Mayor Ed Lee Takes Action on Housing Crisis

​In light of the dramatic increase in rental housing costs over the past year, the City is devoting substantial time, effort, and resources to attempt to address the chronic insufficiency of affordable rental units.

Mayor Ed Lee has asked the directors of the Planning Department and the Department of Building Inspection to implement the following tasks toward meeting this challenge: 

  • Recommend actions to promote more rental housing in San Francisco;
  • Require Planning Commission discretionary review when a loss of housing is proposed; and

  • Advise other municipal departments with permitting authority over buildings that are proposed for withdrawal from the rental market with respect to Planning and Building Code restrictions on such withdrawal.

The two directors have formed a working group that includes representatives from other City agencies, SPUR, and a number of housing associations.  The working group has committed to immediately implement administrative changes in the permitting process that will speed review of new housing permits, retain existing units, and encourage development of more housing.  In addition, the working group has requested that the Rent Board strictly enforce restrictions on owner move-in evictions to ensure that the owner, or close relative of the owner, moves in to the evicted tenant’s unit within three months and occupies the unit as a principal residence for 36 consecutive months.  Once an owner move-in eviction has occurred in a building, no future owner may utilize that path to evict a tenant.  

Recommendations for policies and procedures to be adopted in the short term include the following:

  • Prioritize 100% affordable housing projects and projects with at least 20% onsite affordable housing.  Provide priority processing for market rate housing proposals based on the project’s proportion of affordable units produced. Priority processing is intended to be implemented in both the Planning Department and the Department of Building Inspection.
  • Encourage developers to maximize density when constructing major alterations or new housing projects.  
  • Discourage removal of illegal dwelling units in those cases where it is feasible to bring them up to code.  
  • Encourage concurrent review of proposed projects by the Planning Department, Department of Public Works, Department of Building Inspection, and Fire Department to expedite approvals.  
  • Seek improvements at the City’s Department of Human Resources to expedite hiring of additional staff to review housing permits.

The working group has further recommended a variety of longer term policies that are intended to set the City on a course to approve 30,000 new and rehabilitated dwelling units by 2020.  The working group has identified the following steps that will require legislation to be adopted by the Board of Supervisors:

  • Planning Code amendments to facilitate construction of accessory dwelling units.
  • Development of affordable housing on public property.
  • Building Code amendments to allow a new construction type of one or two levels of concrete podium with five or six stories of wood frame construction above, totaling a maximum of seven stories, while not being considered a high rise structure.

  • Building Code amendments to modify natural light requirements.

  • Streamline historic resource reviews under CEQA.  There is a general consensus that the current system adds too much time and expense to projects.

Further recommendations by the working group for longer term efforts include the following:

  • Advocate for amendments to state law, including the Ellis Act, Costa-Hawkins Act, CEQA, and the Subdivision Map Act to provide the City with increased ability to regulate housing at the local level.
  • Provide increased protections for existing affordable units.
  • Amend the Planning Code to facilitate new housing types that are affordable by design.  This means smaller units and increased density.

  • Identify project types, such as 100% affordable projects, which may be approved via ministerial review for Planning Code conformance and without discretionary review.

  • Implement the state housing density law.  This would include state authorized density bonuses.  
  • Eliminate the current 375-unit cap on the production of micro-units.
  • Consider reducing or eliminating the Planning Code requirements for residential exposure, open space, and parking requirements.  

  • Allow for fee payments in lieu of variances.

  • Add residential units to soft-story buildings.

  • Study creation of environmental regulations by ordinance that could replace case-by-case mitigation measures and thereby simplify CEQA review.

  • Explore efficiencies that would reduce the need for review of transportation impacts of housing projects.

  • Expedite environmental review for housing projects.

  • Support CEQA exemptions for construction of accessory dwelling units on properties that already have multiple units.

Proposed Production, Distribution and Repair (PDR) Reform Legislation Under Consideration

The Board of Supervisors is considering proposed legislation to make the development of PDR space more economically viable by permitting office and institutional uses, research and testing laboratories, and life science laboratories to subsidize the construction of PDR space on properties that are vacant or underutilized and that do not contain significant PDR space that would be demolished.  The proposal is geographically limited to PDR-1-D and PDR-1-G Zoning Districts that are located north of 20th Street and that are parcels of 20,000 square feet or larger.  At least one-third of the total gross floor area developed on the parcel would be required to contain PDR uses.  All projects seeking entitlement pursuant to this legislation would be required to obtain a conditional use authorization from the Planning Commission.

In addition to the normal conditional use criteria, the Planning Commission would consider additional criteria including the likely viability of the new PDR space; whether the project is located in an appropriate location for the proposed non-PDR use, including whether the location of non-PDR uses would be compatible with or destructive to PDR uses on the site or in the vicinity.  The legislation proposes that such projects will have Notices of Special Restrictions recorded on title that will state that PDR uses shall never be less than one-third of the total gross floor area of the parcel, including any future building, alterations, or expansions on the parcel.

The issues discussed in this update are not intended to be legal advice and no attorney-client relationship is established with the recipient. Readers should consult with legal counsel before relying on any of the information contained herein. Reuben, Junius & Rose LLP is a full service real estate law firm.  We specialize in land use, development and entitlement law.  We also provide a wide range of transactional services, including leasing, acquisitions and sales, formation of limited liability companies and other entities, lending/workout assistance, subdivision and condominium work.