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News + PoliticsThe attack on Soma: City wants to create a...

The attack on Soma: City wants to create a new downtown, wiping out culture and thousands of blue-collar jobs

Other departures from city’s plan include TODCO’s ideas about a new park on the north side of 5th and Brannan (how about a Levi’s Plaza South?), the proposed Central SoMa eco-district (the official vision is “technocratic” instead of community-inspired), the forthcoming expansion of Moscone Center (lacks a neighborhood perspective), and greening the freeways (they’re not kidding). Consideration of these intriguing topics will have to wait.


What can’t wait are two topics on which TODCO more or less concurs with the city’s planners: the need for affordable housing, and the rezoning that will eliminate strict protections for Production, Distribution, and Repair (PDR).

In the Central SoMa Plan, housing places second fiddle to offices. But when second fiddle gets 14 million square feet—the total amount of new residential space authorized by the official plan—it’s still a big role. It’s also a role that complicates the analogy between the Central SoMa Plan and the old urban renewal.

When the San Francisco Redevelopment Agency’s bulldozers rolled into SoMa in the the 1960s and 1970s, they wiped out dwellings, businesses, and jobs. By contrast, no housing is jeopardized by the Central SoMa Plan. Rather, small businesses and the jobs they provide are at risk. And whereas the city and the Redevelopment Agency had no intention of replacing what they destroyed, the Central SoMa Plan foresees the creation of a significant amount of new affordable housing. Moreover—and this is the real complication—it ties the provision of that housing to displacing those 1,800 PDR jobs with massive amounts of high-value development, both residential and commercial.

The plan would increase the required percentage of below-market rate units in any housing project—in planning lingo, “inclusionary” housing—built in the areas rezoned from Service/Light Industrial (SLI) and Service/Arts/Light Industry (SALI) to allow currently prohibited uses, i.e. offices, hotels, and market-rate housing.

The percentage of inclusionary housing would also rise on sites receiving substantially increased height that are located anywhere within the plan area. The city’s standard inclusionary requirement is 12% on-site, or 20% if off-site or if the developer is paying a fee in lieu of building affordable housing at all.

Mind you, here “below market rate” means what the U.S. Department of Housing and Urban Development defines as affordable to people earning up to 120% of the Area Median Income, or AMI. In San Francisco that works out to a maximum of $81,550 for a one-person household and $116,500 for a four-person household.

And what HUD says is affordable for local 120-percenters ranges from $1,529 for a room in an SRO to $2,039 for a studio to $2,623 for a two-bedroom apartment, all with utilities. (The full range of AMIs and maximum rents is posted on the Mayor’s Office of Housing website.) Because San Francisco’s annual median income is so high, some of what’s officially below market rate is a lot higher than what most people might expect and what many of the city’s residents can afford.

Exactly how much higher the inclusionary requirement would go under the Central SoMa Plan remains to be worked out during the “refinement” process now underway. Nevertheless, the plan predicts that the increased percentage would generate about 1,750-1,900 on-site inclusionary units, or about $550-600 million in in-lieu fees. (The plan estimates that over its thirty-year life, a total of 11,715 new housing units will be built.)

All non-residential development in the plan area will be subject to the city’s Jobs-Housing Linkage fee, which requires new commercial development to pay a substantial fee to fund new affordable housing. The 2013 rate for offices is $22.83 per square foot. New hotels and retail projects pay somewhat less. The Central SoMa Plan estimates that new development in the plan area would yield $688-$740 million in these fees for affordable housing.

Plus, the plan is extending to Central SoMa the new inclusionary options offered in the Eastern Neighborhoods Plan: developers can fulfill their required percentage of affordable housing by either dedicating land to the city or providing a greater number of below-market-rate units at higher prices that are affordable to households with incomes averaging 135% of San Francisco’s AMI (maximum rent for a studio with utilities: $2,391). This is officially known as middle-income housing.

Having proposed less new office space and lower heights than the city’s planners, TODCO foresees less money for affordable housing. But the  Community Plan specifies as its “highest possible priority” the creation of 1,000 units of permanently affordable housing in the neighborhood over the next 20 years. Whereas the city’s planners call only for the “exploration of mixed-income housing at major development sites such as 5M and the Central Subway’s Moscone Station,” TODCO provides a detailed list of sites and funding for those thousand units. By TODCO’s reckoning, at least 645 of those units would be financed with fees paid by nearby future office or hotel development.

It’s unclear how much of that fee-generating development would go on land that’s proposed to be rezoned from SLI or SALI. Certainly it would be a substantial amount.

And that’s the tricky issue, one that many in the affordable housing movement agree is troubling: The city desperately needs affordable housing, at all levels — but when the source of money for that housing is high-end development and high-end housing, it’s not an easy call.

Most affordable-housing advocates, for example, opposed the 8 Washington project — despite the substantial money it would offer for affordable housing. None of the major housing groups supported it. The same advocates have supported restrictions on housing and offices in PDR areas in the Northeast Mission, Dogpatch, and parts of the Eastern Neighborhoods.

As Peter Cohen, at the Council of Community Housing Organizations, points out, over all, the affordable housing community has never supported the notion of an acceptable tradeoff between PDR jobs and new below-market rate housing.

In fact, the Council just released a plan for 2014 that includes the following:

“Gentrification is not simply about the displacement of tenants, but about the wholesale transformation of people’s neighborhoods and commercial districts.  We need policies to stabilize local-serving small businesses.”

Cohen notes that strict zoning is one of the only ways to “dictate the price of the land. The price of land is based on it’s highest possible use. You can’t be flexible and keep prices down” to a level PDR companies can afford.

“I don’t think a lot of city planners get that.”

John Elberling, the CEO of TODCO, argues that many of the PDR businesses will be lost anyway, and that it’s not politically possible to maintain zoning so strict that all conversions to office and housing uses would be banned: “Basically,” he told me, “21st Century PDR still has a future in SOMA, but 20th Century PDR, except for the very significant auto service businesses, does not.”

Meko, Chair of the SoMa Leadership Council, disagrees:

“There’s no place else in the heart of the city for service and light industrial businesses,” he told me.  “There has to be some social engineering involved in planning, especially community planning. I’m sure there’s a higher and better [more profitable] use for all that property down there, but pretty good working-class jobs trump that and need to be protected.”

That will be one of the big challenges in addressing the city’s plans for SoMa.

PART TWO, COMING NEXT: Who’s behind the attack on Soma — and do we have to give up the neighborhood to save the Earth?

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