Just released! CCHO’s District Housing Snapshots 2015

30 06 2016

Fresh off the presses!  Following the release of the San Francisco Planning Department’s latest Housing Balance Report and Housing Inventory, we at CCHO have compiled our annual Housing Snapshots of each of the 11 supervisorial districts of the City. The goal of these snapshots is to understand at a finer-grain level where affordable housing is being produced and lost in neighborhoods across the city right now – reflecting not just trends over the past ten years, but the balance of housing production as residents are experiencing it at ground level currently.  This report fills a gap left by the usual citywide analysis of housing production: communities exist on a neighborhood scale in San Francisco, and a neighborhood-level analysis makes clear just how uneven affordable housing production and loss are across the districts of the City.

Overall, only 17.1% of the new housing produced in 2015 was affordable, down from 22% in 2014.  As was the case in the 2014 Snapshots Report, the future trend is troubling. Only 10.1% of the 18,144 entitled units in the 2016 Q1 pipeline are affordable. For long-range projects that are not yet entitled, the percent of affordable units is 10.8%.  These numbers show us just how far we currently are from the voter-mandated goal of a minimum 33% affordable housing, as set down in 2014’s Prop K Housing Balance measure. And they confirm what anecdotal evidence tells us: the housing crisis is continuing to worsen, and we need significant action to change those trends.

Read the full report here.




Ending homelessness with – you guessed it! – housing

29 06 2016

Our latest op-ed in The Examiner (read the original article here).

The first step of any plan to end homelessness needs to be keeping San Franciscans housed. As study after study has shown, it is primarily San Franciscans that make up the people who experience homelessness in our city — not people who have come here from other places, but people who had homes here and lost them — due to a variety of reasons, including the increasing rash of evictions. We need to begin by ensuring that folks stay in their rent-controlled housing whenever possible and are quickly rehoused when displacement can’t be prevented. Part of this includes funding rapid-rehousing opportunities.

But for many who do end up living in their cars or on the streets, the route out of homelessness is through — you guessed it — housing! From a fiscal perspective, we know that it is far less expensive to house homeless people than to keep them homeless, as we spend more on health care, social services and criminal justice while someone is homeless than we do on housing for them. For every $1 spent on housing for homeless adults living with mental illness, there is a $2.50 reduction in other government spending.

Currently, we have housing for about 6,000 homeless people: About half of that housing is in residential hotels with light services and that are master leased; the other half is in nonprofit owned supportive housing, permanently affordable units that come with services to help stabilize and support residents like employment programs, youth and family programs and individual case management.

To really address homelessness, we need to double the amount of housing available to homeless people in San Francisco. This means building new affordable units for very low-income residents with on-site supportive services, creating permanent community-owned assets. Doing this will take a sustainable revenue source, and while we need to make sure the federal and state governments do their part, we also cannot wait for them to act. It’s up to The City to take real leadership and change the current trajectory of homeless housing funding and policy in San Francisco.

In the last few years, our city’s housing production for extremely low-income people has shifted toward master leasing. We currently invest less then 3 percent of The City’s budget toward this issue. We should be investing more. In the current housing pipeline through 2022, we are only going to have 632 new units for homeless people — compared to the almost 3,000 units for homeless people that we built between 2008 and 2014. Since 2014, The City has capped the number of homeless units at 20 percent of all affordable housing and stopped producing buildings that are 100 percent supportive housing.

This is a misstep and represents a major shift in our city’s housing policies. In the last few years, The City’s approach has shifted to simply require that new affordable housing family and senior buildings set aside 20 percent of units for formerly homeless individuals. While this policy has resulted in a broader mix of incomes in our affordable buildings and works well for many residents, it does not replace the need for providing supportive housing buildings with 24-hour desk clerks and the kinds of on-site wraparound services so critical for people who have been chronically homeless or have dual or multiple diagnosis.

There are currently no projects in the works for 100 percent supportive housing. If The City is truly committed to addressing the homelessness issue, and housing both families and single adults experiencing homelessness, then they need to invest in nonprofit-owned supportive housing. The Mayor’s Office of Housing needs to reconsider its priorities and immediately start planning for the release of new funds or requests for proposals for supportive housing buildings on a regular schedule over the coming years. As part of its continuum of affordable housing solutions, The City needs to pay as much attention to the building and renovation of 100 percent supportive housing for our most vulnerable San Franciscans as they do to other important kinds of affordable housing.

Folks working on these issues know what the solutions are. What we are lacking is political will.

Credit: Robin Abcarian, Los Angeles Times

Credit: Robin Abcarian, Los Angeles Times





“By-Right Approvals” Will Have No Real Effect on Housing Supply in SF

27 06 2016

Our latest op-ed in The Examiner (read the original article here).

 

Housing construction in SF always lags behind Planning Permit approvals. On average, even taking into account dips following cyclical housing "busts," the backlog of approved units has grown by about 700 units per year. Source: SF Planning Department Housing Inventory data.

Housing construction in SF always lags behind Planning Permit approvals. On average, even taking into account dips following cyclical housing “busts,” the backlog of approved units has grown by about 700 units per year. Source: SF Planning Department Housing Inventory data.

Developers and their lobbying organizations are currently working hard to spread a false, but profitable argument: that the way to get more housing faster is by further deregulating development approvals. The assertion underlies the governor’s latest “by-right” approvals bill, which gives the automatic stamp of approval to any private development providing the minimum amount of affordable housing.

This argument often devolves into a never-ending ideological debate on social media. The debate between market-rate development advocates and affordable housing advocates is centered on whether a marginal increase in luxury units in San Francisco will lower prices by any noticeable amount for middle-income people in The City or lessen the pressure on existing rental housing. Both sides base their arguments on economic models, such as the recent State Legislative Analyst report supporting theoretical market solutions to the housing crisis, or, by contrast, the response by UC Berkeley researchers who basically debunk the supply-side argument that market-rate housing will quickly “filter” down. But aside from these statistical models, it is instructive to look at the reality of housing approvals and actual construction over the last two decades.

Between 1996 and 2015, the city of San Francisco approved 51,000 units for construction. In the same time period, developers actually constructed 37,000 units. That’s 14,000 more units approved for construction than have actually been built, and, on average, that backlog has increased by almost 700 units every year. The City’s latest pipeline report, through the first quarter of 2016, puts that figure even higher, at almost 19,000 entitled units! That’s not even counting the approved housing from the massive Park Merced, Hunters Point/Candlestick, and Treasure Island developments.

So what’s going on? Why are the developers and their front groups, the governor, and now some big tech leaders who’ve signed onto the governor’s bill, so dead-set on trying to convince us that increasing market rate housing approvals by making them “by right” will somehow help solve our housing crisis?

First, we absolutely have to look at this city by city. There are many places that have put up road blocks to all new housing approvals, whether market-rate or affordable, and a certain amount of streamlining may have a positive impact on housing affordability in those communities.

But despite what market-rate development advocates say, San Francisco, with a backlog of 19,000 approved units, is hardly one of those jurisdictions. Even if we double the rate of project approvals, that would simply add to the long pipeline of already-entitled development projects — instead of 19,000 units waiting in the wings, we could have 40,000 units waiting for… what? That’s the mystery—what are they waiting for, why is the pipeline of approved projects growing every year, and why aren’t more approved projects being constructed more quickly? It’s clearly not the approvals process that is holding builders back from building more.

The real reason is financing. Financing is what controls whether or not approved units actually get built. And the amount of financing capital is limited — by investors who are risk-averse and want to ensure high returns on investments. At the first sign of a downturn or a drop in market prices, they are likely to flee to other safer investments. In fact, during the lows of the Great Recession in 2010, it was primarily publicly-financed affordable housing development that was responsible for more than 50 percent of the units (and of construction jobs) built in San Francisco during those years.

Why, then, if speeding up the approvals process doesn’t put more units on the ground, are some special interests pushing so hard the idea that “by right” is the solution to our housing crisis? We could speculate: for politicians, they get to look like they are working on “solutions” without having to spend public money, and it distracts from the real issues of reining in powerful real estate market forces and stopping speculation on existing housing. And for individual developers, it helps their ability to profit on the entitlement itself: the gamble is to get your approvals done before the market slows down, and then either lock in your financing or sell your “entitlements” to another investor. The actual immediate construction of units is not necessarily the primary factor in this calculation.

Why should we care about this kind of deregulation? The approvals process is long and complicated, and the bureaucracy could certainly move a lot faster. But the reason we have been able to win meaningful community benefits over the past 40 years (as opposed to the steamrolling of communities in urban renewal) is precisely because of our growing understanding that it’s necessary for developers to dialogue with communities, and that we need safeguards to guarantee a voice for regular people and a meaningful role for a city Planning Commission and located electeds in land use matters.

Here’s an alternative approach — the politicians, developers, and their advocates who really care about increasing the number of units on the ground in S.F., whether affordable or market-rate, should focus attention on the real problem of financing, working to ensure that investment continues year-in and year-out to finance the construction of a minimum number of units — whether “the market” is up or down. And, beyond our limited ability to influence global investment, really hone in on what we can influence: increasing investments in affordable housing.





Prop C’s Landslide Victory – What Does It Mean?

22 06 2016

 

Election Prop C 2016 SOV10

The Proposition C Affordable Housing Charter Amendment won by a landslide. Not only did the measure take 68% of the vote, but it was also supported widely across the city, with the vast majority of districts voting yes on C.  (See a PDF of the above election map here.)

Prop C doubles the “inclusionary” housing requirement for private developments (the obligation to create affordable housing units when building market-rate housing), requiring development projects of at least 25-units in size to include 15% low-income and 10% moderate/middle-income housing.  Prop C also removes the inclusionary policy from the City charter, allowing the Board of Supervisors and Mayor to make changes to the requirement in the future.  It’s good affordable housing policy and it’s good government practice.

But more than that, a win like this is a clear mandate from San Francisco voters.  San Franciscans are demanding that affordable housing be a top priority in their City and that private development contribute its fair share towards affordable housing.   This further proves what has been shown time and time again in recent years, not only by the win of Prop C, but also by the passage of last November’s $310 million Affordable Housing Bond and the Public Lands for Affordable Housing Measure, the Affordable Housing Balance Measure of 2014 (which called for a minimum citywide 33% affordable housing), as well as the landmark $1.3 billion Housing Trust Fund in 2012 that restored redevelopment funds “dissolved” by the state.  Citywide, San Franciscans are suffering from the housing crisis and they know the solution is more funding and better policies for affordable housing.  And they clearly agree that in our economic boom, while luxury housing is being built throughout the city and a wider range of people are shut out of the housing “market,” private development should provide more housing that low- and middle-income San Franciscans can afford.

Furthermore, this win is a strong statement that voters expect an Inclusionary affordable housing policy that is inclusive, providing diverse, mixed-income communities and housing for both low-income and moderate/middle-income residents.  Instead of providing housing for only one income level and pitting residents in need against one another, Prop C presents a strategy of providing housing for many folks by including both low-income and middle-income affordable housing.  Additionally, it encourages private development to build “on-site” affordable housing, providing affordable units right inside of market-rate developments instead of at a different location or just “feeing out” by writing a check to the City.

Voters are tired of divisive politics about housing – they want more affordable housing for more people.  With this landslide vote for Prop C, San Franciscans clearly asserted that they want their buildings and neighborhoods to remain diverse and that they expect their City’s inclusionary housing policy to help a range of people who are struggling to find affordable housing in this City – More for the Many, Not just the Few.

 





Tuesday’s Two Wins for Affordable Housing

9 06 2016

Election Prop C 2016 SOV4 HighJune 7 brought two big wins for housing affordability in San Francisco, one through the ballot and one through the Board of Supervisors:

 

  • Proposition C, the Inclusionary Housing Measure, won handily at the ballot with 67% of the vote and with support spread widely across the city (see map of election results above, or a higher-resolution version here). Since its proposal by Supervisors Peskin and Kim, CCHO and a wide coalition of supporters have worked hard on the measure, and this is a big victory for affordable housing and significant step forward in the City’s inclusionary housing policy.  Inclusionary housing policies require the market to provide affordable units NOW.  Because of Prop C, private developers will now be required to provide significantly increased affordable housing and provide housing for both low-income and middle-income San Franciscans, helping house a wider swath of San Franciscans without pitting the housing needs of these different groups against one another.  With the passing of this measure, voters have set a new, fairer bar for market-rate development’s contribution to affordable housing and have once again proved that San Francisco’s leading the way in innovative solutions to the housing crisis.
  • The Board of Supervisors unanimously adopted a Short-Term Rentals Ordinance requiring Airbnb and other hosting platforms ensure their listings are properly registered (aka, in compliance with existing law passed in February of last year – yes, just following the law, that’s all it is!). Under this legislation, platforms will face fines for advertising hosts who have yet to comply with the registration law – and currently that’s about 5,500 of the city’s estimated 7,000 hosts.  Any fines collected under this new ordinance will go towards affordable housing. CCHO, as part of the broader ShareBetterSF coalition, has continued to push for such regulation of improperly-rented short-term rentals, which currently contribute to the housing crisis by taking existing rent-controlled and affordable housing off the market.  After the defeat of last year’s Proposition F by Airbnb and its $8 million, this is a huge victory for stronger protection of tenants and our invaluable existing housing stock.

 

Though we still have much work to do in the effort to end the housing crisis and realize our vision of a city for all, a moment of celebration is in order!

 





New Research from UC Berkeley Challenges LAO Report on Housing Affordability

25 05 2016

UC Berkeley's Urban Displacement Project's latest research finds error in the LAO report.

Yesterday, UC Berkeley’s Urban Displacement Project released its latest research, calling into question the validity of a controversial report released by the Legislative Analyst’s Office in February 2016, and providing strong evidence that the most effective strategies for fighting displacement are the construction of affordable housing and policies to stabilize existing tenants – not simply building market-rate development.

The LAO’s report, “Perspectives on Helping Low-Income Californians Afford Housing,” suggested that increasing market-rate development through various deregulation measures is the best means for increasing housing affordability and thus preventing displacement.  Widely circulated since its release, the LAO report has been used as justification for some radical proposals at the state and local level that could undermine long-standing affordable housing and community development policies in San Francisco.

This report has gone largely uncontested until now. UC Berkeley researchers Dr. Miriam Zuk and Professor Karen Chapple have evaluated the LAO analysis, and found that it is based on incomplete data and models.  Their report, “Housing Production, Filtering, and Displacement: Untangling the Relationships,” tests the LAO’s analysis by correcting for these omissions and errors, and finds very different results, including:

  • Affordable housing is still our best strategy, as it is over twice as effective as market-rate housing at preventing displacement: “for every one subsidized unit, we would need to produce two or more market-rate units to have the same reduction in displacement pressure” (p. 4).
  • Market-rate housing becomes less effective at reducing displacement over time.  The Berkeley researchers conclude that “the effectiveness of market-rate housing in mitigating displacement seems to diminish as more market-rate housing is built in a subsequent decade…this result suggests that over time, the construction of market-rate housing may have a catalytic effect on a neighborhood, increasing attractiveness to upper-income residents, rather than a protective effect of filtering” (p. 6).
  • The LAO report presents an incomplete picture of “filtering,” which it cites as the key way market-rate housing prevents displacement.  In fact, filtering of market-rate units cannot address our current housing crisis, as it takes many years for these units to “filter down” to middle- and low-income households (approximately 50 years for households making 50% of median income), and even once middle- and low-income households can access these units, they may not be habitable or affordable to them (p. 4).
  • Though it may reduce displacement at the regional level, new development has little impact on displacement at the local or neighborhood level, again providing strong evidence that “production alone cannot solve the displacement problem” (p. 8).  Instead, the report concludes that we need strong preservation and tenant-protection policies to help with the displacement crisis on the local level.

Read UC Berkeley’s media release on the new report here. 

And check out the blog post by Dr. Miriam Zuk answering some of the big questions about this research.

This fresh challenge to the LAO Report follows earlier critical analysis by researchers Alex Karner of Georgia Tech University and Chris Benner of UC Santa Cruz, who pointed out a major flaw in the work in a Washington Post article from February 19th:

“Most importantly, the report claims that constructing market-rate units will protect low-income communities against displacement. But it relies upon a single imperfect definition of displacement and doesn’t distinguish between parts of the Bay Area that are growing rapidly and where land is cheap from the tight housing markets in San Francisco, Oakland, and San Jose. These three cities account for about a third of new market-rate units in areas the report focuses on. But other top producers include cities on the urban fringe as well as unincorporated areas where displacement pressures are minimal. Grouping together these very different places can make it appear as though new market-rate units prevent displacement, when in fact the opposite might be true.”

 

Image: Logo of UC Berkeley’s Urban Displacement Project.





Pro-Housing Rally, Progressive-Style

24 05 2016
5-17-16 Pro Housing Rally pic1
On May 17th, we had a rally and press conference on the steps of City Hall attended by an impressive coalition of tenant advocates, neighborhood organizations, merchants, labor, environmentalists, faith organizations, and affordable housing advocates.  Supervisors Aaron Peskin and Eric Mar announced a soon-to-be drafted and introduced Affordable Housing Bonus Program, and made connections to the Prop C Inclusionary measure on this June’s ballot, which will also provide more low- and middle-income housing for San Franciscans.
5-17-16 Pro Housing Rally pic2It was a pro-housing rally, progressive-style.
To read more on the Affordable Housing Bonus Program, check out these articles and news clips:




Thanks for coming to the 5th Annual CCHO Party!

12 05 2016

CCHO_Friendraiser_ALexson_012

Thanks to all our Friends of CCHO for coming out and making our 2016 CCHO Party a success!  It was great to see everyone, to take time to celebrate the hard work being done by the affordable housing community, and to be reminded of how many friends and allies we have in this important moment of struggle to make affordable housing a reality in the San Francisco Bay Area. See the full album from the party here.

 

CCHO_Friendraiser_ALexson_024

A special thanks to the AND Shop Band, who kept the party going with their fantastic music.CCHO_Friendraiser_ALexson_017

Congratulations once again to this year’s CCHO honorees:

  • Dale Carlson & Ian Lewis, for their work to save rent-controlled housing from hotel usesCCHO_Friendraiser_ALexson_077
  • Ruby Harris, Tracy Parent, and Karoleen Feng, for their work to protect at-risk tenants and preserve their homes as permanently affordable housingCCHO_Friendraiser_ALexson_090
  • PODER & CUHJ (PODER, FCC, CAA, Coleman Advocates), for their work to keep public lands in public handsCCHO_Friendraiser_ALexson_101

And a big thanks to all our party sponsors: Barcelon Jang Architecture; Brian Murphy & Susan Hoffman; Cahill Contractors, Inc.; California Housing Partnership Corporation; Forest City; Gubb & Barshay LLP; Heller Manus Architects; IBEW Local 6; James E. Roberts-Obayashi Corp.; Lou Giraudo; Non-Profit Housing Association of Northern California; Northern California Carpenters Regional Council; Progress Foundation; San Francisco Building and Construction Trades Council; Senator Mark Leno; SEIU 1021; Sheet Metal Workers’ Local Union No. 104; United Educators of San Francisco; Unite Here! Local 2; as well as Doug Engmann and Speakeasy Ales & Lagers for providing the booze and brews.

Want to see more photos from the party?  Check out the album
(And if you‘re feeling nostalgic, there are also photos of the 201220132014, & 2015 CCHO Parties!)

CCHO_Friendraiser_ALexson_041CCHO_Friendraiser_ALexson_003CCHO_Friendraiser_ALexson_096CCHO_Friendraiser_ALexson_111CCHO_Friendraiser_ALexson_126CCHO_Friendraiser_ALexson_115CCHO_Friendraiser_ALexson_018CCHO_Friendraiser_ALexson_016CCHO_Friendraiser_ALexson_044CCHO_Friendraiser_ALexson_056CCHO_Friendraiser_ALexson_059CCHO_Friendraiser_ALexson_105CCHO_Friendraiser_ALexson_144CCHO_Friendraiser_ALexson_005CCHO_Friendraiser_ALexson_140CCHO_Friendraiser_ALexson_124CCHO_Friendraiser_ALexson_114CCHO_Friendraiser_ALexson_112CCHO_Friendraiser_ALexson_110CCHO_Friendraiser_ALexson_106CCHO_Friendraiser_ALexson_063CCHO_Friendraiser_ALexson_038

Photo Credit: Alex Lexson Photography.





The Future of Balboa Reservoir: Say No to Privatizing Public Lands

9 05 2016

Our latest op-ed in The Examiner.  Read the original article here.

The parking lot at the Balboa Reservoir. Credit: Gabrielle Lurie, SF Examiner.

The Balboa Reservoir, currently a parking lot, could be used to build hundreds of affordable homes. Credit: Gabrielle Lurie, SF Examiner.

The future of a huge swath of The City is currently up for grabs, and with it, the future of San Francisco’s approach to affordable housing.

The Public Utilities Commission parking lot next to the City College of San Francisco’s campus on Ocean Avenue may not seem exciting, but it is 17 acres of developable land in our mostly built-out city, and market-rate developers are salivating at the prospect of privatizing this land.

As publically owned land, the Balboa Reservoir represents an indispensable public resource that should be preserved as a public good for this and future generations. This will require not only a commitment of resources, but also visionary leadership by The City, which we have yet to see.

Any “Request for Proposals,” or Board of Supervisors-approved rezoning or development agreement for residential uses on the site, should prioritize maximum housing affordability, at a minimum mandating that at least 50 percent of the site be affordable to low-income households (families earning less than $50,000), and on top of that another portion affordable to moderate-income families (two-earner households earning up to $120,000). And it should do that while still supporting City College’s continued viability by dedicating parking facilities for a fully enrolled CCSF and providing new open space.

The PUC’s Citizens Advisory Committee agrees: Last March, it passed a resolution calling for 50 percent to 100 percent of housing developed on the site to be affordable, for a range of incomes and family sizes, to truly meet the needs of San Franciscans.

The Mayor’s Office of Economic Development, however, argues the best approach for a large 17-acre site like this, even if it is publicly owned, is to privatize it as much as possible. Any affordable units, they argue, should be entirely dependent on market-rate developers willing to “cross-subsidize” some small amount. And most of these so-called affordable units could end up being studios and 1-bedrooms — only affordable to individuals who earn more than $100,000 (140-150 percent of median income). These are called “creative financing” solutions.

The logical and frightening conclusion of The City’s argument for privatizing Balboa Reservoir is that we would never need to invest in affordable housing again — simply let the paltry amount of affordable units we are able to leverage out of “the market” produce all our affordable housing from now on. These are the same arguments that lead to privatizing public schools and community colleges or contracting out critical public services to the lowest bidder. These are the classic arguments of austerity and neoliberalism, based on a model of scarcity of resources that hardly has a base in San Francisco’s booming economy.

Ideology aside, the problem with this model, practical as it may sound, is that it simply continues to exacerbate the imbalance of high-end market-rate housing (the latest numbers are that only 11 percent of The City’s residents can afford the median cost home) compared to housing for the everyday working and middle-class San Franciscans. And according to The City’s own Housing Element goals through 2022, we have already built or entitled more than 106 percent of our market-rate housing goals, and met only 24 percent of our low-income and 13 percent of our moderate-income needs!

We are always playing a game of catch-up with the overproduction of luxury housing.

It is indeed possible to develop the Balboa Reservoir with 100 percent affordable housing and amenities for the neighboring community and City College. And certainly it is without question possible to develop it with a minimum of 50 percent to 60 percent affordable as we suggested above. It is primarily a question of available funds and phasing. A back of the envelope calculation envisions a total city investment of around $100 million for a 250-to-300-unit affordable development — held in the public trust in perpetuity. This would include compensating PUC ratepayers with a fair-market value for the “unserviced” land (subtracting the cost of needed infrastructure such as streets and sewers).

The City argues we don’t have that kind of money lying around, and even much of the Prop A funds from last November are already being dedicated to new affordable housing elsewhere in The City. This would clearly be a major city investment, spread out in phases, but given the willingness shown by voters over the last decade to support funding for affordable housing, such numbers do not appear to be insurmountable, and the payoff would last for generations.

Some say only by relying on market-rate development can we be reasonably assured that development will happen sooner rather than later. This is simply not true. In fact, city-funded development is more stable and reliable than market-drive development. Large market-rate projects rely on the ups-and-downs of the global market of institutional investors, which quickly dry up at the slightest change in the economy. On the other hand, in the downs of the market, it is often only city investment that moves projects forward. In fact, during the Great Recession in 2010, more than 50 percent of the units completed in San Francisco were publicly financed affordable housing.

The model of Octavia Avenue is a perfect case in point: A huge swath of public land (from the Central Freeway teardown) was divided into parcels, and fully half of the new units were dedicated to affordable housing. Most of those parcels are now built out, and everyone agrees the development along Octavia Avenue is wildly successful. It took vision, leadership and perseverance, but public lands are being used exactly as was envisioned by the public.

It is not a question of feasibility or funding that is holding us back, but a lack of bold leadership that truly attempts to face the housing crisis head-on. A short-term trade-off for a handful of privately financed affordable units for people earning $100,000 at Balboa Reservoir is not visionary. A truly visionary plan would seize this rare opportunity with a longer-term strategy that leverages hundreds of affordable units from this major public resource.

On Monday, the Balboa Reservoir CAC will discuss development parameters for the site. Supervisor Norman Yee has requested that the CAC consider a proposal to mandate 50 percent of all housing on the site to be affordable (and the definition of “affordable,” and affordable for whom, is critical). And on Tuesday, the PUC will take their CAC’s resolution regarding affordability and uses for the site into consideration.

Our elected leaders, commissioners and city bureaucracy would do well to begin with a philosophy that prioritizes and preserves public resources for the public good in perpetuity.





Affordable Housing Week Comes to San Francisco

2 05 2016

For details for each of San Francisco’s Affordable Housing Week 2016 events, see here.

CHP's Richardson Apartments, one of the stops on our upcoming bike tour!

CHP’s Richardson Apartments, one of the stops on Saturday’s upcoming bike tour!

The coming week is Affordable Housing Week here in San Francisco – an annual event with activities throughout the Bay Area.

We spend a lot of time calling for more affordable housing. The need for affordable housing is deep and growing rapidly, as more and more San Franciscans find they can’t afford housing produced on the market.

But there’s a new rumble of voices asserting that our systems for building affordable housing are outdated and broken.

These voices are wrong.  We desperately need more affordable housing, yes, more funding, and even more importantly, we need leadership and vision by elected leaders.  But in San Francisco we actually have a host of proven solutions, and the policies that we’ve developed and are continuing to develop have produced real results.

In light of all this, CCHO and the affordable housing community across the Bay Area are taking a moment to raise awareness around the advocacy and solutions that exist right here at home with Affordable Housing Week 2016.  This is an opportunity for San Franciscans to get a deeper glimpse into affordable housing, and really understand the issue that’s dominating every headline in our city.

Over the past 40 years, San Francisco has taken a lead in affordable housing, both in policy and in actual implementation.  Nearly 30,000 units of permanently affordable housing built, another 3,000 acquired and converted to affordable, several thousand protected SRO units, and nearly 2,000 below-market Inclusionary units. And this has continued up to the present.

TNDC Mosaica 1

The bike tour will also include TNDC’s Mosaica Senior & Family Apartments.

In 2012, SF voters established a Housing Trust Fund, setting aside $20 million annually (and incrementally growing to $50 million in year 15) to support a variety of affordable housing programs for low and moderate income San Franciscans, including a $15 mil new investment for first-time homebuyer assistance.  In 2014, we set a goal and a monitoring system to achieve a minimum benchmark of 33% affordable housing production citywide, and in 2015, we prioritized underutilized public sites for affordable housing AND voted through a $310 million bond for affordable housing. And now, responding to the dramatic surge in the real estate market, San Franciscans are set to vote on adopting the highest inclusionary housing policy in the State, requiring developers to produce 15% low-income and 10% middle-income units in every development over 25 units. These are real solutions.

What does all this mean on the ground? Since 2002, when we passed our first inclusionary ordinance with a 12% requirement, we have created over 2,000 low- and moderate-income units, affordable to families earning from $55,000 to 90,000/year. Since 2012, when we passed the Housing Trust Fund, San Francisco has built roughly 700 units per year, providing quality homes for people at all income levels who are unable to afford San Francisco’s astronomical market-rate rents. These are real projects, scattered throughout the city, some of the best architectural design and the highest quality service-enriched housing anywhere in the country.  San Francisco has also commenced with one of the most comprehensive public housing rehabilitation programs in the country, one that guarantees one-for-one replacement units and a right-to-return to all current tenants.

As part of San Francisco’s Affordable Housing Week 2016, CCHO, along with SPUR and architect David Baker, will be leading an affordable housing bike tour this Saturday May 7th, where you can see a number of these buildings and meet architects, community organizers, and tenants, from Chinatown to SoMa to Hayes Valley to the Mission. We’ll look at senior buildings, family buildings, and even mixed-income buildings with on-site inclusionary units and we’ll talk about the community struggles that made these buildings possible.

todco Mendelsohn garden

The garden at TODCO’s Mendelsohn House, another stop on Saturday’s Affordable Housing Bike tour.

Despite the success we have had so far, this is clearly not the time to rest on our laurels. The need for affordable housing IS growing, and we do need more support and more funding. To learn about the steps the affordable housing community is taking to address the housing crisis, come to this week’s two Affordable Housing Week lunchtime forums, sponsored by CCHO and SPUR. On Tuesday May 3rd, policy advocates from throughout the Bay Area will speak on plans for expanding funding for quality affordable housing, from San Francisco, Silicon Valley, and the East Bay. And on Thursday May 5th, community planners will discuss what they are doing from the grassroots in neighborhoods across San Francisco hardest-hit by the gentrification crisis.

We hope you join us for San Francisco’s Affordable Housing Week 2016, and check out the other events happening this month across the region, as an opportunity to plug in, get informed, and learn about the extensive advocacy and real solutions that exist right here in our City.

For more information on San Francisco’s Affordable Housing Week 2016, see here.





Another Small Site Success!

12 04 2016

WP_20160412_019Down a little back alley in SoMa, there’s now one more permanently affordable apartment building, thanks to the Small Sites Acquisition Program and two CCHO members, San Francisco Community Land Trust and South of Market Community Action Netwok.

Using funds from the Small Sites Program, which CCHO helped establish, the two organizations were able to purchase a 5-unit building at 568 Natoma Street.  Until the purchase, the tenants of 568 Natoma – a rent-controlled building housing lower-income Filipino families, seniors, and first responders – were facing possible eviction.  A previous potential buyer got so far as offering the tenants “buy-outs,” which they refused.

Places like this are where the affordable housing crisis is hitting hardest –in nondescript small buildings in everyday neighborhoods, where average San Franciscans are struggling to keep their housing.  As this situation makes clear, the affordability crisis is not just about building new housing, but about helping people keep their existing housing, preserving the affordability we already have and making it permanent.

The Small Sites program is a means to do just that – stabilize tenants at risk of eviction and take existing buildings off the speculation market to make them permanently affordable.  With this latest purchase, the program is now up to twelve buildings successfully purchased.

Twelve many not seem like a big number and 568 Natoma may seem like one small building, but transforming these units into permanently affordable housing has a big social impact.  We have the policy in place to do this for many more buildings and many more residents – we now just need a significant increase in funding to the Small Sites Program to allow it to realize its full impact.

 

Check out photos from this morning’s press event about the purchase, hosted by Supervisor Jane Kim, The SoMa Stabilization Fund, SOMCAN, and SFCLT:WP_20160412_017WP_20160412_013 WP_20160412_011WP_20160412_020 WP_20160412_021





The “Affordable Housing Balance” Just Keeps Getting Worse

7 04 2016

Our last op-ed in The Examiner.  Read the original article here.

The third “Housing Balance Report” from the City Planning Department was quietly released last week, coincidentally one day before April Fool’s Day and one week before a Planning Commission hearing today. And the punchline is … wait for it … the citywide housing balance of net new affordable housing from 2006 through 2015 is down to 13 percent. The last report in September had it at 15 percent, the July report before that was at 16 percent. The trend line is pretty clear. Overheated real estate development cycle, declining percentage of affordable housing.

And what is being built currently? Wait for it … only 14 percent of all new development now under construction or with active building permits will be affordable to anyone earning less than 120 percent of median income (a San Franciscan earning less than $85,000 per year). And for most market-rate housing today, you have to earn much, much more than $85,000. This bleak news comes at a time while San Francisco is experiencing one of its worst gentrification cycles in history.

Looking even further ahead to the next round of development — based on the entitlement “pipeline” of projects, the Housing Balance Report shows a whopping 15 percent affordable housing (the report does note that this number may increase if more developers commit to provide on-site inclusionary units in their projects).

And the problem is not just about production — these Housing Balance Report numbers make clear how the loss of protected rental units completely undermines The City’s efforts to build more affordable housing. More than 4,100 housing units have been removed from the affordable housing supply over the last ten years through condo conversions, demolitions, owner move-in evictions, Ellis Act evictions and other means (not including tenant “buyouts” which are dramatically on the rise as well). Across The City there is a ratio of three existing units lost for every four new affordable units produced. At a more local level, the affordable housing balance is actually negative in nine out of the 15 neighborhood-level “planning districts”! If the upward trend of evictions and lost protected rental units continues, that already-paltry 15 percent projected housing balance may be eroded even further.

Is there any wonder why we have a housing affordability crisis in San Francisco?
Across The City there is a great need to correct that imbalance of low and moderate/middle income housing for San Franciscans compared to the rate of market-rate housing production. And we are far behind the goal of minimum 33 percent affordable housing set by the voters in Proposition K back in 2014 and way, way, way behind the actual need of 57 percent affordable housing per The City’s General Plan Housing Element, based on job growth projections across the income spectrum.

There are a lot of numbers thrown around these days about housing goals and aspirations of an affordable city for all. But the numbers here are a reality check, and they are sobering. All is clearly not well in the housing “market.” Here in this Housing Balance Report authored by the Planning Department we have the real story. This is from The City’s own building permit data, and The City’s own planning pipeline data, and The City’s own rent board data. It doesn’t get more truthful than this. Thirteen percent affordable and dropping! We as a city have a real job to climb back out of this hole.





The “Supply-Side” Argument, and Why Geography, Scale, and Migration Matter

5 04 2016

CCHO co-director Peter Cohen’s latest op-ed in Rooflines, the Shelterforce blog, responding to Rick Jacobus’ article “Why We Must Build”.  Read the original posting on Rooflines hereShelterforce oped_image

Rick Jacobus’ article, Why We Must Build, published here on Shelterforce a couple of weeks ago has created quite a buzz. Jacobus is smart, and has been writing on the topic of affordable housing and land trusts for a while. The supply-siders have wishfully interpreted the piece as unquestionably supporting their “build, baby, build” agenda, with BeyondChrongoing so far as to share the piece, saying: “Why building housing reduces displacement.” That isn’t the simplistic argument Jacobus’ article makes—even if he positions himself as a bit of a market rationalist, he clearly didn’t write this long and thoughtful piece to simply be a booster for market-rate development, and his article shouldn’t be interpreted as such. A few parts of his article make this clear and deserve further attention, while others are troubling and in need of correction.

Geography and Scale
Jacobus’ piece offers refreshing insight in the way he explains the implications of market-rate development at a neighborhood scale versus a regional scale, providing strong reinforcement to the argument that in “hot markets” like the Mission district (or other front-line neighborhoods) in San Francisco, a simplistic supply-side housing policy will not resolve a local affordability crisis and in fact may make it worse. He says this:

“New development may lower prices regionally even while it raises prices in a specific neighborhood.”

Market-rate “supply” has a very different effect at a local scale and in a hot market (like the Mission) than at a regional scale and/or in a less heated local real estate location. Intuitively and empirically, this makes a lot of sense—that’s what we’ve all been seeing, and it’s why few people at the ground level believe the supply-side argument has much merit for, say, the Mission District. But taken at a regional scale, large-scale developments out in Pleasanton, down in Mountain View, or over in Fremont might have a different local effect and certainly might have a regional effect on stabilizing housing prices. This argument supports the fact that, when it comes to housing, supply and demand isn’t as simple as it seems (or as simple as some boosters would like us to believe), and a supply-side strategy will not work in every context to address affordability problems—including the hot neighborhoods of San Francisco.

Migration Trends
Jacobus makes another important point that is often lost in the current argument over supply and “who is to blame” for our housing affordability crisis:

“We are in the middle of a once in a lifetime tectonic shift in consumer preferences regarding urban living. …There has been a shift, and now a growing share of the powerful prefer the center. But where the edges were occupied by farmland, the center of most of our regions is today occupied by the same low-income and minority communities that were excluded from late 20th century suburbia.”

In other words, we’re now dealing with a near-reversal of “white flight” (Neil Smith’s “revanchist city” articles weren’t so crazy after all!) that is overloading the capacity of local urban resources, policy, and political organizing to absorb that “tectonic shift” gracefully.

The disruption to working class and poor communities has been rapid and unrepentant, and the solutions are not as aggressive as the economic forces that are driving that migration shift. This is quickly resulting in the reversal of urban segregation—a Federal Reserve study from 2012 started to reveal this trend and trigger discussion about the new “suburbanization of poverty” which is a clear symptom of the tectonic shift that Jacobus refers to. Perhaps it should be called a “titanic” shift, as many people are drowning in this process.

All of this means that the same supply-side solutions that may have worked in the past won’t necessarily work in the here and now. We are trying to “build, build, build” in inner city neighborhoods where people already live, live, live; not out in the greenfields of suburban growth for the last 50 years.

Neighborhood Stabilization (Or, Mistakenly Viewing the Mission through a Tenderloin Lens)
Another big point Jacobus makes is that ownership of land and community control are key elements of stabilization/anti-gentrification. For sure, taking land and housing off the speculative market is a core tenet of the affordable housing work we do. It is hard, slow, and not inexpensive, but it is the essential long-term strategy to maintain an affordable city.

But here is where Jacobus goes wrong, however, in citing the Tenderloin as somehow the model for other contemporary neighborhoods battling gentrification. He suggests that, for unexplained reasons, the Mission District has been less successful than the Tenderloin. In reality, Jacobus is comparing an apple to an orange and mistakenly viewing the Mission through a Tenderloin lens. He writes:

“While it may be right that the Tenderloin has been saved by the community’s refusal to allow “upscale” development, the Mission has also mostly resisted the kind of high-end, high-rise development that transformed SOMA, but Mission rents and home prices have skyrocketed nonetheless. Even with rent control, relentless tenant education, and advocacy and nonstop neighborhood organizing, if you didn’t allow any new building, you can’t stop private property owners from cashing in on the fact that the area is desirable to people with a lot of money. Even in the Mission!”

What he misunderstands is that the Tenderloin’s rezoning and strict property controls were a lot more aggressive than the Mission’s Eastern Neighborhoods Plan—in fact, the latter was designed to promote market rate development (in a kind of upzoning-for-public-benefits-value-recapture concept, that in hindsight is proving to have been quite weak). The Tenderloin was not rezoned to promote development, but rather to discourage development and prevent market conversions of existing buildings. The Tenderloin Plan (and the Chinatown Plan also from that earlier era) are the envy of many current “front-line” neighborhoods—the Mission District, Soma, Western Addition, even Bayview, that are getting rocked by development, but have very weak zoning controls and limited mechanisms for community control of land. The Mission District isn’t an example of the futility or even detriment of community resistance to market-rate development, but rather an example of community resistance to gentrification that has been hamstrung to some extent by weak land use controls in the face of massive market pressures.

For all its success, the Tenderloin model is not likely replicable in the current context of that “tectonic shift” in migration that Jacobus writes about. Nor is there currently the political will to put in place the kind of strong zoning that helped the Tenderloin. Nevertheless, the answer today shouldn’t be to discourage communities from fighting for self-determination or berate them for not throwing arms open to “the market”—there are a host of policies that could be put into place now that focus on stabilization and prevent displacement.

Affordable Housing Activists United (Or, Make No Mistake About a “Split”)
And lastly, in what is otherwise a thoughtful article, Jacobus makes a curious assertion that last November’s ballot measure to temporarily pause development in San Francisco’s Mission District—which had lost 177 housing units to no-fault evictions from 2012 to 2014, had a 27 percent decline in Latino residents between 2000 and 2013, and had lost 26 percent of its households with children in that same decade—in some way “split the housing advocacy community” and that, “many committed advocates succeeded in convincing San Francisco voters that the moratorium would only make things worse by further restricting supply.”

Let’s correct that. Prop I did not “split” the affordable housing activist community. But it did split affordable housing advocates from market-rate housing advocates. It was very clear all along that Prop I was not a solution, per se, to the urgent crisis, but a pause to give time to develop and implement solutions.  Affordable housing activists were on the same side of support for that measure and were aligned with community advocates who were not looking just for a “technical” solution but also an organizing response to the disruption caused by the real estate market at ground-level. Jacobus mistakenly lumps together all “housing advocates” – whether affordable housing activists or market-rate advocates—in that landscape and thus inaccurately asserts that there was a “split.”

Where the distinction between affordable housing activists and market-rate development advocates becomes clear is around the increasingly dramatized argument about supply-side housing policy (which is now called “filtering” in the new think-tank literature, as “trickle-down” is evidently passé). We affordable housing activists say more supply at the affordability levels needed; market-rate advocates (sometimes claiming to be on the side of affordable housing) say more supply at any affordability level and everything will filter/trickle down. It’s a simple contrast, but stark and ideological.

Overall, though Jacobus may end his article in support of building more market-rate housing—he is a market rationalist after all—he also lays the foundation for why a supply-side approach to the affordability crisis doesn’t necessarily work, and certainly doesn’t work in every place. Perhaps his most important line, in the middle of the piece, is:

“The first step is to let go of the idea that the market is going to offer neighborhoods that are both highly desirable and economically diverse.”

The debate about getting local housing policy right will be ongoing, and we will continue to see serious fault lines of disagreement. Rick Jacobus’ article adds more fodder and some useful nuance to that debate. And the supply-siders just got brought down a notch or two.

 

(Photo credit: Red Hot Market by Damien D., via flickr, CC BY-SA 2.0)





ADUs Done Right

18 03 2016
adu_diagram_banner_03

A diagram from the SF Planning’s Department’s handbook on building ADUs.

Accessory dwelling units (ADUs for short; also called in-laws, secondary units, or granny flats) have often been touted as a way to create “naturally” affordable housing (rather than being price-restricted, as traditional affordable housing is) and add density to the City with minimal impact to the character of neighborhoods.  CCHO’s stance has always been that even supposedly “naturally” affordable housing needs regulations and tenant protections to actually guarantee affordability for San Francisco residents.  Even developers and property owners building “naturally” affordable units won’t necessarily resist the temptation of a hot housing market and high rental prices.

Finally, however, we have an ADU measure that comes with these guarantees and protections baked in.

Supervisor Aaron Peskin introduced legislation this Tuesday that would allow property owners across San Francisco to create new legal ADUs – units with rent control and prohibited from being used as short-term rentals, or from canabalizing existing commercial space, or from being built in buildings that have evicted tenants, and prohibited from being subdivided and converted from rental units into mini spec condos.  These are exactly the regulations that CCHO called for in previous forms of ADU legislation last year, but unfortunately were rejected.

This is an impressive proposal to expand the supply of rent control housing through secondary units across the City, and it is good to see specific controls to ensure long-term affordability to serve the needs of low-income and middle-income residents.

Innovation + appropriate regulation.  ADUs Done Right.  Thank you, Supervisor Peskin.

Read the SF Examiner’s article on this legislation.





Inclusionary Housing: More for the Many, Not Just the Few

1 03 2016

Our latest op-ed in The Examiner, just in time for today’s Board hearing, where Supervisors will vote on placing the Inclusionary Housing Charter Amendment on June’s ballot.  Read the original article here.

Residents hold signs calling for "Inclusionary Housing, not Exclusionary Housing" as Aaron Peskin speaks at a press conference about the charter amendment.

Residents hold signs calling for “Inclusionary Housing, not Exclusionary Housing” as Sup. Aaron Peskin speaks at a press conference about the charter amendment.

This Tuesday, the Board of Supervisors is poised to put a very important measure before the voters on this coming June’s ballot. If they vote yes, which seems likely, it will be one small step for the Board, one giant step for San Franciscans.

You see, our city’s “Inclusionary Housing” policy — which requires market-rate developers to build mixed-income communities by providing a portion of their housing units at below-market rates (actually affordable prices) — has been locked up in the City Charter since 2012. This was bad policy from the get-go and has meant that as development has boomed and housing prices have skyrocketed, our elected leaders have been unable to make adjustments to the inclusionary housing policy to keep up with that boom economy.

If the Inclusionary Charter Amendment is successfully voted through this Tuesday by the Board of Supervisors, San Franciscans will be able to un-lock the inclusionary policy from the Charter and bring it back into the citizen process. This is widely agreed to be a “good government” decision, putting the process of hammering out the details of policy back in the hands of our elected lawmakers, who can move quickly to respond to public need and financial reality, instead of requiring prohibitively expensive and time-consuming electoral campaigns through “ballot-box planning.”

Beyond being good government, this measure is a serious opportunity to increase affordability in San Francisco. The measure will initially double the number of affordable units a developement is required to provide, by going back to the 15 percent low-income units required before 2012, and adding a new 10 percent of units affordable to middle-income San Franciscans. That initial requirement can then be adjusted by the Board of Supervisors as needed as market conditions change over time. In fact, it is the anticipation of the ballot measure itself that the Board will craft fine-grained implementing legislation if the measure is passed by the voters in June.

The ballot measure will do two hugely important things: 1) set a higher bar for private development and ensure that projects contribute their fair share to housing our city’s residents during boom times; and 2) create affordable housing for the increasingly wide range of people who find themselves unable to afford living in San Francisco. In fact, inclusionary housing is one of the best tools we have to build housing for middle-income San Franciscans, as market-rate development investors have abdicated their traditional role of building housing for the middle classes, and there are no public subsidies available to help build affordable housing at those income levels. Instead of pitting low-income and middle-income housing needs against each other, this measure addresses BOTH needs.

In this way, the Charter Amendment accomplishes the real goal of inclusionary housing: Inclusion. As a resident who spoke during the three hours of public testimony at the Board of Supervisors hearing this past week put it, this measure will help ensure more San Franciscans have the opportunity “… to be part of the fortunate MANY, not the fortunate few.” Another resident eloquently told the Supervisors: “Now is your opportunity to vote for inclusion. … This is your time to be a hero.”

On Tuesday, the Board of Supervisors can all be heroes and move this important measure forward to the San Francisco voters.





A Really, Really Long Definition of Affordable Housing

18 02 2016

The term “affordable housing” gets thrown around a lot these days by a lot of different people, sometimes talking about pretty different things.  Everyone’s talking about it, we all want more of it, but it’s often a little fuzzy what the “it” actually is.  Even at CCHO, we can alternate between broader and more narrow definitions of affordable housing, depending on the context.  The basic idea of affordable housing is simple, but the landscape is complex, so we thought we’d take a minute to break it down.

100% Affordable Housing built by the nonprofit developer Community Housing Partnership.

Zgymundt Arendt homes, a 100% affordable housing development built by the nonprofit developer Community Housing Partnership.

The basic definition of “affordable”:

Housing is generally considered affordable when residents can pay their rent or mortgage as well as meet their other basic needs, and when that home is safe and secure for the long term. Policymakers and advocates typically consider someone’s housing affordable when it  costs no more than 30% of the household’s income, including rent or mortgage payments, insurance, taxes, and utilities. For homeownership the conventional wisdom on affordability is more like 35% of income.

According to this basic definition, lots of different types of housing could be considered “affordable,” depending on who is trying to afford it and how much it costs.  In San Francisco, however, homes meeting this casual definition of affordable housing are hard to come by on the open market, especially for low- and moderate-income people. In order to provide housing for households at these income levels in the city and in proximity to their workplaces, this affordable housing must be produced through a combination of subsidies and regulations.

This gets us to a much more specific definition, and what we at CCHO are talking about when we advocate for affordable housing: price-controlled, permanently-affordable housing.

Let’s examine both of those criteria in turn:

Market-Rate vs. Price-Controlled Housing

San Francisco’s housing stock can generally by divided into two types, market-rate housing and price-controlled housing – and this is one of the most important distinctions when talking affordable housing. It all comes down to who is setting the price and how that price is set. With “market-rate” housing, the cost to buy or rent is set entirely by the market – at whatever amount the owner can get. With price-controlled housing, the cost to rent or buy is in some way set or regulated and enforced.  Though sometimes (and frankly, almost never in San Francisco’s current housing market) residents can find market-rate homes that meet the basic definition of “affordable” (30% of their income or less), when we talk about affordable housing, we are specifically talking about price-controlled homes.

“Price-controlled” is a wide-ranging category, including everything from public housing and nonprofit-owned affordable housing to rent-controlled homes, where rent increases are limited by law.

What’s the difference between permanently affordable housing and rent-controlled housing?

Now that we are within the world of price-controlled housing, we can narrow things down even further by examining the second important distinction for our definition: permanently affordable housing vs. rent-controlled housing.

IMG_8179

A rent-controlled apartment in Chinatown where protesters fight the Ellis eviction of long-term tenants.

Rent-controlled housing is an important piece of San Francisco’s affordability landscape, comprising the largest portion of the housing in the City that is still practically affordable to a range of San Franciscans, but it isn’t permanently affordable.  Though many people refer to San Francisco’s system as “rent-control,” it is technically “rent-stabilization,” because the “control” does not stay with the apartment when it’s re-rented to another person – it goes back to market-rate pricing when the tenant moves out. Rent control does not provide permanent affordability tied to a particular unit. However what it DOES do, very importantly, is keep the rent affordable to the tenant while they are living in the unit – which means stability for a person or a family over time. As one of the core purposes of affordable housing is to provide stability and quality of living for residents, especially for poor, working-class and moderate/”middle” income people whose needs aren’t met by market-rate housing, rent control is an invaluable part of keeping San Francisco affordable.

The passage of rent control in California cities is closely tied to the passage of Prop 13 in 1978. As landlords got a reduction and “stabilization” of their property taxes through Prop 13, many renters demanded a similar stabilization to their rents, and a few cities were able to pass rent control laws.  San Francisco’s rent control law, however, currently prevents any building completed after 1979 from being subject to rent control, so any rent-controlled units we lose (through demolition or conversion) cannot be replaced. It is thus incredibly important (and one of the main goals of CCHO’s work) to preserve the existing rent-controlled housing we have.

Permanently affordable housing developments, on the other hand, provide homes at low rents to residents who qualify and these restrictions stay with the unit, usually for the life of the building or at least 55 years. Permanently affordable housing is often price-controlled according to AMI, or Area Median Income. “Median” means that half the people in the area make less than that amount, and half the people make more. Based on AMI, the federal government classifies household earnings into different income levels: Very Low Income (those earning less than 50% of the median), Low Income (incomes between 50% and 80% of the median), and Moderate Income (those earning between 80% and 120% of the median).  Affordable housing units are built for a particular income level, and are price-controlled so that the rent or cost of those units equals 30% of that income level.  In order to be eligible for affordable housing, a resident has to qualify by showing that they are within that particular income level when they move in, though their incomes can change in the future and they would still retain their housing. When one resident moves out, the unit will remain affordable for the next tenant who moves in.

Different Types of Permanently Affordable Housing

Okay, so we are almost there!  There are several different categories of permanently affordable housing that exist in San Francisco, some of which are still being built, and some of which are no longer being built.

Most permanently affordable housing units rely on public subsidy to cover part of their costs.  Over the years, however, who is building affordable housing, what types of subsidies they’re using, and when they use these subsidies has changed.

Public housing in Bernal Heights.

Public housing in Bernal Heights.

Federally-Subsidized Housing (AKA, Public Housing and Section 8 Housing)

The way permanently affordable housing used to get built was primarily through federal subsidies.  Federally-subsidized affordable housing includes public housing and Section 8 housing, and some housing cooperatives.  Public Housing was owned and run by the federal government through local Housing Authorities. Section 8 housing was built by private developers receiving federal subsidies to cover the difference between what a low-income renter can pay and the fair market rent of the apartment. The important thing to know is that the Federal government no longer subsidizes the construction of new public housing – these types of housing were primarily built between the 1940s and 1970s.

St. Peter's Place, 100% affordable housing development for people with special needs, built by Bernal Heights Neighborhood Center.

St. Peter’s Place, a 100% affordable housing development for people with special needs, built by Bernal Heights Neighborhood Center.

Today’s Affordable Housing

Because the federal government is no longer building public housing and has cut way back on its funding for operating and maintenance subsidies, the way most affordable housing gets built today is through a complicated mix of funding sources (usually including money from local government and Federal tax credit investors).  In San Francisco, most affordable housing is built by community-based, nonprofit housing developers (most of which are members of CCHO), though there are also regional nonprofit and for-profit developers of affordable housing.  Another important distinction between the old public housing and new affordable housing, besides the quality of design and construction, is that typically these newer developments depend on substantial up-front investments rather than requiring ongoing public subsidies throughout the life of the building.  This means that the “affordable” rents that tenants pay are sufficient to cover the building’s operating and maintenance costs, making these developments less likely to fall into disrepair (like many public housing developments have as the federal government cut back on subsidies).

Typically, this newer permanently affordable housing serves various income ranges under 60% AMI (what HUD defines as “Low Income” in San Francisco). Some buildings serve specific populations, such as formerly homeless, low-income families, or seniors. Permanently affordable developments may be in new construction buildings or may be in rehabbed existing buildings, such as residential hotels (also called “SROs” or Single-Room Occupancy) or old hospitals. They often include on-site “supportive services”: case-management, treatment or job counseling, senior programs, food bank deliveries, family activities or childcare, or other supports. Smaller apartment buildings are also sometimes acquired and converted to permanently affordable housing – what we call “small sites acquisition and rehab” – a strategy that has been especially important in recent years to protect tenants vulnerable to evictions and preserve rent-controlled housing that could get “flipped” by speculators.

NEMA, a market-rate housing project with on-site rental BMRs.

NEMA, a market-rate housing project with on-site rental BMRs.

And Lastly, Inclusionary Housing Units within Market-Rate Developments (AKA “Below-Market-Rate” or BMR units)

Some affordable housing units are also built today by market-rate developers through inclusionary housing requirements.  This is one way in which cities are able to get units built for households with incomes between 50% and 120% AMI, for which there are no Federal tax credits or other subsidies, and compel developers to help mitigate the affordable housing needs created by market-rate housing. In 2002, CCHO and other housing advocates got the city to implement “inclusionary zoning,” which requires market-rate developers (of 10 units or more) to either build mixed-income buildings with on-site, price-controlled units, build these below-market-rate units at another site, or pay an “in lieu” fee to the Mayor’s Office of Housing for the development of affordable housing. The inclusionary housing ordinance in San Francisco requires these homes to be affordable to households at 55% AMI for rental apartments, and affordable to households at 90% AMI for ownership homes. The basic concept here is to use the profits from the market-rate units to offset the cost of the affordable, price-controlled units. Because there are no public subsidies to help build this type of “moderate income” housing, the City’s inclusionary program is the only source of units affordable to households making close to the median income. A measure on the ballot this June may make some important changes to inclusionary housing, including increasing the percentage of affordable housing required and adding an additional requirement for middle-income housing for people earning 100% and 120% of AMI.

 

So, there you have it!  When CCHO advocates for building new “affordable housing” today, we mean price-controlled, permanently affordable housing, generally built by nonprofit housing developers for people below 50% AMI, or inclusionary housing built by market-rate developers for people earning 55%-90% AMI (though this may soon expand to include people earning 100% to 120% AMI).  If you’re feeling overwhelmed by our very long definition, the most important thing to remember is why it matters to have affordable housing, of whatever typology: because it provides stability and quality of living for San Francisco residents, including the poor, working-class, and moderate/middle-income people who are otherwise permanently shut out of the housing market. This is the housing that isn’t getting built by the market and helps keep our city affordable to all.





Freeing Up the Affordable Housing Gridlock: Process Improvements that Matter

16 02 2016

We weighed in on the debate around process improvements with our op-ed in today’s Examiner (read the original article here).

One way to improve process: make community meetings more meaningful by keeping good records of promises made.  Photo: abc7news.com.

One way to improve process: give community meeting requirements real teeth. Photo: abc7news.com.

As seems to happen at the turn of every new year, there is once again lots of chatter about “process improvements” and “streamlining” to speed up the timeline for approving developments. For developers, these are usually code words for eliminating community review and public hearings. But there are certainly aspects of The City’s bureaucratic process that should be improved for the benefit of developers, communities and city staff as well. Addressing the lengthy process for approving affordable housing could be one more way to improve our city’s Housing Balance achievements.

First, however, let us put to rest the notion from streamlining boosters that simply increasing the speed of approvals for market-rate development will increase San Francisco’s housing affordability. Hooey. The problem with affordability is fundamentally an issue of stark and rapidly increasing income inequality — San Francisco has one of the greatest degrees of income inequality of any city in the United States. It’s also the result of the harsh and rapidly increasing evictions crisis as rental housing is lost to the speculation market, and the result of the current imbalance between market-rate and below-market-rate housing production.

Simply speeding up approvals will not solve any of these much deeper problems. Furthermore, The City currently has more than 15,000 fully entitled housing units citywide waiting to be built, 87 percent of which are market-rate housing units, as well as another 23,000 units entitled in major project areas like Park Merced and Hunters Point, which indicates the real challenges are more related to financing and construction schedules than to the approval process of a large-city bureaucracy.

When making improvements, we need to make sure we don’t lose sight of what the permitting process is actually for. Process exists to make sure development is done right. An overarching goal of process improvements should be creating both an efficient and effective process — not simply speeding things up or eliminating community involvement.

In 2014, the Council of Community Housing Organization’s advocacy in a city working group, together with a broad set of stakeholders, led to a number of improvements in the permitting process without eliminating public engagement, a good first step in the right direction. What follows are three ideas we offer for the next step in this conversation: truly prioritizing affordable housing within the bureaucracy; standardizing notification, public meetings and design guidelines; and carefully streamlining environmental review for certain projects.

Prioritize Affordable Housing

We already have several city “directives” that prioritize affordable housing — the problem is that everything seems to be a priority for the Planning Department. One staff person should be dedicated solely to shepherding 100 percent affordable developments through both the Planning and Building Permit process, and the environmental review and the queue for Planning Commission hearings should always prioritize affordable developments. Secondary priorities should be assigned depending on the level of affordability, and high-profile projects, whether a Warriors Stadium or the America’s Cup, should not be allowed to bump affordable housing.

Standardize Public Notification, Community Meetings and Design Guidelines

Public Notification: The Planning Department has a dozen different notifications for different projects and permits, none of which make sense to the average person. We should have a universal notification system that simplifies notifications into just a few categories, with a standardized minimum 30-day timeline, and that makes notifications actually understandable and informative. The geographic area of notification should also have some logical relationship to the type and scale of the project.

Community Meetings: Required “pre-application meetings” are ostensibly an opportunity for the developer to hear from folks who have a stake in the project’s outcome and to respond to questions, improving the project from the outset and building a foundation for a constructive relationship with the community. In actuality, this requirement has no teeth. Meetings should be staffed by public officials, and recorded with a publicly-accessible record of issues raised and promises made, with adequate notification if those promises change. A little more time and seriousness building a relationship with the community on the front-end can save a lot of time later on.

Design Guidelines: The Planning Department’s outmoded Residential Design Guidelines, which set citywide expectations for design, are only for single-family and smaller buildings, and moreover are flawed in some ways (especially dealing with rear-yard development, which is now happening at an increasing rate as property values skyrocket). They are long overdue for an overhaul. And missing entirely are guidelines for larger multi-unit developments, a critical need as the City pushes for higher-density development in infill parcels and commercial corridors adjacent to existing housing. Good guidelines, developed with community input, will create much more certainty for both the developer and the community, and help standardize the review of individual projects.

Improve the Environmental Review Process

The environmental review process can reveal important issues and provide the community and City planners with information and a process to understand a project’s “fit” with its location. But there are certain situations that could warrant a reduced environmental review process if they were evaluated according to clear standards that have been vetted by the public. This could look like a checklist, similar to the existing Categorical Exemption checklist, that identifies specific situations that meet a certain threshold, such as affordable housing projects, where lengthy environmental documents or consultants may not be needed.

Those kinds of administrative reforms would be a significant step in freeing up delays in affordable housing development. In the end, process improvements shouldn’t just be about making things faster, but about making all parts of the process efficient and meaningful so they actually do what’s intended — create real engagement with impacted community members and make sure developments are designed and built in the best way for the community, the environment, and The City.





Hope vs. Fear: The Inclusionary Housing Measure

11 02 2016

Check our recent piece in BeyondChron (read the original article here):

The development at 55 Page Street included 17 onsite inclusionary units. Photo: Intracorp Companies.

This development at 55 Page Street includes 17 on-site inclusionary units. Photo: Intracorp Companies.

A big and exciting change is coming down the pike for the City’s inclusionary housing requirement. This June, a measure proposed by Supervisors Kim and Peskin will be on the ballot to take the inclusionary housing policy back out from the City charter and initially double the affordability requirement from 12% to 25% of units in a development project.

In his recent piece for BeyondChron (“What Is Best Way To Build More Affordable Housing“),Tim Colen of the HAC paints a doom-and-gloom picture of the proposed charter amendment, arguing that we are in grave danger of placing too large a burden on market-rate housing, and descending into a spiral of decreased market-rate development, leading to less affordable housing, fewer jobs, and general economic decline for San Francisco.

Though it’s easy to get caught in such a politically-charged fear spiral, the underpinnings of Colen’s argument don’t hold. In fact, this charter amendment is a necessary and timely opportunity to increase affordability in San Francisco.

Colen’s argument relies heavily on the deceptively straightforward supply-and-demand argument that the displacement and affordability crisis simply comes down to not having enough new market-rate housing. Displacement and the affordability crisis have many root causes, including drastic income inequality, unfettered speculation on housing, and the huge imbalance between market-rate and affordable housing constructed in San Francisco (read our previous piece on “Unpacking the ‘Affordable Housing Balance’” here).  To improve affordability, we need to improve that affordable housing balance, and increasing inclusionary housing requirements on private development is one effective means to start doing just that.

1600 Market Street is a 100% affordable off-site BMR project of first-time homeownership units.  Photo: Power Construction, Inc.

1600 Market Street is a 100% affordable off-site BMR project of first-time homeownership units. Photo: Power Construction, Inc.

Also wrong is the idea that any obligation placed on market-rate housing will threaten affordable housing production. In actuality, affordable housing construction in San Francisco is not so dependent on market-rate housing (read the reasons here in our piece “Don’t Believe the Hype”). Modest inclusionary requirements, as are being proposed here, are costs to development, just like construction costs, developer fees, and interest rates, and, just like other costs, get factored into the cost of land. In fact, the proposal simply restores the inclusionary requirement for low-income units back to 15% as developers were building until 2012, and then adds a new middle-income category for 10% of the units, which is much less expensive for developers to provide.    Our current inclusionary housing requirements were reduced by 20% in 2012, and locked in the City’s Charter.  According to the City’s Residential Nexus Analysis, the current inclusionary requirements do not even mitigate the need for new affordable housing that is created by market-rate development (meaning that, at the current level, we can never begin to catch up to the affordable housing need new development is creating, let alone fulfill the pre-existing need).  Whether or not our current inclusionary requirements were appropriate for 2012, they are not appropriate for 2016, when San Francisco’s housing market and affordability crisis look very different.

Market-rate developments should be expected to contribute significantly more affordable housing to San Francisco. And recent measures (like 2014’s Proposition K, calling for a minimum of 33% of new development to be affordable) show voters are on board with this.  It’s beyond time to set a higher bar for private development and ensure that projects are contributing their fair share to housing our City’s resident workforce.

Finally, Colen’s argument distracts from the two huge and necessary changes that this amendment makes: 1) a “good government” provision removing the inclusionary requirement from the Charter, allowing for future legislative amendments when appropriate; and 2) creating affordable housing for a wider range of the City’s working residents, including moderate/middle-income San Franciscans. Inclusionary housing is one of the best tools we have to build housing for moderate/middle-income San Franciscans, as there are no public subsidies available for those income levels.  Instead of pitting low-income and middle-income housing needs against each other, this measure addresses BOTH needs, adding a second tier to the City’s inclusionary housing requirement in the form of 10% of on-site units for middle-income households.  This means rental housing for households making up to 100% Area Median Income (for example, a teacher making $70,000/year, or a postal worker and a restaurant worker with a child making $90,000/year) or first-time homeownership opportunities for households making up to 120% AMI (for example, an electrician making $85,000/year, or a family of four with two teachers together making $120,000/year).

So, there’s no reason to create fear here. Only reason for excitement that we finally have some of the changes to inclusionary housing that San Francisco has long needed.





Density Done Right in the City

9 02 2016

CCHO’s latest op-ed in The Examiner.  Read the original article here.

People protesting the Planning Department's "Density Bonus" Program. Credit: Joe Rivano Barros/Mission Local.

People protesting the Planning Department’s “Density Bonus” Program. Credit: Joe Rivano Barros, Mission Local.

As San Francisco’s affordability crisis continues unabated, there is almost universal consensus that we need to expand housing opportunities that are affordable to working-class residents in all neighborhoods of The City. One way to incentivize new housing and compel developers to provide more onsite affordable units is through altering density limits.

For the last two years, San Francisco’s Planning Department has been developing its own version of a “Density Bonus” program, with tons of staff and consultant expenses and practically no community input until the last few months. However, this program and the approach to altering density it represents, leaves San Franciscans with a zero-sum game: Either accept redevelopment-scale rezoning — which potentially destroys existing homes and community-serving businesses, builds predominantly single-bedroom and studio units and streamlines development through the approvals process — or conversely oppose all development proposals of any kind. It does not have to be this way.

Last week, the Planning Commission faced more than five hours of public testimony about the program, most of it serious and substantive concerns about the negative implications of the legislation. It was a bruising hearing, and the planning staff barely afforded a continuance of a few weeks. The clear message was: We can do better.

We’ve all seen the abandoned gas stations in the avenues and vacant corner lots in Excelsior neighborhoods and one-story buildings facing the wide canyon of Geary Boulevard. Why can’t The City encourage desolate sites to be developed with real homes for working-class families that our neighborhoods so desperately need, as a counter to the current predominant “housing” model of developing unattainable luxury towers along the Bay? As a starting point, we propose several principles for doing density right:

Protecting residents, homes and neighborhood businesses

Any discussion about development must start with preserving what makes our beautiful, walkable, human-scaled and diverse neighborhoods: Protecting our existing residents, our existing housing and our community-serving businesses. At minimum, any program that creates new “incentives” for development should exclusively apply to sites with no existing rental homes — a precious resource — and should clearly be mapped that way. And in our commercial districts or light-industrial areas, any program that needs to relocate small business tenants should provide the same full relocation benefits, within the same general neighborhood area, that our affordable housing developers are already required to provide.

The right amount of ‘incentive’ and the right affordability

The proposed “Density Bonus” program offers developers increased density and additional heights in exchange for more on-site affordable housing. This basic principle is good, but two key questions need to be asked.

First, how much in additional profits will The City give to developers, and how much of that value should be recaptured by the public in terms of increased affordability or other public benefits? The proposed program uses a “one-size-fits-all” approach that doesn’t make sense, and would give some developments huge additional profit for very little additional affordable housing.

An example of this kind of giveaway is what recently happened with projects on Divisadero Street, where development capacity (and profit) more than tripled when The City simply eliminated the density limits (and that was without adding extra floors). Making sure generous incentives are reciprocated by ample affordable housing will require the type of financial due diligence analysis that has yet to be done.

Second, what should our affordability goals be in exchange for developer incentives? What income levels need to be served in order to keep our neighborhoods affordable and diverse? A straightforward approach would figure out how to house our city’s residents earning salaries from minimum wage to teacher salaries, and for a full range of family sizes. Translated into the “Area Median Income” levels, that would be housing from 45 percent to 85 percent AMI for single-income earners, and up to 60 percent to 120 percent AMI for two-income families.

Moreover, the affordability should be relevant to the local incomes within the community. When neighborhoods like the Bayview, Chinatown, Mission and the Western Addition have median household incomes well below the citywide average, how then does The City’s current proposal for all “bonus units” to be priced between 120 percent and 140 percent of the median income level benefit the residents of those communities? The City must be careful in picking who wins from Density Bonus.

Getting real family housing

Increasing density often means increasing heights and diminishing unit sizes, regardless of whether or not small units meet community needs. Instead, we can increase density while still requiring that developers provide predominantly family units and minimum unit square footages, or that building heights be appropriate to cost-effective building types. In any case, decisions about unit types should not just be set by planners, but also in thoughtful consultation with people in those neighborhoods.

Linking community improvements to new housing

As new development is financially incentivized for The City’s neighborhoods through increased density, there should be attention to the transportation infrastructure and other community improvements that may be needed to support that growth. The City’s recently adopted “Transportation Sustainability Fee” is a start, but only applies to large projects, and fees aren’t directed to help with the local transit impacts related to development in particular neighborhoods. To do density right, The City needs to decide how to hold increased development accountable for increasing transit service and other improvements.

Affordable housing not a ‘trade-off’

Finally, in the quest for “density done right,” the role of the public should not be diminished in some kind of “trade-off” for increasing affordable housing requirements. That is another zero-sum game. The process of building housing should also be about building relationships with the local communities that will live with new development for the many years to come. Design matters, ground floor retail matters, and transportation matters. Ensuring that the public has a role in shaping those outcomes and that developers are accountable is not unreasonable. San Francisco is a city of neighborhoods, and any density bonus program should approach it as a landscape of neighborhoods, not just a real estate map for expediting development.

How do we get there?

Few if any of the questions raised here are addressed in the Planning Department’s “Density Bonus” proposal — which is too bad, as The City really does need a viable program to create affordable housing for a mix of working-class households. The Planning Commission seems to still be struggling, and soon the Board of Supervisors will have the opportunity to weigh in. We hope they begin fresh and create a program that starts from a vision of what truly enhances communities.





Good Changes Ahead for Inclusionary Housing

1 02 2016
The ballot measure proposed by Kim and Peskin puts forth much needed changes to the City's inclusionary policy.  Photo: Lea Suzuki, SF Chronicle.

The ballot measure proposed by Kim and Peskin puts forth much needed changes to the City’s inclusionary policy. Photo: Lea Suzuki, SF Chronicle.

A big change is coming down the pike for inclusionary housing (the requirement on market-rate development to build mixed-income housing with below-market-rate units, or contribute funds to the City’s affordable housing development).  Since 2012, San Francisco’s inclusionary housing requirement has been locked up in the City’s charter –meaning that any change to inclusionary has to be done through a charter amendment voted on by SF residents and can’t be made by the Board of Supervisors legislatively.  Really meaning that it is impossible to increase the inclusionary housing requirement to align with the current housing market in San Francisco, which has dramatically changed since 2012.  This June, a measure will be on the ballot to take inclusionary housing policy back out from the charter and at least initially increase the affordability requirement from 12% of units in a development project being affordable for low-income residents, to 15% affordable for low-income AND 10% affordable for middle-income households.

If you aren’t feeling excited about this yet, you should be.  This is a big opportunity to increase affordability in San Francisco.  Our current inclusionary housing requirements were set back in 2012 as part of the compromises around the Prop C Housing Trust Fund, which helped restore affordable housing funds put into limbo when the State government dissolved the City’s redevelopment agency (and which some have tried to portray as a romantic grand bargain – though many of the outcomes of Prop C were good, the reality of some deal points today is less pretty).  Now in 2016, the housing market and affordability in the City look very different and market-rate developments should be expected to contribute significantly more affordable housing to San Francisco.  And recent measures (like 2014’s Proposition K, calling for a minimum of 33% of new development to be affordable) show voters are on board with this.  It’s beyond time to set a higher bar for private development and ensure that projects are contributing their fair share to housing our City’s resident workforce.

Beyond setting that higher bar, this measure does something else important – it acknowledges that a wider and wider range of the City’s everyday people are being shut out of the housing market.  Though low-income and working-class residents still have the greatest need for affordable housing and are the most vulnerable to displacement and exclusion from this great city, increasingly middle-income San Franciscans are finding that they are scrambling to afford to stay in the City, too.  Inclusionary housing is one of the best tools we have to build housing for moderate and middle-income San Franciscans, as local, state, and federal subsidies don’t apply to housing for those income levels.  Instead of pitting low-income and middle-income housing needs against each other, this measure addresses BOTH needs, adding a second tier to the City’s inclusionary housing requirement in the form of 10% of on-site units for middle-income households.  This means rental housing for households making up to 100% Area Median Income (for example, a teacher making $70,000/year, or a postal worker and a restaurant worker with a child making $90,000/year) or first-time homeownership opportunities for households making up to 120% AMI (for example, an electrician making $85,000/year, or a family of four with two teachers making $120,000/year).

So get excited.  We will finally have the change to inclusionary housing that we’ve needed – a measure that recognizes the real obligation private development has to contribute to affordable housing and works to address the ever-widening housing affordability crisis.