Supervisors hear BLA estimate of tens to hundreds of millions in unpaid commercial rent; officials say legal aid and outreach lag behind need

A San Francisco Board of Supervisors Government Audit & Oversight Committee hearing on March 18 heard fresh estimates of unpaid commercial rent and repeated calls from business owners for more legal help and direct relief.

The Budget & Legislative Analyst, Fred Brusseau, told the committee the office’s new estimate of unpaid or partially paid commercial rent for San Francisco runs between about $19.1 million and $45 million per month, with retail concentrated toward the lower and middle of the range. Aggregated over longer periods, BLA presented a range that reaches into the hundreds of millions: "So it goes up from our 1 month estimate to the 9 month of $172,000,000 up to $404," Brusseau said as he summarized the report. The office stressed the numbers are model-based and limited by data availability.

Why it matters: supervisors said those unpaid obligations put neighborhood-serving businesses at risk and that outcomes will vary widely depending on landlord behavior, access to federal aid and the availability of local legal and financial assistance.

City response and program limits

Office of Economic and Workforce Development (OEWD) staff described the city’s commercial eviction protections ordinance and the local moratorium, including the forbearance/repayment framework that follows the moratorium’s expiration. "For the smallest businesses... have up to 2 years to repay any back rent," said Manish Goyal of OEWD, describing an element of the repayment period set in local guidance aligned with the governor’s extension.

OEWD and the Office of Small Business (OSB) said they have provided referrals, webinars and neighborhood grants and loans and are expanding partnerships with nonprofits and the bar association for lease-review services. But supervisors and presenters repeatedly flagged data gaps: OEWD reported about 400 annual referrals to legal and counseling partners but said partner reports do not consistently track whether those referrals produced rent reductions, waivers or other outcomes.

"We don't have a specific measure of demand," Diana Ponce de Leon (OEWD) said of referral versus unmet need, noting referrals provide a partial picture of demand for legal aid and negotiation support.

Legal representation gap

Tobias Damler of the Lawyers Committee for Civil Rights said transactional assistance — lease review and negotiation — is being provided by pro bono networks and nonprofit partners but warned the bigger gap is full-scope litigation defense when landlords sue tenants for unpaid rent. "Legal representation... can mean the difference between business closure and continuation," he said, recounting cases where representation led to reduced liabilities or lease exits without penalties.

Public testimony and neighborhood impact

More than a dozen small-business owners and advocates called in during public comment. Themes included landlords refusing to negotiate, city grants being routed to landlords via tenant payments, language access barriers, and the disproportionate impact on minority- and immigrant-owned enterprises. A fitness-studio owner said, "To date, we're about $40,000 in back rent thus far." Several callers urged the city to expand direct rent relief, extend moratoria and create stronger legal-defence funding.

Policy options and next steps

Supervisors and presenters discussed a menu of options: improving data collection, scaling legal services (including rapid-response litigation funding), expanding targeted grants for legacy neighborhood anchors, pursuing state-level changes to permit stronger local interventions, and using incentives or penalties (for example, vacancy-related tools) to change landlord behavior.

The committee said it will pursue follow-ups with BLA and city departments for clearer business-level and industry-specific figures and to track outcomes of referral and grant programs. Supervisor Rafael Mandelmann moved to file the hearing for the record; the motion carried on a recorded vote.

What’s next: the committee recorded the hearing and asked departments for follow-up data on program outcomes, the incidence of landlord-initiated lawsuits, and additional, industry-level breakdowns of unpaid rent. The full Board will receive recommended settlement items (see separate note on the litigation items heard at the start of the meeting).