San Francisco plans to invest in “social housing”. What is it exactly ?
Late last month, as part of budget negotiations, the Mayor of London Breed agreed to spend $112 million on affordable housing, calling for debt financing money to be used to pay for new housing projects and fund repairs to existing buildings.
It was part of a late-night budget deal that preserved most of the mayor’s priorities, but also added money originally requested by Supervisor Dean Preston as part of a ‘social housing’ package. , and in accordance with the recommendations of the Supervisory Board of the Housing Stability Fund. . This council was formed to help figure out how to spend the revenue from Proposition I, a real estate transfer tax that goes into the city’s general fund.
So what does social housing really mean? Let’s break it down.
What is social housing?
Social housing, a type of public housing used in parts of Europe where the government plays a larger role in providing social programs, aims to use private money to subsidize government-run housing where rents are capped for tenants based on their income level.
“The idea of producing public housing is not new,” said Sulaiman Hyatt, the lead public housing organizer at San Francisco’s Housing Rights Committee. “But doing it at the city level is new.”
The portion of the city’s administrative code that established the Housing Stability Fund Oversight Board (HSFOB) after the adoption of Proposition I defines social housing using two criteria: it must be permanently affordable and the income average of all tenants must not exceed 80% of the local median income.
At the state level, State Assemblyman Alex Lee made a similar proposal with the California Social Housing Act, which seeks to create the California Housing Authority to oversee the production and maintenance of public housing. . The bill stalled in committee this year, but Lee plans to reintroduce it next year.
Alex Lantsberg, who sits on the HSFOB, said the board is driven by the belief that the private market alone will not be able to meet the city’s affordable housing needs. The public sector must therefore also intervene.
“We’re not talking about inventing the wheel or even reinventing the wheel,” Lantsberg said. “We’re literally talking about picking up tools that are at our feet that are used in other parts of the country and other parts of the world.”
What is the difference with public housing?
Public housing is state-run housing that caps housing costs at 30% of a resident’s income and is only available to low-income renters who earn less than 80% of the city’s median income . Social housing would institute a similar rent cap based on income, but would not use income levels to restrict who can live there.
Today, public housing in San Francisco is already partially privatized. Indeed, most of the city’s public housing was turned over to private landlords and nonprofits after the city took over the state-run San Francisco Housing Authority in 2019 due to financial mismanagement that resulted in a $30 million shortfall in the agency’s reserves.
The main difference between the two concepts is where the subsidy for lower rents comes from, Hyatt said. In public housing, this comes 100% from the government, while social housing would also use rents or taxes from high incomes to fill the rent gap for low income tenants.
Where else is it done, and what’s different about SF?
Social housing advocates cite Singapore and Vienna as examples of where different versions of social housing have worked overseas. They also point to Montgomery County, Maryland, which is building housing for people of varying incomes using $50 million in government bonds placed in a revolving fund that would be repaid from development profits.
What’s different about what San Francisco is undertaking, Hyatt said, is that it would be city-run and tax-funded.
Where will the money go?
The final spending plan for the $112 million, which will be administered by the mayor’s office for housing and community development, has yet to be determined and would still require board of oversight and finance office approval. public, said MOHCD communications manager Anne Stanley. .
But his office’s spending pledges align closely with HSFOB recommendations, Stanley said, although the department does not use the term “social housing” internally. She said the MOHCD will also seek to raise state and federal funds to help fund future projects.
“As a city agency, we can’t fund all of these projects,” Stanley said. “It’s just too much money.”
Sarah Wright can be contacted at [email protected].
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