June 23, 2014 Housing Action Coalition
On Friday, June 20th, senior members of Mayor’s staff, SF Planning and MOEWD convened a “Big-Tent” housing task force meeting to recap the progress to date of the Mayor’s goal of adding 30,000 new homes, including 10,000 permanently affordable homes, by 2020. This meeting came after introduction of two opposing November ballot measures focused on housing affordability. At the June 17th Board of Supervisors meeting, Sup. Jane Kim introduced her “Housing Balance” initiative that would require a guarantee of 30 percent affordable housing to 70 percent market-rate development. It would put the onus on market-rate developers to keep the market-rate housing development in balance with the City’s historic affordable housing production rate. In response to Sup Kim’s measure, the Mayor placed a counter-measure on the ballot that focuses on revenue for the production of the 30,000 units with the caveat that 50 percent would be within reach of low and middle-income households. Needless to say, it has been an intensely interesting week in the housing world.
Supervisor David Chiu opened the Mayor’s Working Group meeting by stating that he did not co-sponsor either ballot measure, because he does not believe that housing policy should be decided by ballot initiative. The SFHAC strongly agrees that complex land-use policy should be done legislatively. In the next month, the SFHAC will be advocating that both measures be removed from the ballot, and all parties come to the table to collaborate on a legislative solution.
Over the past 4 months, SFHAC has participated in the Mayor’s Working groups to find ways to increase the housing production, reform entitlement process, and examine City policies regarding housing.
Here are the latest policy recommendations from the Mayor’s working groups:
– Reduce time to grant Community Plan Exemptions under CEQA to 6-9 months
– Add flexibility in the design guidelines and planning code. The SFHAC’s Flexibility in Planning Code has done a lot of work on this issue. The City is looking at turning our proposals into legislation this Fall. The SFHAC final report on our Flexibility in Planning Code findings can be found here.
– Density Bonus Ordinance, which will provide additional incentives to projects that exceed 12 percent Inclusionary housing is moving forward. Adopting new density bonus rules would still requires an EIR, but hopefully it can be wrapped into the Housing Element EIR. The different tiers of affordability perks still need to be established.
– Legislative changes to Inclusionary Housing that are still being investigated include the partnership between nonprofit and for-profit developers. These will include an expanded time frame to deliver off-site inclusionary projects and possible changes in the distance from the off-site to the primary project.
– The Inclusionary Dial proposal, in which a developer can increase the number on-site inclusionary units but price them at a higher AMI levels that require less subsidy. A new proposal was made at the meeting to “dial down” inclusionary housing.
Strategies still under discussion but without resolution include:
– A proposal from CCHO to increase in-lieu fees for high-rise construction exceeding 120 ft “to ensure equitability”.
– Using in lieu fees for acquisition and rehabilitation of existing housing as an inclusionary option. This could be attractive, particularly for smaller developers. Doug Shoemaker, president of Mercy Housing CA, commented that acquiring and rehabilitating existing buildings would stretch the City’s limited capital further than building from the ground up.
The Mayor’s team is also looking into CEQA exemptions for 100 percent affordable housing buildings under 100 units, which is currently a state law. How can this be implemented in San Francisco?
The Mayor’s Financial Resources sub-group, on which the SFHAC has not participated, seems to have addressed the biggest challenges — the resources needed for building affordable housing following the demise of SF Redevelopment, and as federal funding is dwindling. A key need is to attempt slowing building cost increases. Could public-private partnerships for funding including a Housing Acceleration Catalyst Fund as one option? Oz Erickson, Emerald Fund Chairman, suggested a $350M housing bond against the increased revenue coming into the city through the new construction and healthy financial state of the city. Libby Seifel from Seifel Consulting asked whether a establishing a fund for private stock and land donations from private industry has been considered. This might include a “Take the Pledge” fund where a certain percentage of private industry revenue goes into a philanthropic fund that is used for building more housing. All valid ideas that need consideration and further feasibility investigation.
As the meeting came to a close, Jim Lazarus from the Chamber of Commerce commented “We are just nibbling at the edges with all these proposals. Because of our strong economy, demand for housing is expected to remain strong for the foreseeable future. Housing is a Bay Area issue, not just San Francisco. What are we doing about it?” This is certainly a question on everyone’s mind.
Stay tuned for the final Working Group report to be released by the Mayor’s office in July.