The city attorney's office began the probe at Daly's request after the supervisor disclosed that he and his wife had purchased two homes earlier this year in Fairfield, and that his family had moved to that city.
Daly has maintained that he still lives in his home at 1346 Stevenson St. in San Francisco.
"Supervisor Daly has consistently stated that he spends most of his time in San Francisco and that he intends to remain at the Stevenson Street residence," City Attorney Ethics Team Chief Jon Givner and Chief of Investigations Thomas Boyd wrote in their report.
"His actions -- as evidenced by witness observations as well as public and private documents -- corroborate that intent," they wrote.
"Applying the established legal standard, we conclude that Supervisor Daly currently remains a resident of District Six," the report stated.