Okay, good afternoon, everyone.

This meeting will come to order.

Welcome to the June 8th, 2026 regular meeting of the land use and transportation committee of the San Francisco Board of Supervisors.

I am Supervisor Mirna Melgar, Chair of the Committee, joined by Vice Chair, Cheyenne Chen, and also by Supervisor Bilal Mahmoud.

The committee clerk today is John Carroll, and I would also like to thank uh Jeanette Eganlauf at SFGov TV for staffing this meeting.

Mr.

Clerk, do you have any announcements?

Yes, thank you, Madam Chair.

Please ensure that you've silenced your cell phones and other electronic devices you've brought with you into the chamber today.

If you have any documents to be included as part of any of today's files, you can submit them directly to me.

Public comment will be taken on each item on today's agenda.

When your item of interest comes up and public comment is called, please line up to speak along your right-hand side of this room.

Alternatively, you may submit public comment in writing in either of the following ways.

First, you may email your comments to me at J-O-H-N.

C-A-R-R-O-L-L at SFGOV.org.

Or you may send your written comments via U.S.

Postal Service to our office in City Hall.

The address is one, Dr.

Carlton B.

Goodlit Place, Room 244, San Francisco, California 94102.

If you submit public comment in writing, I will forward your comments to the members of this committee and also include your comments as part of the official file on which you are commenting.

Items acted upon today are expected to appear on the Board of Supervisors' agenda of June 16th, 2026, unless otherwise stated.

Okay, thank you so much.

Uh Mr.

Clerk.

We have uh members of the public here today, and I just want to make a couple of announcements before we get started because today will be a long meeting.

Um that I do intend to continue to make a motion to continue items number four and number five to the call of the chair.

So if you are here to um hear or to get public comment on the uh site of Compton's cafeteria riot, the landmarking uh that is item number four, that will be continued to the call of the chair, and also item number five, the smoke-free places legislation that would also be continued to the call of the chair.

Of course, they're agenda, so if you want to provide public comment, uh you can uh but we will not be voting on those things today.

We will be voting on the continuance for both.

So uh just being mindful of your time.

Uh so with that, uh Mr.

Clerk, please uh call item number one.

Agenda item number one is an ordinance amending division one of the transportation code to make non-substantive organizational changes to the provisions governing the interdepartmental staff council on traffic and transportation and remove outdated provisions concerning the temporary use of streets for school uses.

The ordinance also amends the administrative and fire codes to update cross-references and affirms the planning department's secret determination.

Um, thank you so much.

Um this item was continued uh last week because of substantive amendments.

We do have staff on standby to answer any questions, uh, but I don't think there's a presentation.

So with that, um let's go to public comment on this item, Mr.

Clerk.

Thank you, Madam Chair, land use and transportation.

We now hear public comment related to agenda item number one.

If you have public comment for this item, please come forward to the lectern at this time.

And Madam Chair, it appears we have no speakers for this item.

Okay, public comment on this item is now closed.

Um I would like to uh make a motion to send this item out of committee to the full board with a positive recommendation.

On the motion offered by the chair that this ordinance be recommended to the board of supervisors.

Vice Chair Chen.

Chen I, Member Machmud Mahmoud I, Chair Melgar.

I.

Madam Chair, there are three ayes.

Thank you.

That uh item passes.

Let's go to item number two, please.

Agenda item number two is an ordinance amending the San Francisco fire code to prohibit the sale, offer, and delivery of lithium-ion batteries and replacement lithium-ion batteries that do not meet specified certification requirements to any address within San Francisco.

Establish enforcement processes and penalties for violations, authorize the city attorney to seek injunctive and monetary relief and attorneys' fees, and authorizing the fire department to implement the restrictions through rules, forms, and other guidance.

Thank you so much.

Uh Supervisor Mahmoud, thank you so much for introducing this item.

Uh the floor is yours.

Thank you, Chair Melgar.

Um, and first I'd like to call up the Chief Crispin to share a few words about the legislation, and then I'll share some of my remarks as well.

Good afternoon.

Madam Chair, members of the committee, Dean Crispin, San Francisco Fire Chief.

Uh, thank you, Supervisor McMood for presenting uh this legislation.

Um, this is an increasing problem.

The lithium ion battery fires that we're having at San Francisco.

I think a punctuation mark was placed on it at a fire that we had uh in mid-December last year at 50 Golden Gate that displaced over 130 residents.

And the challenge with these types of fires is they get a really big head start on us.

So that particular fire, uh, station one arrived on the scene within three minutes, and by the time they arrived, the fire had already exited the fire room, entered the hallway, entered the wall space, and was in the attic.

So we were chasing it from the moment that we arrived.

Our members did a fantastic job.

They stopped the fire from extending to the Golden Gate Theater and the adjacent structure.

But the issue with these non-certified batteries is that they continue to charge even after the battery is completely full.

So that causes heat and heats the battery, and a phenomenon called thermal runaway occurs, where all the cells ignite and cause a significant fire immediately, and an incredible amount of toxic gas is being emitted.

So and a lot of these happen in our most vulnerable communities, particularly in the tender loin.

So we're really concerned.

We have recorded over 120 fires of this type over the last five years, and this legislation would give uh the laws some teeth so that we can enforce and stop these.

We are fully in support of micromobility devices, e-bikes, and scooters, uh, but only those that are that are certified and safe.

Um so I'm happy to answer any questions if any of the committee members have them.

Thank you, Chief.

Um I'll say some comments as well as to um why my office introduced this legislation, but a lot of it was prompted by the fire that Chief mentioned at 50 Golden Gate.

Um, and we're bringing this forward because we do believe that prohibiting the sale, offer, and delivery of uncertified lithium ion batteries and powered mobility devices, uh, is about preventing disasters before they happen.

Lithium ion batteries fires are a growing public safety threat across our city.

Um, as the chief mentioned, they burn hotter, spread faster, and are significantly more difficult to extinguish.

At 50 Golden Gate, 130 residents requires significant emergency response, and it highlighted how quickly these fires can escalate.

And unfortunately, these incidents are not isolated.

Over the last several years, there's been over a hundred and twenty lithium ion battery related incidents, and many of these fires have occurred in and around District 5, particularly in neighborhoods like the tenderloin.

Because the reality is simple: one unsafe battery can displace an entire building of people.

According to the fire department, many of these incidents originate from uncertified replacement batteries in e-bike, scooters, and other powered mobility devices.

These products are often purchased online, brought into homes and charged in small living spaces where malfunction can have the catastrophic consequences the chief described.

This legislation we believe is a common sense approach.

It would prohibit the sale, offer, or delivery of powered mobility devices and replacement lithium ion batteries that are not certified to nationally recognized UL safety standards.

It would require proper certification labeling from recognized testing laboratories, authorized enforcement by the San Francisco Fire Department, and establish penalties for violations to ensure compliance.

I want to note that this legislation is not about limiting access to technology.

It is about ensuring that the products that are being sold in San Francisco meet basic safety standards.

I'll also be today introducing a minor amendment requested by the Small Business Commission to recognize EN 15194, an internationally recognized safety standard for e-bikes and related mobility devices.

This amendment broadens compliance pathways while maintaining the bill's core objective, ensuring that batteries sold in San Francisco meet rigorous, independently verified safety standards, because safety remains the standard, and that is unchanged by this amendment.

This amendment can be found on page three line five, and deputy city attorney Brad Russian has confirmed that this amendment is non-substantive.

I also want to address the question of cost and access, particularly for residents in communities who rely on these devices as everyday transportation.

The truth is that uncertified batteries are not a bargain.

They are a hidden cost, being borne disproportionately by the very communities least able to absorb it.

When an unsafe battery ignites in an SRO or a dense residential building in the tenderline, it's not a wealthy neighborhood that loses housing.

It's working families, seniors, and low-income residents who face displacement, loss of belongings, and disruption to their lives.

We should be clear about what that cost difference actually represents.

It's the price of cutting corners on safety, and it is our most vulnerable residents who pay the real price.

That's why I'm also grateful that the San Francisco Fire Department's commitment to community outreach and education, particularly in neighborhoods that are most often affected by these incidents.

Because enforcement alone is not enough.

Residents deserve to understand these risks and SFPD SF fire department's work to reach those communities directly in an essential part of making this legislation work in practice.

Residents should not have to wonder whether a battery they purchase could ignite in their apartment.

They should be able to trust the products sold in our city have been independently tested and certified as safe.

Safe batteries should be the standard and not the exception, and we should not wait for another building to burn before taking action.

This proposal complements existing fire safety protections by addressing one of the most preventable causes of these incidents: unsafe and uncertified batteries from entering the marketplace to begin with.

By ensuring that only certified batteries are sold in San Francisco, we reduce the risk of catastrophic fires, protect tenants from displacement, safeguard first responders, and improve public safety citywide.

I want to thank our draftings deputy city attorneys Hugo Cabrera and Sarah Fabien for their thoughtful collaboration and work on this legislation.

I also want to thank our partners at the San Francisco Fire Department for their leadership and expertise, including Chief Crispin, Fire Marshal Law, Assistant Fire Marshal Gower, and Adrian Sims, and our partners at local 798, especially Union President Sam Gebler.

Their insight into how these fires start, how they spread, and how they impact both residents and firefighters was instrumental in developing a pot policy that is practical, targeted, and enforceable.

I also want to thank my chief of staff, Sam Logan, for her diligence on this issue and for helping shape this legislation from its inception.

And at the end of the day, this is a straightforward public safety measure.

And if we know what is causing these fires, we know how to reduce the risk.

Then we have a responsibility to act.

This legislation helps prevent displacement, protects residents, supports first responders, and addresses a growing fair fire safety threat before another family will lose their home.

Respectfully ask for your support, colleagues, and look forward to working with all of you to advance this important legislation.

And looks like Supervisor Chen has a comment.

Supervisor Chen.

Thank you, Chair Malga.

And thank you, Supervisor Mammoo, for moving this forward.

Talking about fire, I'm also very sensitive for fire safety, and it's concerning that batteries that do not meet minimum health and safety standard, readily available through local retailers.

I know that certified battery retail, as Supervisor Mammu addressed it, is a higher price, which can be a hash for consumers who rely on electric buys and scooter.

But I think this legislation takes the right approach, not penalizing consumers, but establishing tools to hold online retailers accountable.

So I appreciate that, and I also would like to, and myself as a co-sponsor and to support this.

Thank you.

Thank you, Supervisor Chen.

Thank you so much.

I very much appreciate the amendment that you're putting forward today.

And after we make the amendment, I will co-sponsor.

Thank you so much for all the work that you've put into this.

We did have a couple of fires at Park Merced.

And I think that this is really, really important to keep the community safe while also supporting the adoption of micromobility devices that will help us reduce our greenhouse gas emissions.

So thank you, Chief, for all the work you've done on this as well.

And with that, let's go to public comment on this item.

Thank you.

Thank you, Madam Chair.

Land use and transportation.

We'll now hear public comment related to agenda item number two.

If you have public comment for this item, please come forward to the lecture and at this time.

Good afternoon, Chair Melgar, other members.

Thank you, uh Supervisor Mahmood for authoring this legislation.

Good afternoon.

My name is Joel Coppel, representing the San Francisco Electrical Contractors Association.

Our contractors work closely with the fire department, building owners, inspectors, and design professionals throughout San Francisco.

Regardless of technology involved, our industry's primary concern is always life safety.

As battery energy storage systems become more common, installation standards, permitting requirements, and fire safety protect protections must keep base.

Clear regulations help protect building occupants, first responders, property owners, and the public.

We appreciate the fire department's leadership on this issue and support efforts to ensure these systems are installed, inspected, and maintained safely and responsibly.

This especially comes into play when we have densely packed buildings like we often do here.

Also including dwelling units where people, when asleep sometimes don't know there's a fire, life safety systems in general, and electrical work in general, as long as first responder and firefighter safety is always a shortcut we can never take.

For those reasons, we respectfully support this legislation.

Thank you.

Thank you for your comments.

Do we have anyone else who has public comment for agenda item number two?

Madam Chair.

Public comment is now closed.

Supervisor Mahmoud.

Thank you, Chair Malgar, and thank you for those in public comment and to our fire department as well.

And thank you, Supervisor Chen and Supervisor Malgar.

Chair Malgar for your support.

I'd like to make a motion to move the amendments as right into the record and distributed first, and then a second motion to send the item to the full board with a positive recommendation.

Two motions, both offered by Supervisor Mahmoud, the first to amend the ordinance and the second a motion that the ordinance be recommended as amended.

On those motions, Vice Chair Chen.

Chen, I member Machmood.

Aye.

Machmoud I, Chair Melgar.

Aye.

Madam Chair, there are three eyes on each motion.

Thank you.

Um and if uh I could please be added to the amended motion that passed as a co-sponsor.

I'd appreciate it.

Thank you.

Um, okay.

So uh before we go on to uh the next item, I do want to make the announcement again because I messed up at the beginning.

Uh I said we were continuing items at four and five, and it's actually five and six.

So I do intend to make a motion to continue items five and six to the call of the chair.

So if you are here for those items, of course, you are welcome to stay and provide the public comment because it is on the agenda, but we will not be voting on those items.

We will be continuing it to the call of the chair.

And uh the next um or at least item number four will be lengthy.

So uh just be mindful of the time.

So with that, um, let's go on to the next item, please, Mr.

Clerk.

Agenda item number three is an ordinance amending the planning code to allow modification and revocation of certain conditions of approval for non-residential uses administratively, where the applicable zoning no longer requires a conditional use authorization, subject to planning commission delegation.

Clarify where enlargement or intensification of a nonconforming use does not require a new conditional use authorization and delegate limited authority to the planning director to administratively approve requests to modify certain conditions of approval imposed through a conditional use authorization.

The ordinance affirms the planning department's secret determination and makes other findings.

Okay, thank you, Mr.

Clerk.

Uh we have a request from the planning department to continue this item for one week.

Uh is there anything else you would like to say about it, Miss Gluckstein?

Uh, if we may continue it to the call of the chair just to ensure that we have time to work through any potential amendments.

We don't have to continue again.

Okay.

Um that does have noticing requirements.

No?

Okay.

So we'll just continue to the call of the chair if that's okay with you, uh, Supervisor Mahmud.

Yeah.

Okay, thank you.

So let's take public comment on this item then.

Thank you.

Um thank you, Ms.

Gluckstein.

Land use and transportation.

We'll now hear public comment related to agenda item number three.

If you have public comment for this item, please come forward to the lectern at this time.

And Madam Chair, please, it appears we have no speakers for this item.

Okay.

Public comment on this item is now closed.

Um, I would like to make a motion that we continue this item to the call of the chair.

On the motion offered by the chair that this ordinance be continued to the call of the chair.

Vice Chair Chen.

That passes.

Okay.

Now to um item number four.

Uh why don't you call that, uh, Member Mockman.

Clark?

Agenda item number four is a hearing on strategies to address San Francisco's unfunded affordable housing mandate, including assessment of the mid-cycle progress in meeting the 2031 regional housing needs assessment requirements for below market rate homes affordable to the local workforce from the lowest income workers to middle income households, the impact and forecast created by the removal of impact fees and inclusionary requirements that have been used to support the development of affordable housing, the efficacy of the city's reliance on one-time funds or funds tied to market conditions versus other possible revenue strategies, the availability, excuse me, the ability of city strategies to meet the gaps in the city's affordable housing delivery system to meet the unique needs of particularly vulnerable communities and neighborhoods and strategies and the actions that are required to accelerate public investments that are at scale, counter-cyclical and not one-time infusions.

And if you would not mind, Madam Chair, I'd like to invite uh interpreters to come forward and to announce their presence here and their services on microphone.

Please get Harvey Ty, Annabelle Garay, and Dennis Castro forward to the lecture real quick to uh provide introduction to your services here for those who may need them.

Sorry, okay.

Buenas tardes.

El municipio de San Francisco va proportional services de interpretation al Espanol para la conversation que van a tener sobre el asunto quadro que tiene que ver con el progresso de viviendas asequibles y los allá legislativa de presupuestos.

Umstead necessitated interpretation in Spanish, we can obtain los auriculares acca fuera para poder escutar interpretation simultanea.

Gracias.

Gracias.

So, okay.

Salam atpo, thank you.

You seem to laugh at we can say, come you'll call way so you're going to want to do how you chopina.

Okay, thank you.

Okay.

Okay.

Um, Vice Chair Chan, thank you so much for calling this meeting, this hearing.

Housing is our most critical issue in San Francisco.

I'm looking forward to a very robust set of presentations and discussions so that we can uh consider all tools and all of the things that we need to do for this very complicated issue.

Thank you.

It's yours, the floor is yours.

Thank you, Chair Malgar.

Good afternoon, colleagues.

Um, first I want to thank Chair Malgar for scheduling this hearing, and thank you to Supervisor Mahmoud for your co-sponsorship.

I requested this hearing in order to provide a forum for the budget and legislative analytics to present finding from report they prepare at my request.

I asked the BLA to conduct an independent analysis in February of this year, because it was clear to me that the city had been marching full speed ahead without a coordinated strategy to fund our affordable housing goals.

The report that the BLA prepared it is thoroughly research, extremely informative, and really push the needle forward on affordable housing funding solutions.

Housing affordability is consistently named as one of the city's top concerns, which disproportionately affects low and middle income residents, many of whom many of whom play essential roles in San Francisco economy.

While we have an ambitious set of goals that we adopted through our housing elements, peneman data from the planning department has shown that progress is very slow.

We are at the middle point of the housing element cycle and have only achieved one third of the halfway goals we set for ourselves.

Reliance on market rate housing, it's it's insufficient to get us to those goals as well.

As reported in San Francisco standard, a new study concluded that it could take between 18 to 124 years for unsubsidized housing production to stabilize rents for the medium wage earner in San Francisco.

What's needed is a robust set of strategies and funding approaches that will bring our affordable housing production to scale over the coming years.

I would like to structure the hearing in the following ways.

First, planning will provide an overview of city's progress in achieving the Renault goals with particular focus on affordable housing production.

Second, Mo City will present on funding development process, people serve and a method.

Third, we will have the budget and legislative analysts present their overview of our affordable housing system, their analysis on fees reduction, equity gaps, and financing strategies.

I hope that the departments are able to stay throughout all the presentations and be able to respond to questions as they arise.

And I would also like to appreciate the clerk's office for their support in providing interpretation for this hearing.

Thank you, Supervisor Chen, for calling this hearing.

Like Supervisor Chen said, I agree that San Francisco is at a pivotal moment for how we move forward on affordable housing.

There's broad consensus that we need to encourage more building in this city.

This means cutting red tape, streamlining processes, and removing neighborhood veto points, all things the state legislature and this board have taken significant steps forward on.

But I'm more interested today in how we raise funding for building affordable housing and how that money helps house San Franciscans because this is the question that should be driving the conversation.

One of the primary selling points of the family zoning plan that we passed last year was the ability for projects to pay a fee to cover their inclusionary housing requirements, something the major state streamlining programs don't offer.

If we don't have faith that MOHCD is spending that money effectively, that can threaten the political viability of the program.

Affordable housing financing is more of an art than a science.

It's not simple to factor in the needs of nonprofit development partners with shifting state, federal, and private funding landscapes when making decisions about which projects to green light.

But that doesn't mean that we as decision makers don't deserve full transparency and why some sites are earmarked for affordable housings, while some sit unutilized.

I also want us to talk about the scale of our affordable housing investment.

We are clearly not building at a fast enough rate to keep pace with demand and meet our goals as a city.

I hope today that we learn how much more funding we need to secure affordable housing to bridge that gap and what our plan is to get there.

Look forward to hearing from departments on the plan to reach our goals, and looking forward to the discussion today.

Thank you.

And thank you again, Vice Chair Chan and Supervisor Mahmood for this conversation.

As I said at the beginning, I think housing is our most important issue in San Francisco.

Without a place to live, very few of our other public policy goals will take place.

Economic development, education, transportation, anything that we are trying to do together will not work if we don't have housing for our residents.

Land use decisions really are about access to resources.

Our region, San Francisco region has one of the highest upward mobility indices in the country.

There's a reason why people want to be here.

Like my family, Supervisor Chan's family, Supervisor Mahmoud's family, anyone with an immigrant background who came to this place, this magical place, this tolerant place specifically, because it provides access for people like me, fleeing a war-torn country where we could thrive and have access to our wonderful educational system and all the opportunities that are here.

It is about access.

Without affordable housing, it is an empty promise.

We are only focusing off our externalities onto other places and losing the fabric of otherwise very vibrant communities.

That being said, as the as a member of the Metropolitan Transportation Commission and the Bay Area Housing Finance Authority, I also have to acknowledge that this is a regional promise problem.

We're not at this alone.

San Francisco must do what we need to do.

We are by far the driver of job creation in the region, and also, like I said, a magical place of tolerance and opportunity, but we are in the Bay Area.

And what Palo Alto does, what Oakland does, what Marin does, absolutely affects the calculation for us.

So we have to work together and also hold up our end of the bargain.

So again, thank you, Supervisor Chen, for this.

Because this didn't just happen right now.

This is the result of decades of land use planning decisions, of taxing policy, of racial residential segregation, which needs to be rectified in order for us to move forward.

So again, thank you, and I look forward to a robust discussion.

Thank you, Chair Malga.

Thank you, Supervisor Mahmood.

Now I would like to invite Lisa Chen from Planning Department to present.

Good afternoon, Chair Malgar, members of the committee, and Lisa Chen with the planning department.

We're also joined by Rachel Tanner from the planning department as well as Jacob Bintliff from OEWD to answer questions.

If I could get the slides, thank you.

So today's informational hearing will provide an update on San Francisco's progress toward meeting our arena goals with a focus on affordable housing production.

We'll discuss the city's performance to date, the funding and feasibility challenges affecting housing production, and key actions that may improve our ability to meet our housing goals.

To ground our discussion, we'll start with the San Francisco's with San Francisco's housing obligations under the regional housing needs allocation or RENA.

With the adoption of the Family Zoning Plan, San Francisco fulfilled its state obligation to provide zoning capacity for more than 36,000 additional units.

We also met our affirmatively furthering fair housing goals by locating the rezoning almost entirely within high opportunity areas.

And we exceeded our requirement to designate sites suitable for the low and very low income portions of Arena, making qualifying projects eligible for ministerial review.

There are often misconceptions about what the RENA targets mean and how they're developed and assigned to cities.

Fundamentally, the RENA is a statement of our housing needs based on projections of growth and unmet needs across income levels.

These numbers are not based on market analysis, funding availability, or other practical considerations.

Also, RENA is not a mandate for cities to build housing.

That happens through nonprofit and market rate developers.

The arena simply requires cities to plan for and encourage housing by making zoning changes and removing development constraints.

This chart shows housing authorizations over time.

Even though our housing targets have increased substantially in this RENA cycle, the city has seen a period of continued decline in development activity due to challenging economic conditions.

While we have seen some improvements in 2025 and into early 2026, production remains below historical peaks and below the pace needed to reach our RENA goals.

This chart shows San Francisco's progress at meeting our arena by income levels during this cycle starting in 2023.

Overall, the city has authorized around 10,000 units or about 31% of what we would need to keep pace with our RENA goals.

Oops.

Progress has been strongest in the low and very low-income housing categories where we achieved roughly 37 to 38% of our goal.

Authorizations for moderate and above moderate income housing have lagged farther behind at a little over one quarter of our goal.

To date, the city has fallen short of its goals by about 21,000 units.

This slide provides a regional perspective comparing San Francisco against other Bay Area counties during the previous housing element cycle from 2015 to 2022.

Counties are listed in order of their RENA allocation with the more urbanized counties with higher low-income targets appearing first.

As you can see, none of the larger urban counties met their low-income RENA goals, highlighting a shared need for affordable for additional funding and financing tools.

However, it's worth noting that San Francisco did produce the greatest number of affordable housing units of any Bay Area County during this period, and it performed the best among the urban counties, building about 70% of our low-income RENA goal, while counties like Alameda, Santa Clara, and Contra Costa counties produce closer to 30 to 40% of their share.

This higher performance is a direct result of San Francisco's success in raising affordable housing funds, which Director Adams from OCD will discuss in greater detail.

San Francisco residents and legislators have repeatedly voted to raise funding for affordable housing, including general obligation bonds in 2015, 2019, and 2024, among other funding sources.

The data suggests that sustained local funding is successful in producing more affordable homes.

However, despite these successes, we are facing a growing feasibility gap for both affordable and market rate housing.

Construction costs have increased by more than 30% since 2020, while financing and labor costs have also risen substantially.

For affordable housing, this means it takes more public subsidies to build, and it may result in greater delays in the pipeline.

For market rate projects, it means that many housing types simply aren't financially feasible.

In fact, two recent financial feasibility studies found that all of the market rate prototypes studied are infeasible under today's conditions.

To illustrate the point, here are the key findings from the housing elements constraints analysis financial feasibility study conducted last year.

The Proformas modeled seven common housing types and found that all had negative land residual values or RLVs, ranging from negative 80,000 to negative 423,000 dollars per unit.

The study also reviewed various scenarios that could improve feasibility shown on the right, including process streamlining, fee reductions, modifications to inclusionary requirements, and improved market conditions.

The key takeaway is that no single scenario would get us to market feasibility.

Rather, we will likely need a combination of factors to change.

This slide summarizes a range of policies aimed at supporting housing development, either adopted or under consideration.

For affordable housing, these include streamline review, dedicated funding measures, and regulatory flexibility.

For market rate housing, potential tools include fee adjustments, tax incentives, and targeted development incentives.

Across all housing types, streamlining, flexible zoning, and cost reducing innovations can help reduce barriers and improve project viability.

The proposed housing trust fund measure would renew and expand one of the city's most important affordable housing funding sources.

The proposal, which is sponsored by the mayor, Chel Melgar, and others, is a generational investment that would more than double the allocation to the housing trust fund from 50 million to 125 million dollars annually.

In total, the proposal would generate more than $3 billion dollars for affordable housing over 30 years.

If successful, this would create a recurring and more reliable funding source for affordable housing production and preservation.

Increases to the fund would be tied to the overall growth of the city's property tax base, including growth from the recent rezoning, and the proposal includes guardrails in the event of a fiscal downturn.

The proposal also implements the recommendation from the inclusionary housing TAC by leveraging new housing development without affecting financial feasibility.

As we close, we wanted to highlight our ongoing work as a city to implement our housing element.

The housing element identifies more than 350 actions meant to expand housing production and advance housing equity.

As of early 2026, about one-third of the actions are considered complete, with additional actions either underway or ongoing.

In addition, the city is continuing to implement the recommendations from the Affordable Housing Leadership Council and from the Affordable Housing Sites Analysis and Strategies report.

Collectively, these efforts represent an ongoing commitment to removing barriers and expanding housing opportunities across San Francisco.

This concludes SAS presentation, and we're available for any questions.

Thank you very much.

Thank you, Lisa.

I appreciate the comprehensive review of the data and combining the information across city departments.

Will you be the one answering question, Lisa?

Anybody?

I mean, it'll be some combination of uh three of you.

Oh, yes, yeah.

Okay, in slide number seven, that was presented.

You know that more, you noted on the slide that more funding it equals more homes.

I think this is important because there's a narrative out there that the city puts money into affordable housing, but we aren't moving the needles.

I don't think that it's true.

Your slide shows that in 2025, after Gioban that the voters has passed, San Francisco was able to produce what looks like about a thousand more affordable units annually than the period in 2015 when funding was at a low level.

Those 1,000 units likely translate into affordable homes for approximately 3,000 San Franciscans.

I think that it's definitely moving the needle forward.

So my question to that is I want to make sure that we are keeping the data to track our progress fund and center, so our public is not in the dark.

Is this summary on the city's RAINA affordable housing progress something that the department is required to do on a certain calendar time frame to present this information to the public and to the city policymaker, not just to HCD?

Sure.

So I'm happy to start, and then if Mo CD would like to add, please feel free.

But uh so the planning department does report annually to HCD through our annual progress report requirement, the APR.

It's due by April 1st of each year.

So we essentially submit a packet to HCD that includes our housing production across income levels, and then it does also report on those 350 plus implementation actions that I that I identified.

So that does get posted online.

We do also, of course, have our housing dashboard, which um gets better all the time.

They're always making improvements to that.

Um it's actually updated nightly.

Um, that also does report the numbers for both affordable and market rate housing.

So, oh yeah, yeah, yeah.

So am I correct?

So the the report uh that you report to HCD, it's available online on a regular basis as well.

Yes, so um, so it's actually available through HCD's website.

It does take them some time after it gets submitted in April for them to actually put it online.

Um, so I believe this year's are already up on HCD's website.

Um, I do know that um the regional government, A Bag MTC, they also do have their own dashboard with RENA outcomes by city and county.

Um, can I finish the um the presentation also mentioned that the state requires the city's plan for and encourage growth, but do not require a plan for productions.

Uh, giving the sweeping zoning reform that was passed earlier this year and the slow pace of private development to create new BMR units.

What are the department's contingency plans to facilitate new affordable housing?

So, yes, as you noted, um, you know, our requirement under the RENA obligation is that we create capacity for growth, and that we also within that um identify low-income sites, so those are sites that meet essentially both state requirements, but then we add our own layer, you know, where we're also thinking about what might meet kind of our own requirements for affordable housing.

Um and essentially sites housing on those sites that meets minimum affordability requirements that are eligible for ministerial review.

Um so by doing that, we're really making sure that the sites are available and that we're making the process as easy as possible, so that when we have the funding, um, those sites can move forward quickly.

So it really does um, you know, hinge on having the funding available so that those sites can enter the pipeline and get developed.

Um so you know, feasibility really is um kind of more of a measure of market rate development, you know, whereas you know, you know, as director Adams will will note, there's kind of a different range of factors that go into um affordable housing production and what makes those possible.

So so am I correct that uh the department is able to also have another strategy?

It's to identify uh sites that it's for affordable housing, that it's available, and then another department or other entity will then will require to come up with uh actual funding, and then you will work with that entity or a department collaborately to move forward for affordable housing.

Um, yeah, that's that's a way to summarize it for sure.

So it's you know, we're creating the capacity, um, but then it's on the city as a whole and and through the actions of the board as well to to generate the funding that we need as well as find the the um funding from other sources, including state and federal and philanthropic funds.

Okay, thank you.

Um another question that all there are also many policy actions in the housing element related to equity and affordability.

How is the department also tracking and prioritizing implementation of this policy actions, uh reporting progress to the public?

So, so yes, as noted, we have about 359 actions.

Um, and so you know, the zoning is only just one, you know, small handful of those actions.

Um so we do report on those, as I said, to um HCD annually, we make that publicly available.

Um, you know, those actions are not the planning partner's actions, they're citywide actions.

So they're um reported across a range of agencies.

Every year we put the call out to all of our sister agencies, such as Mo and HSA and HSH and others to monitor our progress.

Um, so so we're always, you know, trying to make that information more um readily accessible to to folks.

Um, so you know, people are always free to reach out and ask about them.

Um, but you know, they they kind of run the gamut of you know both our housing production as well as preservation, our our programs such as our tenant programs, you know, it really is a robust um set of actions.

Okay, thank you, Lisa.

Hold on.

Um, my colleagues also have questions.

Thank you so much, uh Chair Chan.

So I do have a question about um what we're counting and what we're not and uh I mean I know that there are regulatory requirements from HCD and then things that have been done uh by ordinance that we make you do uh in terms of reporting.

Uh but um I'm wondering specifically about Section 8 vouchers, uh, in what percentage of that is included or not included, and in looking at the overall need, how we keep track of that, especially given the changes that are desired by our federal government.

And then also rent control, because we are losing rent control units every day in San Francisco because you know, buildings are getting older, but they are also a really important part of keeping uh working class and low-income people housed, although they don't house exclusively uh low income people, but you know, it is part of the picture.

So I'm wondering how we crunch those numbers, how do we like take it all into account, even if it's imprecise?

Um, and how do we attempt to look at like sort of that need versus supply, given that a big chunk of uh, you know, how people are housed is not just you know subsidized housing controlled by the mayor's office of housing, but these other things in the market, also some subsidized by the federal government and also rent control.

Thank you for the question, Supervisor.

Um, so I'll try to answer the first one about um your question about, for example, section eight vouchers, how do we um count that?

Um if I could just clarify, do you mean um how are we counting that against the need or uh against the production?

The need, I mean I know we cannot count it against the production or I mean I guess sometimes we can, you know, if we have a project-based, but right, you know, I I'm like my question is about need.

Yeah, because we know that there are people who have that and they're by definition low income people who are living in our just in, you know, the federal government is subsidizing it, and that's a good thing for us for our budget.

But like in terms of the need, I want to understand how much of that and who's keeping track of it and who is assessing the need.

Yeah, so um in terms of the need that's identified by RENA, um, you know, I'm not actually sure if that accounts for such a lot.

That's not my question.

Yeah, because I understand that we have an obligation to HCD.

That's like, yeah, that obligation's not gonna go away.

I'm asking for us.

Like we need to figure out where we're at and what we need, and if there's a threat by the federal government or an increase, you know, like we can advocate for, like, that's where we should go, and it should be part of the picture.

Yeah, okay.

Um feel free to good afternoon, Dan Adams of O CD.

Uh and the housing authority, actually.

Uh so in terms of section eight, I think it's a great question in terms of how we're tracking that, and I think part of the disconnect is it's not a as you point out, it's not arena obligation.

Um the housing authority manages about 16,000 vouchers.

So that just gives you a sense of the scale for San Francisco.

Yeah, it is a lot.

Um about about half of those vouchers are considered project-based vouchers.

So they're in buildings that are generally 100% affordable buildings and would be reflected then in some of the reports that we manage at Mo CD, because they're included in our our overall portfolio, and they would show up in that way.

The balance, about half 8,000 vouchers are what are called tenant-based vouchers, and so those are folks out renting in the private market.

They're they're they're getting a subsidy from the federal government that's channeled through the housing authority that goes to a private landlord.

And um, we have that information at the housing authority.

We know where those properties are and certainly can provide that, but I'm it's a it's a good question.

I'm not sure how it if and how it overlaps with certain planning department reports, which I think is maybe what you're what you're getting at.

Yeah, that's not actually what I was asking because the planning reports are what they are.

I'm asking for it because it affects the decisions that we make overall in terms of policy.

And so, you know, I do I do think, you know, uh you know this because you're, you know, in charge of it, but you know, when times are good and market rents are high, the turnback rate for those vouchers tend to be high, and people take them and go to Antioch, you know, and that's not what we want.

And so uh when uh rents are a little bit more depressed, which had been in the past, not today, you know, people have a greater chance of using that voucher to stay, and then we can count those in some way, maybe not against our RENA obligation, but we can say, okay, this working class family got a housing unit on the market with a voucher, and we know they're low income and you know, somewhere it should end up as a report.

So in terms of like looking at the overall picture of how we address the needs of working class San Franciscans, that should go somewhere, and it's you know, like I know it's separate from our RENA obligation, but I think it's an important thing to count for us is my point.

Very I could not agree more.

And I think we can start to incorporate that picture into some of the reporting that we do, whether it shows up in a planning department report or a mo CD report, I think that's a very reasonable request.

Thank you, Director Adams.

And so those, I'm sorry, I just I want to ask about that second part of the question, which is about rent control.

Um, because we do know that we are losing rent control units at some in in some way.

I don't know who's keeping track of it.

Uh and then, you know, are we then measuring also like the loss against the potential you know in the the gain as we are building new units that are not rent controlled?

Maybe some subsidized, but maybe not.

But if if if that is a ending up in numbers somewhere.

Yes.

Our our housing inventory does track when units are converted, right, for or lost from the rent control stock.

Um, and you know, I think this speaks to you know why the city invested so much time in developing strong tenant protection especially over the last year with with the new ordinance which is continuing to be evolved through the through the duplicate ordinance as well so um it is part of our records um I believe it is also part of the the RENA um reporting but we can confirm that as well okay great thank you um thank you again uh for the presentation um if you could go back to the slide that talks about the different efforts around streamlining affordable housing um it's clear that we've made a lot of progress around the streamlining affordable housing um but I'm curious from your perspective you also alluded to some that are still in the pipeline um it's clear those things were necessary but insufficient which of them are left that you would help uh recommend that we prioritize going forward um thank you so um as we noted you know there's been kind of a range of policies over the last several years um really throughout the the post-pandemic period um ranging from both you know constraints reductions so actual changes to our zoning code to change our rear yard requirements change our notification requirements etc um as well as you know a range of kind of more streamlining um options that um you know are designed to essentially reduce the process um uh and then as also noted there's been both temporary um as well as um you know other proposals for reducing fees and reducing other costs so we kind of see this as um you know really it needs to be a layered approach and we're trying to convey that with by sharing um the financial feasibility analysis because it's not going to be any single factor that's really gonna make the difference we really do need to have multiple approaches um so we're continuing to look at those changes that we can make I think a lot of the kind of low-hanging fruits have been changed already um so we're we're looking at other um kind of cost reducing fact factors that we can think about such as um you know additional um proposals to to lower impact fees um our our transfer tax for example um as well as things that we can do to bring down down the cost of construction so we've been looking at things like pre-approved plan sets and um and other strategies that have been um you know explored other in other cities um and states can you share more specifics about what are those types of fees that you're for affordable housing what are the type of remaining streamlining fees or you mentioned this report can you share more right now um for affordable housing specifically I would defer to Mo C D to talk about kind of the the challenges and um you know the process to develop those um projects um but um just from the planning department perspective you know we've already basically streamlined the the um approvals of the affordable projects um they also also are not subject to any of the impact fees they those have been exempt for quite some time so there's no nothing else from your perspective from the planning department can do from a streamlining perspective for affordable housing um I would ask my my colleagues to you know suggest if there are other items um in which case you know we'd love to work with them on on that but you know we've been moving in that direction for a number of years at this point yeah I feel like I'm skipping line but uh I'll just chime in so I mean uh to to uh Lisa's point um it really has been a sea change on the entitlement front for affordable housing so the SP 35 which passed a number of years ago uh we used to build in a lot of time into into our approval process for required a community meetings obviously the uh CEQA analysis that would be prompted the appeals the litigation and much of that has gone away so our entitlement um uh streamlining has been very successful and while there may be refinements to it uh that we can make I think it would be uh at on the margins we we really have done a great job as a city uh to to advance our affordable housing approvals and that's been exciting I I worked here for many years, and I thought it would never happen, and then it happened um on the on the cost front, you know, affordable housing is exempt from a lot of the uh fees that might be charged, impact fees, because we're often the recipient of those impact fees.

So we don't have the same kind of fee burden.

But cost control is a real issue, and there are cost drivers.

Some of those relate to the the requirements of the financing itself.

It can add cost to our projects um we do have uh uh very laudable goals around energy efficiency, environmentalism, workforce requirements, small business engagement.

Those are important policy considerations and goals, but they do add costs.

So I think we're on the cost side, it's an area where we want to continue to sharpen our pencils and refine because that's going to increase feasibility for our projects.

Um, and then the last thing I'll note is, and and we can talk more about this during my presentation where where we have lags in our implementation process is really around the financing.

As you'll see uh in a in the presentation to follow, we use it's a whole grab bag of resources that we need to bring to the table in order to make a project work.

Those have different funding rounds.

We're often waiting for a subsequent funding round.

Now, very excitingly, the state has started to consolidate its funding, and as of this year, we'll start to direct and coordinate its state funding, these are state grants, with its tax credit allocation.

And so that's gonna that's going to increase uh the speed at which we can move from entitlement to implementation.

But to date, we haven't seen that, and that's a that's been a major impediment to our our production schedule.

Thank you.

Thank you, Supervisor.

With that, I also would like to bring you back for your presentation.

Thank you so much for having us here again, Dan Adams, director of the mayor's office of housing and community development.

I'm here with Sheila Nikolopoulos, our policy director.

And um, just a couple of comments to get started.

Uh first of all, Supervisor Chen, thank you for calling this hearing, and thank you so much for for signaling at the start that money matters and money brings results.

So, you know, we see it when we work day in and day out on affordable housing.

We get to go to grand openings and groundbreakings, we we talk to the families who get to live in the housing, we know it makes a difference.

Um, and I can see why folks who are not following affordable housing as closely might say, where did that money go?

Or what happened if they're not living in or nearby and new affordable housing development.

But as the production numbers show, we make good use of the funds we receive.

Um we, as was presented in the previous uh slide deck, you know, we produce more than our peer cities do by a considerable factor.

We leverage more resources than any other city in across the state of California on a per capita basis.

So we we pull down a lot of funds from our state um funding partners to invest here.

That builds affordable housing, it creates jobs, it creates economic activity.

Um in 2025, as the BLA reported, uh affordable housing production was two-thirds of all the production, all the residential production in San Francisco.

So these are points of pride for us, but we also recognize it's not enough.

There are lots of lots of people who can't afford affordable housing in San Francisco.

So we know, even if even if Rena didn't tell us anything, we know we have to do more, and we we continually want to do better and seek out enterprising and innovative ways in which we can improve our production and leverage more resources.

So eager to have the conversation with you all and with the public to follow.

With that, we'll get started with our presentation.

Um we'll be talking about our affordable housing portfolio and production, our affordable housing financing, and the populations we serve.

So just a quick kind of table setting.

Mo CD, we're the lead housing agency for the city, and we direct a number of programs and financing, but we're part of a larger ecosystem that addresses housing.

We talked a little bit about the housing authority, which is primarily a voucher management entity at this stage, though it does manage small portfolio of uh public housing still.

Uh OCII or the former redevelopment agency has obligations to complete affordable housing production within certain plan areas that were approved at dissolution.

And so they're still an active player in terms of issuing debt and and providing loans for new affordable housing production.

Of course, our Department of Homelessness and Supportive Housing is really focused on programs and services directed toward alleviating our homelessness uh issues in San Francisco, and we partner with them very frequently.

And finally, there is privately owned affordable housing.

Chair Melgar, you mentioned rent control, which provides an important component of affordable housing stock in San Francisco.

We have SROs and other types that are not deed restricted but do provide affordability to our residents.

Our housing programs are diverse.

We fund new construction, acquisition, preservation, and rehabilitation.

A quick word about preservation.

We often use the term to describe two different things.

One is acquiring sites and moving them out of the market into a preserved or permanently affordable housing context.

And we also use preservation to describe investing in our portfolio, which increasingly needs reinvestment in order to stay vibrant, successful housing for low-income tenants.

We have down payment assistant loan assistance and home buyer education.

We fund services that keep people housed, and we fund programs such as tenant legal services, eviction prevention, and conflict mediation, also with the goal of keeping folks in their housing.

Our affordable housing portfolio is about 35,000 units.

And you can see its location.

I mean, this includes new construction, inclusionary rental, ownership programs, and preservation units.

And we'll talk more about this as we talk about the geography of our work, both to date and moving forward.

You can see a preponderance is in certain parts of the city.

This represents both where eastern neighborhoods rezoning happened to create site capacity.

This is often where a lot of market rate housing has been produced.

So when there's a requirement to spend funds near market rate housing or have inclusionary included in market rate housing, that's where most of the growth has happened in the city.

And you see on the Southeast sector the legacy of redevelopment agency and their involvement in building affordable housing in the Southeast in particular, which was largely a redevelopment area for many years.

So we talked a little bit about this, and I won't dwell on it, but the a new affordable housing development process, it's it's similar to a market rate process.

We have to acquire a site, get it entitled, get financing, start construction, and then lease up.

Now, construction is going to take about two years in general to build the units and then lease up, you know, three to six months to be fully leased.

As we just were talking about the difference between an affordable housing financing strategy and a market rate, while the market rate sector will need to wait for the market to be favorable and to move forward.

Our gating issues is really the upper tier resources that we need to leverage at the state and the federal level.

And so that can be the waiting game and the kind of strategy work that we do, which can add time to the implementation process.

Here you can see our affordable housing production over time, and you can see there's over the last 10 years we've had very robust production.

I would like to point out the 2017, 2018, and 2019 numbers were reflective of a large conversion of public housing that we did to uh privately nonprofit-owned housing supported with vouchers.

So those are great numbers.

It was an amazing effort that uh the city led, but those pure production numbers are a little bit anomalous.

It includes a lot of preservation work that we did during that period.

But since then, and and during that time, our productions has been quite robust, and that reflects the fact that we have passed uh measures that have funded affordable housing.

There's a direct correlation between the 2015, the 2019, and the 2024 bond, and our production numbers.

So thank you the citizens and residents of San Francisco for voting for those measures because it has resulted in very robust production over the last decade.

A little bit about affordable housing financing.

This, I was at a presentation years ago where somebody compared affordable housing finance to being a like a rocket scientist or something.

The complexity around affordable housing finance is hard to overstate, and it's because it includes so many different sources.

So this just gives you a sense.

We have our tax credits, the federal tax credits, we issue bonds, there are federal programs that are more direct subsidy like home and CDBG, each with their own requirements.

We have state funding sources.

HCD has a number of programs.

Obviously, our local funding, which is also diverse, general obligation bonds, housing trust funds, fees that we collect.

There are rent subsidies, we referenced Section 8 vouchers, but there are other kinds of vouchers that the city manages.

And then our projects, many of them leverage private debt or commercial mortgages.

So very diverse funding source.

I think it's it's worthwhile really taking this in because a lot of our strategy and decision making relates to the complexity of the funding.

So what we the reason we've been so successful relative to our peers is that we are very good at strategizing and positioning projects in order to take advantage of this menu of funding options.

And it is a complex uh landscape, but it does mean that our local subsidy is leverages twice as much as basically we fund about a third of the total development cost for our projects.

So for every dollar we spend, we leverage a couple dollars in resources that come from outside the city in order to build the housing.

So it's a it's a critical component of our work is that leveraging of state and federal resources.

Um these resources next slide, are limited and competitive.

So if we lived in a world of abundance where we've had both had abundant resources at the local level and abundant resources at the state and federal level, there would be much less strategy needed.

Um we could do over the counter for many years.

Tax credits, for instance, were over the counter, but they became over-subscribed, and now there's a there's an infrastructure that establishes competitive rules that we have to meet or exceed in order to leverage that financing.

Always I should say working through our nonprofit and affordable housing development partners.

So for just as an example, federal tax credits currently prioritize high resource areas, so that shifts where the kind of geography of where we can look in order to maximize leveraging, as well as a high degree of permanent supportive housing, and so depth of affordability really helps tip the scales for these resources.

Housing choice vouchers or section eight can provide a subsidy sufficient to leverage some debt.

So that's it's it's a rent subsidy, but it can it can influence the our capital stack.

Excuse me.

Um at the state level, we have there are there's a state tax credit program, which requires even deeper affordability.

The infrastructure infill grant program that the state manages requires it enables housing related infrastructure.

Uh MHP requires very deep affordability, PSH and certain kinds of developer experience.

And finally, the affordable housing sustainability.

Sustainable communities program requires coordination with MTA and the identification of eligible transportation projects, which again limits or directs us to focus on certain projects over others as we pursue that funding source, which unfortunately looks like it will be going away in the future.

So unfortunately, we cannot rely on that source in the immediate future.

Our local funding sources include general obligation bonds, these are approved by the voters.

We just mentioned we've had some successful voter approvals in recent years.

We have our housing trust fund, which we're very excited about will be on the ballot to be increased dramatically, and I want to appreciate the leadership of Chair Melgar in that effort and co-sponsors.

So that is going to be an increasingly important funding source for future affordable housing production.

We have used what are called certificates of participation in the in the past, which are a form of debt that the city can issue.

We've gotten impact fees, there are citywide fees, there's project-specific development agreements that sometimes include contributions.

And then we have certain subsidy programs on the rental side, such as our local operating subsidy program, which supports permanent supportive housing, and our affordable housing opportunity fund, which supports extremely low-income households.

Local funding sources over the years, you can see I think the big takeaway here is these big jumps represent the geo bond issuances in 2015, 2019, and 2024.

Though as the BLA report will point out, we had for before the pandemic, we had had many robust years of collection of inclusionary fees and jobs housing linkage fees, and at the start of the pandemic, those basically went away.

Our financing tools.

So we get money in and we we spend it, we issue it, and we do so in a different different uh types of way.

We issue loans, and these can be two types of loans of residual receipts loan that gets paid to the extent a project produces cash flow, and then we have some amortizing debt that must get paid but is a below market rate.

We do operating subsidies, we have revolving loan fund for down payment assistance, and then we grant provide grants for housing services.

There are some new and emerging emerging funding and financing opportunities.

The recently passed affordable housing opportunity fund, as I just mentioned, provides subsidy for rent subsidy for extremely low income households.

Also just mentioned the uh exciting expansion of the housing trust fund would be on the ballot this November.

There's a statewide affordable housing bond planned also for the November ballot, and conversations have already initiated on a potential regional housing funding measure in 2028.

Those will be important leveraging sources moving forward.

Just a quick example of the complexity of developing affordable housing.

This is an image of the under construction 1515 South NS, and this just gives you a sense of the kind of diversity of funding sources that are needed in order to fund such a project.

Our pipeline is you know quite citywide, though there's still a preponderance on priority equity geographies or traditionally where we built affordable housing.

I will say that that will shift and has shifted over time.

In 2023, we issued a NOFA to select sites on in high opportunity areas, which were primarily on the west side.

So we are introducing greater geographic diversity in our pipeline, but relative to and that will it that will continue as the state provides additional incentives for those geographies.

So you'll this map will shift over time, but it but it is an accurate reflection of where we are today in terms of our pipeline.

Really quickly, just the populations we serve.

Nearly 50% of our housing serves seniors.

That's both a function of the fact that we build senior housing that's restricted for folks above 62, and the fact that folks stay in our housing and they age into senior seniorhood and aren't displaced.

So that's a sign of our success.

About a third of our housing, it's housing with families, and we serve a preponderance of BIPOC residents across different demographics.

About 15,000, a little less than half of our total portfolio, is set aside for specific populations, be they seniors, homeless households, or formerly homeless households, veterans or transition aged youth.

This is a slide on housing applicants, and just to give you a sense, I mean, I think there are a couple takeaways.

In general, um the placements reflect roughly who is applying, so that we get we get fairly good balance in terms of applicant demographics and the ultimate demographics of the pop of the households we serve.

You'll note a big discrepancy between total applications and the number of units we have available.

So that's that's something we need to work on.

What we'd love to do is get that number up, number of units we have available, so we can serve more people.

But that's um, that gives you a sense of uh placements versus applications.

Um this next slide is a little redundant to our our um portfolio slide.

It again it shows the really the preponderance of where the opportunities are.

They've generally been in the southeast sector or the center of the city, and as I say, we hope to and plan to expand into the west side with greater um uh greater production in the years ahead.

Uh we're nearing the end, just a few slides left.

Um, the rental housing, so we we use this terminology AMIs.

I use it as if I was born speaking this way, but I I wasn't.

I had to learn all these acronyms, area median income.

It's a way to think about how much a household makes.

And so extremely low-income households really are in the zero to 30% AMI.

Um, 30 to 50 percent is considered very low.

We have low-income households at 51 to 80 and then over 80.

Just as I've called out, I'm sure previously, our primary funding source for rental housing is the tax credit program.

It caps out at 80% AMI.

And until a few years ago, the cap was 60% AMI.

So in general, when we access that program, we're we're seeing units that are below 80% and really in that 30 to 50% AMI.

So there's a there's a financing that uh contributes to uh this AMI range.

Above 80 is generally attended to through inclusionary uh production.

Um just and it likely will come up in our conversation that zero to 30% AMI.

It's very it's very hard for us to reach that depth of affordability without a rent subsidy.

Those residents don't pay enough rent to support operating costs.

So we need that subsidy.

Though not a production issue, we are very interested in keeping people housed once they have housing.

So we do fund housing place-based services, as I mentioned, tenant right to counsel, um, as well as immigration and family law, legal services, and rental housing counseling, all of which are intended to help keep people successfully housed.

Um we do produce a number of reports.

I would really encourage folks to uh look on our website for our annual report, which includes a number of exhibits that have really good information in a in a user-friendly way to look at our production the previous year.

We do have also very user-friendly online housing dashboard, so I encourage folks to go there, and then a number of other uh plans that are required either by HUD or working with the planning department on HCD requirements, just a couple of challenges and opportunities to uh to end here.

So our challenges, you know, we have these production mandates and quotation marks, but they don't come with any money, so we need more money.

The federal government is not uh an ally or a collaborator when it comes to affordable housing production.

A lot of what we do on the housing authority now is on the housing assorti, excuse me, the housing authority side now is play defense.

So that really constrains our the opportunities we have.

Uh state subsidies very competitive, and I and the uncertainty at the federal level is uh disconcerting at the very least.

Um our operating expenses really are a challenge for us.

A lot of our projects are running in the red, meaning they can't meet their operating obligations.

We have limited funding, though again excited about the housing trust fund to come.

Uh, and we've seen um a reduction in our fees coming in as a result of lack of production in the office and residential market.

But what's working, we do have some really fantastic local subsidy programs.

We have great partnerships, like with the housing accelerator fund to do innovative work.

Public lands, and as I say, we're very competitive for our state funding sources.

We have new state regulation that allows streamlined entitlements, and we have a great network of partners to work with across the city and strong programs to keep people housed.

Thank you.

For that, yeah, thank you, Directory.

Surprisingly, lengthy presentation.

Thank you for for your presentations.

I do have some questions.

Um in your report on in the average length of development for a new affordable housing project, it's seven years.

Why does this process take so long?

And what does the city need to do to cut down this development timeline?

Well, as I mentioned, I think we've made great strides on the entitlement side where the streamlining has really worked.

And the biggest challenge we have is the pacing of projects and the waiting for certain state funding sources primarily.

So that is the biggest impediment.

Again, they're forming a consolidated housing finance agency, which will better coordinate between the tax credit program and the myriad of HUD excuse me, HCD funding sources.

So there'll be kind of a one-stop shop.

So we should see this timeline reduced.

Excuse me.

It needs an infusion of public dollars in order for it to happen.

You've got to take a pause because we don't have the capital, the gap financing identified.

So it needs to wait until we get the required resources in order to move it forward.

So I think between the state reforms and then just having more resources, those are going to be the critical aspects in increasing our production speed.

So as I'm referring to the trial, it's about seven years.

So you mentioned earlier that construction takes about two years, so the rest of the five years, it's basically financing.

Well, it is entitlement, so there's still a process for getting your approval process.

I mean it's it's it's much faster than it used to be.

And this would be, you know, this we we have projects that have and can move more quickly than seven years, but then that we've had projects that have waited many years.

In general, it's because of that the need to leverage financing, and you just queue up.

So you apply for you apply for MHP, the multifamily housing program of the state, you don't get it.

You go in the following year, you don't get it.

So like that is often what elongates the process, but there's still an upfront entitlement period, you've got to design the building.

There's a permitting piece where you get the permit.

So those are going to take up uh significant, those will take years, but there is a the potential um uh accordion part which can expand or contract is really the financing.

Okay, great.

Thank you.

And in your slide of affordable housing funding stack, I actually didn't see you mention a private philanthropic dollars.

You know, I've been hearing that about how our mayor has been really effective in uh securing private um philanthropic support for key initiatives.

What can we do to ensure that this kind of support is also direct towards our affordable housing priorities?

Great question.

Um so we have benefited from philanthropic support um in a couple of areas which I think we want to continue to pursue.

Uh first of all, in our collaborative work with HSH, there's uh funds that have come for the breaking the cycle work to support innovative activities really directed at uh alleviating the homelessness uh crisis in the city.

Umtimes those are directed toward um more temporary or uh transitional or interim housing solutions that don't roll up directly to this office, so they're less likely to show up in our kind of reporting, but we are um supporting efforts to direct philanthropic dollars into cost saving improvements in our existing affordable housing portfolio.

So again, it's not so much of a production measure as it is: hey, if we could get these plumbing improvements, we'd have fewer insurance claims and our insurance rates would go down and then our operating costs would be saved.

So there is philanthropic dollars that are flowing to that effort as we speak.

Um the the other area where we see philanthropic engagement is through our partnerships with the housing Accelerator Fund.

They have some very favorable loan um access to loan dollars, loan funds, um, that have helped spur a couple of uh affordable housing developments.

The recently completed 1633 Valencia, for example, used a um a revolving loan, philanthropic revolving loan to accelerate production at that site.

So it's usually through a partnership with like a half or another nonprofit entity that we see those philanthropic dollars.

I will say in general, we don't see a lot of foundation in what I'll call traditional affordable housing, where you've got five, six, seven different sources of funding, it's gonna cost a bunch of money.

Philanthropy has generally wanted to work around finding either innovative ways to make process improvements.

So we'll see it on a project specific basis.

Even with favorable debt, it doesn't, it doesn't move the needle as dramatically on feasibility as it might in different kinds of housing solutions.

Thank you for the answers.

How much local funding support is needed annually in order to fully fund our existing pipelines?

Great question.

So I think the one thing is the 10,000 unit figure really includes a lot of inclusionary units.

It shows up in our in the city's pipeline, but it really isn't most CD's pipeline.

A quick look, I think we have more like 66 projects, and some of these are already funded and underway.

So I can get a more precise figure.

We're still talking about thousands of units, I will say, but it's it's a little bit uh it's fewer than the two thousand, excuse me, the 10,000 two hundred projects.

Um it's still a bunch.

We have a very robust pipeline, and not to be too imprecise, but it would be a lot of money.

We need a lot of money to move that pipeline forward.

In general, uh, you can calculate our um we we fund projects in general about 250 to 300,000 dollars per unit.

So if you if you want to do 100 units, you need 25 million bucks, 30 million bucks.

So it's fairly easy math when you're talking about kind of our traditional affordable housing, which leverages tax credits and other state funding sources.

That's how that's the that's the math you can use.

Okay.

So you just to recap 60 about 66 projects, and out of 66 projects, many what is the portion?

Do you remember like percentage that is already fully funded in the pipeline that's ready to move on?

I don't have that.

It's about 7,000 total units.

I would say probably a thousand of them are already funded, so we could say 6,000 units for 6,000 units.

So that means we we do the math.

250 to 300K per unit times the 6,000.

That is the total amount.

That's right.

It's a big number.

It's a big number.

Yeah.

Okay.

Can you also clarify if if there's a difference figure for their local funding needed to build our pipeline than the local funding that's needed to achieve our rental goals?

So I think I I'm I you just kind of answered it.

So my understanding is even if we fully fund the pipeline, the pipeline, we will still need to go further in order to achieve our RENA goal.

That's correct.

That's great.

I mean, I do think the arena um the RENA goal includes, so our, you know, the the figures I was just giving, where it's you know, the more kind of traditional we work with a nonprofit.

We're building tax credit affordable housing, 100% affordable housing.

RENA does extend into other areas, more moderate income housing, which is included in the affordable zone uh or set of categories, which wouldn't be as reliant on subsidy.

Uh so there's a little bit of nuance there, but the arena goals are very um ambitious, and they even though we have a robust pipeline, the arena goals are even more robust.

So it would require um I think multiple times more funding to meet those RENA goals, as certainly according to that timeline than just what we're calculating for our existing pipeline.

Um the other uh part that RENA RENA sets a goal according to an eight-year cycle, as I mentioned, it doesn't come with any funding to support production, nor does it recognize the leveraging that I was just describing, the fact that our local dollars, even if they gave us everything we needed for our local dollars, they would also need to provide the state the money for the matching dollars in order to make the production numbers work.

So there's there's a kind of funding failure on multiple levels when it comes to uh the RENA goals.

Thank you.

Um, a few more questions.

I know Supervisor Malga has proposed it uh for the ballot a charter amendment to increase our affordable housing trust fund to 125 million per year.

Thank you, Chair Malga, for your leadership on this.

I know that this is an important part of one of the solutions, and I would like to know if San Francisco voters approve this and how many of the unfunded units in our pipeline would remain.

Well, again, just using the math I provided earlier at 125 million dollars a year.

If all of that were dedicated to new production, it would be four to five hundred units annually under that rubric.

Now, the beauty of uh a permanent source, especially one that's growing in the initial years, is we can issue debt against that source, so we can we can prime the pump as it were.

We can issue debt that exceeds the annual contribution.

Now that carries debt service obligations, but we likely be able to increase that production number as the trust fund grows because we can issue uh bonds or other forms of debt against that funding stream.

So this is this is the power of having a permanent source is that you can issue debt against it.

Um, and it's likely that we can look at other kinds of innovative structures like revolving loan funds.

You know, we can we can do better planning because we have that certainty.

But in order to really boost production, we're gonna want to be um advocate at the state for the state bond measure and get out the voters for that in 2026, and we're gonna want to be very active in encouraging a regional housing funding measure in 2028.

We'll need those other sources really to advance our pipeline and production work over and above the housing trust fund.

So with the um with the fund increase if the voters approve it, so because Reynolds goal is also including you mentioned the moderate income housings, right?

So what would the number, just give on top of your head the best estimate of like how many unfunded unit uh in our rena obligation would continue to remain?

This is like an SAT nightmare for me as I think.

You've got numbers, like we're dealing with finance, we all get numbers.

Yeah, I uh um well.

I do I'm gonna if I spent my days uh judging our success relative to the state RENA goals, I would be very depressed.

Let me just say that.

Um the RENA goals are very ambitious, um, and as the as the BLA report and has been as we've talked about previously, the the amount of investment to achieve that is in the billions of dollars.

I think they said 17.9 billion dollars.

So my focus is really on what we can do with the resources that we have, with the political opportunities that we have, with the partnerships and expertise that we have to increase our production to the maximum degree possible.

Um, I don't I don't spend a lot of time and nor am I able to right now calculating deficits.

I'd rather focus on where we're strong and where we need to get stronger.

Great.

Um you have good partners here to continue to move forward for more strategies to continue to build more affordable housings.

That's good to to know.

Um I also want to switch gear to draw attention to Mo Cities' uh unmet needs in affordable housing delivery system.

Uh I understand that uh Mo CD conducts extensive needs assessment on a periodic basis, and you have identified gaps in serving specific populations.

Will you say in this uh this is a question of additional investments, and or are there uh programmatic changes or new tools that is needed to be added to the toolbox in order to better serve these populations?

Fundamentally, this is a resource scarcity question.

There are always opportunities for program refinements and finding new tools.

In general, those do represent refinements, they don't represent sort of sea changes or uh drastic increases in production.

We I would say we do a very good job of serving a diversity of needs.

We have to balance our analytical needs assessment work with being opportunistic, given very specific funding priorities that may be outside of our control.

So, as an example, when the pandemic hit and uh the governor created Project Room Key and then Project Home Key, that created a lot of funding opportunity for permanent supportive housing.

We also had an accrued balance under our RCD home for the same program type, project type.

And obviously, there was a real need for that in the community.

So we took advantage of those that uh conversion or confluence of of financial opportunities to really invest in acquisitions and production of permanent supportive housing.

So we always want to be in a position where we can take advantage of those opportunities, even as we're uh deliberate and and diligent and looking at what our needs are.

So there's always a balancing act.

But um, I just I would I I can't emphasize strongly enough that it, you know, we can do more work with more resources, and under a resource-contained environment, there's always going to be trade-offs between certain population groups.

The last thing I'll say is one of the, and I mentioned this earlier, is um, you know, there's both funding on the upfront side, what we call the capital side or the development side, and then there's the ongoing operations.

And so some of attending to some of the more acute needs, uh be they based on income or disability status, they require an ongoing operating support that is outside the capital dollars, which is largely what we manage, not exclusively, but largely.

So there's there can be um, it's just important to keep in mind that there's sort of two kinds of subsidies, and for certain populations you've got to muster both of those.

Thank you for that.

And and I we understand there's always constraints, and we're trying to uh continue to see how we can also, you know, modify our constraints and to expand you know the poll.

With with that, we also continue to see from the PowerPoint that we we still have a lot of unmet needs.

Um so, but we also have you know upcoming funding opportunities that you mentioned from the state and also from potential other increase of funds.

Um, then what is your strategy in incorporating you know the capital investment and also the ongoing operation side of it, and and also including you know the post potential you mentioned also the potential 2028 regional bond and other resources plus other resources.

So, so what is your strategy in in incorporating all this up new funding opportunity into your plan?

Well, to be honest, it doesn't require too much strategy.

I mean, we have a really good um team, we have uh really good policies and procedures, we have programs that have been defined.

We are we are ready and able to receive more resources, and so now once certainly at the regional level, once that picture becomes more clear, um another part that's important to mention is oftentimes, and this will be true as part of the regional strategy, in order to build a political coalition in the design of the finding the funding, certain categories of use will get defined because you want to attend to a broad array of needs and to build that political support.

So, it wouldn't behoove us to do too much planning in advance of having a picture of what that regional funding measure might look like because it almost certainly will have certain categories of use that we want to be attentive to.

So, again, it's just a to call out that the planning work that we do has to be very cognizant of near-term funding requirements and potential funding requirements that are likely going to be part of the puzzle.

Every general obligation bond that we've passed has included buckets of money that for specific use, be it senior housing or for infrastructure or for housing for survivors of gender-based violence.

So some of the strategy work really comes at the finance side rather than the executional or production side.

Just to follow up on this, because some of the funding you can see it like potentially for the trust fund in the next 30 years, it could generate potentially a 30 billion dollars.

So this is like a long-term planning.

So I would like to also, is there a strategy that you can envision your plan for affordable housing for our city, including something that is short term, five years, maybe, midterm, 10 years, and then long-term, maybe in the next 30 years with the potential more stable funding mechanism, what is our goal in terms of like investing in affordable housing and also in the ongoing operation side.

Is that a conversation that the department it's incorporated into part of the comp the strategy?

It's certainly a conversation we'd be happy to have.

As I mentioned, doing um one of the pieces I want to emphasize, and I'll just say it again, is both the need to be responsive to almost nothing we fund doesn't leverage other resources.

So there's a there's just constraints to the level of precision of planning that we can do locally.

That's different than other capital projects that the city might undertake.

So if you want to uh improve certain certain miles of streets or sidewalks, I don't want to speak out of turn here, but you're likely not leveraging um four or five other sources to make that happen.

It's more reliant on local subsidies.

So it's likely more easy, might be more straightforward to make kind of more precise plans about implementation.

Whereas with housing, as we've talked about, you're leveraging a very diverse array of funding sources, and you need to be opportunistic.

So a 30-year plan, this is what I want to do in 2056.

I don't think it's going to be particularly useful given the number of unknowns between now and 2056.

I think I did that right.

So I think it'd be more useful to look at, you know, on more shorter term plans and in particular once these funding sources are have greater certainty.

Um, as I say, we have a lot of the tools already in our toolkit.

It's really a matter of where do we want to prioritize and how do we best utilize the funds to leverage outside resources?

But that kind of near-term planning I think would be very eager to we're doing all the time and eager to be engaged with you all in that work.

Thank you.

One last question before I share with my colleagues.

Uh, I like you mentioned opportunistic.

So I saw that uh the BLA report also references the housing stability fund oversight boards previous recommendations regarding land acquisitions.

I want to uplift the needs for this.

This is also a market strategy to acquire sites when they are more affordable now.

We can bank the sites when lands prices are lower, what is the department's plan to include site acquisition in future NOFAs?

Well, we um we have just recently, I mean, as of 2023, I believe, issued a site acquisition NOFA, and we have those, we acquired five sites under that NOFA.

I think um I'm a big fan of acquiring land and land banking.

I think it can make a lot of sense.

These are all trade-off conversations.

So if we dedicate funding for uh acquiring new sites and we have the 66 projects in our pipeline that are awaiting capital dollars, we're just adding to that pipeline.

So there's there's a conversation to be had about whether additional sites are needed or whether um we should prioritize moving our existing pipeline.

Um I will say that as especially as we think about issues of geographic diversity and having a kind of equitable distribution of affordable housing resources across the city.

I can very easily imagine that we collectively would want to prioritize the acquisition of sites in neighborhoods where we don't have a production pipeline in particular when those sites are are going to be particularly are especially competitive for for state resources so I think there's a there's a policy conversation to be had around that but um controlling land is amazing it's it's wonderful and we have a lot of sites that are in our control now or in our kind of broader nonprofit community control uh as part of our pipeline so um I just want to follow up on this too it's we are also seeing more you know the stuff you mentioned earlier that the states also streamlining that's also potential bond money fund money and other other sources of income so do you see an advantage because the market right now to be as expensive but the land to bank the land it's it's relatively at today's market is lower do you see this deciding portion of the portfolio to bank length it's a good strategy.

I'm not sure it is a good strategy.

I don't think land is necessarily cheaper it may be more available but I don't think I I think there's there's land values don't actually fluctuate that differently currently if you on the market rate side if you would do what's called a land residual land has no value because the costs to produce the housing are so and relative to the rental income that you're gonna get you you result in a zero land value that doesn't mean that people who own land are just going to give it to you for free.

So there's um there's an inalisticity to the land values that I think is um challenging now are our sellers of land more willing to engage on a potential purchase by an affordable housing developer because there's not competition in the market yes I think that's true.

I do think we're gonna start to see that shift and I think we're already starting to see that shift the question really is the trade-offs given a relatively recent NOFA to acquire new sites the fact that we've actually had to pause most of those projects while we get the capital dollars together to move them forward to ask our pipeline projects and their sponsors to wait even longer while we dedicate additional resources to acquire sites for which we also don't have that gap money I don't think I would I would I would make that policy call at this time.

Thank you Director Adam for your your thorough answers um supervisor Mammu.

Thank you Supervisor Chan um and thank you for all the context on the the funding sources my my questions are more shifted to expenditures how much money is MHC planning to spend on affordable housing this coming fiscal year subsequent years and when do you feel you're gonna run out.

Great question somehow I thought you might ask me that question and someone has provided me an answer here on this piece of paper.

We anticipate making about 270 million dollars in loans in this fiscal year our current fiscal year next fiscal year about the same amount of money so nearly 300 million dollars this year 13 projects next year 12 projects in 2027-28 we're looking at about a hundred million 180 million dollars for seven projects and then it's in the subsequent year that we really do we really do we have a dearth of funding we've got a little bit of funding to advance projects but it's quite de minimous now these are estimates of course there can be project delay so I don't want to get too precise on the timing but the trajectory is very clear.

We have a very robust pipeline in fact I think we have over 2,000 units under construction now our teams are very busy issuing new loans and will be for the next couple of years.

But after that it's um our funding sources go out uh just almost disappear.

And again, per our earlier chart, it's because we've been drawing down the balances from voter-approved geo bonds over the last the 2015, 2019, 2024.

2015 is fully expended but um we've also had accrued balances under our fees, our jobs housing linkage fees and inclusionary fees.

So we've just been living off that large S and been be able to move this project forward.

So the Housing Trust Fund is you know designed to kind of pick up where that decline starts.

So it starts to be funded in a couple of years.

Ideally, we're out of a kind of acute financial issue at the city of deficits currently, and then we start to see that housing trust fund grow right as our funding sources start to decline.

So that's that's kind of how that models out.

So you're saying there's about a dozen projects a year for the next two years.

That's correct.

How are you deciding just edification of the public?

How do you decide which projects to fund across the city?

Well, all of these projects would be projects that are have been come through our our procurement requirements so they were came through either a land dedication, an RFP if it's land that we control, or uh NOFA.

Um, as I mentioned, all of our decisions to fund and prioritize are really based on competitiveness uh and ability to move into production.

So that's that's the foundational part of our work is positioning projects to be competitive for state funding sources.

For example, um 1939 Market Street, um, receive went for a uh ASIC award, the affordable housing and sustainable communities, did not get it, waited another round, I think a full year, applied again and received that ASIC award, and now has the capital stack to move forward.

So while these may seem like funding decisions that we make, it's really the ability for projects to leverage the resources that unlocks their production pipeline.

And so that's really what we're charting out when we look at this when on our allocations budget is likelihood of receipt of those uh funding sources at the state at the state level.

So just um when we talk to projects particularly affordable housers, they all want a lot of money.

They all do and so how do you decide even within the projects that are coming forward how much to give to one project versus another?

Is it what you implied, which is like what you determine is necessary to unlock some specific phase of the project, or like how are you deciding the allocation project?

Well, it's uh almost exactly right.

It's the amount of money that it really to unlock um funding for that project.

So the um it is so for instance, um, we have a number of senior developments in our pipeline.

Um use an example on Treasure Island.

There's a project on Treasure Island that received a very very rare and hard-to-get allocation of HUD 202.

There's barely any HUD 202 money anymore.

So that's a project that got a federal resource.

We don't want to lose that federal resource.

So those are really hard to get.

So now we want to do everything we can to make sure that that senior project has the balance of resources that they need in order to move forward because otherwise we're gonna lose this very rare federal resource.

Um other situations I think are helpful to call out, um, our projects receive additional equity if they're in certain geographies.

These are called difficult to develop areas or qualified census tracks, and they're determined by HUD, and the tracks themselves shift over time.

So you might be in a what's called a DDA, and that DDA is going to expire.

And if it expires before you have a construction closing, you might lose access to tens of millions of dollars in equity.

So we would make a decision.

We don't want to lose that opportunity, because it just means that local dollars would have to make up the difference or the project has to be put on hold.

So a lot of our it's less decision-making than it is strategy around the leveraging of these resources, and that and that is the work of our partners, you know.

So it's most CD we're primarily a bank, we're a lender, but it's really our partners are our affordable housing developers who are going out and identifying, and we require them.

You have to go after every funding source imaginable to lower our per unit subsidy.

And it's those that are most successful at leveraging those uh outside resources that we are then able to advance.

You're kind of playing a game of chess and trying to figure out and match precisely.

Um getting maybe into specific specific projects in that context, for instance, the 650 650 divisadero.

Yep.

Um they're postponed because of funding issues.

That's right.

How did that decision happen in that context and how are we maybe potentially trying to supplement or if not if not why not it's a great example.

So we um that project applied for MHP and MHP is a is a is a so if the bond passes so when the state passes bonds they generally then fund their existing programs.

They don't create a whole new program and MHP has been a longstanding program at the state multifamily housing program there's all the whole programmatic structure is in place.

So but the money you know like locally their money has been running out and so 650 divisadero applied for MHP did not get it.

And that was the reason we had to say hold on also it didn't look like there were going to be future MHP rounds and the project itself wasn't going to be competitive as the amount of money for MHP dwindled they just weren't going to be competitive for that funding source.

However, we have worked with our partners at MTA to identify a transportation project on a similar timeline that 650 to Viz could access in order to be eligible for an ASIC award the Affordable Housing and Sustainable Communities Award.

So they either have or will apply for an ASIC award and should they get that award we'll move that project forward.

So it is an example of okay you didn't you weren't successful at that funding source that funding source is going away we don't see a viable path today stop hold your horses pencils down but keep keep looking and then we identified this alternative path ASIC and they're they're pursuing that funding source now.

So again at a future hearing I might come back to say great news much like 1939 Market Street they were able to get it we're moving forward or unfortunately it was so competitive that we weren't successful and that project is still on pause.

Another example you alluded to previously about bonding is whether you might match it as well obviously those funds are meant to create units that are replaced during redevelopment particularly from SP593.

What are the conversations right now about deploying capital from SP593 for affordable housing today?

What are the conversations?

Oh great um well I should say that um SB 593 is under the purview of OCI so they are most involved in the conversations with the budget office and the mayor's office about the use of that funding tool I guess just excuse me a couple points one is it is a it is a funding tool it's not a source so the conversation I'm not in these rooms directly but um uh almost certainly involves uh the trade-offs between um uh property tax revenue coming from former redevelopment agency areas um that if we don't issue bonds through SB 593 it would go to the general fund so it's it's the same thorny conversation that you all and your colleagues are having about how do we spend the limited resources that we have I think it's an amazing tool the replacement obligation can be spent citywide so um it's a extraordinary uh capacity to be able to bond against this revenue stream and invest it anywhere in the city not just former redevelopment areas wonderful opportunity but that income stream uh other folks have their eye on it uh controller's office the budget office and are trying to balance the uh ability to issue debt against this revenue stream with using that same revenue stream to fill gaps in our overall budget so that's that's the conversation um I think I'll leave it at there for now yeah thank you.

Thank you thank you Director Adams this has been uh really illuminating uh so uh my colleague uh Vice Here Chan uh touched uh on and you and you know your answers uh uh the distinction between capital for building uh new affordable units that are subsidized and then operating um and as construction costs go up and our area median income also goes up that gap for what people uh have to pay and what can they can afford go has been going up for some uh and who bears that cost usually is the affordable housing developers.

And so the voters of San Francisco a couple years back did pass like a limited subsidy uh for very low-income people, but you know, as that grows, you can see that you know, like worrying that's gonna take up more and more of our general fund because that's not gonna go away as a need.

If anything, it will get more acute.

So my question is, what else can we do?

If we know that this is a growing need, and that you know, our budget choices are limited because it's you know, general fund is competing with everything else.

Um, what strategies can we do?

So I will note that for market rate developers, you know, they subsidize their uh BMR obligation with the market, but our nonprofit developers don't.

So uh it right now we're looking at a fiscal cliff, as you noted in 20 uh 29.

If we don't, you know, do something.

Um, some of our nonprofit developers who have Section 8 vouchers, which is pretty close to market rate rents, um, are faring a little bit better because they have you know that source of income that's not restricted, um, that would you know that's great that we have that, but what other things can we do to help our nonprofit developers, particularly the ones that are, for example, doing the um site acquisition for small sites, because when you have three units and like one of them gets evicted for non-payment or rent, or two, you know, that's like a third of your income, that's a lot.

So, what other tools are we looking at, or what can we do to fill that gap?

Well, I think you've touched on a full few of them already.

I mean, I think income diversity can help, and so if you have some higher paying tenants, it can help offset some of the costs for deeper affordability.

And we aren't we doing that.

Well, we do it, we do it through our acquisition program.

I I uh our small sites program, um, and you know, I will say on on the part of some of our sponsors whose mission is really to serve the most at need, we can we can have some tension there.

They'll be like, well, why aren't you serving these extremely low income households?

And I'm like, Great, but we also need to pay the bills, and so there's a natural tension there.

I think, again, if we if we didn't have the resource constraints, we we would all agree on the kind of depth of affordability, but we do we do prioritize that income diversity.

The market rate cross-subsidy is a tricky one because a you know, market rate isn't happening now, so so it's not happening for folks who are expert at it, and so it's not an immediate um uh uh uh solution to the to this income diversity problem.

And what what what we see on the affordable side is um once you move outside that 80% AMI restriction, you lose all that leveraging resource.

So all of those other capital subsidies that come in to help reduce the cost to the city of production go away at 80 percent AMI in general.

There's one state program that that attends to a higher income level.

So it can be what we're when we talk about income diversity, it it kind of varies by product type.

Within affordable, it really is up to 80% because the cliff on the capital side is so great, you've got to have really high rents in order to make up for it, and we just don't see those rents in San Francisco right now.

Um, so but I but I think we can look at income diversity.

Uh you mentioned the vouchers, and we are um uh we're we're working on making always improvements to the voucher program, um uh ensuring that the subsidy is flowing on time, ensuring that if units are an abatement, we take those uh uh we get those back into contract as quickly as possible.

So, one of the benefits of the integration with Mo CD right now and the housing authorities, we're really trying to make that our existing pool of vouchers work better, and that'll help on the cash flow side.

We can imagine a future.

It's hard to imagine at this stage, but imagine a future where there's a federal government that really invests through HUD and through its voucher program, and and and where we have expansive resources, and I think that's gonna be a great opportunity to really either layer those into existing projects that have deficits and align them with our pipeline to make to increase feasibility.

So I'm very excited about that future, and I'm hopeful that it can happen.

Um the other pieces on the expense side, we've had some success in working with sponsors to identify opportunities to lower their insurance costs to really kind of push on that to work with different brokers.

The insurance fever is maybe breaking a little bit, but still really problematic.

Finally, we have made changes to our own what's called residual receipts policies.

So we're foregoing uh revenue that otherwise would come to the city and allowing uh organizations to cross-pollinate or cross-subsidize projects.

So if they have a winning project over here that's generating cash flow, we're allowing them to divert the resources to help subsidize a project that's struggling.

When did you do that, Director Adams?

We've been doing it the last, I think we've done it three three years.

So is that a written policy?

It is a written policy.

Thank you.

It is a policy.

That's great.

The challenge is that in your portfolio in one in a developer's portfolio, you've got to have the winners.

Some of our sponsors who really only attend to permanent supportive housing or kind of deeply affordable struggle to have those those cash flowing properties.

But it has been it's been very impactful.

Thank you.

I do have several questions, but the interest of time, because um I know we only have the um translators at Vice Chair Chan until 4 30, and I want to be cognizant of that uh for um public comment.

I do have so I will ask just one more question because it's important to me.

Um, so uh, you know, I'm the West Side supervisor, one of the Westside supervisors.

Um I supported the family zoning plan because uh the West Side has fought uh building affordable housing uh for decades.

Um, and uh, you know, everything in our side of town from school graduation rates to um you know health disparities according to race, everything, you know, would have a multiplier benefit if we had low-income people being able to live on the West Side.

Um so uh and yet I look at your pipeline and there's not much there.

I mean, we now have a couple development agreements uh on the market rate side that are gonna have a lot of affordable housing.

So Stone Sound and the Bablar Reservoir, those are big ones.

Um, but I would like to see more investment in affordable housing, particularly deeply affordable housing, senior housing on the West side.

And so to uh, you know, follow up on vice chair's question about um land, um I uh I'd like to know what specific strategies we may be pursuing, um, perhaps not just through our nonprofit development partners because you know they are already maxed out doing what they do, but on the city, the mayor's office of housing, you know, working with planning to identify opportunity sites to uh look at um perhaps working with OEWD to look at perhaps infrastructure financing districts or ways that we could plan for changes in using.

We have a lot of golf courses on the West side.

I will just say we have a lot of opportunities of vast areas of land that may see changes and the way people want to use that land over, you know, uh generations.

We have Brotherhood Way, that's a mile of long big parking lots around churches where they have seen joint link congregations also, for example.

So that's one question, and attached to that is the that the West Side is right now, or at least my district, district seven, um, is zoned for single family homeownership, about 80%.

And so homeownership has always been a pretty big uh you know part of the character of the West Side.

Uh, it has traditionally been working class, and over the past couple decades, as you know, land use values have gone up, less so, right?

Right.

But we currently don't do any homeownership.

Uh subsidized.

We do the down payment assistance loan program to you know for individuals uh acquiring those units, and we do, you know, administer the BMR program, uh, which is you know uh the obligation of the developers, but we don't build uh lower income homeownership units, and so I am wondering if that's part of what we might consider in the future, especially as we have upzoned, and to do that kind of housing, and also if there's any ideas that you have for you know different ways of achieving homeownership that we could explore that would provide those opportunities for nurses, you know, for uh first responders, people who don't qualify at 120% of AMI, but for whom home ownership opportunities are still not available in the market, which is you know, that's the gap.

Yep.

I think there's a great question.

No, that's a lot.

I'm sorry, but I just had to get it in.

Well, maybe I'll try and be brief, but I'd love to expand the conversation either in chambers or uh outside.

I think, you know, I we're to the home ownership question.

You know, we are participating in application for some planning dollars to look at um modular infill modular executions and not from where I sit, I think there could be a convergence of you know truly missing middle, missing middle can refer to like middle income folks, but also these middle scale sites that we as tax credit affordable housing developers have a hard time developing on just because of economies of scale, but which could be great first-time home buyer sites, you know, smaller number of units if we can get the cost of production down.

So I I do think there's some gonna be some emerging research around exactly this issue.

And um, I think it's exactly a kind of first-time home buyer um uh income level where I think you might be able to get the numbers to work out without too much public subsidy, so very interested in pursuing that.

Um and then could not agree more about expanding the pipeline on the west side.

We do have a number of sites out there that are ready, so I mean, I think there's if we can get some resources, just delivering on those sites would be our first execution.

Um, and then happy to work with OEWD on other kind of alternative financing strategies that are a bit more uh broad-based, like EIFDs or others, uh, where we could look more at an area level than just an individual site.

So uh happy to continue to engage on those topics.

Thank you so much, Director Adam.

With that, I would like to ask Mr.

Um Fred Bousseau of the Padgen legislative analyst to present the findings of your report.

Thank you.

Oh, good afternoon, Chair Melgar, Supervisors Chen and Mahmood.

I'm Fred Rousseau from the budget and legislative analyst office, and with me this afternoon is Avalon Bauman, a senior analyst with our office who uh staffed this project.

The project uh that we're gonna talk about today was the report we issued last week, funding and incentivizing affordable housing in San Francisco prepared for you, Supervisor Chen, at your request.

Uh you asked us to look at four uh issues.

One was um to explain provide information on our current affordable housing system funding, uh portfolio and um just for information purposes to provide that information.

Um second, you asked us to look at the uh cities development impact fees and inclusionary housing requirements, and specifically what the impact was of the uh reduction in the requirements in both of those areas through the legislation adopted in 2023 by the Board of Supervisors.

Um you also asked us to look at alternative financing strategies and other ways that the city may uh uh find and make available more funding for affordable housing, but not just more, but also enduring or ongoing funding.

So rather than one-time sources or sources that depend on a vote or a federal budget cycle and so forth, your interest was in sources that could be sustained over time.

And then finally, you asked us to look at equity issues and whether or not San Francisco's various vulnerable communities were being considered incorporated, listened to in the planning for affordable housing.

So that was what we did, and I'll sort of go in the same sequence to present our results.

So if we can start with the first slide, just this is the kind of the environment in which we are operating.

Spending more than 30% of their income on rent, and 18% are severely rent-burdened, meaning they're spending more than 50% of their income on rent.

So in the next slide, we talk about what does San Francisco do about that.

We produce and oversee the following types of affordable housing, below market rate units, which are developed along with market rate developments.

We produce and sponsor 100% affordable housing.

We have permanent supportive housing, which is largely for the homeless population, and we want to mention it.

It was not the particular focus of this report.

We focused more on the 100% affordable and below market rate housing.

There's also preservation and rehabilitation, of course, of existing housing to keep it affordable.

And an important piece of this picture is unsubsidized affordable housing, or what is referred to as naturally occurring affordable housing.

So it does not necessarily have a public subsidy, but it is affordable either due to rent control or owners are renting their housing units at reasonable rates.

The next slide gives a snapshot of the mayor's Office of Housing and Community Development Affordable Housing Portfolio as of 2026.

This has been mentioned earlier.

I think that this there's about 36,000 units.

Most of them, as you can see here, are classified as multifamily rental.

That's 20,000 out of the 36,000.

So that's another large number on the schedule.

The next slide, we jump on to RENA, the regional housing needs allocation, state mandated, as I think you all know very well, the state mandate comes to the regional planning bodies throughout California, and then they go through a process where they allocate the statewide need to individual jurisdictions.

And that gets us to our goal of the 82,069 new housing units by 2031.

There's an eight-year period that is governed by the RENA allocations.

So this goes through January 2031 in our case.

Not to necessarily fund them or sponsor the construction of them and make them happen, but to make sure that the zoning laws and procedures make it possible.

As of 2025, the city produced only 20% of its needed housing for this current period, the one that goes through 2031.

And at the point that was measured, we're 37.5% through the time that is required designated in the RENA process.

So we are behind, as has been already pointed out in previous presentations.

On the next slide, I just provides the numbers here of the RENA housing goals and breaks them out by these income brackets.

The 82,000 progress made as of 2025, the deficit 72,488.

And you can see the percentage breakdowns on the progress made.

One thing to note here though is the on the very low income, there are sub-categories of that, and one is extremely low income.

And you'll see in our report, I don't think we have the number in this presentation, but it is a lower progress rate than the very low income overall.

So it is a tougher area to provide housing for, requires higher subsidies, and it's doesn't always work out in the financing of affordable housing projects.

So that is an ongoing challenge for the city.

This is not including the federal, particularly the federal tax credits, low-income housing tax credit, which is an extremely important source of funding for affordable housing in San Francisco.

But this does show you the breakout of our local funds, and you can see the importance of general obligation bonds, development impact fees, and the general fund, and that would include the current housing trust fund.

General obligation bonds, which has been a major source for our affordable housing, is of course subject to voter approval and limited duration.

There's an amount set every time a bond is issued, but it doesn't go on forever.

So when that money is spent, we have to go through the process again of getting voter approval and competing with other debt issuance needs of the city.

So there is a process through the capital planning committee where determinations are made about how our debt capacity will be distributed between all the various needs, affordable housing being one of them.

So in short, it's not a reliable ongoing source, although we have a pretty good track record in the past of bonds being passed by the voters for affordable housing, but we don't know what the future holds in that regard.

The next slide shows the distribution of funding sources for a typical affordable housing unit in San Francisco.

This was assuming a per unit cost of about $984,000 per unit.

And you can see what the city contributes, about 32%.

The federal, and I'm saying federal funding, it's not necessarily funding that flows through the city, but the low income housing tax credit is a big piece of that, and that's granted to investors by federal and state entities separate from the city, but it's critical to affordable housing financing for San Francisco.

The next slide, I'll switch to the temporary fee reduction program.

One of your questions, Supervisor Chen, was what has the impact been of uh that program adopted in 2023?

This first slide is uh kind of a combination of cause and effect.

This shows what has been going on in recent years in terms of housing production.

You can see the ups and downs over the years, but if you particularly focus on uh 2020 on, there was a big decline.

We had um uh net production of 4,621 units in 2020.

That had dropped down in all the succeeding years.

There was an uptick in 2025, but uh only to 2,669.

So we're still uh well below um where we were before the pandemic.

Um in response to that, and on to the next slide, the temporary fee reduction program was adopted by the Board of Supervisors in 2023.

That created three-year window of reduced development impact fees and lower inclusionary housing program requirements for market rate housing.

That was an important reason for that was the Technical Advisory Committee report that reviews inclusionary housing requirements.

So their first report was in 2023 and showed that the majority of residential development in San Francisco was financially infeasible under conditions at that time.

And they ran various scenarios and showed that you know the impact of development impact fees and the below market rate housing requirements, all contributing to the difficulty of producing housing in San Francisco.

And they recommended a reduction in those fees and rates, which the board followed through on and adopted.

A new report has come out.

There's a requirement that the Technical Advisory Committee for Inclusionary Housing produce a report every three years.

So a new one has just come out in 2026 and found pretty much the same results.

In fact, actually they were worse.

They showed that more projects were infeasible under current conditions.

So on the next slide, I want to just make this point that the reduction in the fees and the requirements mean that we have less produced for affordable housing.

So the decline in housing production affects the two funding sources of the inclusionary housing and inclusionary fees, both the you know production of on-site units and the fees paid in lieu.

And then it reduces development impact fees paid by market rate housing developers.

And that, by the way, covers uh provides funding for affordable housing, but also for other purposes.

So the point of development impact fees is to have developers pay for the impacts of their developments on various city services, such as transit or additional child care needs because of the development, and affordable housing is one of those.

So the fees are used for a variety of purposes.

When they are reduced, of course, the amount of funding for those purposes goes away.

On the other hand, housing production has gone down, so it's it's not producing those needs or producing the funds for affordable housing.

But the big problem is it's not producing housing too.

On the next slide, we can see the drop in inclusionary in LU fees from fiscal years 2017-18 through 2425.

Major drop around the same time as the housing dropped.

So this isn't surprising, but it ended up, it ends up in fiscal year 2425 with a negative amount because there were project developers who backed out of their projects even though they had initially gone through the paperwork to start them, but then changed their minds due to the financing conditions that they couldn't make their projects work with.

We show them from fiscal year 2718 through 2425.

Same story here, and what these these fees are just the ones that are for affordable housing.

There is more than that being collected over the same period of year shown here.

If you looked at all the development impact fees being collected, the total was about 194 million dollars.

But then of that, we can see here 126 for affordable housing, and then a great reduction in that in the most recent years.

As we looked at it and looked at the overall conditions though, our conclusion was that the as shown here that the loss fee revenue was pretty insignificant.

We've come up with some estimates.

These are ARM estimates based on what should have been charged if all projects had gone through as anticipated.

These aren't actual numbers from the Department of Building Inspection or Mo CD, but these are our estimates based on the reduction in rates.

So for example, development impact fees, we estimate a 1.9 million dollar loss based on a 33% reduction in revenues collected.

But of that amount, only 211,000 would have gone for affordable housing.

For inclusionary fees, we estimated a 448,000 reduction in fees collected.

The next slide, we put together a hypothetical development project.

This was assuming a 98 unit project with certain square feet kind of laid out here, but an 82 million dollar project.

And then we uh estimated what all the development impact fees would be based on the project's location, because as you know, uh the fees can be different based on the area of the uh of the development.

So this works through all those numbers, but if you look at the column on the right, what what that is showing is the savings to the total project cost, in other words, to the $88.2 million if the fees weren't uh if the fees were reduced consistent with the 2003 legislation, and the range there, because the fees differ based on where the project is located, uh the highest was 1.8 percent, and the lowest was uh 0.44 percent of the total project costs, so it's a small piece of uh of the total development costs.

Um what the point we want to make with that is that the um the macroeconomic factors affecting projects, uh what we have concluded in looking at this are have a much bigger impact.

Those reductions in fees adopted in 2023 did not change things.

Housing production remained very low, maybe a slight uptick uh in the last year, but factors such as these shown on um on this slide, which is the construction costs, uh and the increase in those over the last you know five to six years uh have been fairly dramatic.

And on the next slide, we're showing uh rent and uh condominium prices in San Francisco and the fact that they have either gone down in the case of condos or um not increased by very much up through 2025.

Um we do note that there's been quite an uptick in the last couple of months.

So as we were writing this report, uh there have been big jumps in rents.

Uh we don't know if that will continue or not, and change things over time, but through the present, our conclusion is the um the change in the fees uh did not greatly affect housing production, and um it did reduce uh fee revenue for affordable housing.

On the other hand, not by much because it's so tied into the housing production.

In our recommendations in the report, we uh do talk about the need for um looking at the whole uh question of you know, should the fees be continued or not?

Are they stopping development?

We we don't believe that was the case uh looking at the last couple of years and the data we've presented today, uh, but if the city, if the policy direction is to do everything possible to increase uh housing production and development impact fees and inclusionary requirements were reduced, it may make a difference.

We think it's on the margin, you know, there could very well have been individual projects where decisions were made because the fees were reduced, and that maybe made a project feasible, but overall in the aggregate, it was not something that we can see you know making a difference or getting us back to uh where San Francisco was prior to 2020.

On this current slide, I'm switching now to the financing strategies.

Uh this is showing the big dramatic number of you know our deficit in terms of meeting the RENA goals and what would be needed based on average city subsidies for affordable housing.

It's a kind of a wild number of this 17.9 billion dollars in city subsidies needed or 2.9 billion a year.

Uh so it's well beyond the resources we have or anyone has come up with uh possible sources for.

Again, back to the point uh earlier about RENA, you know, not all of that would actually have to be of city cost, because some of that could be provided by uh the private market or other sources.

Uh turning now to financing tools.

We started with the affordable housing leadership council report that was uh produced in 2024 where uh the planning department assembled a group of housing experts and advocates and practitioners and came up with a um uh extensive list of recommendations for uh improving funding for affordable housing.

We have not um repeated all of those, we borrowed from it and added to it with some other ideas as well.

But this list includes them.

We have a lot of details about each of these ideas in our report.

I won't go through all of them in the level of detail you can find in the report, but to summarize and group them by some common themes, and I think um, and following up on some of the questions to the previous presenters about you know what can we do, what is another source, uh what could be an ongoing source.

We thought a lot about that in coming up with ideas and uh borrowing from some other jurisdictions and what we could find in the literature about it.

But the main point is the money is not uh going to be generated from nowhere, so this all really stems from one way or another from existing city resources.

And the first four uh tools, public financing tools, where we characterize them as having an upfront city investment and long-term self-sustainability.

So this is these are kind of interesting, we think, because that yes, they would take an investment by the city and an allocation of funds that could be used for all kinds of uh purposes that the city funds now, but they would there would have to be a policy choice to put them into affordable housing, but it would get us much further, and um all of these have a characteristic of recycling the funds so they would be used uh on an ongoing basis and replenish themselves over time.

So the initial investment would be paid back.

A revolving loan fund is a great example.

Um we looked quite a bit at the Montgomery County, Maryland revolving loan fund where that county put in a hundred million dollars and is uh now projecting you know six thousand new units that will be produced in 10 years.

Uh the fund goes, it's loaned out for the construction uh part of the development process, which is the usually the highest cost, high interest uh rate, part of the loans for a development project, and then the loan amount usually goes down once uh the project is leased up and there is revenue coming in.

So to get developers through that process and then uh return the funding so it could be used for other developers, is the concept behind the revolving loan fund.

Also, using the Montgomery County model, the housing would be owned or at least partially owned by the county itself.

So it keeps it affordable in perpetuity and builds up assets for the public jurisdiction.

Similarly, with joint powers authority, a typical model would be combining the housing authority and the mayor's office of housing and community development here, though other models could be applied.

But the idea is to pool resources and a joint powers authority could issue bonds, and to the extent it owns the housing that is developed or acquired, property tax would not be required on it to help keep it affordable.

An open indenture is a very ambitious idea.

But it would be separate from the current city processes.

Creating a municipal bank is not a new idea.

It's been considered by the city for a number of years, but one of the benefits of doing so would be to have funding for affordable housing, and that's been part of the vision of a municipal bank since it was first being discussed over 10 years ago.

We also have a suggestion of creating additional enhanced infrastructure financing districts.

There are several now in the city that they use increased property tax funds related to the district that is designated, and that can be used for improving the designated area and affordable housing.

There is a limit on how much funding can be used for EIFDs in San Francisco.

So another part of our recommendation is for the board to consider increasing the limit on how much funding could go toward EIFDs.

Leveraging the SB 593 bonding authority, that was already discussed as OCII funding and plans for replacing projects that were lost after the dissolution of redevelopment agencies.

And that will be coming back to the board, and that's something that the board could support and could encourage OCI to continue on with.

So that funding is still being collected at 100 million dollars a year, the board could advocate for it to be used for social housing or another form of affordable housing.

But since the legislative history was geared to social housing, we have suggested that, and that has the benefit again of city ownership of the housing, keeping it affordable in perpetuity.

Raising the debt ceiling for affordable housing through general obligation bonds and certificates of participation is another idea along the same lines that would allow for more bonding for affordable housing from either of those instruments.

It has the potential downside, of course, of taking away funding from taking away property tax money that would otherwise have been available.

It could also lower the credit ratings of the city, and but it could generate quite a bit.

We estimate for every uh 0.01% increase in the general obligation bond debt capacity.

About $410 million in debt debt capacity principle could be made available.

Enhancing the housing trust fund allocation, this has been talked about quite a bit already, and I know it's a subject of a ballot initiative that may be coming.

So we wanted to add that to our list.

It seems like a great opportunity.

This, like everything else, means, of course, funding coming from the general fund and being reallocated to affordable housing.

But I think, and I just want to make that point very clear that that is common to all of the recommendations that this is really a policy choice for the board to say we're going to make that kind of commitment and allocate more money because we can't we can't make it at the rate we are going at now with the resources we have.

We also suggest new or enhanced taxes.

There's a list of them on this next slide.

I won't go through all of them, but they are probably familiar to all of you, but they all offer the potential for additional revenue.

And less on the direct financial benefit side, but is continuing to pursue local and regional bonds just to continue that as a source, continuing advocacy efforts at the state and federal level for funding from those sources or new sources of federal and state monies, and then continuing advocacy for efficiency efforts to improve processes but also to lower construction costs.

Very quickly on the equity gaps and opportunities.

We did find that the current process definitely identifies various populations and vulnerable groups in San Francisco and documents and reports on affordable housing made available to them.

There are some of these groups identified on the next slide.

There's the preference system, as you know, in allocating affordable housing, which designates certain population.

There's the homeless population, which is certainly very designated and has a whole system of affordable housing construction and tracking of allocation of housing for them.

Low-income households are tracked carefully and reported on, and those with housing insecurity are identified, and funding is available for assistance in rental subsidies, eviction, defense assistance, and other services.

This has informed the housing element and the housing element update, where we think there's room for improvement is tracking the results on all that outreach effort and the goals and so forth that have been set from it.

There was reference earlier to the annual progress report that's submitted by MOCD to the state, that is not always very transparent to the public or to groups, community groups that want to see what has happened and what sort of progress has been made with reference to their group.

So that is something we think could be improved.

Similarly, there's uh a HUD-mandated analysis of impediments to fair housing choice.

It's an extremely comprehensive report.

It's uh identifies vulnerable populations and remedies underway to ensure they have the affordable housing they need.

But it is only produced every five years.

It's not an easy document to review for the general public, so it's another area where we think reporting can be improved.

And we heard loud and clear from MOCD about all the reporting that they currently do.

We are sensitive to that, and and our recommendation is that there be some sort of process where the board and MOCD talk about a way in which this information can be reported without being burdensome, but still getting the key information across to the Board of Supervisors and community groups that are interested in this because we interviewed a number of housing providers and advocates of various groups felt that they didn't know what was happening in terms of responding to their needs and the input they provided.

Safe housing for women, survivors of domestic violence, and extremely low-income households were groups that sort of stood out as wanting more information about progress being made.

A quick slide here on housing units in San Francisco versus housing need.

I think this is kind of an interesting way of looking at it and probably a good measure to track over time.

Here's where you see kind of the nuance of the lower income progress that has been made, which is very encouraging for the low-income and very low-income group, where you see the number of units produced relative to the housing need is less encouraging for the extremely low income where there's still a gap, and interestingly for the above moderate groups.

So we have a number of recommendations following up on some of the points I made on the equity-related issues.

And I know there's a lot of information here, and I'll stop now and we're happy to respond to the questions.

Thank you.

First, I would like to really express my great appreciation for Mr.

Busel and also your colleague, Avalon Boltman and Stefania Swayya, for all your great work on this report.

So I do have a couple questions and I'm gonna re faster.

You referenced that possibly 8.6% of San Francisco's housing stock is de-restricted affordable housing.

How does this compare to other jurisdictions?

Would you say that having a higher proportion of our housing stock permanently affordable provides more stability to serve the city's workforce and our local communities?

Well, I'll start with the last question first.

That is uh absolutely I would agree with that statement, yes.

Um, it would it would do all of those things.

In terms of how we compare, um we have looked at that.

It is not uh that easy, unfortunately, to compare city to city because uh there's different kinds of programs and different ways that cities measure affordable housing.

Having said that, um, so this is um, you know, shouldn't be taken as the most reliable way of looking at it, but we're probably higher than a lot of cities in the country, and there are other cities that are higher, but they would be a small handful, I would say, um, higher than 9%.

But they're uh New York and Boston sort of stand out.

They report much higher percentages, but they have different kinds of programs in place as well.

If you go outside the US, there are some um astoundingly high numbers.

Singapore, you know, 80% of the people in Singapore live in some form of public housing, 60% in Vienna, um, I think it's 30 or more in Amsterdam.

But again, their programs might not exactly match us in terms of deed restriction or funding sources and so forth.

But there's lots of room on the upside, I would say, for increasing our percentage.

Great, thank you.

And also referring to the uh the report, uh, especially on the analysis of the fee reduction program impacts.

I know that that it's pending legislation, which I will not discuss, but I do want to better understand the BLA and analysis that the impact of the PyR fee reductions.

I'm wondering how much bang of our bug the city got from the reduction of the fees.

You mentioned that in your analysis, depending on the location of the project and the applicable fees, there were modest cost saving for developers between 0.44 to 1.83% of their total development costs.

Does this mean that the cost saving from reduced C fee were insufficient to make projects pencil?

Um that is a great question.

We um struggled with that ourselves when we were working on the project because we don't know on an individual project level if uh a 1% savings in total cost um made a difference or not.

And maybe it did, but we can't tell from the aggregate data.

But what we can tell is housing did not swing back.

So there may have been individual projects that it benefited, and decisions were made to go forward where they wouldn't have been without the program.

But the overall impact has not dramatically changed housing production.

And I also have a follow-up question on the slide that you presented for 2025 on page 25 of the slide, new housing units in San Francisco versus housing need.

What we need to produce every year and what level of investment we need on an annual basis.

And we need to go further than that by understanding what investment is needed to achieve our goal at each AMI level, because we know that all things consider the costs to ELI units are different than example of moderate income units.

We should create a table with this kind of data over a 10 years period.

Is this kind of data or analysis available?

Uh the data is definitely available because this is showing new housing units, so we can get that for any year.

And the housing need, and I'm gonna ask Avalon Bauman to confirm that I think that you know that would remain constant as for every RENA period, is that I'm missing that okay.

Uh so you know that would have only changed if we went back in time to the previous arena period.

But for the current and through 2030, that could stay the same.

So I think what you're asking would be fairly simple to do to kind of keep that as an ongoing metric year after year.

That would be great.

And I'm moving a little faster because I know uh some of our commenters uh need to go.

I'm now I'm switching to like funding strategy.

One of the strategies that you outline in our report is to create a joint power authority that would combine the power of MOCD with those of the house with those of the housing authority and even potentially OCI.

What are some of the additional powers that would be created under this joint power authority, and what additional activities could a joint power authority help us implement?

I think the biggest difference, Supervisor, is that um there would be uh pooled resources from the two agencies.

So the housing authority owns properties, the housing authority has expertise in managing properties, managing the voucher program, and then that would be combined with the financing arm of most CD.

So the joint powers authority could issue bonds, they could be acquiring properties, developing properties, and they would have already have some in-house expertise in uh managing those, assuming they would continue to own them.

And I also want to another funding question is that we we one of the challenges current affordable housing sites experiences are operating deficit once projects have been built.

So this may come as a result of rising insurance costs, capital improvement costs, or even potentially loss of welfare tax exemption, for example, uh, any of this strategy in the report appropriate to help fill the gaps for this operating budget.

And I know that Supervisor Malga and Director Adam also had similar conversation earlier.

Right, the uh I think the answer to the question is that uh what whatever strategy gives the greatest flexibility to the entity would mean funding could be made available as needed for elevator repair or you know maintenance at a uh an existing site that's um fallen into disrepair.

Um, of the strategies listed, the open indenture provides a lot of flexibility because it's issuing bonds and um and the entity would have the difference between what is being collected and bonds being issued to use as it sees fit.

But that could be true of some of the other options as well, as long as there uh I think there was reference earlier to the housing trust fund, and if that's expanded and additional funding is coming in, there's you know, the administrative code allows for using that for uh all purposes related to affordable housing, including maintenance.

Uh so the more that is available from that source, for example, uh the more that could be used for different reasons.

Great.

Thank you.

And one thing that I also found interesting is that some of the financing strategy you described require initial investment of staff time funding, but then achieve financial self-in-sustainability over time.

Um I'm thinking about a revolving loan fund and/or a municipal bank.

Uh for example, many projects rely on private construction term financing from commercial banks, which can be very expensive.

Do you see the cost saving for affordable housing projects as a result of more favorable financing from say a revolving loan fund or a municipal bank provide a jurisdiction uh justification for the upfront cost to start up these programs?

Uh yes, Supervisor, I think that's a very good summary.

That is uh the uh strategies we included that include an initial investment uh all fall under that approach.

So they would there would be an upfront cost and there would be ongoing funding available to continue it over time without the city having to always come back and provide additional funding.

Great, thank you.

And I also know that the state and city have adopted policy goals to encourage affordable housing in well-resources neighborhood like the west side in San Francisco.

One challenge is that the land is already built up and there are fewer larger opportunity side that could accommodate up to 100 units.

Uh the threshold that state funding through housing tax credit is prioritizing 100 plus units.

Uh any of this strategy appropriate to help deliver smaller projects on smallest opportunity sites, uh, any of this strategy appropriate to help acquire this opportunity site to build the pipeline for these future projects.

Um I think that you know, if you get away from low income housing tax credit, then maybe that opens up more doors for smaller sites.

Uh, the revolving loan fund, for example, would not be dependent on the low income housing tax credit.

So it could be funding projects of any size or on any uh size parcel of land or number of units.

So I I know we also talk about public lands.

Um I'm also particularly interested in how the city is leveraging our public lands for affordable housing development.

Does any of this strategy provide us with additional tools to help maximize public land resources for affordable housings?

Right.

Um I would say not specifically, but they provide funding for projects, and the more funding you have for projects, that could certainly include uh projects on public land.

I'll just mention that we are working on the report on that very topic right now, so we will have a report out this summer on ways that um publicly owned land in San Francisco could be used for housing and other purposes.

Thank you.

And I also really appreciate that you produced it a long list of strategy that is recommended to to the policymakers.

Is there any single source sufficient to address the affordable housing goals or our unmet needs?

Are there combinations that are more important to pair together?

Um I think you know, ideally they could all be done and they would you know produce even more funding.

That's probably not realistic.

So I think that one of one of our recommendations is that city staff come back to you on uh particularly those that require the upfront investment and kind of give you the details of um what that would take to get it up and launched, like the open indenture or the joint powers authority, the revolving loan fund, and then I think that will help in the decision-making process to say, well, what's the payoff going to be?

What are we going to have to put up front?

I will tell you for an open indenture, for example, that's probably the most complex.

New York City has one.

They've produced tens of thousands of housing units with it.

Um, but it is a big sophisticated complicated operation that you couldn't just start up overnight.

A revolving loan fund is a little simpler and could be extremely beneficial.

Um so I would guess when staff provides that kind of information, you will see those sort of trade-offs.

And if I had to pick one right off the top of my head right now, it would be revolving loan fund just for the reasons I was saying.

Thank you.

I also notice that Supervisor Chair Mauga.

Thank you.

I do have questions.

I think a supervisor Mahmoud was on before, but I'm gonna go.

So thank you so much.

Um, this is really uh great and thorough.

Um there's a couple things that I didn't see, and I'm wondering if you considered them and just didn't want to.

I will say just from the get-go, like sort of what my perspective is.

I sometimes hear folks saying, well, you know, Vienna has this, whatever.

They started a hundred years ago, so we can't do that.

You know, and it just really frustrates me.

Because if we had started 100 years ago, we would be where Vienna is now.

My point is that it requires the political will to actually act today, and we haven't had that.

So uh to that end, um, Vienna has 60% uh social housing.

It's not subsidized housing, it's social housing, right?

Uh, indeed restricted, and it's about affordability, but it's about a bunch of other things, too.

Did you know they have like a gender planning equity officer?

Uh, it's about sustainability and climate change and you know, design and a bunch of other stuff, which is great.

Singapore, same thing.

So I'm glad to hear from Director Adams that we have, you know, changed our residual receipts policy.

I'm gonna dig into it to see what you got.

But uh one of the ways they do it is to uh require as a compliance um, you know, mechanism for the limited equity developers to reinvest after they've paid off their loans to build new affordable housing.

So they build in this like pipeline for development, specific for development, not for operations or anything else.

And so, why didn't we consider that as a uh strategy?

I realize that's not a today, that's a tomorrow, but to my point, we've have you know, like up until you know we just proposed a housing trust fund, which is for 30 years.

It would be like, you know, we get a dollar, we spend a dollar and not plan for the future as much.

And so if this is our biggest issue, and if what we want is a pipeline that will be sustainable, because we're always gonna have this issue as long as we're the job center of the Bay Area.

Why not plan for for that?

Right.

No, I think that's a great idea, Supervisor.

And um, if I could rewrite our report, uh that would be a great thing to put in.

Um, I you know, this is not the exhaustive list, um, so I'm sure there are other ideas that could be considered, but um again, we went back to the what would produce additional funding and what would be sustainable over time, but um that sounds like something that would fit the bill.

And actually, I'm glad you mentioned it too, because I want I wanted to also uh mention something that came up in the earlier presentations.

A lot of the uh strategies include mixed income housing, so as is the case in Vienna, uh where you know a lot of middle income people live in city-owned housing, and um a lot of the models for revolving loan fund or um joint powers authority assume mixed income as well, and so it is people at higher incomes living in the housing, paying higher rents than people at low income, but it's subsidizing it.

It's just another way of getting funding and resources available for people who need it.

And some people object saying, well, it's not all for you know uh deeply affordable, and that is absolutely right, but it is a funding source, and um I I I would say there's a need for middle income housing in San Francisco as well that subsidized.

So, but it's a policy decision too, right?

If we so when we pass the inclusionary ordinance in two thousand and two it was a long time ago, uh, one of the goals was to have um mixed income, you know, settings at where luxury condos would be side by side with BMRs um in that principle you know like we haven't really quite codified it as a like a value that we want to see right and I mean I think that that could be you know a starting point it is a policy decision um the other thing I was gonna ask you about is um the um the idea that we uh that we have multiple goals you know with affordable housing um and one of them has been to decrease our climate you know um footprint because we have exported so much of the working class and low income people who still work here and provide services here you know two other places that are cheaper um and uh the role of the private sector in that so right now we have put that role on on you know developers but not necessarily employers and so we could say oh yeah we tax them or whatever and that's contributing a little bit but in other places um the sort of that workforce obligation has been codified in in ways you know sometimes uh voluntary sometimes not but we haven't really done that so we do have some major employers in our town including the city and county in San Francisco is a major employer we have done a little bit you know like uh around down payment assistance for furry radio ponders but we haven't really done anything in terms of production of you know uh making any vehicles available for union pension trust investment or for you know um you know uh interest free loans from you know UCSF or you know whoever the employers are who have a need for affordable housing although they themselves have taken up some uh development things but it wouldn't it be advantageous to have a vehicle to pool resources from employers for production rather than allowing the or or just you know the one-offs that happen right now because people need them would that be one of the solutions perhaps yeah and I think that um all of the above should be considered and when we looked at our list you know we wanted to make that clear that it shouldn't just be one of those necessarily or there's potentially combinations and they could be enhanced so I think a lot of what you've suggested this afternoon um uh would be great enhancements.

Thank you Mr.

Brisoy thank you so much for this report it's really awesome.

Thank you.

Supervisor Mambu thank you Fred and thank you for presentation I had a couple questions um on a couple different topics one uh starting with um uh on site inclusionary uh is one of the things you brought up uh your report highlighted the need obviously for extremely low income housing um and do the need of services at this type of housing these are rarely built as on site inclusionary um given uh the type of services that are needed to support individuals and that in those types of housing does that suggest from your perspective that an inclusionary free rate structure should incentivize feeing out as opposed to building on site um I guess the the existing policy gives the developer that choice and you're saying should it actually be encouraged um one way or the other to include the services um you know I think that I think there's some value to that idea definitely um in you know there may be environments that are more conducive for to have a service center or have service providers uh so it's something we didn't really look at in this report but the idea makes sense to me um and I guess the input I'd want to get is from the providers themselves and if it if there are uh environments excuse me environments where um they feel it's more beneficial to work in certain kinds of environments than maybe the uh the market rate housing.

That would be some valuable input.

Understood.

Second is on timeline um you mentioned a couple range of options.

Public bank, which Supervisor Chen is working on.

I'm excited to support as well.

Walling loan funds, EIFDs.

Do you have a perspective on how long it might take to see results from those respective solutions?

Yes, I think that a revolving loan fund, just to go back to that, but you know, that could be up and running in the short amount of time, and money could start going out the door immediately, as opposed to creating a municipal bank, which you know the city is making progress, but it's been years and it will take a while.

So the other thing is like the uh the debt capacity limits, they could be lifted by a vote of the board.

Uh you could have a meeting next week and make that decision.

But you know, you it will take a while to see the impacts.

Um, the debt would have to be issued and so forth.

But I'd say you could get to some of them, you know.

I'm gonna say a year or two, you would start seeing um benefits from some of the more straightforward proposals.

Municipal bank open indenture, probably talking about multiple years.

Okay, understood.

Thank you.

Thank you again.

Uh thank you, Mr.

Folza again.

Um, right now I would Mr.

Clare, I would like to open uh a hearing to the public.

Very good.

If you have public comment for agenda item number four, please have to speak along that western wall.

I'm indicating on your right-hand side of the room, and when the electron is free, you can come forward and start your comments.

I'll begin your time.

Good afternoon, supervisors.

Thank you for holding this important hearing.

My name is Honest Charlie Bodkin.

I'm the president of the District 5 Democratic Club.

But today I'm here in my capacity as co-founder of San Franciscans for social housing.

Uh staff from planning and MOCHD uh mentioned that the state's arena goal uh may not require that the city uh directly fund affordable housing, but as you heard, to meet our goals to meaningfully move the needle to produce affordable housing, it will require greater subsidies and greater dollars be spent to create the homes that San Franciscans and families in our city desperately need.

The housing trust fund expansion was raised by staff as an example of a revenue measure that could raise billions of dollars for affordable housing over the next 30 years.

Another measure that I didn't hear mentioned by department staff is Prop I, the transfer tax on property sales over 10 million dollars.

I'm glad the BLA raised it.

Uh voters have already approved it, and it's projected to generate billions of dollars over the same 30-year period, and that could be directed to affordable housing.

I represent a group of over a thousand San Franciscans for social housing that have been asking with other housing applicants through hundreds of letters sent to this board to dedicate prop I funds to affordable housing and social housing.

The board has the opportunity to act to respond to these voices and to allocate this existing revenue to make the housing truly affordable.

Instead, a piece of legislation called the Build Act is currently making its way through this body that threatens the billions of dollars that could go to fund affordable and social housing funding.

And we're asking you to instead spin this money to truly move the needle and to stand with working families.

Taken all of the above strategy.

We need yes and thank you.

Thank you for comments.

Next speaker, please.

Can I use the wolf vision?

CivCov TV, if we could please display very good.

I'll start your time.

Good afternoon, supervisors.

My name is Sean Auckland, a resident of SOMA.

I want to draw your attention to this table that was not included in today's presentation using MOCD data.

We mentioned that sorry, Director Adams said that the pipeline for new affordable housing is diversifying.

It is actually not.

So I would like you all to take a look sorted by the share of housing that is within Mo CD's current affordable housing pipeline, and we can see that the most is in districts five, six, and ten.

And districts six and ten are slated in the future pipeline to take on more than a third of the total future pipeline.

This is not a balanced citywide strategy.

This is a containment strategy.

In 2015, the case inclusive communities versus Texas had the Supreme Court of the United States hold that government policies that disproportionately concentrate affordable housing in low-income neighborhoods while shielding affluent areas from integration violate the federal Fair Housing Act.

And now in California, that is also the AFFH guidelines.

San Francisco's current siting practice mirrors what the court outlawed outlawed just 10 years ago.

I heard excuses today around uh residential character, and there already being buildings and it being single family homes.

You definitely have empty buildings that can be converted to dense affordable housing, again, if there were political will.

Furthermore, the city controllers 26 2026 triennual report, as you know, says that the inclusionary mandates are not producing housing.

They're effectively acting as a ban on private development.

We need more affordable housing, and we also need to build more housing overall.

This is why I support reducing the inclusionary rate to 5% to generate the production we desperately need, and it must be geographically equitable.

Thank you.

Thank you for comments.

Next speaker, please.

Access to safe affordable housing is often what determines whether a survivor can leave an abuser, and DV remains a leading cause of homelessness for women and children.

Good afternoon, Rebecca Jackson, co-chair of women's housing coalition.

Thank you for the hearing.

We're here to support the equity gaps and opportunities recommendations in the BLA report and urge the board to adopt them.

Survivors' experiences create unique barriers to stable housing, and those barriers should be clearly recognized and named in housing policies, programs, and planning.

The BLA recommendations was strengthen transparency and accountability by creating a clear framework for tracking housing equity goals and identifying gaps.

Women survivors must be included in future assessments of how they are served, what unmet needs remain, and resources required to address.

And the women's housing coalition has been identifying these needs of this data for years.

We've been busy trying to advocate getting survivor language and carve out in local housing bond, working at the state AB 1573 to add survivors as a vulnerable POP to the California housing element, which is currently on consent and Senate committee.

Presented at Housing California Conference Unseen Unheard.

The need for survivor-specific housing, submitted proposed amendments to add survivors as a carve out to the affordable housing bond act of 2026.

And we're sitting in meetings on the Bay Area Regional Housing Bond Groups.

And just to remind us in 2025, we declared our city as a sanctuary for women survivors seeking housing, urging the city coordinate resources and investments in affordable housing and services.

California is leaning into naming survivors as a vulnerable POP who deserves to be named.

This is a real opportunity for San Francisco to help close this equity gap by adopting the BLA recommendations.

Thank you.

Thank you for comments.

Next speaker, please.

Good afternoon, supervisors.

My name is Quentin Necky with the Council of Community Housing Organizations.

I think we can uh really sum up Director Adams' uh presentation by just focusing on the one statement, which is money matters.

And I think I really want to thank the BLA for doing this report and naming the number.

The true north of this entire conversation is the amount required to actually create the affordable housing that the city needs.

That number should be on every website on every dashboard.

We should be talking about and not be scared that it's billions of dollars.

It is billions of dollars.

And I appreciate Supervisor Melgar, your uh observations about Singapore and about Vienna.

There are other models that we can do, and we should not be afraid of doing them.

But even here in the United States, Seattle didn't just talk about social housing.

They created the Social Housing Authority and then went out and created a funding mechanism for it.

Philadelphia earlier this year passed a two billion dollar home initiative.

They have half the city budget and three times the population.

So the vision can be there.

They committed to issuing $900 million in municipal bonds in the next four years.

Not over the course of the next 30 years, but the next four years.

So I think the commitment that the city can make to actually unlock this pipeline needs to be real, but we can put together a different vision for what this looks like.

And I think you know uh our organizations were part of the work that you did around the housing trust fund.

And I think that we should look at that as the absolute floor, by no means the ceiling, and look at that as the ability to at least get some projects off the ground in the next few years, especially as we're facing the fiscal cliff that we're all aware of in 2029.

That being said, I think this is really the opportunity for the city to look bigger to a larger vision and put together all the different assets it has to create the affordable housing it needs.

Thank you.

Thank you for comments.

Next speaker, please.

Hi, my name's Jenvo, and I'm here on behalf of the women's housing coalition.

Thank you, supervisors for holding this hearing, and thank you to the BLA for providing this report.

Uh the women's housing coalition is in strong support of the equity gaps and opportunity recommendations, and we hope that the board acts on them going forward.

We'd like to see women survivors of gender-based violence be included in any consideration, just like other vulnerable groups have been when most of the evaluates population-specific housing needs going forward.

Um we all know the domestic violence and homelessness are strongly like interconnected.

Uh DV is still the leading cause of homelessness uh for women and children, and uh affordable housing is often the barrier or the decision maker if someone's going to leave their abuser no matter their gender.

Um, these are unique challenges that need to be considered when we're looking at our policy.

So, luckily, the BLA report, um, if you adopt the recommendations are gonna make sure that the city's housing policies are informed by the realities that women and survivors face and that resources are directed where they are most needed.

Thank you.

Thank you for comments.

Next speaker, please.

Good afternoon, supervisors.

Uh, my name is Rishov.

I'm a renter uh in district nine in the mission.

I'm here uh to speak about uh speak in support of uh 2020's proposition I and talk about the affordable housing guarantee act.

Uh today's hearing is about a simple question.

How does San Francisco meet its affordable housing obligations at a scale that matches the crisis we're facing?

The the report of the BLA report before you uh makes one thing very clear meeting these obligations requires sustained commitment and dedicated investment.

Uh voters uh approved Prop I in 2020 with the expectation that taxing the largest real estate transactions would help address our housing crisis.

Since then, Prop I has generated more than 400 million dollars in revenue.

The city has invested a significant portion of those funds in affordable housing and housing stability programs, helping preserve homes and keep people housed.

Uh, but not all of that revenue has gone towards affordable housing, a lot of it has gone towards the general fund, uh and funding levels can change year to year based on broader uh political budget decisions.

Uh at the same time, the city faces a major shortfall in meeting its affordable housing goals.

Uh we've reduced impact fees and inclusionary requirements that helped uh that previously helped fund affordable housing, while state and federal fund uh resources remain limited and unpredictable.

The BLA report highlights the need for revenue that is scalable, stable, and countercyclical.

The Affordable Housing Guarantee Act would donate revenue, uh would dedicate revenue from Prop I's tax on properties over 10 million dollars to the protection, preservation, and production of affordable housing.

It would ensure that when the city receives revenue from the largest real estate transactions, those funds are used for uh used for the public purpose.

I'm sorry, I'm gonna stop you.

Are you talking about what um is going to be on the ballot in November?

Yes, talking about the recommendations.

There is no electioneering allowed uh here.

So you can you can talk about you know general recommendations, but not about something that you know may be on the ballot.

Okay.

Well, in that case, the that's just the rules.

I'm not okay.

Thank you.

Yeah, the the recommendation from the BLA report uh to dedicate the revenue from Popeye towards uh towards affordable housing.

I think uh this uh this uh committee, this board should uh follow those recommendations to dedicate uh those that that funding towards affordable housing, towards social housing, towards these alternative models.

Uh, thank you.

Thank you for comments.

Next speaker, please.

Um good afternoon, supervisors.

My name is Divya Singh, and I'm a volunteer lead with Growth of Richmond, uh Mountain D1.

Um, and I support the technical advisory committee recommendation to lower the inclusionary zoning rate and um the proposed new funding for the affordable housing fund.

Um I think that you know, time and again now we do see analysis after analysis pointing to how a lot of the um like cost increases that we're seeing in developing housing or due to this uh supply-demand imbalance.

I think that there's no greater illustration of that than what's going on in S hub right now with like the um rapid growth of the AI industry.

Um and I just kind of reflect on my own experience.

Um I was working uh you know remote remotely for the federal government about a year ago, but then I ended up losing my job.

Um, and you know, I was thankful to have the support of like my family and an old an agreeable partner that I was splitting my apartment with um and savings and stuff, but like many people don't have those luxuries.

And if they're fighting this battle of needing to meet these higher and higher housing costs that take form of like uh increasing rents in the city, I just think that, like, that's uh an unwinnable slippery slope.

So we need to be pulling out all the stops that we can to reduce overall costs, reduce the timelines that we have to sort of obtain the third-party financing and subsidies needed to get these housing developments produced, um, and deliver, you know, lives of dignity to our neighbors.

Thank you.

Thank you for comments.

Next speaker, please.

Hi everyone, my name is Tiffany.

Um, I'm with the Chinese Price of Association.

We had two members come, but they had to go do you know kid pickup.

Um so I'll just uh read uh Erme Wu's uh public comment.

Uh she is I am a member of the Chinese Price Association.

I'm a family of five.

Uh we live in uh San Francisco's district three.

I'm from a low-income family.

Rents are very expensive nowadays, and they only continue to rise every year, making it harder for low-income families to afford living here.

Our family of five used to live in a 10 square foot room in SRO's uh single room housing building um for 10 years.

The room had no space for movement, eating, doing homework all in one bed.

Sometimes in a sh we had to use shared toilets, and the wait times are very long.

I had to go up and down the stairs uh to find an available toilet for my kid.

Mondays to Fridays are busy times, and we had to wait long lines to cook in the shared kitchen.

Um, not to mention the poor hygiene and the cockroaches.

Um these are not safe environments for children to grow up, and it all really impacts their self-esteem too.

Um so as parents, we feel miserable.

We want to be able to provide a joyful childhood for our families.

Um I'm grateful for the orgs that we work with.

Um that I'm part of the Chinese Paris Association, the Chinese Community Development Center for their advocacy efforts for the different forms of affordable housing.

I hope more families living in SROs can be relocated to affordable housing.

Our families have been fortunate after waiting to get the opportunity to get a housing voucher program to move out, but more people need to have that opportunity.

Um so that I'll just cut it short.

Yeah.

Thank you.

Thank you for comments.

Next speaker, please.

Hi, Supervisors Asia Nicole with Build Affordable Faster.

Uh, thank you, Supervisor Chen, for holding this hearing.

Thank you to the B BLA.

And uh the one question I want to echo what Clinton Mackey already said from Choo Choo is like how how are we going to fund this?

Um, thank you, Supervisor Melgar, for your comments to BLA as well.

Um, we just need more funding.

We need to figure out other tools, other avenues for funding affordable housing.

Thank you.

Thank you for comments.

Next speaker, please.

Good afternoon, supervisors.

My name is Peter Stevens with Todd Co.

Um, really happy we're having this conversation about money.

Thank everyone for the hard work they put into this.

Um, because as we know, money builds housing, money operates housing.

Um, so let's make it rain money and make the city work.

Thank you.

Thank you for your comments.

So the next speaker, please.

Hi, Supervisors.

Thank you, Supervisor Chen, for having these reports uh made.

That was very enlightening.

And Supervisor Melgar, thank you for your work on the uh housing trust fund.

My name is Jugal Patel.

I'm a resident of District 8, and I'm here with Abundant San Francisco in support of the proposed recommendations on the reduction of the inclusionary housing requirement and development impact fees paired with a more stable affordable housing financing mechanism.

Over the last 15 years, I have lived every facet of housing insecurity in this city, from sleeping on its streets to shelters, rehabs, transitional housing, relying on housing subsidies, and now supporting myself in a rent control department.

I was lucky to find a right controlled room I could afford through my community.

Not everyone is so fortunate.

As I work my way up from the streets, the line to support myself in the city kept moving further and further away.

I tried to apply for affordable housing, but with so few units and so much need, I gave up after a while.

Now I make too much for an affordable unit, and I still can't afford to live outside of rent control.

I cannot get an affordable unit when I qualified for one.

Now that I don't, I can't afford a market rate unit.

Nothing about this system is working as it should.

I'm a champion for affordable housing.

I understand how essential it is for our most vulnerable neighbors to build a stable life.

But when affordable housing is tied to market rate development and no market rate housing is getting built, no affordable housing gets built either.

The controller and the TAC have told us what we already know.

Today's requirements are blocking the very homes they're meant to fund.

San Francisco needs to pull every lever to get home building moving again, lowering inclusionary rates, reducing impact fees, and pairing those changes with a stronger housing trust fund.

I urge the committee to support these amendments when they come to the board and when they come to this committee to help build housing at every level, from deeply affordable to market rate.

Thank you.

Thank you for comments.

Next speaker, please.

Hello, two remaining committee members.

My name is Sunny Engulow, and I am representing PRIPAL, San Francisco, but also myself and want to thank uh Supervisor Chen for all of your work with the BLA to really get a very comprehensive and thorough report out.

It's as supervisor, as the chair said, it's nothing really new.

We've had these tools at our disposal and different iterations and models of them on different scales, and and I want to really echo beyond just yes, we need a lot of money.

Yes, we we've known that for a long time.

It is the political will.

And sometimes that does mean dedicating things.

Sometimes, you know, it's pushing our executive branch to allocate the funding and to actually spend it for its intended creative bold purposes.

You know, we would never have gotten the Shirley Chisholm Apartments if we had not fought with the mayor's office, unfortunately, in the end, one to get money dedicated in that bond.

Same thing with women's housing.

They said that couldn't be done.

There were all these barriers, and we said, let's dedicate some money so that we know that you will have to ultimately do it if you want to spend that money.

And so whether it is, you know, increasing uh property taxes over time or you know, bonding against that debt, increasing our housing trust fund, taking, you know, taxing billionaires and billionaire real estate sales over 10 million dollars with the affordable housing guarantee act, supervisor Chen's uh recommendation to or measure to legislation to put forward and establish a public bank.

These are all things that we can be doing now, but we're really gonna need a lot of that political will and a lot of that standing up and saying, hey, like we made commitments, we made promises, it's time to deliver.

Thank you.

Thank you for your comments.

Next speaker, please.

Hello, uh, good afternoon, good evening.

Um, but good evening.

Uh I'm PJ Uhenia with Tom Kent, a member of Race and Equity and All Planning Coalition, Rep SF.

Uh, we want to thank Supervisor Chen and the D11 office for commissioning this VLA report and for pushing the city to engage in meaningful policy discussion around the need to significantly increase access to affordable housing.

We see the everyday struggle of our communities that need affordable housing.

Our families, seniors, workers, needs it now.

We work with recent immigrants that who want to work and stay in San Francisco, but there's always the question: how long can they afford to live here?

A lot of our families already moved outside San Francisco, and even outside the Bay Area because they are tired of waiting and have nothing left.

Uh, we urge the city to pursue both new funding streams and new tools to create the affordable housing and social housing opportunities that we desperately need, as described in the BLA's report.

Thank you for your time.

Thank you for comments.

Next speaker, please.

Good afternoon, Supervisor Zachary Freel, Somcan, DeFi resident.

Thank you, Supervisor Chen for leading the discussion on this very important item.

Since January, we've made a little bit of progress this year on funding affordable housing.

Thank you, Supervisor Chen for taking the first step towards establishing a municipal bank.

And thank you, Chair Melgar for helping to broker the housing trust fund agreement.

These are both good steps in the right direction pending the November election, of course, and there are many, many more we still need to take.

I'd like to point out the following table from the BLA report, exhibit 48B, page 12, page 121.

If I can get the overhead, please.

Yeah, so I found two things striking.

One about 70% of applicants for affordable housing are Latino Asian or Black, and two, across all groups, regardless of race.

If you apply for affordable housing, you have a less than one percent chance of getting into affordable housing.

So I'd like to ask: how do we improve these odds?

Rep SF is the race in equity and all planning coalition.

Our goal is to ensure that our city makes a housing plan where these 33,000 Latinos, 27,000 Asians, and 17,000 black applicants have a real opportunity to live here regardless of their income.

The numbers are right here.

These are the low-income people of color who want affordable housing in SF.

And this is not speculative, this is real data that MOHCD has collected, representing real people, and I'm in here too.

We brought along some of our Filipino community members to tell you directly about their housing needs.

Please genuinely listen to their stories and think about them when you consider what it will take for our city to actually fund and build truly affordable housing for the people in this table and in this room.

This conversation doesn't end here.

Thank you so much.

Thank you for your comments.

Next speaker, please.

Good afternoon, supervisors.

My name is Lloyd Serangan, a San Francisco resident and currently a sophomore in college.

I'm working with us um with Somgan.

I'll share a bit of uh share a little bit of my story.

I was born in a low-income family in the Philippines and grew up there for a part of my life when my parents worked here in San Francisco.

I always imagined the U.S.

as this oasis for my family.

However, when I immigrated here to the U.S., it couldn't have been any more different.

I found myself in a cramped one-room apartment where my entire family had to squeeze itself in.

It would be absurd to even imagine moving out, knowing that the price my family would pay could be triple the amount we currently do.

Still, my situation is much more privileged compared to others.

Housing is beyond just a place to stay.

It is where families and friends break bread, where students study and where full-time employees go to rest.

Failing to provide adequate housing is a failure for our labor force, our students, our families, and who holds this city together.

I appreciate the committee for bringing up the fact that housing is a core material issue that underlies other problems in this city.

It is the most critical issue in San Francisco and Bay Area as a whole.

As you have experienced now in the city, SF is in another moment that could leave residents vulnerable, and yet housing development has continued to decrease.

We cannot keep creating prescriptive policies that only partially quell the problem.

We need transformative policies that uproot the issue.

The public sector needs to be invigorated in creating more initiatives to fund affordable housing because it has a prerogative of actually acting in the interest of working class families.

We must not be stingy and hesitant about this issue.

We are living through a crisis and we must handle it as such.

It is our responsibility to protect the families that breathe life in San Francisco.

Thank you.

Thank you for comments.

Next speaker, please.

Hi, um, good afternoon.

My name is Jericho within Uban, and I am with Somkan.

When I moved here in America with my mom, we struggled to find housing and we're homeless for a year until we were able to get into an SRO with the help of Soncan.

We were homeless for a year because of how hard it is to find an affordable housing here in San Francisco.

And we still live in that SRO building.

And we are still trying to apply to any other affordable housing through these years, but still can't get in this housing.

So I urge you to please do not wait too long for more solutions and accessibility for more for communities.

And also there will be no other newcomer families or low-income families that will go through to what I have been through.

Thank you.

Thank you for comments.

So the next speaker, please.

Hi, good afternoon, supervisors.

My name is Victoria Aquino, and I'm with SomChan, a nonprofit organization.

My income is only 994 each month for my rent to be affordable.

My rent can only be 298.

But currently I pay 323 for my rent each month.

I have applied for affordable housing through Dahlia four times.

I did not get chosen four times.

Please build affordable housing with low rents for seniors like me.

Thank you.

Thank you for your comments.

So the next speaker, please.

Hello, good afternoon, the label supervisor.

I'm I'm with Sonkan group, and my name is Lucana Francisco.

Before I say that, I've been here for 30 years.

Then when I retired early, I get a little money only from the government.

And now I'm lucky because the Song CAN group, she helped me how to find my house.

And then because the help of the Soncan, she gives they find me house in the carry present manor, so I was lucky, but I receiving only a one thousand, one thousand twenty, and I pay in my month.

My rent is 314.

And then now I'm already asking.

I really thankful.

I know that you will help all the people that need a housing, affordable housing because I was one of that.

My room that I found is very small.

So it's bet because I have had a lot of medicine to take.

And then I asked my tenants there to give me a big bigger than the and the tenants give me a caregiver because I have a lot of medicine to take.

And lot of medicine.

So I'm very thankful for you, everyone.

Good night, and God bless you all.

Love you.

Thank you for your comments to the next speaker, please.

Hello, I'm Teresa Dolales with SomCAN.

You know, San Francisco must pursue range, a range of solutions to increase access to affordable housing because there is no single solution, you know, to solve this crisis.

The community has waited for decades to access, you know, real affordable housing.

This city must give affordable housing the same urgency that it gives market rate housing.

I ask decision makers not to look at this issue from only one side.

There are two sides of the story.

While we continue to hear about policies that support market rate development, we must also prioritize solutions that create and preserve affordable housing for working class families, seniors, immigrants, and longtime San Franciscans who are struggling to remain in the city.

The BLA's report identifies new revenue sources and new tools to create affordable housing of opportunities, and hopefully they'll include also social housing.

These recommendations should move forward alongside any expansion of the affordable housing recommendations, and especially the expansion of the affordable housing trust fund because one strategy alone will not meet the scale of the need.

Are we expected to wait over 115 years for approximately 45,000 affordable housing units to be built, become available and be accessed by the people who need them?

If not, what is the city's plan to accelerate that timeline?

Please let us know.

Our communities cannot wait another generation.

Affordable housing deserves the same urgency commitment and investment that this city gives to market great housing.

Maraming Salamat Po, thank you for everything that you do.

Thank you for your comments.

Next speaker, please.

Good afternoon.

Thank you, Supervisor Chen Melgore, for having this bill well.

Um my name is Heather Davies, and I'm a District 4 resident.

I had a full immersion in the housing market from 2022 to 2023 after we sponsored my husband and I sponsored 10 Ukrainians to come to the United States and helped attempted to help them find housing.

We probably went through 50 houses, I'm sorry, 50 applications, 100 houses, and thankfully we are now co-signed on two five-bedroom homes for four families.

But I was I was encouraged by your words today and your ideas.

I do think the revolving fund is a great idea.

Give low interest uh bridge loans to those market rate developers that raise their inclusion, please.

Um I also want to say that with regard to the Westside being well resourced.

The Westside Potable Emergency Water Firefighting Water System is a five billion dollar project.

And so without that or an alternative system, we're not well resourced.

There was just a 7.8 earthquake in Mindanao, the Philippines, which is tragic.

We are not prepared at five billion dollars and with no scheduled bonds for the FSPUC to put more money over into this project over the next 10 years.

It will take at least 20 cycles of S for bonds.

If you put 250 million each time every three years, it would take 20 cycles or 60 years to complete it.

The emergency pump house is the last phase.

That wouldn't happen until 2086.

By then, we could be Altadina.

So please, please find a different way to fund that project or go for a cheaper project.

Don't bring people to our neighborhood just to lose their homes.

Thank you so much.

So the next speaker, please.

Kristen Evans with Small Business Forwards here today to speak from a small business lens on the lack of affordable housing and what that means for our businesses.

I think it was maybe 15 years ago with Supervisor Wiener at the time, and he, you know, I asked him, you know, we see visible homelessness in the Haight Ashbury that impacts our customers' willingness to come and shop in our stores.

And I said, can't we build some more housing to address homelessness in our community?

And I I think he gave a five-minute response, but felt like 20 minutes, where he talked about the need for establishing conservatorship as like a main mechanism of addressing homelessness.

And it occurs to me that 15 years later, we've made so little progress.

I've been in the community meetings talking about the lack of affordable housing to address visible homelessness.

At my own store, I've had employees, Ellis Act evicted.

I had an employee whose grandmother passed away, and all nine family members became homeless.

He had to couch surf and could not afford housing.

Today, most small business workers making $30,000 to $80,000 a year in our neighborhood commercial corridors.

What's affordable to them is less than $2,000 a month.

So one bedroom at $4,000 a month, which is way more than it was 15, 20 years ago.

It's about political will.

It's about the politicians that have not faced the reality of the scale needed for this uh challenge.

And I'll just mention in terms of increasing the trust fund from 50 to 125 million as a 7% annual growth rate.

So it's not even a double-digit increase over that period of time.

It's not meeting the need of what's been present as a problem in our community for decades.

Thank you.

Thank you for your comments.

Next speaker, please.

Good evening, supervisors.

I'm Lori Droste, Director of Housing and Planning at Spur.

We appreciate the focus of this hearing because, as you know, San Francisco is facing significant challenges in meeting its affordable housing goals, particularly for low and moderate income households.

This is an important issue not only to spur, but for me personally.

I have a family member living in the Arlington and the tenderloin, who's previously unhoused, and it's a supportive affordable housing complex.

And as the city considers long-term affordable housing funding strategies, I encourage us to distinguish between between two important questions.

One is how we fund affordable housing and how much housing development, how much housing development can realistically support.

So, you know, as you saw, the controller's recent feasibility analysis found that under current market conditions, every rental housing prototype was financially infeasible.

That means we're relying partially on a funding strategy that depends on development activity that is not occurring.

Of course, the city should continue exploring larger and more stable counter-cyclical funding sources for affordable housing, but we also cannot rely solely on market rate development to help San Francisco meet its affordable housing needs.

At the same time, let's make sure we don't undermine housing production while searching for those solutions.

When projects stop moving forward, we lose market rate homes, affordable homes, impact fee revenue, construction jobs, future tax revenue, and of course, then rents go up.

So please consider these strategies as you move forward, and I want to thank you for your service and being here for a very long afternoon.

Thank you.

Thank you for comments.

Next speaker, please.

Hello, thank you, supervisors.

My name is Emily Mock.

I'm an organizer from the Chinese Progressive Association.

Thanks to the clerk, John Carroll for sending through some written comments from our youth members who are in school right now and prepared comment sent to all of you.

I'm gonna read today a comment from one of our members, Miss Moon Huang.

Hi everyone, my name is Moon Huang.

I'm a member of the Chinese Progressive Association.

I'm here today to speak for thousands of families who are just trying to survive in San Francisco.

We all know the truth.

There are nowhere near enough affordable homes in the city.

And honestly, even the housing that people call affordable is still way too expensive for normal working people.

Look at my own family.

Right now, three generations, seven of us all together, including my parents, my in-laws, my two kids, are all crowded under one roof.

We're lucky because we actually own our home, but because prices out there are so crazy, my parents can't afford to move out and retire on their own.

And my kids, they will probably never be able to afford their own place in the city.

We are packed in like this because we have no other choice.

If a family that owns a house feels this stressed and anxious every day, just imagine how terrible it is for people who rent and are rent burdened.

So I'm asking all city departments and officials, please use every dollar that you have to build more housing, more deeply affordable housing, and help working-class families pay for it.

We need real long-term plans to fund these projects.

And please do not lower the rules for developers.

Do not let them build fewer affordable units.

Affordable housing is about our dignity and our future.

Please give San Francisco families a fighting chance.

Thank you.

Thank you for comments.

Next speaker, please.

Good afternoon, supervisors.

Or maybe it's evening now, but my name is Sharon Ng and I'm a planner at Chinatown CDC.

We're grateful to be part of conversations to find ways to meet the city's affordable housing goals in community coalition spaces with marginalized populations themselves and with legislators like you all.

Today we're especially thankful for Supervisor Chen and D11 staff for commissioning this BLA report to assess the current status of affordable housing in the city.

It highlights much of what we've already seen working in the community as affordable housing developers and tenant counselors.

The deficit of affordable housing units to meet the needs of San Franciscans, particularly extremely low income ones.

Over a third of San Franciscans being rent burdened, et cetera.

But the report is also significant because it provides a path forward with policy and funding solutions that should be further discussed in community.

We're grateful for Supervisor Melgar's work to expand the housing test fund and recognize the amount of work that went into this process, but we can't stop there.

As the BLA report has illustrated, it's going to take a lot more to meet our arena goals, and housing production hasn't been evenly distributed across income levels.

CCDC worked with many other rep member organizations to advocate for equity related policy actions in the 2022 housing element pertaining to housing, placekeeping, and land use because we all collectively believe that planning should be tackled as such.

As the years have gone by, we're still short of our goals, and many of these policies remain unimplemented.

This report reveals funding strategies, and we hope that they will work in conjunction with the community-driven implementation actions from the housing element that already exist.

We also need an accessible way for San Francisco to track and report progress towards meeting its arena goals for each income category specifically, because as we've seen here, production is unevenly distributed, and that often isn't captured in the overarching housing conversation.

Planning has a housing dashboard where the public can see the number of units in the pipeline, but this doesn't capture the specific levels of affordability.

Overall, we need accountability around implementing the equity related policy actions in the housing element, including those focused on affordable housing production, preserve preservation, and anti-displacement.

Thank you.

Thank you.

Let's have the next speaker, please.

Hi, my name is Dane.

I'm a Cole Valley resident.

I'm a volunteer lead with SFEMB.

I want to speak here in support of both the lowering of the inclusionary zoning that was proposed and shown is needed through the TAC report and stuff that we've heard from planning and other groups today, as well as strongly in favor of this expansion of the Affordable Housing Trust.

I really appreciated earlier, Supervisor Melgar, when you brought up how access and upward mobility is a very strong pull to San Francisco.

My wife and I moved here a little over a year ago from Texas, and that access and that welcoming and honestly just the more livable and better legal environment in San Francisco in particular was a huge draw from Texas.

And I know that a lot of people are moving from all these different red states from more torn areas, and I think that access is something that we really need to keep in mind.

I know that me and my wife were fortunate enough to find a affordable apartment a little over a year ago.

And as we've heard in some of the presentations, rents have only continued to go up.

We also heard, though, that it is not currently feasible for market rate development to happen with the inclusionary rate.

And so I think we need to let everyone do what they do best.

The developers of market rate housing producing market rate housing, all these barriers in their way, are making it not happen while also boosting our affordable housing trust and making sure that we can get access to not just these middle income and all these market rate groups, but also make sure we have a reliable, consistent funding structure for these affordable housing and to help offset some of these costs for developers.

Thank you.

Thank you for comments.

Next speaker, please.

Hi, Witt Turner, on behalf of the housing action coalition.

I'm gonna try to keep it super brief because I know it's officially the evening.

I think I heard the director say in comparison for like our numbers in comparison to our arena goals, it's depressing.

I feel like if you look at any of our housing numbers in comparison to any of our housing goals, it's very depressing.

Keeps me up at night.

Um looking at the TAC when we saw the negatives across the board on production and home value.

It's it's it's just horrible.

So we're really big fans and supportive of uh the leadership of um Supervisor Melgar on the affordable housing trust fund, um, and especially the inclusionary reductions on the other side of that, um, hoping to actually produce some sort of inclusionary housing.

Um, because the limits are there right now and it's just not happening.

So we hope to keep moving forward, and as many options as we can get and uh financial backing for affordable housing as possible, is would be amazing.

So thank you.

Thank you for your comments.

Next speaker, please.

Good evening, Supervisor Jean-Tal Laborinto with the Race and Equity and All Planning Coalition.

Echoing others, we want to express our gratitude to Supervisor Chen and the District 11 office for commissioning this BLA report and the BLA for their work.

Um it was a long report, but a lot of good stuff to read.

Um, it's really important that the city is engaging in meaningful policy discussions around the need to significantly increase access to affordable housing.

Uh the BLA's report clearly demonstrates how the city's current approach will fail to meet the city's affordable housing goals.

And we know that we need to implement multiple strategies to get us there and meet our communities' needs, and we ask that our city agencies and departments take the report's recommendations seriously.

We know, however, that recommendations are only made strong by implementation and accountability.

As is, uh, the annual APR report is inaccessible and is not presented in a fashion that allows the community to understand what our progress is towards our goals.

We also ask that the Board of Supervisors take action to increase accountability.

So San Francisco is reporting and tracking our progress towards meeting RENA goals and implementing all of the actions we committed to in our housing element, including those focused on affordable housing production, preservation, and protecting tenants against displacement.

Thank you.

Thank you for your comments.

So the next speaker, please.

Good evening, supervisors.

I'm Anna Christina Rana, a member of the Race and Equity and All Planning Coalition.

Rep SF is grateful to Supervisor Chen and the District 11 office for commissioning this BLA report and for holding this hearing.

The BLA report presents inspiring success stories from cities and counties across the country that are already implementing innovative strategies for research resource generation and development of affordable housing and new models of social housing.

San Francisco must follow their need their lead by pursuing both new funding streams and new tools to create the affordable housing and the social housing opportunities we desperately need.

As many of our community leaders and experts have already said today, the city must pursue a range of solutions to increase access to affordable housing and meet the needs of our communities.

We need our city leaders to create more infrastructure for housing models that don't rely on the speculative market to deliver a basic need.

This means preserving rent controlled housing, funding smaller scaled affordable housing and land banking, reserving surplus sites for affordable housing, social housing, and community land trusts, rather than handing them off to private developers.

We urge the city to pursue both the new funding streams and the new tools presented in the BLA report to create the affordable housing and social housing opportunities that we need to house the essential communities that keep our city running and make our city what it is.

San Francisco needs to build for our communities' needs rather than for profit.

Thank you so much for your time.

Thank you for your comments.

Do we have any further speakers for agenda item number four?

Madam Chair.

Okay, public comment is now closed.

Um I just wanted to provide a couple comments before I let you wrap up this hearing.

So I uh first of all, I just want to thank the community uh and our uh city staff for all of this work uh and for coming today and staying the long hours uh to uh as I said, weigh in on the most important topic uh for our city, which is uh housing.

Um, you know, I think that they it there's a tendency that if we do this one thing, we're gonna solve all the problems, right?

If we just change the zoning, we're gonna solve all the problems.

If we just you know put more how money into housing, we'll solve our problems.

And I will say that um housing is a really complicated thing.

So uh it is about land use, it is about zoning, it is about financing, it is about historical patterns of exclusion based on race.

It is about uh policies and priorities that we have that deal with environmental review, uh, with proximity to transit.

It's about a lot of things.

Um, and so you know, I do want to caution us um that you know, uh, if we just do this one thing, we're gonna win.

That's not the case, but that doesn't exempt us from like doing the hard work to, you know, rectify past wrongs and build a future.

And so, in that spirit, I really appreciate your approach, Supervisor Chan, because that's the right way.

It is uh about analyzing all of the different aspects that have led us to uh this crisis and having the political will to be able to uh take on these things, sometimes against uh the you know uh political um uh coalitions that have been built in the past that wanna preserve their power, and sometimes uh, you know, wanting to like be bold and do things that you know need to be done.

Uh and so like I said, I am really grateful to you and your staff, Supervisor Chen, for uh taking this on and uh for guiding this process and uh Fred, thank you again uh for the hard work of your staff and the Nungber Crunching and the analysis that you have done, and I hope that we all have the political will to work together to solve um the very complicated issue that is actually not one problem because you know, just like we need to address the needs of women who have uh, you know, experience domestic violence.

We also have to solve for firefighters who want to buy a home in San Francisco and cannot.

And so it is a very complicated set of issues and a whole spectrum of need, not just one need.

Um, and I'm looking forward to uh tackling with you, uh Supervisor Chen, all of the different recommendations that this uh report has put forward and even coming up with some new ones.

So thank you so much.

Thank you, Chairmel.

Uh again, I want to also thank um my colleagues, Supervisor Mammu again, and uh thank all the community partners and and this report, um, and also in San Francisco, we have been playing a very important leadership role in affordable housing.

And we also have many accomplishments uh in the past that we can celebrate.

But at the same time, persistent housing insecurity continue to push out many of our working families, vulnerable communities and our local workers.

The goal of this hearing was to create a space for our for discussions of what additional steps are needed to build coordinated strategy to fully fund our affordable housing goal.

Supervisor Malga has worked on legislation to expand our affordable housing trust fund.

Again, thank you, Chair Malga.

I have worked on legislation to expand our toolbox, such as the municipal financial cooperation and public bank.

I also want to thank uh Supervisor Mammoo for your uh support on that too.

This kind of measures will likely go before the board and hopefully the voter to approve them.

There's still more work to be done to develop new strategies, significantly scale up our investment and fill in the gaps where our affordable housing programs do not reach particular communities.

The good news is that many of the financing strategy in the BLA report have been tried and implemented in other jurisdictions, and so that it's a track record that we can build off of.

I look forward to working with stakeholders, my colleagues and the mayor and our departments to continue to explore both the new funding streams and new tools for creating affordable housing that are outlined in our BLA report.

I also continue to want to thank again our community organization that provided testimony today.

Uh, this community organization that makes up of everyday working people from mission to Chinatown to SOMA to the Excelsior to the Bayview, and also to the West side.

This communities are the bearing of the burn of the affordability crisis.

I know that you all are working hard to advocate for a city that is affordable, includes all of us, and leaves no one behind.

And we owe you a depth of gratitude for all the work that you're doing.

And I also want to get again express my gratitude to the BLA for this excellent report and appreciate the planning department and Mo CD for all your partnership and needership in this as well.

If there's no further comment from my colleagues, and I would really like to make a motion to have this committee hearing be heard and file.

Chen I, Member Mockwood.

Machmood I, Chair Melgar.

Malgar I, Madam Chair, there are three eyes.

Thank you.

Okay, let's go to item number five, please.

Agenda item number five is an ordinance amending the planning code to make a landmark designation amendment for the site of Compton's cafeteria riot located at 101 to 121 Taylor Street.

Okay, as I said, uh we have a request to uh continue this to the call of the chair.

Uh did you want to say provide any uh further comments?

Supervisor Mahmoud, no?

Okay.

So with that, let's go to public comment on this item, please, Mr.

Clerk.

Land use and transportation.

Now here public comment related to agenda item number five.

If you have public comment for this item, please come forward to the lecturer at this time.

And Madam Chair to preserve no speakers.

Okay, public comment on this item is now closed.

I'd like to make a motion that we continue this item to the call of the chair.

On the motion offered by the chair that this ordinance be continued to the call of the chair, Vice Chair Chen.

Chen I.

Member Machmo.

Machmood I, Chair Melgar.

Aye.

Melgar, I, Madam Chair, a three eyes.

Thank you.

That motion passes.

Uh, please call uh our last item number six.

Agenda item number six is an ordinance submitting the health code related to smoke-free places.

Thank you so much.

Uh Mr.

Clerk.

As I said, I am the sponsor of this legislation, and it is clear that um we need to do a little more work.

I see uh several of the advocates here on both sides of this issue.

Um, and I um have uh accepted the uh recommendations from a couple of my colleagues and the mayor to help uh with us perhaps some amendments and some process issues.

Um, and uh so I'm gonna continue this.

I'm gonna make a motion after public comment to continue this to the call of the chair so that we can keep working together and hopefully make some progress.

Uh and with that, let's go to public comment on this item, please, Mr.

Clerk.

Thank you, Madam Chair, land use and transportation will now hear public comment related to agenda item number six.

If you have public comment for this item, please come forward to the lectern at this time and I'll start your time when you're there.

Good evening, supervisors.

My name is Bob Gordon, speaking as a gay man, a volunteer with um American Cancer Society Cancer Action Network and also a resident of District 8 in the Castro, urging you to support this clean air ordinance.

So I moved to San Francisco in 1993, and in 1993, restaurants were still full of smoke.

But I remember it wasn't long before all restaurants had to clean up their air.

And I remember it well.

Some restaurant owners panicked, saying that clean air would somehow put them out of business, but it didn't happen.

And then in 1998, smoky bars had to clean up their air again.

Quite a few bar owners panicked at that thought, saying that clean air would somehow put them out of business or harm their businesses.

Again, it did not happen.

And today, understandably, we hear some bar owners panicking, saying that clean air in their patios would somehow um either put them out of business or have a severe impact on the nightlife industry.

Um, it's actually the opposite, and we know this from decades of smoke-free restaurants and bars.

Clean air actually attracts more business.

A policy like this one creates a level playing field, no more discrimination from one bar patio to another enclosed bar, for example.

Smoke-free bar patios mean that everyone can enjoy the vibe, the music, their friends, and if someone wants to smoke, they head to the curb to smoke, eager to come back to enjoy the vibe, the music, and their friends.

Harmful chemicals have no place in our city.

Discrimination has no place in our city.

There should no longer be toxic exposure on patios, period.

Clean air can be good for business.

Thank you.

Thank you for your comments.

Next speaker, please.

Brian Davis, volunteer co-chair of the San Francisco Tobacco Free Coalition, retired project director of LGBTQ minus tobacco and district five voter.

I'd like to express my deep appreciation to Supervisor Melgar for sponsoring this important public health ordinance and to Supervisor Sauter for his co-sponsorship.

I understand that the ordinance will be continued today, but we appreciate Supervisor Melgar's commitment to bringing it back in the future, despite the threats of physical violence and many difficult conversations she has had to navigate due to her commitment to creating a San Francisco that is as healthy as it can be for the maximum number of people.

If efforts to find common ground take place, we hope that that common ground will be built upon an exploration of the actual evidence rather than be dominated by fears of harms to businesses, which do not occur in other cities and therefore can reasonably be expected not to occur here when San Francisco does eventually require bar patios to be smoke-free.

The media has not helped as they have misrepresented this issue by building their narrative on the false premise that public health and bars cannot both be winners.

The media loves conflict.

Bars versus public health is the default setting.

We ask the media and everyone else who has bought into that false premise to look at the actual evidence.

There is decades of research showing that bars are not harmed and often benefit from smoke-free laws.

Over 400 cities and counties nationwide have smoke-free bar patio laws, including New York City, San Jose, and Oakland.

The patio bars are still there.

You have received letters from the Alameda and Santa Clara County tobacco-free coalitions this week sharing local information.

Smoke-free bar patios will be a win for everyone.

The air on the patios will be healthy.

People who currently smoke will be motivated to quit, and bars will gain new customers making more money or breaking even at worst.

Thank you.

Thank you for your comments.

Next speaker, please.

Good evening, supervisors.

I'm Liz Williams with Americans for Nonsmokers' Rights.

We're a Bay Area-based nonprofit.

And thank you, Supervisor Melgar, for sponsoring this proposal.

We really appreciate you championing this change to help people breathe air that is free from the health risks of secondhand smoke exposure.

And we appreciate the continuation.

San Francisco will be in good company when the city is ready by expanding its smoke-free workplace protections.

This is a proven policy change.

It's not a new or untested idea.

San Jose adopted this law nearly 15 years ago, and Oakland did so last year.

And these cities still have a thriving bar scene.

We know that these laws work well in practice, and cities have not rolled back their laws.

The majority of people simply follow the law when there's good signage and awareness.

They step out to the curb, they have a smoke and then come back inside.

And this is what they people already do at most bars in the cities that don't have a bar patio, don't have a patio out back.

They simply step outside and it's not creating problems.

We know that back when bars were going smoke-free indoors in the 90s, they were worried that this was going to put them out of business having to go smoke-free, but these laws ended up working well because we focused on education and supporting folks, and everyone adjusted.

And at ANR, we're a worker health organization.

We hear from workers like bartenders and musicians who don't like breathing secondhand smoke, but they feel like they don't have a choice if they want to keep their job.

They just don't feel comfortable speaking up.

And non-smokers are often called a silent majority, and that is especially true for workers who don't want to risk their job by speaking up.

So we will continue to be here providing support when the city is ready to move forward because ensuring people can breathe clean around the job is the right thing to do for San Francisco.

Thank you.

Thank you for your comments.

Next speaker, please.

Good evening, supervisors.

My name is Alex Marenkov.

I'm a Berkeley resident, and I'm here in strong support of the smoke-free bar patio ordinance.

Thank you, Supervisor Melker, for sponsoring this ordinance, and Supervisor Sauter for co-sponsoring it.

Supervisor Melgar, I really appreciate you recognizing that smoke-free bar patios are not just a lifestyle preference.

And for people like me with a disability who have asthma, this is an accessibility issue.

I understand this height of maybe continued today, but rather rather than voted on, but I hope it can't comes back because San Francisco's nightlife should be open and welcoming to as many people as possible.

I love San Francisco's gay bars and I love that people can gather, watch Eurovision, dance flirt, decompress, and feel like they be belong somewhere.

But when smoking is allowed on patios, that belonging becomes conditional.

Repeatedly I've had to tell friends uh that I want to go to the back patio at like Toad Hall, and I've had to tell my boyfriend I'll just stay inside on the dance floor because the smoking on the patio is so heavy that it's not really a real choice to go out there.

And it means either exposing myself to smoke and leaving with coughing, headaches, and breathing problems, or isolating from my friends.

One time a friend was moving away from San Francisco, and the last chance to spend time with them was ruined because we could not comfortably stay in the patio space due to smoking.

Even at places I care about, like Midnight Sun or Noi Valley Tavern, smoke can turn a welcoming environment into a physically difficult one.

I understand that bars are struggling, and I do not want beloved bars to close.

I want them to be more accessible.

A bar patio is still a shared space and a workspace.

Workers, patrons, and people with asthma, disabled people, and smoke sensitive people should not be asked to absorb the health costs of keeping patios open to smokers.

Thank you again, Supervisor Melgar, for taking this on, especially in the face of difficult conversations, hostility around this issue.

Please keep working to bring this back.

San Francisco should not be behind on protecting workers, patrons, and disabled people.

Thank you.

Thank you for your comments.

Next speaker, please.

Hi, Jenbo again.

Um, I just want to say thank you for continuing this to work with the business owners and other people.

I think it's good that we're gonna try and come to some sort of conclusion.

It's been a or a good compromise.

It's been a bummer talking to business owners who feel like they're going to be really impacted by this and their workers also.

Um, I don't think anyone wants anyone to be unsafe or feel unwelcome anywhere, so I'm glad there's gonna be more time um to go through this, but I think just the additional burden on the small businesses.

Don't tell my socialist uh comrades that I'm talking about small business owners, but um, that uh I do feel like they they have to deal with a lot outside of just like running a business and the ups and downs of the economy, but all the additional things that come with having a business in San Francisco when there's other things not being met.

Um adding this on uh without talking to them, I think was a little hard for them to handle, but I'm glad that it's being continued to work through.

Um, and just thank you for taking everyone's feedback.

Appreciate it.

Thank you for your comments.

So the next speaker, please.

Thank you.

Small business forward, Kristen Evans.

Um, so I just want to just thank thank you for continuing this to the call of the chair.

Um, Small Business Forward, the Council of District Merchants Association, the Small Business Commission, all in opposition as currently presented.

Um the legislation impacts businesses that have uh smoking patios as well as those that have non-smoking patios.

So you have in like Cole Valley, Finnegan's Wake, smoking patio, across the street woods, non-smoking patio, both would bear the burden of uh enforcement.

Um and uh specifically as we heard at the prior hearing, uh employees talking about how that would fall upon them to enforce uh impacting their ability to uh interact successfully with our customers.

So I do think that um working more collaboratively with the small businesses that are impacted.

I don't think we ever came up with a total number of businesses that were going to be impacted, so we didn't have an actual list of the bars that were impacted to work from to really kind of sit down and put together some ideas.

Um, as I said uh in my prior comment, bars have been at the forefront of addressing public health issues in many, many ways.

We very much care about our patrons and care about employees, and our opposition to this legislation is uh primarily in in relationship to how the legislation was brought forward, uh, not in collaboration.

Um we would like to see partnership going forward.

Thank you.

Thank you for your comments.

Do we have any further speakers for agenda item number six?

Okay, public comment on this item is now closed.

I would like to make a motion that we continue this item to the call of the chair.

On the motion offered by the chair that this ordinance be continued to the call of the chair, Vice Chair Chen.

Chen, I, Member Mockmood.

Machmud.

Aye.

Madam Chair, there are three ayes.

That motion passes.

Mr.

Clerk, do we have any other items on our agenda?

There's no further business.

We are adjourned.