Why is Scott Wiener trying to undermine affordable housing in SF?

Amendments to state bill could make it harder for the city to demand reasonable affordability levels from developers

The San Francisco supes approved new rules for affordable housing today – but a move by state Sen. Scott Wiener almost derailed the carefully negotiated compromise and could still impact the city’s ability to require a reasonable level of affordable housing.

The affordable housing rules that the city is putting in place require what should be a minor tweak in state law, and all of the parties to the negotiations agreed that the deal would fall apart without that chance. Assemblymember Phil Ting got a bill through the Assembly without much dissent.

But when it came to the Senate, Wiener insisted on amendments that could have – and still might – dramatically reduce the amount of affordable housing that the city can require.

Sen. Scott Wiener is undermining the city’s affordable housing rules

The state has a rule that allows a developer to get a “density bonus” – that is, the right to build more housing than existing zoning allows on a site – in exchange for adding a very small amount of affordable housing.

Ting’s AB 915 would allow San Francisco to apply its own, higher, affordable housing requirements to all new units, including units only allowed under the state density bonus law.

It’s called a “district bill,” which means it applies only to one city – and typically, these bills only pass if all of the legislators from that district are in favor.

Without this bill, the percentage of affordable housing that the city will require developers to build could drop from the compromise level – 18 percent, rising to 22 percent by 2019 – to just 13 percent. That’s a lot of lost affordable housing.

So: All was going along fine, and the two sides on the Board of Supes were all on board, and so was the mayor.

Then Wiener got involved.

Wiener proposed an amendment that would make it impossible for San Francisco to enforce its new affordable housing rules. The original plan would allow the city to enforce its own rules only

after there has been an affirmative declaration made by the Department of Housing & Community Development that the affordable housing minimum percentage required is broadly feasible for density bonus projects. The feasibility assessment shall include, but not be limited to, confirmation that the minimum percentage will not reduce the amount of total housing produced pursuant to the density bonus, and will not reduce the amount of affordable housing produced pursuant to the density bonus.

Here’s what that means: A state agency would have to agree that there’s absolutely no chance that a requirement of 18 percent affordability could convince a developer not to build a project.

There is no way to prove that, one way or the other. The city’s local planning would be pre-empted by the state, which requires far less affordable housing.

John Elberling, president of Todco, notes on Facebook that

AB915 has been endorsed by the City’s Board of Supervisor and Mayor Ed Lee. So instead of outright opposition, Senator Weiner has proposed to amend it with a condition that he knows full well would doom it as a practical matter. This is called a “poison pill.” if the State Department of Housing (not the local Mayor’s Office of Housing) determined it might result in ANY less market-rate housing at all, it will become void — possibly as soon as next spring.

That would mean that for every 1000 housing units that result from the State Density Bonus, 180+ Affordable Inclusionary Housing units will NOT be built, and that opportunity is lost forever.

I asked Wiener why he was pushing an amendment that would damage the city’s ability to require a higher level of affordable housing. He told me:

“AB 915 is about state housing policy, and as always, I am committed to making good housing policy.”

The deeper issue here is the “feasibility” of building housing developments with reasonable affordability requirements. Several San Francisco developers have already agreed to 25 percent, and the city has already done its own feasibility study that concluded that the current 18 percent law would work. But critics say that if the requirements are too high, the market-rate housing won’t “pencil out,” and nothing will be built at all.

The folks who think that building more market-rate housing will get San Francisco out of this crisis say that inclusionary rates could be self-defeating. On the other hand, the city’s own studies show that inclusionary below 20 percent actually makes the housing crisis worse.

And the more reasonable housing developers in SF have signed on to the 18 percent deal.

Ting urged Wiener to accept some changes, and Wiener agreed to back off – a little. His new version deals with the problem that the state agency might not act in a timely manner, leaving San Francisco unable to enforce its own housing laws. Wiener has agreed to allow a one-year grace period if the state fails to act. Here’s the version that passed out of the Senate Transportation and Housing Committee today:

after there has been an affirmative declaration made by the Department of Housing & Community  Development that the affordable housing minimum percentage required is broadly feasible for density bonus projects, which must be completed by June 30, 2018. The feasibility assessment shall include, but not be limited to, confirmation that the minimum percentage will not reduce the amount of total housing produced pursuant to the density bonus, and will not reduce the amount of affordable housing produced pursuant to the density bonus. Any affirmative declaration by the Department will expire on June 30 of the following calendar year, at which point it may be reauthorized by the Department for one year if the department continues to find the arrangement feasible, as defined above. This reauthorization shall be sent with the department’s response to the City and County of San Francisco’s annual production report, outlined in Section 65400(a)(2) of the Government Code. If the Department fails to issue an affirmative or negative declaration to reauthorize by June 30 of the following calendar year, the City and County is permitted to apply that ordinance to development for a one-time, one-year grace period, at which point the authorization lapses until the department issues an affirmative declaration.

Even with the changes, Wiener is using state law to make it harder for San Francisco to mandate affordable housing. It’s pretty stunning.

The reality is that what developers tend to want, more than anything, is market stability – they want to know what the rules are. And if the state is in a position to change those rules once a year, it’s going to be a mess.

I don’t know what Wiener is thinking.

  • FunnyBecauseItsTrue

    More disingenuous slop from 48hills. So happy that we elected Scott to the state senate. This is excellent news. Still can’t believe Peter Cohen and his goon squad are trying to wreck the density bonus policy.

    Hey Tim, if AB915 was such good policy, why was every affordable housing developer whose name isn’t “Peter Cohen” begging to be exempted? And why was it scoped down from a state wide bill to an “only applicable in SF” bill?

    • Kraus

      Because San Francisco is so “virtuous and special” and obviously so successful in providing adequate amounts of housing that it deserves a “special exception” to the laws that the rest of the State is required to follow.

      AB915 would be a “windfall” for existing homeowners like Tim, who will continue to see their property values skyrocket. It’s exactly the opposite of what we need to be doing to truly address the housing crisis, get the maximum amount of housing built and start to control runaway housing costs.

      AB915 is bad/backward-looking legislation and Wiener is rightly doing what he can to neutralize it. Additionally, if it somehow gets through the Legislature in a form that doesn’t sit well with Brown, the governor is certain to veto it as it doesn’t have anything near the 2/3 support necessary to override such an action.

  • Sanchez Resident

    Jane Kim would have been much better in Sacramento. Too bad Wiener got elected.

    • Kraus

      If one is truly interested in addressing the housing crisis, i.e., shortage, then Weiner is, by far / hands-down, the better choice — and apparently, the majority, agrees.

      • sfsquirrel

        Sonja Traus, if one is truly interested in addressing the supply side, why not back the vacancy tax? You have been silent on that. But really, we do not have a shortage of luxury housing. We have a shortage of affordable housing. Even by YIMBY/Reaganomics theory, which I don’t subscribe to, it would take about 30 years for the wealthy to grow tired of their luxury boxes and somehow decide to sell them off or rent them out to us poor and middle class folks. Hardly sounds like a good way to deal with a crisis.

        By all means, if your own place catches fire, let me know, I’ll be there to trickle down some water onto it. Should be just fine in a few decades.

        • whateversville

          Kraus isn’t Sonja, btw.

          “But really, we do not have a shortage of luxury housing. We have a shortage of affordable housing.”

          San Francisco’s population has been increasing by around 10,000 people per year, and in a good year we build 2500 units of housing. How is that not a shortage?

          I rented a decrepit firetrap in the Mission that would sell for $1M+, easily. When there’s a shortage, you pay “luxury” prices for what should be “affordable”. If we ever hope to reverse that trend, people need to stop denying that the shortage exists in the first place.

          “it would take about 30 years for the wealthy to grow tired of their luxury boxes and somehow decide to sell them off or rent them out to us poor and middle class folks. “

          If we don’t build any “luxury boxes”, what stops them from moving into my old shitty firetrap Edwardian and renovating it?

          “Hardly sounds like a good way to deal with a crisis.”

          What are you proposing instead?

          • Heart

            Um. Kraus is Sonja Traus.

          • curiousKulak

            Hardly. Much more knowledgeable and contained.

          • sfsquirrel

            Not adding to the problem by building “investment” housing. Rent freeze, overturn Ellis Act, expand rent control, introduce vacancy control. Then tax the hell out of the rich. Build limited equity housing with public funds. Treat housing as a human right, not as a three-dimensional stock for the wealthy to buy and trade.

        • SF Sunset Guy

          Would a vacancy tax be legal? Would it violate state law?

          Even with a shortage of affordable housing, it still costs a large fortune to build. The City purchased a developers lot putting a cool $16 Million into developers’ pockets, and each unit (all of them “affordable”) will cost nearly $1M to build. Each. Unless I’m mistaken, the lot is still the decrepit gas station.

          https://missionlocal.org/2015/07/72-south-van-ness-condos-will-now-be-affordable-housing/

      • No_Diggity
  • Heart

    I see the pernicious BARFbot and YIMBot trolls arrived early to spread their lies and commence with the ad hominum attacks.

    • Porfirio666

      Why not post a counter-argument instead of the name-calling?

    • Kraus

      The only “name-calling”, as usual, is coming from your side of the aisle.

      • Porfirio666

        You’re a NIMBYbot troll and a liar spreading ad hominum attacks!
        (Do you get my point now?).

        • Kraus

          I was replying to “Heart”.

          • Heart

            Oh Sonja. You and your BARFbots should give the disinformation campaign a rest. Don’t you have some real campaigning to do in your run for D6 Supervisor? Best get on that and quick.

          • Porfirio666

            Sorry about that. My comment was directed at the spittle-spewing Heart, who doesn’t want to discuss the issue and screams BarfBOT!

      • sfsquirrel

        The hypocrisy behind that comment is stunning.

    • Cole Ryan

      “I see the [insert ad hominem attacks here] arrived early to [more ad hominem attacks] and commence with their ad hominem attacks”

      Stay classy!

  • curiousKulak

    “The reality is that what developers tend to want, more than anything, is market stability – they want to know what the rules are. And if the state is in a position to change those rules once a year, it’s going to be a mess.”

    Yes. Far better those changes come more often and unpredictably from politicians of the CCSF?

    What happens if by chance there is a slowdown. In 2011, there was virtually NO new construction. But that didn’t stop people from coming here. In that circumstance, an 18%/ 22% mandate might indeed stiffle creation – where a lower figure might just keep them building. 18% of zero is nothing. 13% of a reduced figure still provides housing.

    And of course. with the next election, that “18%” gets changed again (and again). I think state law provided the stability that local limits don’t.

  • erikschn

    Ah Wiener, always the Dick about these things! Well, those of who know Wiener and his long career before he changed his image to run for state senate, know that he has always hated poor people and couldn’t care less about what happens to them. But he’s always there for the wealthy, white and privileged!

  • Heart

    Also worth noting: Tech, developers, venture capitalists, realtors association and apartment owners association have given beaucoup bucks to Weiner, Chiu, BARF and YIMBYs. Follow the $$$$$.

    • sfsquirrel

      You reminded me to add to my list of alternative solutions to build, baby, build: Lets make SF a sanctuary city from Citizens United. Get the money the hell out of politics. Then maybe those “poor put-upon” developers can put that money into building affordable housing.

    • goodmaab

      Ethics violations of Chiu and wiener are part of the history as well…

  • DragonflyBeach

    “By Tim Redmond”
    M’kay, thanks for playing.

  • goodmaab

    Follow wiener and chiu’s bed linens and it takes you back to Parkmerced and the monster in the mission…. More profiteering for those developers able to afford the lobbyists and get to the state capital daily…..

  • Yonathan Randolph

    It’s worth repeating a bit more context on AB-915.First, Wiener’s amendment makes explicit the feasibility assumption that the Inclusionary Housing bill makes. If you think the Affordable Housing Fee on density bonus units is fully justified, then you have nothing to fear from Wiener’s amendment. The supervisors have decided to set the Affordable Housing Fee on density bonus supposedly as high as is feasible, including on units that are awarded under the State Density Bonus. What this means is that they have rejected the density bonus approach of incentivizing the construction of low-income housing and have decided to depend entirely on mandating low-income housing. The downside of mandating low-income housing at the maximum predicted feasibility is that for lots where the prediction is wrong, none of the housing is built, exacerbating the housing shortage.Secondly, the Inclusionary Housing bill that sets the Affordable Housing Fee does not, on its face, require AB-915 at all! Instead, is legally justified by the Residential Nexus Analysis, a backwards sophism (which also happens to be the basis of Tim Redmond’s “more housing makes the crisis worse” article which he keeps linking to). If you think the Residential Nexus Analysis will withstand judicial scrutiny, then there is no need to pass AB-915 at all.

  • Shlomo von Glickstein

    BECAUSE HE’S A PATHETIC CORPORATE DEMOCRATIC WHORE WHO HAS TAKEN TONS OF CASH FROM DEVELOPERS SEEKING TO CONTINUE THE PERPETUATION OF SF’S GENTRIFICATION… HOPEFULLY A PROGRESSIVE WILL PRIMARY HIM AND HE’LL BE TOAST….WHAT A FUCKING FRAUD HE’S BEEN ALL HIS LIFE…

  • Bobinsf

    Why is Scott Wiener trying to undermine affordable housing in SF? Could it be that he’s a corporate democrat that takes money from republican supporters that are trying to get rid of affordable housing and rent control? It’s a no-brainer.

  • sebra leaves

    Learn about the bills and actions you can take:
    https://zrants.wordpress.com/resistance/