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The Battle To Build Affordable Housing in Western San Francisco: A Study of the Proposed 25050 Irving Street Project

Aug 18, 2022

Officials from San Francisco revealed plans to create a 100 percent affordable housing project in the Sunset District. The Sunset District lies on the west side San Francisco. This is an area where there has been little recent construction of affordable housing. Based on San Francisco Supervisorial District Maps (District 4), the Sunset District was designated as "District 4". Data from SFYIMBY, a San Francisco non-profit that focuses on housing development, shows that District 4 saw only 26 net affordable units, and 64 total new units, between 2010 and 2020. District 4 saw more than 5,000 applicants for affordable housing during fiscal year 2019. Only 49 applicants found housing, and all were relocated beyond District 4.

The majority of the City's western section is zoned for single-family or duplex units. Historically, it has been difficult to build high-density multifamily housing projects. Tenderloin Neighborhood Development Corporation is proposing a 100% affordable project. It will be located at 2550 Irving Street. TNDC, a non profit developer, focuses exclusively on affordable housing developments in San Francisco. The project was partly funded by Inclusionary Housing Fees. This fund was overseen and managed by the San Francisco Mayor’s Office of Housing Community Development. Projects utilizing inclusionary housing fee funds, like 2550 Irving Street, are required to build 100% affordable housing projects. San Francisco's 2550 Irving project has been the subject of headlines for the past few months. The Mid-Sunset Neighborhood Association was formed to stop the development of their neighborhood. Due to the SB-35 approval, the project did not have to be held with the Mid-Sunset Neighborhood Association. Katie Lamont, senior director for housing development at TNDC stated that although the project does not need to go to a vote to approve it, they would like to get the community involved in discussing the impact of the building's design. Mid-Sunset Neighborhood filed the lawsuit alleging that 2550 Irving Street's project was breached contract, negligent, and breached an "implied Covenant of good faith, fair dealing". Due to the SB 35 application's inherent by-right, it is unlikely that this lawsuit will shut down the development. However due to opposition from the community, many more months of delays are expected.

This article gives a brief background on how 100% affordable housing projects like 2550 Irving Street are developed in San Francisco, as well as the balance developers must consider surrounding the time-consuming nature of community involvement as the dire need to increase affordable supply in San Francisco continues.

Proposed Project

The 2550 Irving Street development is a seven-story building with 91 units. Of the total, 73 units are reserved for families earning between $38,450 - $102,500 each year. The remaining 17 units are reserved for formerly homeless households. The ground-floor community space will cover 2,250 feet, and the rear courtyard will be included. The following are renderings showing the proposed design.

What Are Inclusionary Housing Fees and How Does Senate Bill-35 Play A Role?

Inclusionary housing fees are one of three ways market rate developers in San Francisco are allowed to fulfill their inclusionary housing requirements. An example of this is a market-rate developer proposing a project that has 25 units or more and they do not wish to include affordable units. They will be charged an "inclusionary accommodation fee". At the time of writing, the fee is $199.50/square foot gross floor area. This applies to 30% of the project size. According to data from the City and County of San Francisco Controller and Budget Analysis Division (the most current data available), fees collected through the program amount to approximately $200,000,000 between 2014 and 2019. The funds are used exclusively to develop affordable housing projects. Most cases, these funds are given to TNDC or other non-profit developers to build projects like 2550 Irving Street. From 2014 to 2019, 96 affordable projects have been completed. That's 6,112 total units. The Mayor's Office of Housing Development oversees the distribution of fees to non-profit developers. MOHCD will typically identify a site for development within the City and send out requests for qualifications. Non-profit developers then respond with their credentials, vision and plans for the project. MOHCD usually issues funds to the project for 25% to 50% depending on the amount of non-city funding.

San Francisco's charter stipulates that every permit is discretionary. All proposed developments must be granted conditional use permits regardless of whether the proposed use is legal. In order to build affordable housing in San Francisco, 100% of the projects must be approved by the community. While there may be legitimate concerns regarding traffic, parking, density, or other issues, the not-in my-backyard (NIMBY), mentality that is prevalent in San Francisco surrounds affordable housing projects. State Senator Scott Wiener introduced Bill 35 in 2017, as a response to a lengthy entitlement and community involvement process regarding affordable housing projects throughout San Francisco and California. Many housing initiatives were included in the bill, including the conversion of 100% affordable housing projects to by-right housing. By-right housing approval is a way to allow construction to begin without the need for planning approvals. According to Sam Moss, Executive Director at Mission Housing Development Corporation, the by-right nature of SB-35 projects has made the development process faster by months, if not years, for non-profit developers to build 100% affordable housing projects. Developers, such as TNDC and their 2550 Irving Project, are now faced with the question of how much community involvement is necessary now that these projects have become legally binding. In the case of TNDC and the 2550 Irving Project, engaging with the community on their plans for the project has caused multiple delays, a reduction of 50 units in the overall size of the project, and a lawsuit against the developer from the Mid-Sunset Neighborhood Association.

Community Opposition to 2550 Irving Project

Neighborhood groups were formed in protest of the proposed 2550 Irving Street Project. 200 opponents to the 2550 Irving Project were present at a Sunset District neighborhood meeting to express their concerns. The concerns from the community were expressed through signs held by community members with messages like "Be Kind To The Adjacent Community", "Tell the Supervisor To Stop Toxic Waste", and "The Right To Light For All Neighborhoods", which were noted by a local San Francisco Chronicle reporter who was at the meeting in November 2021. Multiple people in the crowd also attacked Gordan Mar, District Four Supervisor for Sunset District with chants like "Recall Mar," and "Recall Mar." Anonymous attack posters were posted throughout the Sunset neighborhood and slipped into mailboxes that read "No Slums In The Sunset" and "In just two years, 2550 Irving Street will become the best place in San Francisco to buy heroin" as well as additional attacks on the project, its tenants, and Gordon Mar himself. An image of the mentioned poster is highlighted below:

The strong opposition to 2550 Irving Project highlights San Francisco's housing shortages, especially in San Francisco's western regions. There have been very few multi-family affordable housing developments.

Community Engagement Balancing Act

The 2550 Irving Street Project has been met with strong community opposition. However, this opposition doesn't just affect 2500 Irving Street. It is consistent in the difficulty affordable housing developers are having throughout the City when trying to build affordable housing projects. Local developers claim that many San Francisco homeowners believe 100% affordable housing projects today will be similar to those previously built in San Francisco. They are much the same as the 15-story concrete blocks. Sam Moss (Executive Director, Mission Housing Development Corporation) noted that the new affordable housing projects being constructed in San Francisco today often resemble well-designed, market-rate housing. It is difficult for most people to distinguish between affordable housing developments and market rate products. In order to counter the strong opposition from the community to affordable housing in the city, non-profit developer have always engaged with the community deeply to get their preliminary approvals.

The SB-35's drawback is its inability to integrate into the thinking of many non-profit developers. In the hope of avoiding the lengthy approval process, affordable housing developers have sought to blend in with the community and make as little noise as possible. Many projects were granted concessions regarding the number of units, which in turn reduced the supply. The ultimate goal is for 100% affordable developers and the people responsible for granting these rights to these projects to be more open-minded about the by-right powers that SB-35 provided for affordable projects. History has shown that local communities within the City will continue to fight against 100% affordable developments, especially in neighborhoods in the western portions of San Francisco that see little multifamily development of any type. In order to make the City more accessible and equitable, non profit developers may have to change their approach from minimizing their presence and use the power of SB 35 to create more affordable living options.

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