By J.K. Dineen Updated Nov 27, 2023
https://www.sfchronicle.com/sf/article/s-f-builder-s-remedy-housing-legislation-18517453.php
The old power station on Potrero Hill in San Francisco is now the site of a housing project. A measure advanced by a Board of Supervisors committee will help the city ease red tape and speed approvals of new housing. Jessica Christian/The Chronicle
Faced with threats of losing control of local zoning and jeopardizing funding from the state for housing and transportation, a committee of the San Francisco Board of Supervisors advanced legislation Monday that would reform how the city approves residential development.
Under a set of state mandates laid out in an Oct. 25 “San Francisco Housing Policy and Practice Review,” the California Department of Housing and Community Development, or HCD, gave the city 30 days to pass Mayor London Breed’s “constraints reduction” ordinance, which would slash red tape and allow many projects to go forward without a hearing at the Planning Commission.
While that deadline came and went on Monday — the state is likely to issue a warning letter on Tuesday — the city has another 30 days to pass the streamlining ordinance. The full Board of Supervisors will hear the ordinance Tuesday.
While the legislation was sent to the full board with no recommendation, it was amended to include some protections likely to make it more palatable to some board members. This includes amendments from Supervisor Rafael Mandelman that will prohibit demolition of rent-controlled units — the initial legislation allowed two-unit, vacant rent-controlled units to be razed to make way for denser developments — as well as a provision that would protect historic resources.
Mandelman also introduced an amendment to withhold streamlined approval of so-called “monster homes,” jumbo single-family structures that have proliferated in some of the city’s more affluent neighborhoods.
“I don’t think this is easy or simple but hopefully we can get to an ordinance that both increases housing production in San Francisco and also makes us a better city,” Mandelman said.
Looming over the debate is the threat that HCD could decertify San Francisco’s so-called “housing element,” an eight-year plan approved earlier this year under which the city is obligated to plan for 82,000 housing units, 46,000 of which are supposed to be affordable to low- and moderate-income families. That, in turn, would allow developers to file “builder’s remedy” projects, allowing them to bypass all local planning review. The city could also lose out on money for affordable housing and transportation as long as its housing element is not certified.
While the members of the pro-housing YIMBY movement have cheered on the state’s interference as a long-overdue correction to San Francisco’s position as California’s most expensive and time-consuming place to build housing, others see it as a heavy-handed form of “blackmail” that will allow market-rate developers to run roughshod over neighborhoods while doing little to promote housing for poor or moderate-income households.
Committee chairwoman Myrna Melgar said that her office, working with the city attorney and the Mayor’s Office of Housing and Community Development, has come up with “collaborative” legislation that does its best to protect tenants while making it faster and cheaper to construct much-needed housing.
“A lot of people had their doubts,” Melgar said. “I think it is a really good piece of legislation, and it’s compliant (with state law).”
The deadline comes a month after HCD released its first-ever review of city housing practices, which included 18 actions the state said San Francisco must take in order to remain in compliance with housing laws.
At the time of the review, HCD Director Gustavo Velasquez said San Francisco’s byzantine planning process has created an “entrenched” system that is so hard to navigate that many developers have given up on building in the city. The result is a housing market that only wealthy households can crack, unless people are lucky enough to win the lottery for a subsidized affordable unit.
“People who were born and raised in San Francisco cannot afford to stay and raise their own families there,” Velasquez said. “It is egregious and must be addressed.”
On Monday, committee member Supervisor Dean Preston blasted HCD for using the threat of withholding affordable-housing funding to force a streamlining bill that he said would just lead to superfluous luxury units.
“The premise the state is operating from here — that if the city doesn’t sufficiently streamline and deregulate housing for rich and upper-class people, the state is going to cut housing for poor and working-class people — is completely outrageous,” Preston said. “It is very clear to me that HCD is not going to do a thing … to insist that our city actually produce the 46,000 affordable homes” required in the housing element.
Numerous critics pointed out that San Francisco exceeded the number of market-rate units required by the state in the last housing cycle while falling short by 40% in producing homes for low-income families.
Li Lovett, communications director of the Council of Community Housing Organizations, called housing production in San Francisco “a tale of two cities.”
“Affordable housing developers know the real challenges to building the housing we need,” she said, “while market-rate development is where the money is at.”
But others blamed the city’s current rules for making it one of the least affordable cities in the United States. Ingleside resident Steve Marzo said the city’s unaffordability is the result of “empowered special interest groups and landed gentry working together to preserve the city in amber.”
Jake Price of the Housing Action Coalition urged board members to pass the legislation as quickly as possible
“We are tempting fate, flirting with disaster and stomping on thin ice if we delay this any further,” he said.
The committee tabled a non-binding resolution from Supervisor Aaron Peskin that urged City Attorney David Chiu and the “city lobbyist” to work with state officials to extend the deadlines.
The resolution, co-sponsored by Supervisor Connie Chan, also takes issue with what it calls HCD’s “singular focus on private development policies and practices, and without sufficient measures to address racial equity, fair housing practices, affordability and displacement.”
HCD spokesperson Pablo Espinoza said the agency “does not plan on revising the timelines or content” of the review, which he said was informed by “extensive community outreach” that included “city staff, appointed and elected officials, community-based organizations, housing advocates, affordable developers, market-rate developers, attorneys and others.”
John Avalos, Executive Director at the Council of Community Housing Organizations, suggested San Francisco had been unfairly targeted by the state.
“Cities that have historically shirked their fair share of developing affordable and market-rate housing should be held accountable, but San Francisco is not one of these bad actors,” he said. “San Francisco overproduced its market-rate housing goals and has one of the best track records on building affordable housing in California.”
Robert Fruchtman, a volunteer organizer with YIMBY Action, said the state report “was clear in finding San Francisco had introduced barriers to building housing that were not necessary and caused the cost of housing to go up.”
“The idea that HCD is unfairly punishing San Francisco is absurd,” he said. “San Francisco has no excuse.”
Reach J.K. Dineen: jdineen@sfchronicle.com