San Francisco Politicians Weigh Options to Boost Housing

San Francisco leaders are trying a dual-pronged approach to revive the city’s frozen housing pipeline by pumping more public money into affordable projects and easing the financial burden on private developers.

Supervisor Myrna Melgar, with backing from Mayor Daniel Lurie, is advancing a charter amendment that would more than double the city’s annual contribution to its Housing Trust Fund from roughly $52 million to $125 million a year, or an increase of approximately 140 percent, the San Francisco Chronicle reported. The proposal is slated for the November ballot.

The measure comes as the Lurie administration and a group of supervisors are also pushing to slash San Francisco’s inclusionary housing requirements, a move meant to entice market-rate developers back into a city where new construction has largely ground to a halt. Under the proposed ordinance, projects with at least 25 units would only need to set aside 5 percent of apartments as affordable housing, down from 15 percent. Developers could alternatively pay an in-lieu fee, donate land or provide off-site affordable units equal to 10 percent of a project, according to the proposal.

Supervisors Shamann Walton, Danny Sauter, Stephen Sherrill and Matt Dorsey are in support of Melgar’s charter amendment as well as the proposed ordinance to lower costs for developers.

The Housing Trust Fund was originally established in 2012 and is set to expire in 2043. The fund finances affordable housing development, acquisition and rehabilitation programs across the city. Melgar’s amendment would extend the fund through 2058 and tie future increases to property tax growth until annual contributions hit the $125 million mark. After that, growth would be capped at 3 percent annually based on discretionary revenue increases. The proposal also includes fiscal guardrails allowing the city to freeze or reduce contributions during recessions or major budget shortfalls.

Separately from the charter amendment, the mayor’s office and Melgar announced plans for an additional $70 million revenue bond, set to be issued next year, that would be used to preserve existing affordable housing stock, acquire rent-controlled buildings that could otherwise sell to private investors and convert the rental housing into permanently affordable housing.

— Chris Malone Méndez