Contents under pressure: San Francisco’s boom

Here in the land of bubbles — the tech bubble, the real estate bubble, the blue state California liberal bubble — a good deal of anxiety is spent wondering when things are going to burst and come crashing down. Is San Francisco at its breaking point?

As if to confirm such fears, the City Controller’s Office last week reported that our maxed-out office space, extreme housing crunch and jam-packed transportation system are stifling further opportunities for growth. There is no more give in the trousers without loosening a button — or popping the balloon.

While these are indeed boom times for The City as whole, the benefits have been, as is usually the case, unevenly distributed. For the most part, this means the poor, the renters, the homeless and semi-homeless, the disabled, and many from other countries, documented and not, are feeling a disproportionate share of the squeeze such growth brings. Issues of gentrification and economic equality have been a decades-long struggle, and a worsening topic, in this quickly changing city.

As San Francisco Examiner reporter Joshua Sabatini recently wrote: “For the past six years, San Francisco has experienced a huge boom in jobs and construction and the opening of new businesses. But amid all the economic growth, there remains a charged debate over displacement of long-standing residents that continues to boil over into intense political discourse.”

The average wage of a San Francisco worker last year was $97,040, a 3 percent increase from the prior year. Wages totaled $65.5 billion last year, an 8 percent increase and a 39 percent increase since 2005.

Between 2010 and 2015, the tech sector increased its share of the total job market from 9 percent to more than 20 percent. The City’s unemployment rate is at 3.5 percent, lower than the 4 percent during the previous economic cycle that peaked in 2007-08. These have been years of plenty.

The good news — or the bad news, depending on how you see it — is the technology sector seems to be slowing, and local real estate prices are calming down, or at least not climbing at such insane rates.

This slowing may ease some of the pressure for capacity, but the fundamental inequities, compounded now by fears of repressive social policies proposed by President-Elect Donald Trump and his circle, seem unlikely to lessen anytime soon. If anything, there is reason to fear the pressure on the less affluent will continue, and results will likely be explosive and painful.

“The reality of displacement and gentrification across all of San Francisco — and the entire region — is undeniable, and of serious concern,” Planning Director John Rahaim wrote in a Dec. 9 letter to the Board of Supervisors.

In this volatile equation, there must be a tipping point, where an ever-changing San Francisco ceases to be that city we associate that name with. It is an existential question that we have been grappling with for some time: How much of our city must we lose before it is no longer recognizable as ours?

This question was lurking last month behind a Board of Supervisors fight over a proposed development in the Mission District, long considered ground zero for San Francisco’s displacement crisis. The debate was over an appeal of a 159-unit development at 1515 S. Van Ness Ave. in the Mission. Thirty-nine of the units would be offered for below market rate.

The appeal brought out a chorus of voices denouncing the changing face of the neighborhood,

“On Valencia Street, you can get your $6 croissant or you can have a meal for $50 to $100 per person. You can buy fancy clothes. You can spend $350 for a handbag,” said tenant advocate attorney Scott Weaver. “These are not the types of businesses that belong in the Latino Cultural District.”

Weaver is representing the Calle 24 Latino Cultural District in its appeal of the Van Ness Project. The appeal argues the city review failed to consider the project’s impacts of gentrification as part of its environmental review.

Rahaim, in his letter to the supervisors in response to the appeal, said the Planning Department would address gentrification concerns by imposing a new set of special development and land use rules in the Mission as well as also other vulnerable neighborhoods, like South of Market and the Tenderloin.

“We know that there is simply not enough housing regionally or in San Francisco to meet our needs. We know that producing housing at all income levels is critical,” Rahaim wrote. “We also know that it will take a broad set of smart, bold strategies to address the totality of the causes and effects of high housing costs and displacement.”

Weaver, the tenant advocate, told the Examiner last week he was encouraged that city official were at least listening, adding, ”The political will to take the steps necessary to address this problem now lies squarely with the Board of Supervisors and the mayor.”

With the board’s composition in flux and three new supervisors set to be sworn in next month, now is the time for new action from City Hall. Last month, Supervisor Malia Cohen said The City needed “a sea change” on how it handles development, saying, “Development should not be about displacing people.”

We hope her colleagues, both new and returning, agree and can steer a new course for San Francisco, one that brings us closer to The City we once thought we were.

Michael Howerton is editor in chief of the San Francisco Examiner.

Michael Howerton
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