The Board of Supes Budget and Finance Committee will consider Wednesday/25 putting on the March 5 ballot a measure to sell $300 million in bonds to finance the construction and preservation of affordable housing. The mayor support this; Sup. Aaron Peskin is the main board sponsor. It will likely get unanimous board support and head to the ballot; I don’t know anyone who is seriously against building affordable housing.
Bond acts, thanks to terrible state laws, have to win two-thirds of the popular vote. That’s never easy, when you figure that about 20 percent of the voters will oppose anything that involves taxes and spending. So the bond act needs to get almost all of the remaining 80 percent.
It probably will. I see a lot of political support, which will mean financial support for a campaign, and I don’t see any organized opposition.
This is all good. Except for one problem.
The cost of building the affordable housing that the state says San Francisco needs over the next seven years is $19 billion. This bond is about 1.5 percent of that.
Why so little? It’s simple: Anti-tax politics.
The folks who passed Prop. 13 in 1978 wanted not only lower property taxes; they wanted to throttle government spending. So they made it hard for cities and counties to borrow money or raise taxes.
Local bonds are paid back with property taxes. Thanks to the power of the landlord lobby, rental property owners can pass half of the cost of new bonds onto their tenants. (That’s local law, not state law; we could change it.)
So city officials, from the mayor to the supes, refuse to put on the ballot anything that would lead to an increase in property taxes, which means we can only issue new bonds when old ones are paid off. Supporters can sell this housing bond as a measure that “won’t raise property taxes,” because another existing $300 million will be paid off when this one goes into effect.
Let’s be real here for a second.
According to the Controller’s Office, this bond would raise taxes a total of $5 for every $100,000 of assessed valuation. That means my property taxes would go up about $16 a year. The owner of a $1 million dollar house would pay $50. A landlord with a $10 million property would pay $500 without passing the costs to the tenants.
This is nothing. Anyone who owns property in San Francisco right now can well afford that.
In fact, and I speak as a homeowner, most of us who get massive benefits from Prop. 13 could afford a $3 billion housing bond. (Me: $160 a year. A landlord with a $10 million building? $5,000). Donald Trump? $210,000 a year (he owns the Bank of America building, and has escaped at least $11 million a year in taxes for many years).
If the city ended the pass-through, and launched a major campaign to make it clear how much property owners (particularly commercial property owners) get away with under Prop. 13, maybe we could seriously address affordable housing.
For now: Make sure no rich person pays higher taxes, while poor people live on the streets.
The full board will get a chance to talk about this Tuesday/24 when Sup. Dean Preston asks Mayor London Breed about her plans for affordable housing.
Three of the supes are participating in Question Time this week: Sup Myrna Melgar wants to know about behavioral health and homelessness services on the West Side, and Sup. Rafael Mandelman is asking about the implementation of the state’s new laws making it easier to force people into drug, alcohol, and mental-health treatment.
Preston’s question is described as “Housing Element: Affordable Housing goals.” He has asked Breed’s staffers in the past about the huge issue: Does the mayor have any plans at all to find the level of affordable housing that the Housing Element mandates? If not, why are we even talking about eliminating “obstacles” to high-end luxury housing?
Then there’s the APEC summit.
Mayor Breed has made this a central theme for her administration, the ability of San Francisco to host a massive international gathering with equally massive security. It’s going to be almost impossible for anyone, even residents, to get through the Secret Service security barrier without waiting in long lines, showing ID, and going through a metal detector.
Except that some residents of Soma may not have “government issued IDs.” And most small business will be unable to get supplies, much less customers, on a timely basis.
Unhoused people will be summarily removed before or during a “security sweep” the night before the conference starts.
Sup. Connie Chan, Dean Preston and Hillary Ronen want to protect those vulnerable communities—and San Francisco’s values—during the celebrity event, which they describe in a resolution as
A multilateral forum for promoting and negotiating corporate centered trade deals among 21 member economies in the Asia Pacific Region including the United States, Mexico, and China and will bring together global industry giants, their corporate lobbyists, and billionaires, but will not include representatives of vulnerable and impacted sectors like women and workers of the Global South, nor indigenous, environmental, and human rights advocates.
San Francisco also has a deep history of labor organizing and international labor solidarity against free trade agreements that diminish labor rights and environmental protections, cause widespread food and economic insecurity, privatize and outsource public resources, and weaken human right protections.
City activities related to APEC thus far have prioritized advertising and promoting APEC, plans and events to host dignitaries, and expediting infrastructure and beautification projects to serve APEC visitors, however, there has been very little information shared with impacted communities on how their daily lives and movement may be impacted by security perimeters, disruptions to traffic, public transportation access, pedestrian flow, and access to social services and public institutions …
There are many vulnerable residents including immigrants and the unhoused, and facilities such as senior housing, small businesses, child care centers, schools, and community serving organizations within the South of Market area and surrounding neighborhoods which will be impacted by the exclusion zone and traffic disruptions …small businesses have been struggling to survive through and recover from the pandemic and those within and around the Moscone area are concerned about the impact to their businesses, including loss of income, background check requirements on workers and suppliers, and safety for customers and workers. …Seniors in the vicinity rely on paratransit, medical treatment, access to senior centers and food delivery, and family and friends and caretakers on a daily basis are concerned about how they will have access to critical care and be impacted the week of APEP. …. Immigrants and families that live and work in the area are concerned about the presence of Homeland Security, surveillance, militarized checkpoints and and whether San Francisco’s Sanctuary policies will be upheld during the week of APEC.
The supes have already approved $10 million in money to support the APEC summit, but that’s been put on reserve, and the mayor has now raised the entire $20 million the city needs through private corporate donations.
So the three supes want that $10 million set aside
for residents and neighborhoods including community based organizations, schools, small businesses, and workers to address and mitigate the local impacts and disruptions that will be caused by the APEC related activities including loss mitigation for small businesses and workers, safe passage for vulnerable populations such as immigrants, seniors and children instead of police overtime and subsidizing exclusive events and activities related to APEC.
The three are calling for immediate adoption without committee reference, so one of the more conservative supes could demand it be sent to committee. I wonder who wants to stand with the global power structure and against vulnerable San Francisco residents.
We’re getting a picture of some of the measures that are headed for the March ballot. The Rules Committee will consider two of them Monday/23—a proposed charter amendment that would set minimum staffing for the Police Department (at a cost reaching $300 million a year) and another charter amendment that would require the mayor to sign off on all parking meter changes and Muni fare hikes.
Six supes have to approve a proposed charter amendment to put it on the ballot.
The police measure is sponsored by Sups. Matt Dorsey and Joel Engardio. It would set in the city’s constitution specific numbers of officers in the department. That doesn’t exist for any other city department, and would wind up, at a time of budget cuts, a significant shift of resources from other public priorities.
It’s part of the whole StopCrimeSF agenda—and it’s also a political wedge issue. Any of the supes who are up for re-election who vote against it will face attack mailers funded by the billionaires who want to defeat progressives in 2024.
The other measure is also politically intriguing. Sups. Aaron Peskin and Ahsha Safai want the mayor to take direct accountability for move like increasing the hours of enforcement in neighborhood parking areas, and potentially the expansion of meters, as well as increases in Muni fares.
Those are controlled by the director of the SFMTA, with approval by that board. The idea, when the agency was created years ago, was to “take the politics out of parking and Muni.” The result has been a lot of angry people and merchants in a lot of neighborhoods—and a mayor who, while she is otherwise demanding more power, can duck responsibility for this one.
Safai also wants to put the Department of Emergency Management in the City Charter. Not sure what the exact problem is that this seeks to solve.
That hearing starts at 10am.
But now she can’t blame “obstacles,” since the state has eliminated a lot of the local rules that gave the public more ability to weigh in on new development, and she’s pushing for even more.
So now it’s about fees, like a requirement that developers pay for the affordable housing impacts of their projects and the impacts on Muni and other city services:
When you look at all of these different fees, all the different taxes, all the different requirements, people think just because you add them and they sound good, that all of a sudden the people who are the developers making the money on these projects, that they are going to change what their fees are or change what they’re requiring for themselves. That’s not going to happen. They’re just going to add that onto the production cost.
Hold on a second: If the Yimby line that the mayor supports is true, and free markets will bring down the cost of housing, then her statement is just false. In truly free, competitive markets, companies competing for customers do, indeed, change “what they are requiring for themselves.” That’s called profit, and in the world that old-fashioned economists so loved by the Yimbys inhabit, competition leads to lower prices precisely because a company would rather make five percent profit than no profit at all.
A reduction in profits, in expected return, is the only way that housing prices would even fall to a level affordable to working-class San Franciscans.
But that’s not what happens in this type of market. As this SF Chronicle article by J.K. Dineen points out, the investors who fund market-rate housing won’t put up the money unless they can get a (guaranteed) 20 percent return.
In many small businesses, a five percent annual profit is not only acceptable but something to celebrate. Not for the speculative capital that funds market-rate housing developers.
Let’s be clear here: As far as I can tell, there is no scenario in which a private developer can build housing in this city, right now, make a 20 percent return for investors, and provide that housing at a level that is affordable to the San Franciscans who most need a place to live.
I have asked the developers to present one to me, and I haven’t seen it.
Meanwhile: Let’s cut taxes and get rid of the well-established urbanist idea, articulated clearly by Tom Radulovich at Livable City, that “growth should pay for growth.”
I agree that the city’s tax system is out of date and kind of a hodge-podge. That’s because of the state: If Breed wants to cut taxes on high-end real-estate sales (one of the few ways local government can tax the rich), then she ought to organize other mayors and go to Sacramento and demand legislation that allows city income taxes, including on corporate profits.
Instead? Tax cuts to solve economic problems. Wow, that always works.