San Francisco raises bar on affordable housing

The San Francisco Board of Supervisors Tuesday unanimously approved legislation setting the highest affordable housing requirements in the nation for market-rate housing developments.

The updated inclusionary housing ordinance, the result of months of wrangling between the board’s moderate and progressive factions, sets higher requirements for the inclusion of affordable housing units in new projects and also for the first time expands the definition of affordable housing to include units affordable to middle-income residents.

Supervisor Ahsha Safai said:

“We have created and expanded the definition of affordable housing to include janitors, teachers, nurses, firefighters, paramedics, laborers, carpenters. … This is the element of the workforce that has been pushed out of San Francisco.”

The ordinance calls for 18 percent on-site affordable housing for rental projects within 18 months in most of the city and 20 percent for sale projects, with higher levels set for neighborhoods such as the Mission and Tenderloin and gradual increases planned through 2027.

The ordinance was developed after the passage of Proposition C last June, a measure sponsored by Supervisors Jane Kim and Aaron Peskin. That measure set inclusionary housing requirements at 25 percent but also called for the board to revise those levels based on the results of a controller’s office feasibility study.

Released in February, that study called for levels of 14 to 18 percent for rental projects and 17 to 20 percent for ownership projects, with in-lieu fees ranging from 18 to 23 percent.

Legislation initially proposed by Safai and Board President London Breed hewed closer to those recommendations but also included a larger proportion of housing set aside for middle-income earners than the final proposal.

Kim and Peskin had pushed for higher levels of affordability.

However, Kim said she was proud of the collaborative effort:

“Today we are setting the highest affordable housing requirements in the nation on San Francisco market rate developers.”

Breed, who pushed for a consensus bill that could be approved unanimously, said:

“I am very proud that we achieved the most expansive inclusionary housing policy possible for San Francisco. … We all know that housing is a critical issue for our City and this policy will provide more homes for the working families we need to keep.”