San Francisco has cut its affordable housing requirements and building fees to encourage the construction of cheaper homes.
The city’s Board of Supervisors voted to reduce the percentage of required affordable apartments in housing projects to between 12 and 16 percent, depending on neighborhood and product type, from a previous threshold of 21.5 percent, the San Francisco Chronicle reported.
They also cut the percentage needed for condominiums to between 12 and 16 percent, from 23.5 percent.
The city slashed 20 building-related fees, including those that fund public transportation and parks, by 33 percent for the next three years, with some put off from the start of construction to completion.
Mayor London Breed and Board of Supervisors President Aaron Peskin had introduced the legislation known as the Housing Stimulus and Fee Reform Plan. Supervisor Dean Preston cast the sole no vote.
Peskin, who helped establish the city’s inclusionary housing laws six years ago, said the San Francisco’s economic malaise, coupled with high interest rates and construction costs, required “a time-limited and time-certain stimulus program that will move the dial on our housing pipeline at this critical time.”
The proposed legislation comes after an eight-member technical advisory committee recommended a major correction to affordable housing percentages and fees while city reports showed building is infeasible under the current requirements.
But the reduced affordable housing requirements and fees may not be enough to encourage developers and their lenders to wade back into the San Francisco market.
An economic analysis completed for the committee said they wouldn’t be enough in today’s economy. If interest rates or the cost of construction should come down, however, the reduced requirements and fees could breathe new life into dormant projects.
The new legislation is part of a larger push to ease development in the wake of state requirements to create 82,000 new housing units in the next eight years.
“We are fundamentally changing how we approve and build housing in San Francisco,” Breed had previously said in a statement. “When fees are set so high that everything freezes, it halts housing and hurts our entire city.
“By reforming our fees and setting them based on data, we can make sure we are delivering new housing, jobs and the economic benefits we all want for our city.”
— Dana Bartholomew
Read more
Development
San Francisco
Affordable requirements and development fees could drop in SF
Development
San Francisco
SF could cut affordable housing requirements in half
Development
San Francisco
Report: Housing creation economically “infeasible” in SF