By Thomas K. Pendergast

San Francisco’s legacy small business owners might get some eviction protection if legislation now before the Board of Supervisors that temporarily exempts them from the mayor’s plan to ‘streamline’ the business permit approval process passes.

Legislation passed last year lifts restrictions on certain qualifying commercial businesses like bars or restaurants that required a Conditional Use Authorization (CUA), which can involve a lengthy process for businesses to be granted approval for their plans, including providing public notice and attending hearings – a CUA can add months to the process of opening a business.

Yet the process also gives neighbors advanced warning about coming changes and to have their voices heard at Planning Commission and department meetings, for example, if those changes involve the eviction of legacy businesses.

According to the Legacy Business Program, the legacy designation is given to businesses that have been open for at least 30 continuous years. The business also must have impacted San Francisco’s identity and must be dedicated to keeping its traditions alive. The program was created in 2015 to support historical businesses; members can receive grants, business and marketing help as well as recognition from the City.

Joe’s Ice Cream on Geary Boulevard is an officially registered legacy business with the City but is also facing possible eviction now that their building has new owners.

So that is likely the motivation for Board President Aaron Peskin, who is running against London Breed for mayor, used that location to announce he is also seeking to expand his legislation throughout the City, already put into place in the Fillmore, to protect legacy businesses there.

“I have to say that as a candidate for mayor, the other candidates express concern about legacy small businesses but are adopting the same massive redevelopment plans that Mayor Breed is pushing, without any of the sensible protections for residents and legacy businesses like Joe’s Ice Cream,” Peskin said at the Sept. 17 press conference.

Peskin takes some credit for helping to create the legacy business program, giving recognition and support for these well-established businesses.

“The program has mostly been a carrot, providing grants to small businesses at risk of displacement,” he said. “Today I am introducing at the Board of Supervisors, with the support of Supervisor Chan and my colleagues, citywide protections for legacy businesses because it has become clear that if a billionaire venture capitalist in the Upper Fillmore can displace two legacy businesses in the course of a few months, a wave of speculation is upon us, and the program needs more teeth.”

Since January, at least six properties along a two-block stretch of Fillmore Street have been sold, and the commercial tenants there have been told their leases will not be renewed. Two of those businesses, Ten-Ichi and La Mediterranee, are restaurants which have been there more than 40 years each.

Peskin’s resolution, co-sponsored by Chan, would impose interim zoning controls for an 18-month period to require CUAs prior to replacing a “Legacy Business in Neighborhood Commercial Districts and Neighborhood Commercial Transit Districts.”

The resolution lists almost 50 commercial districts throughout the City that would be affected, including those on Clement Street, Balboa Street, Geary Boulevard, Noriega Street, Irving Street, Judah and Taraval streets.

And on Geary, Joe’s Ice Cream has already been feeling the pressure of getting scooped up by wealthier entrepreneurs.

“The building was sold to a developer two years ago, and we were shocked to discover that they already had plans to redevelop it,” said Alice Kim, who runs the parlor with her husband Sean. “With the high profits they can make from redeveloping, there’s no reason for them to keep a small, family-run business like ours.

“They won’t have enough incentives to work with us since, for buildings like ours, they don’t have to go through a public hearing, and we won’t have any chance to get support from our own community,” she said. “Relocating isn’t an easy option either. New up-zoning plans will affect other neighborhoods like Clement, California and Irving. Rents in new buildings will be too high, and older buildings will likely face the same issue with redevelopment plans.

“It is sad to see how these new upcoming redevelopment plans could easily push out businesses like ours that have been a part of San Francisco for decades. It’s frustrating that our future is so uncertain, and we cannot plan anything not only for ourselves and communities. It will be very appreciated if we can get support from our community.”

Christin Evans of the organization Small Business Forward also spoke at the rally, pointing to what happened on Fillmore as a warning sign.

“The latest chapter is this venture-capital-fueled real estate speculation buying up properties blocks at a time speculatively to profit from up-zoning, displacing long-term, beloved neighborhood businesses … emptied out store fronts, leaving spaces vacant with no apparent intention to lease to a new tenant anytime soon,” Evans said.

“They have threatened legacy businesses, forcing Ten-Ichi to close and refusing to negotiate in good faith with La Mediterranee in May,” she said. “Two successful and beloved community-serving businesses that have served their community for more than 40 years, contributed to the cost of the building maintenance, including the insurance, the taxes, the carrying costs for the property owner. While the landlords were able to cash out when they sell these buildings, the small businesses have been left behind to fend for themselves.”

Evans said small business owners are still recovering from the economic fallout of the pandemic, which has put many of them in debt for years to recover and pay back, so they don’t need this extra pressure right now.

“Up-zoning does create new housing, but it shouldn’t be at the expense of and out of reach for small businesses who have shouldered the rent, contributed to their building’s maintenance and paid taxes for years,” Evans said.

District 1 Supervisor Connie Chan, who is running for re-election, is also concerned about the possibility of an eviction tsunami sweeping over the west side of the City.

“Going around our neighborhood, we can see a lot of ‘for sale’ signs,” Chan said. “I really am concerned that we’re, as a neighborhood and as a district, very similar to what we have seen with the small businesses on Fillmore. We’re going to fall into either speculative real estate investment or really just people that have means, like a billionaire, can just buy a block and really significantly change the dynamics of our neighborhoods.”

She said that the morning Peskin introduced the proposal for the Fillmore, she contacted him and told him the same was needed for the Richmond.

“We’ve got to have some mechanism to protect our small businesses,” Chan said. “Can you, in your legislation, expand the interim zoning control beyond Fillmore?

“And then, as it turns out, I wasn’t the only one. He has co-sponsors from Preston, Walton and Ronen and so that it expanded into neighborhood commercial corridors because it’s a direct admission that the businesses on Fillmore are not the only small businesses that are at risk,” Chan said.

“It’s actually, in fact, everywhere, city-wide, as we’re facing the mayor’s proposed up-zoning plan,” she said.

Peskin’s resolution is expected to go before the Board’s Land Use and Transportation Committee as early as Sept. 30, before being heard by the full Board of Supervisors for approval.