In the housing chaos that is San Francisco, high rents are a common story. But in a new twist, the landlord in this story is the city of San Francisco.

At the beginning of this month, the city raised rents up to 300 percent for residents at Midtown Park Apartments, a boxy, beige cluster of 139 units at 1415 Scott St. near the intersection of Geary and Divisadero. Most of the residents are seniors and minorities who have lived there for decades, and they are accusing the city of violating its own rent control laws and of sheer coldhearted treatment.

City officials counter that they had to raise rents to generate income for a property so in need of repair that it couldn’t qualify for insurance. And they emphasize that residents will pay no more than 30 percent of their income toward their housing, which means nearly a quarter of residents will see a decrease in their rent.

Midtown Park is not public housing but a city-owned apartment complex, the only one of its kind in San Francisco. After nearly four decades of minimal rent increases, with the city maintaining little to no oversight of its own property, it is now implementing a new rent structure that has angered many residents.

Tensions hit a new low this month when 65 families threatened to withhold their rent — even those not facing the increases — to show support for neighbors affected by the increases.

Donald Briggs, a retired air traffic controller who has lived in the complex for 33 years, is one such resident. Briggs’ situation is a stark contrast to that of his neighbor of 22 years, Tomiko Oshiro. Briggs’ rent was raised just $40 a month, but Oshiro’s will climb $2,202.60 to $2,935 a month.

“That’s my buddy,” Briggs said of Oshiro. “I could just go right ahead and sign the lease and pay 40 bucks. But for me, I’m concerned about my neighbors, and I’m willing to stick my neck out for you.”

Missed deadline

Oshiro, a retired preschool teacher who suffers from lupus, is one of seven Midtown residents whose rent will climb to market rate because city officials couldn’t verify their income.

From her kitchen table, Oshiro explained in a faint voice that she had been traveling for three months visiting family and friends. When she returned, city officials told her she had missed a deadline to have her income certified — meaning her rent would automatically rise to market rate.

“I said, ‘Please, I need to get a second chance,’” Oshiro said. “They said, ‘We don’t accept it.’ … For 22 years I’ve never missed a rent. I never complained. I was a single mother and then this came.”

In 1968, the city took over Midtown Park Apartments during a foreclosure, then leased the complex to Midtown Park Corp., a nonprofit composed of tenants. Residents said the goal was that the complex would eventually become a co-op, but that never happened — city officials decided tenants lacked the funds to make it feasible. Over the years, the city was essentially an absentee landlord while the complex cycled through various property managers.

Rent increase scrubbed

Maintenance problems arose and festered. In 2006, Midtown Park Corp. sought to raise rents $50 per household to help pay the costs. But the city — which retained final say over rent increases — balked, in part because some tenants were upset about paying more money.

By 2013, the city was paying $200,000 in maintenance, leading it to terminate Midtown Park Corp.’s lease and initiate a review of rents. The city’s solution was for all tenants to pay 30 percent of their income as rent.

That means 28 households will pay less in rent and two will see no change, but the city will raise rents annually over the next five years for many others: 49 households will have an annual increase of less than $100; 22 households will have an annual rent increase of between $100 and $199; 11 households between $200 and $299, five households between $300 and $399; four households between $400 and $499; and one household will jump $500 every year for the next five years. Seven other households, which the city says couldn’t be income certified, will immediately see their rents raised to market-rate prices. The rest of the apartments are vacant.

Civil rights attorney Joshua Arce, who advises the Midtown Park residents — and is a likely candidate for District Nine supervisor in 2016 — says the rent hikes will force residents to leave their homes. “That’s displacement the community is never going to recover from,” he said.

Rent Board backs city

Arce contends the residents are protected by rent control. The city says rent control doesn’t apply to city-regulated property. The San Francisco Rent Board has sided with the city, although residents are appealing that decision.

But the dispute can also be seen as a question of long-term versus short-term goals. Should the city’s priority be to keep the complex’s current residents in their homes or should it be to ensure that the complex is affordable to new residents in the future?

“This is not private property,” said Supervisor London Breed, who supports the city’s plan. “This is subsidized, taxpayer-dollar housing. There has to be a level of accountability. ... This is about doing what’s responsible for the long-term stability of these residents.”

By operating the building as subsidized housing, the city can benefit from federal payments and ensure that all of the units are dedicated to low-income people for years to come.

“Those people who say the city is exploiting the tenants and has ill intentions — that’s so far from the truth it’s very insulting,” said Olson Lee, director of the Mayor’s Office of Housing and Community Development. “Our goal is to preserve this as affordable housing.”

The counterargument is that the city’s plan will lead to the immediate displacement of tenants who have lived in the complex for decades and the erosion of a tight-knit community. Residents upset about the rent increases want to pay for the deferred maintenance by renting out the complex’s 10 vacant apartments at market rate prices.

Discrepancies

Phyllis Bowie, a resident of Midtown Apartments for 22 years, will see her rent jump to market rate. Bowie worked for years as an interior designer but is now unemployed. She says after discrepancies arose during the income verification process, the city “punitively” increased her rent.

“Even on the current rent, I’m paying over 50 percent of my income,” Bowie said. “Can you imagine every day coming to my home thinking I’m going to have to move?”

For now, the city and residents are at a brief detente. City officials are allowing residents to pay their old rents so long as they promise to set aside the balance in an escrow account pending further negotiations. And there are ongoing discussions about offering another chance to residents to certify incomes and reassess the proposed rent increases.

“It’s still not over,” Bowie said.

Emily Green is a San Francisco Chronicle staff writer. E-mail: egreen@sfchronicle.com Twitter: @emilytgreen