org/rentboard. You can also obtain the Hardship Application form at our office.

It is not necessary to prove the amounts listed on the Hardship Application form at the time the hardship appeal is filed. However, should the Commissioners accept the appeal and remand the case for a hearing, the appellant will be required to submit documentation proving the veracity of the income, assets, resources, expenses and debts that are claimed. It is helpful if the appealing party submits his or her most recent tax return. See the Hardship Application form for additional requirements and information.

To determine tenant hardship, the Rent Board generally uses the HUD guideline that rent should comprise no more than 30-35% of gross income. If a tenant establishes that payment of a rent increase would constitute a financial hardship, the increase may be temporarily or permanently deferred, in whole or in part.

To determine landlord hardship, the Administrative Law Judge will consider the landlord's total financial picture, not just the income generated by the subject building. If a landlord establishes that a refund of rent overpayments to a tenant would constitute a financial hardship, the judge may order a repayment plan for all or part of the refund. Landlords should be aware that financial hardship is grounds for appeal only - it is not grounds for a separate rent increase.

June 2006