City Ignores Proposition K, Doing Little to Repurpose Surplus Land to Beneficial Uses

By Michael Iacuessa

In 2015, voters approved Proposition K to streamline the process of identifying surplus municipally-owned land that could be used for affordable housing. The voter guide indicated that there’d be specific reporting dates for public agencies, hearings and oversight by the San Francisco Board of Supervisors (BoS). Three years later, the City has passed on the only parcel deemed suitable to be repurposed.  Proposition K remains largely unimplemented.

From a list of 33 unused sites compiled last April, the Mayor’s Office of Housing and Community Development (MOHCD) decided that only three contiguous parcels, if combined, would be large enough for a housing project. MOHCD staff determined that the land, near Civic Center at 240 Van Ness Avenue and 155 and 165 Grove Streets, could house 88 units rising eight stories.

MOHCD ultimately rejected the site because it didn’t have sufficient funds in its long-term budget to build the units. Development costs were estimated at $24.6 million, with an additional $6.4 million needed over 30 years to subsidize 18 residences set aside for housing homeless individuals. The agency recommended that the land be transferred to another municipal department, or sold to two adjacent property owners who could develop five parcels as a single project

MOHCD’s evaluations were given to BoS last spring. There are no indications that they have ever been discussed by the Board. Instead, the Mayor’s Office submitted the Van Ness-Grove Street parcels to an international competition, Reinventing Cities, which sought private sector bids to develop carbon-neutral uses for underutilized public property. Under the competition, proposals for the site will be evaluated early this year. According to Reinventing Cities, San Francisco sought maximum housing for the parcels but with only a minimum threshold of 33 percent guaranteed as affordable.

One other property, a long-abandoned police station at 2300 Third Street, was also singled out from the surplus list, but MOHCD didn’t do an analysis of it because neighborhood advocates, led by Friends of Dogpatch Hub, have been clamoring for a community center at the site. The San Francisco Police Department has since expressed a desire to repurpose a portion of the space; discussion over the community center remains active.

John Updike, Director of the Real Estate Division, which compiled the surplus list from various municipal departments, said excess land typically consists of mere slivers adjacent to property being used. “Most are not enough for development,” he said, citing a minimum of 10,000 square feet. However, the City does not appear to have fully examined the potential of less than a quarter-acre parcels being consolidated in collaboration with friendly neighbors willing to repurpose the land to beneficial uses. 

One reason why the surplus land list came up short is that Proposition K exempted some agencies from reporting, including the biggest public land owners in the City. The Port of San Francisco, San Francisco International Airport, San Francisco Municipal Transit Agency (SFMTA) and San Francisco Public Utilities Commission (PUC) are what Updike refers to as “enterprise” agencies. They generate their own funding; the City doesn’t have direct jurisdiction over their land. The San Francisco Unified School District (SFUSD) also falls under a separate category.

Former District 6 Supervisor Jane Kim, who was Proposition K’s main proponent, requested a hearing last year after the list of surplus sites was released. She wanted the Port, SFMTA, SFPUC and SFUSD to attend or make a report to further identify underutilized properties. The inquiry was never scheduled. Kim, who was termed out of office last month, said the entreaty is still pending before the Land Use and Transportation Committee and, while no date has been set, District 3 Supervisor Aaron Peskin is championing the effort on the committee. 

According to Peter Cohen, co-director of the Council of Community Housing Organizations, which advocates for affordable housing, the impetus behind Proposition K was to establish a systemic process where agencies combed their assets annually, prompting public discussion.

“Well, that hasn’t happened as far as we are concerned. It feels as though it’s either being ignored and circumvented or not really taken seriously,” he said. “Unfortunately, what tends to happen with these policies that require reporting, that require transparency, that require procedures is that unless someone is watchdogging it and unless there is some kind of enforcement or consequence system it is really easy for them to blow it off.”

Proposition K was an attempt to strengthen a previous policy. In 2002, the BoS approved a forerunner, the Surplus City Property Ordinance, chapter 23A, which called for surplus land reports to be compiled annually. The impetus for the decree was to identify sites that could be used to shelter the homeless. Proposition K amended that, not only by adopting new requirements, but to prioritize surplus property for affordable housing in general, including mixed-income developments.

“For large sites it is incredibly difficult to do 100 percent affordable housing,” said Kim.

She added that, under the original ordinance, departments refused to list properties; doing so was at their discretion. “It was incredibly disappointing that we would get such a short uncreative list.” With Proposition K, which added underutilized properties to unused ones, Kim said she hoped to get a much broader list. “To my incredible disappointment this year I got the list from the City and it only listed one property,” she said.

The concept of using surplus land for affordable housing isn’t original to San Francisco. There’s been similar action at the state level. California Code 54220 indicates that municipalities should, when disposing of surplus land, give preference to open space, recreation and affordable housing uses. In 2014, the California Assembly adopted a bill requiring local agencies and school districts to prioritize surplus land for affordable housing.

“We have a lot of publicly-owned land in San Francisco and we have a heck of an unmet need for affordable housing and it seems as if this should be low hanging fruit,” said Cohen.

There have been public land transfers outside of Proposition K. On PUC land at Balboa Reservoir planning is underway to develop mixed-income housing, with at least 33 percent affordable. Last year, SFMTA sold property at Geneva Street and San Jose Avenue to the MOHCD to be dedicated to 100 percent affordable housing. SFMTA proposes to build housing at its Potrero Yard, just south of Franklin Square, when it’s renovated in 2023.

However, according to Todd David, San Francisco Housing Action Coalition executive director, land isn’t the biggest obstacle to affordable housing. Money is. “There is a public misperception that building affordable housing is less expensive than building market rate housing and that’s just not accurate,” said David, whose organization lobbies for development across all affordability spectrums. “A lot of the affordable housing developers will say the only affordable thing about affordable housing is the rent.”

Maya Chupkov