Mayor Lee Announces Blueprint to 10,000 Affordable Homes for Families & Residents

Legislative Package Helps Meet & Exceed Mayor’s Goal of 10,000 Permanently Affordable Units by 2020 to Address Housing Crisis; Speeding Production & Preservation of Needed Affordable Housing, Rehabil

WASHINGTON, D.C. – September 9, 2015 – (RealEstateRama) — Mayor Edwin M. Lee together with Board President London Breed and other members of the Board of Supervisors set forth a blueprint to provide more than 10,000 permanently affordable homes to families and residents by 2020, the most critical component of the Mayor’s 2020 housing goals. The Mayor’s Blueprint to 10,000 requires the introduction of five critical pieces of affordable housing legislation throughout the month of September including rehabilitating public housing, preserving affordable housing, stabilizing neighborhoods by keeping people in their homes, and keeping neighbors living in their communities, building more affordable units within market rate developments and accelerating and incentivizing the production of more permanently affordable units.

“San Francisco’s housing crisis demands our continued, aggressive leadership, and with this clear blueprint of making more than 10,000 affordable units available to low and middle income families and residents, we are delivering on our promise to keep San Francisco a city for everyone,” said Mayor Lee. “From those at-risk of displacement to those living in public housing to low-income families, we are increasing production of affordable housing, stabilizing neighborhoods, and increasing affordability for our City’s families. By 2020, new affordable units will be in place in growing neighborhoods like SOMA and Transbay. And more will be stabilized in at-risk neighborhoods like the Mission and Chinatown. This November’s proposed $310 million affordable housing bond that does not raise property taxes will provide additional resources we need to increase production of permanently affordable housing up to and beyond 2020.”

The adoption of this package of five key pieces of legislation will ensure 10,780 permanently affordable units are in place by 2020. These initiatives will move units forward faster, in the City’s most impacted neighborhoods, for the residents who need them most. The five proposed legislative initiatives are:

1. Reconstruct 1,400 Distressed Public Housing Units: Proposed legislation will allow the start of the Mayor’s $1.6 billion public housing preservation program. Construction for the first phase of the Rental Assistance Demonstration (RAD) Program will begin in November 2015, and will repair and preserve 1,400 distressed units of public housing. Renovations will be completed between August 2016 and April 2017, with rehabilitation of more than 2,000 units following shortly thereafter and completed by 2018. This effort is the central recommendation of the Mayor’s 2013 Re-Envisioning Public Housing Workgroup established to preserve and protect the City’s public housing. Serving the most vulnerable residents, public housing is a critical step in the ladder from homelessness to stabilized, healthy lives for families and individuals in need. This legislation will allow 3,561 units will be built or rebuilt. Overall, a total of 4,855 public housing units will be built or rebuilt including the HOPESF rebuild of Alice Griffith, Hunters View, Sunnydale and Potrero into new, mixed-income communities.
2. Preservation of Expiring Affordable Units: The Mayor is working with building owners to ensure that no tenants living in units with expiring affordability restrictions are displaced. Part of this effort is proposed legislation that will strengthen the City’s preservation tools. Affordable housing built today and in the future with funding from the Mayor’s Office of Housing and Community Development will prohibit the kinds of agreements and contracts that allowed affordability terminations after 30 years.
3. Provide Affordable Opportunities to Residents in their own Neighborhood: Introduced by Mayor Lee and Supervisors Breed, Christensen, Cohen, and Wiener, the Board of Supervisors is currently considering legislation to give existing residents priority for affordable homes built in their own communities. The proposed ordinance maintains the existing priority assignment in affordable housing for Certificate of Preference holders, expands the existing Ellis Act Housing Preference to encompass a broader range of displaced tenants, and adds a third preference that would provide priority access for a percentage of affordable housing units for residents who currently live in the neighborhood where the housing is built. The legislation is concurrently being considered by the Planning Commission on September 24th.
4. Expand Affordable Production through the Inclusionary Housing Program: Mayor Lee together with Supervisors Mark Farrell and Jane Kim on September 15th are introducing legislation that will provide more ways for developers of market rate housing to directly build or preserve units in the neighborhoods where they are building. These amendments to the Inclusionary Housing Program will:
   • Promote development of 100 percent affordable buildings by market rate developers. Changes to the Off-Site Alternative, which allows developers to build an affordable housing project to meet their Inclusionary requirements, will incentivize affordable housing projects to be built within the neighborhood (including a ¼ mile buffer) or within one mile of the market rate project, will strengthen partnerships between market rate developers and nonprofit builders, and will allow more construction of family sized units.
   • Create a “dial” that allows a housing project sponsor to increase the targeted pricing and affordability level of on- or off-site units in exchange for providing more overall affordable units. This change will provide more moderate and middle income units in mixed income buildings, with rental units available to families up to 90 percent area median income (AMI) levels, and ownership units available to families up to 120 percent AMI.
   • Allow developers of small projects to preserve at-risk rental units as permanently affordable, along the lines of the City’s Small Sites Program that secures buildings whose tenants are at risk of displacement. This option will allow developers to direct their fee to acquire and preserve building in the neighborhood of the principal project.
5. Establish a Bonus for More Affordable Units, including Middle Income Units: This proposed ordinance will enable the State Density Bonus, which allows developers to receive small changes to their building envelope in exchange for greater production of onsite affordable units, and it will include a special “middle income” program that would allow up to two stories of height along neighborhood transit corridors in return for mixed income projects that achieve up to 30 percent on-site affordability including middle income units. This program has the potential to create up to 16,000 units overall with 5,000 units of housing affordable to low and middle income households. The program will also enable the City to stretch limited public affordable housing dollars further by allowing for faster, more efficient entitlement of 100 percent affordable projects and provides the ability to increase height or bulk to create more units and greater efficiency on publicly-financed sites such as the recently purchased parcel at 490 South Van Ness in the Mission.

These policies and programs will work in concert with the $310 million affordable housing bond proposed for approval by voters in November to ensure delivery of at least 10,780 units by 2020, if not more. Mayor Lee is committed to using every tool, including leveraging local, State, and Federal resources, to build more housing. Mayor Lee is working with the Governor and the State Legislature on Senate Bill 441, which if passed and signed into law, provides the City with a powerful tool to build thousands of affordable housing units faster in Transbay, Mission Bay, and Hunters Point Shipyard redevelopment areas. Mayor Lee’s planned $2.7 billion investment from the Housing Trust Fund, tax increment and fees over the next 20 years, make up the Mayor’s long-term plan to fight the affordability crisis and shift the balance of housing in the City so that San Francisco remains affordable for low and middle income families over the long term.