Housing high jinks

S.F.'s Planning Commission still dragging its heels on affordable housing

By Cassi Feldman

At the height of the real estate boom, the San Francisco Planning Commission approved thousands of live-work units without requiring that a single one be affordable. The commissioners let dot-com office developers displace scores of tenants for projects that, thanks to the recession, may never be built. And all the while, they insisted they were doing their best to increase the city's affordable housing stock.

Now, once again, the commission is making that claim – but the evidence suggests just the opposite.

The commission refused Feb. 14 to endorse a bill by Sup. Mark Leno that would require all new projects to have affordable units and instead last week passed its own, weaker version.

Leno's legislation would require developers to make 10 to 12 percent of their ownership units affordable to households making the region's median income ($86,100 this year) and 10 to 12 percent of rental units affordable for those earning a maximum of 60 percent of the region's median income ($51,660).

The Leno bill has its share of critics. At the commission's Feb. 14 meeting, Joe O'Donoghue, president of the Residential Builders Association, argued that it would unfairly penalize small builders, since large ones are better able to absorb the costs. He warned that if housing becomes too unprofitable, construction will simply stop.

Commissioner Hector Chinchilla also raised concerns about the fact that the legislation covers only project applications submitted after June 18, 2001. Since any developer who had filed an application prior to that date would be exempt, he said, the proposal gave "some people a clear walk." Chinchilla and commissioner Anita Theoharis both said the date was "suspicious," implying that Leno had cut a deal with certain developers who had projects under way.

In a Feb. 21 San Francisco Examiner column, Warren Hinckle made the same argument, noting that the law would exempt 4,500 units that are currently in the approval pipeline and that some of the exempted developers have contributed to Leno's assembly campaign. For example, Tishman Speyer Properties, which is developing 806 units on Folsom Street, gave Leno $500.

Leno denies that the cutoff date was a political favor. "It was just the date we introduced it," he said. He points out that between 1992 and 2000, the Planning Commission's current policy only produced 128 affordable units. Meanwhile, its staff have been sitting on another housing proposal of his – a simple change in floor-area ratio requirements that could produce hundreds of affordable units – for almost two years.

Leno is confident that, despite the commission's vote, inclusionary housing will soon be law. His plan is already backed by five supervisors and several housing groups, and the Planning Commission won't derail it: the supervisors can ignore the commission's recommendation and pass the law themselves. If they do, this ordinance will trump the Planning Department's own inclusionary guidelines, passed this week as a temporary plan.

In the department's version, most of the "affordable units" will be reserved for households earning 80 to 120 percent of the median household income – as much as $103,320. Although the Association of Bay Area Governments reported that this middle-income group has been largely ignored, Carlos Romero, executive director of Mission Housing Development Corporation, told us it isn't a fair comparison; families making $100,000 have a lot more options than families making $50,000.

The commission also watered down a staff recommendation that developers be required to make 14 percent of their housing affordable. Although a Jan. 31 staff report found that "reasonable net profits can still be realized even with the inclusion of affordable housing at 20 and 25 percent," the commission quickly lowered the staff's suggestion to 12 percent.

At the commission's Feb. 21 meeting, commissioner Myrna Lim, who supports Leno's legislation, urged her colleagues to stop quibbling over numbers. She said what "sickens" her is watching projects slip by the commission with no affordable units. Her comments seemed to anger Theoharis. "What sickens me most is when people are demonized," Theoharis said.

But many planning activists agree with Lim and find it hard to believe that after all these years the commissioners suddenly have their best interests at heart. Even if Leno's plan isn't perfect, they say, it's better than trusting the commission to enact its own.

"It's the height of perfidy to have them introduce this," Romero said. "Now that Leno's ordinance is fully baked and about to come out of the oven, they want to put it back in and burn it."

Mauricio Coronodo, a housing activist with San Francisco Organizing Project, agreed. "It would be great if there was another proposal that was 30 or 40 percent," he said. "But right now there's no proposal on the table except Mark Leno's that has the support of all the players and a chance to pass."

E-mail Cassi Feldman at cassi@sfbg.com.