Intermediate Length Occupancy (ILO) Dwelling Units
The Planning Code was amended in June 2020 (Ord. No. 78-20) to regulate the leasing of Dwelling Units for periods of less than a year (aka ILO Dwelling Units).
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The ILO designation in the Planning Code is a residential use characteristic that applies to a Dwelling Unit offered for occupancy by a natural person for an initial stay, whether through lease, subscription, license, or otherwise, for a duration of greater than 30 consecutive days but less than one year.
The ILO program sets a maximum of 1,000 ILO Dwelling Units to be permitted in the City within existing buildings or those buildings with permits issued prior to June 22, 2020. Eligible Dwelling Units within such buildings must submit ILO applications no later than June 22, 2022. After that date, to the extent that the 1,000 ILO Dwelling Unit limit is not met, ILO Dwelling Units may also be approved in new projects.
The Intermediate Length Occupancies Ordinance, passed in June 2020, gave an exemption period of two years to units operating as an ILO prior this date the chance to apply for authorization without penalty.
Further, the Ordinance contained a provision that any new unit whose building or site permit was issued after the Ordinance’s effective date of June 2020 would not be eligible for ILO authorization for two years. The intent of this two-year "freeze" on newer units was to allow the older units a chance to apply before the cap of 1,000 units indicated in the Ordinance was possibly reached.
After June 22, 2022, the exemption period and freeze are lifted – all eligible applicants will be open to ILO authorization, and all unauthorized ILO units are subject to enforcement action if they keep operating as such – including those older units which were previously exempt (older units can apply after this date, though enforcement action may be taken in the interim).
Therefore, there is no "deadline to apply" as indicated in the correspondence.
This deadline of the exemption period does not limit the ability to apply for authorization of an ILO unit after that date, nor remove the responsibility to comply with the Ordinance.
Any ILO unit designation must be established through the issuance of a building permit with plans that document the location of the ILO units within the building, and each established ILO unit is subject to annual reporting requirements. However, as detailed below, some Dwelling units are either 1) prohibited from obtaining an ILO designation, 2) required to obtain a Conditional Use Authorization for an ILO designation, or 3) completely exempt from the ILO controls. All proposals for ILO Dwelling Units in either existing or buildings with permits issued prior to the program start date are encouraged to submit the required approval applications by June 22, 2022. After that date, to the extent that the 1,000 ILO Dwelling Unit limit is not met, ILO Dwelling Units may also be approved in new projects.
A Dwelling Unit is not eligible to be permitted as ILO if:
- It is located on a lot within a Mixed Use Zoning District (i.e. Eastern Neighborhoods, Chinatown, etc.) regulated by Article 8 of the Planning Code;
- It is located in a building with 3 or fewer Dwelling Units;
- It is an affordable unit subject to the Inclusionary Affordable Housing Program pursuant to Planning Code Sections 415 and/or 419.
- It is subject to the price controls of the San Francisco Rent Ordinance (Administrative Code Section 37.3);
- It is in a building with an active Notice of Violation from the Planning Department; or
- If it is located within a new project that had its site or building permit issued after June 22, 2020 (effective date of the ILO program).
Conditional Use Authorization Required
For buildings with 10 or more Dwelling Units, ILO authorization requires a Conditional Use Authorization (CUA) from the Planning Commission, in addition to a building permit with plans that document the location of the ILO units within the building, and is subject to the following criteria:
- No more than 20% of the Dwelling Units in the building may be permitted as ILO units;
- The authorized ILO units for the project do not result in more than 1/3 of the permitted 1,000 ILO units in the City falling outside the downtown core (i.e. C-3 Zoning Districts);
- The authorized ILO units for the project do not result in more than 1/3 of the permitted 1,000 ILO units in the City falling within Census Tracts in sensitive communities, as defined by the UC Berkeley Urban Displacement Project Sensitive Communities Map.
Only a Building Permit is Required
Up to 25% of Dwelling Units in buildings containing 4 to 9 Dwelling Units may be authorized for ILO designation through the issuance of a building permit with plans that document the location of the ILO units within the building. For example, an existing or proposed building containing 9 dwelling units may have up to 2 Dwelling Units authorized as ILO (standard rounding rules apply). For more information on filing building permits, please see the Department of Building Inspection’s website.
The following types of Dwelling Units are not subject to ILO restrictions and do not require any separate authorization for leases between 30 days and one year:
- Any Dwelling Unit that is defined as Student Housing in Planning Code Section 102;
- A Residential Hotel unit subject to the provisions of Administrative Code Chapter 41; or
- An organization with tax-exempt status under 26 United States Code Sections1 501(c)(3) providing access to the unit in furtherance of its primary mission to provide housing, provided that any organization that provides an ILO Dwelling Unit complies with certain reporting requirements.
No later than March 1 of each year, the owner or operator of each ILO unit shall submit to the Department an Annual Unit Usage Report for the prior calendar year containing the following information:
- The address and location of the ILO unit.
- The number of times the unit was occupied by a natural person for an initial stay, whether through lease, subscription, license, or otherwise, for a duration of greater than 30 consecutive days but less than one year, including the duration and dates of each of those stays.
- The average duration of each stay.
- The average vacancy between each stay.
- The nature of the services, if any, that are provided to occupants of the ILO units, including furnishings, or other amenities, and whether there has been an increase or decrease in the services since the last report.
ILO Tracking Information as of March 10, 2022
|ILO Dwelling Units with CUA||33|
|ILO Dwelling Units with Issued Building Permit||4|
|ILO Dwelling Units Fully Completed||1|
|ILO Dwelling Units Authorized Outside C-3 Districts (i.e. downtown core)||37 (11.1% of max)|
|ILO Dwelling Units Authorized within Sensitive Communities Census Tracts||36 (10.8% of max)|