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California threatens San Francisco over city's missed deadline on housing development process

PIX Now - Morning Edition 11/29/23
PIX Now - Morning Edition 11/29/23 07:12

No later than Dec. 28. That's the deadline set by the state for San Francisco to get its housing policy in order, or else it will face consequences.

The city missed a Nov. 25 deadline to make changes that would streamline its permitting process, a deadline determined by the California Department of Housing and Community Development, or HCD. The date was set after an extensive state-funded study of city practices was done earlier this year, known as the San Francisco Housing Policy and Practice Review.

The report from the study, published Oct. 25, includes a checklist of obligations to be completed within a month. On Tuesday, HCD sent San Francisco a warning letter with a final December deadline.

Since April, Mayor London Breed has worked with Supervisors Joel Engardio and Matt Dorsey to meet the new obligations in their Housing For All plan, which was presented to the Board of Supervisors as the Constraints Reduction Ordinance.

In Tuesday's letter, the state threatened to take punitive action if the changes are not adopted in time.

"I just want to make sure that we all understand we are within the timeframe," said Supervisor Myrna Melgar about meeting the December deadline. "We are cutting it close. However, this is a complicated city, with buildings that share lot lines, with a very long and rich history of land use struggles."

In Monday's session of the board's Land Use & Transportation Committee, supervisors made some amendments to the mayor's ordinance proposal. They added a condition that local government can first review any authorization for the demolition of buildings built before 1923, for example. But the state wants the supervisors' amendments taken off and no new amendments made without their prior approval.

HCD's letter lays out specific actions that include the elimination of Planning Commission hearings for code-compliant housing development in all locations outside of areas designated by the city's Department of Public Health to be more vulnerable. It removes the use of the term "neighborhood character" and "neighborhood compatibility" in local reviews. These terms, as well as the words "light" and "air," are used to build cases in situations where people ask the city for discretionary, or individual, review.

It limits the approval of density waivers by the Planning Commission. And it requires the approval of the mayor's Constraints Reduction Ordinance, which includes the elimination of some developer fees.

"Can someone just tell me why we would eliminate developer fees on certain affordable housing projects, knowing that these fund parks, community programs and other improvements?" asked Supervisor Shamann Walton. His question was met with 10 seconds of silence in the chamber.

"Is there anyone who could answer that question for me?" he continued. "We build a lot of affordable housing in District 10, and we don't give up developer fees. I'd be interested to know what we are trying to accomplish here, because housing is still being built. And so just giving anything to a developer makes no sense to me."

"I think it's important that we do everything we can to be in compliance with the state agency," Supervisor Matt Dorsey answered. "This is an agency that has made clear that it's not messing around."

In its warning letter to the city, the HCD listed potential punishments for non-compliance. They could withhold affordable housing and infrastructure grants. They could issue the city monthly fines of $10,000 to $100,000 or more over time. They even suggested a lawsuit.

In the end, the state is requiring the city to accommodate 82,000 new housing units by 2031. Supervisor Connie Chan read figures from recent budget and legislative reports. "We have 40,000 empty home units through the housing elements process," she said. "We know we have 60,000 approved housing units in the pipeline waiting to be built."

In Monday's Land Use & Transportation Committee meeting, supervisors forwarded a resolution to direct the city attorney and city lobbyist to request an extension of the HCD deadline. The resolution, which they will revisit next week, also asked the state to revise the new requirements.

Commenting after Tuesday's meeting, Supervisor Aaron Peskin said the resolution was meant to show the public that the state was not working collaboratively.

"Arguably they are working with us counterproductively in a way that is going to not produce the type of housing that San Francisco needs, which is housing for families and working-class people and not for the superrich," he said.

"Sacramento is now captive to the real estate development industry and has passed a series of laws taking over local land use control throughout the state of California," Peskin said. "Because the developers that are funding these Sacramento politicians are in the luxury housing business, which is where the most profit is made."

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