Local Measure Tackles Affordable Housing

The Mission District’s housing market is a hot commodity for hip yuppies and rich techies like rumored neighbor Mark Zuckerberg.

But the heat is often too much to handle for low-income renters and middle-income homeowners, who at times are forced out of their urban dwellings by eager would-be tenants with open checkbooks.

As the city copes with the pressures of high market-rate demands, affordable housing has arguably become the most pressing issue facing middle- and low-income tenants across San Francisco.

Tomorrow city residents will determine the fate of Mayor Ed Lee’s proposed Housing Trust Fund, which would establish a reliable funding stream for affordable housing and attempt to appease both market-rate developers and nonprofit housing advocates.

If approved, Proposition C would establish the city’s first dedicated, locally sourced affordable housing fund.

The measure comes nearly a year after Governor Jerry Brown axed funding for more than 400 redevelopment agencies statewide to close the state’s then-$13 billion deficit. The agencies — supported by property tax revenue — provided financial support to struggling urban communities.

The loss of state funding fueled statewide fury as local governments scurried to find ways to meet the housing needs of struggling communities. And the city took another blow when a performance audit produced in April revealed that San Francisco has failed to meet its affordable housing goals since 1999.

“There is a dire need for more affordable housing and there has never been a greater gulf of those who can afford housing. We definitely need to find a mechanism to fund that,” said Phil Lesser, a registered lobbyist who works closely with developers. “We are trying to find ways to fill the void [of reduced redevelopment funding]. San Francisco is not alone.”

Over the next 30 years, Prop. C is expected to funnel more than $1 billion toward the construction of new affordable homes, homebuyer and downpayment assistance, and housing stabilization and foreclosure prevention programs.

While providing affordable housing is a nonpartisan agenda item, contention often arises over how to marry the needs of a developer’s bottom line with nonprofit advocacy agendas. Prop. C seeks to appease both sides of the aisle by increasing construction of affordable housing while relaxing developer requirements for expanding construction projects.

The fund is expected to spur up to 30,000 low-income rental units and restore funding for at least 9,000 previously planned units for working-class residents.

In exchange, the measure would provide concessions for developers, who currently must designate 12 to 15 percent of housing units as affordable. This requirement would not change under Prop. C, but developers would have the option to lower costs by selling or renting private housing at a higher price, for example.

The Housing Trust Fund would be funded by a variety of monetary streams, including a portion of hotel taxes that previously funded affordable housing in the city.

Additional funding will come from set-asides in the General Fund. The city would provide $20 million in 2013, increasing its funding by $2.8 million annually until contributions reached $50.8 million in 2024. Thereafter, increases in funding would rely on changes to the General Fund.

Today San Francisco relies on multiple sources to fund affordable housing, including federal, state and local sources. The money is funneled into three main areas: improving affordable housing, providing downpayment loan assistance and providing ways for eligible homeowners and renters stay in their homes.

Another source of funding relies on the passage of Proposition E, which would increase business license fees and tax businesses based on a percentage of their gross receipts — the total amount they receive for goods and services — rather their payrolls.

Prop. E faces no organized opposition.

According to Sara Shortt, executive director of the Mission’s Housing Rights Committee, a locally sourced housing fund would alleviate bureaucracy while allowing more flexible rules regarding who can receive assistance. Illegal immigrants, for example, are not eligible to receive federal support dollars.

“We’ve often relied on federal and state monies in the past, and those are reliant on appropriation and political processes, and all of [which] are certainly vulnerable,” Shortt said. “This would be locally generated and locally controlled.”

The committee is a member of the Council of Community Housing Organizations (CCHO), an advocate for affordable housing that consists of 20 nonprofit housing organizations and religious groups across San Francisco. The CCHO worked closely with the Board of Supervisors to draft and finalize the measure.

District 9 Supervisor David Campos was not enthusiastic about Prop. C early in the planning process, asserting that the measure, while a step in the right direction, did not go far enough to meet the city’s affordable housing needs. He’s since come on board in the hope that funding will expand over time.

“It’s something that’s especially relevant in the Mission,” said Campos, who is running for reelection. “We’ve seen in the last few months, in the last year or so, rent and prices have been going up. We need to help low-income and middle-income residents who want to stay in San Francisco.”

Campos is among eight supervisors who support Prop C. District 4 Supervisor Carmen Chu and District 7 Supervisor Sean Elsbernd oppose the measure.

As of Nov. 5, Prop. C faces no organized opposition. The sole committee in support of the proposition — the Coalition for Sustainable Housing — has raised $438,250.

Rigoberto Hernandez contributed to this story.

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