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Monday, September 27, 2021

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News + PoliticsAgain, the Chron pushes the Yimby agenda that will never work

Again, the Chron pushes the Yimby agenda that will never work

But a public bank might actually make a difference. Plus: Rent relief and accountability for business districts. That's The Agenda for Jan. 24-31

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Heather Knight, the Chron City Hall columnist, is the latest on the Yimby bandwagon: Her piece this week argues that San Francisco is “one of the most conservative cities in California” when it comes to housing.

Yes, we could have development without displacement — if the state Legislature weren’t controlled by the landlord lobby. Housing Rights Committee photo via Twitter

She cites Sacramento, where rezoning now allows four units of housing on any land where a single-family house is allowed. The idea, Mayor Darrell Steinberg said, is that everyone should be able to live in the city, next to nice areas like public parks.

What if San Francisco mayors and supervisors had adopted that vision 20 years ago during the first dot-com boom? Or 10 years ago as we emerged from the Great Recession and saw an influx of tech companies and a huge spike in housing prices and rents? What if they’d called for our thriving economy to not leave anybody behind and demanded that people of all income levels be able to live near Golden Gate Park?

I am getting tired to trying to explain what’s wrong with this picture – but since there’s an actual potential solution on the horizon, which Knight didn’t mention, let me try again.

San Francisco doesn’t “build” housing. Private developers do.

Knight says that Sacramento

plans to allows people to build up to four units of housing on any piece of land now slated for one house.

That sounds as if your average homeowner or landlord is just going to demolish their place and put up four units, maybe by hand with a few boards and a hammer and saw.

That’s not how it happens. Construction in San Francisco is expensive, and you need qualified union labor, and materials are costly, and codes (like seismic safety) are in place for a good reason – and that means if you want to build anything, you need that magic word: Financing.

Financing comes from capital – from banks and investors. And banks and investors don’t give money these days to for-profit projects that don’t offer a substantial return.

And there is absolutely no way that housing affordable to Knight’s “artist, teacher, waiter, custodian or nonprofit worker new to the city and lacking a trust fund or high-earning spouse” will be built by the for-profit private sector right now, no matter what the zoning rules say.

Sure: Upzone the Sunset and the Richmond, get rid of all the single-family homes, allow lots of apartment buildings – but if any housing gets built at all (which is a bit dubious right now) it won’t be affordable to working-class people.

Because the for-profit private sector, with private financing, simply can’t build housing affordable to working-class people.

Peter Cohen at the Council of Community Housing Organizations calls this the “feasibility monster.”

As Sup. Dean Preston notes:

Yes, if you eliminated public appeals, did housing “by right,” and cut all that “red tape” you would cut costs. But not nearly enough to make a four-unit project with apartments that rent for $1,500 a month or sell for $300,000 “pencil out.”

And if, as the free-marketeers argue, more supply will bring down prices, the problem will just get worse: Unless you can bring down the cost of land, building materials, and labor (and I am not in any way in favor of bringing down the cost of labor by using non-union, exploited workers) you can’t significantly bring down the cost of new housing in SF. Not enough to matter.

What does bring down prices? A reduction in demand. We are seeing that now; prices are falling because we are in a pandemic, and people are unemployed, or leaving the city to work remotely somewhere else. That will go on for a while (and while it’s going on, nobody will build any new housing – check with the Planning Department on that.)

If San Francisco had the “vision” 20 years ago at the start of the tech boom to rezone neighborhoods to allow more housing, we would have gotten more of what we have already seen in the Mission and the Castro: Denser housing developments that tech workers can afford, but working-class people can’t. That drives up local property values and leads to displacement (not just of residents but of local businesses).

There are ways to add more market-rate housing without displacement – but right now, the state of California won’t allow cities to use those tools. We could essentially ban no-fault evictions and impose real rent control (including vacant apartments) and set controls on commercial rents, and those policies could allow more development without gentrification. They are all illegal thanks to the landlord lobby in Sacramento.

Instead of attacking progressives in San Francisco, I would love to see the Chron call every member of the state Legislature and ask why they won’t let cities address displacement by repealing the Ellis Act and Costa Hawkins and allowing commercial rent control. (One reason: A full 25 percent of them are landlords.)

In the meantime, we deal with the Feasibility Monster: The only private-sector housing that is “feasible” for the lenders is high-end condos and luxury apartments. That’s how modern Capitalism works.

But on Tuesday/26, Preston will be introducing legislation to create a public bank in San Francisco.

That’s such a potential game-changer in the housing world that Heather Knight and the Chron and the Yimbys all ought to be in favor.

“The linkage between a public bank and affordable housing is critical,” Kyle Smeallie, and aide to Preston, told me. “This is one of the most important advantages of a public bank.”

A bank that didn’t have to maximize profits on every investment could put the billions of dollars in money the city is now giving to major commercial banks to work building housing – as the Yimbys like to say, “at all levels.”

A lot of use would be happy to see more density on the West Side of town (if the city can invest in transit to keep up with the need). There’s nothing wrong with a four-unit building in the Sunset (and since most of the nearby housing west of 19th Avenue is owner-occupied, you don’t have the same displacement issues).

But if we want to see new housing for Knight’s “artist, teacher, waiter, custodian or nonprofit worker” market, we need a different financing model than what late-stage Capitalism is offering in 2021.

That might be a public bank.

Preston is also asking that the board allocate $11.4 million from the General Reserve to fund emergency rent relief and the acquisition or creation of non-market social housing. That item comes before the Budget and Finance Committee Wednesday/27; the meeting starts at 10:30 am.

The full board will hold a hearing Tuesday/26 on the status of reforms to the SF Police Department. That’s slated for sometime after 3pm.

The full board will also hear a resolution by Sup. Aaron Peskin that would call for more transparency in Community Benefit Districts and Business Improvement Districts – semi-private operations that raise money from property owners for things like private security. These operations often have their own private security cameras, and the footage from those has been shared with the cops. They also get money from contributors who remain anonymous. Peskin wants a written policy on security cameras presented to the board – and a ban on secret contributions.

The board will also confirm, I suspect unanimously, Assessor-Recorder Carmen Chu to the post of city administrator. Mayor London Breed can then appoint a new assessor-recorder. Chu has always been on the more conservative side of city politics, but she’s also been competent and honest.

The next assessor ought to be someone who not only advocates for property-tax reform at the state level but someone who understands the immense importance of public access to the records in that office and is willing to rebuild an online database of real-estate records that used to be among the most useful things the city offered and is now a complete mess.

Tim Redmond
Tim Redmond has been a political and investigative reporter in San Francisco for more than 30 years. He spent much of that time as executive editor of the Bay Guardian. He is the founder of 48hills.
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7 COMMENTS

  1. Just had to drive down to Palo Alto and back in a single occupancy internal combustion vehicle to get some hardware from the offices of the tech firm I work for. I felt like I was in YIMBY hell driving down University with all of those single family homes beckoning like the true dachas for fascist white supremacists they are. Even the apartments are a fascist two stories.

    Fortunately, I noticed on the way back that there were some lovely denser apartments with ample parking, bottom floor jammed up against the freeway wall and top floor serenaded day and night by the US-101/CA-92 interchange. So there is hope!

  2. Agreed, the YIMBY agenda will never work. The CCHO agenda of YIMBY lite, inviting luxury condos into at-risk neigborhoods for the affordable housing in-lieu fees is not exactly working either, green lighting gentrification and displacement, waiting a decade for people to be forced out, and then to replace a fraction of units at rents set to meet nonprofit constraints rather than community needs.

    The nonprofit agenda is not necessarily the popular agenda and that political disconnect is why YIMBY is rampaging while CCHO drones on and on and on.

  3. Where you find an above average percent of 3-4 unit buildings you don’t find many low income households. Some of these areas, Noe Valley, Cole Valley/Parnassus Hts. high income households.
    and these areas are 58% White.

    You will find lower income people near Golden Gate Park, maybe 20 to 30 percent of the households. In the Richmond District the higher income households tend to favor the northern part near Lake.

  4. Tuesday/26, Preston will be introducing legislation to create a public bank in San Francisco.
    Great to hear this is happening at last!

  5. Heads up for people who think it is easy to split a lot.

    First you must bring your abode up to the current level of building code standards. A lot of older homes are not up to the current codes and that is not a cheap endeavor. You need to hire the lawyer, even if you are a lawyer, and architect, and contractors and probably take out a loan to finance the work needed to bring your home up to code before you can split the lot, unless you want to demolish the house and start over.

    For that you will have to move out. Not many people are going to take advantage of this unless they just want to build in the back yard or add an ADU which they can do now anyway, although the requirement to upgrade to the latest codes will probably still stand.

    By the time you go through all the exercises to take advantage of these new options, you might as well sell and move somewhere else. This is probably the goal of the new bills. Convince people to move out of their homes so they can be torn down and replaced with up to 8 new homes by the time your do the split and add the ADUs and Jr. ADUs.

    Read Wiener’s latest bill SB9 to get the details, or read about it here: http://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=202120220SB9

  6. This sounds like an argument to stop the large scale building project right in the middle of the most crowded part of the west side – Irving Street. NIMBYs fighting that.

  7. “Construction in San Francisco is expensive, and you need qualified union labor”

    Why do you believe that all constriction work in the city needs to be unionised?

    The large projects downtown for office buildings and hotels done by large-scale developers probably are. But construction work on residential lots in the city is usually done by small building firms, and they are almost universally non-union.

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