A new plan to pay for affordable-housing construction was unveiled Tuesday by Mayor Ed Lee in a charter amendment intended for the November ballot.
The strategy was developed after the recent statewide dissolution of redevelopment agencies, which helped finance affordable-housing construction.
Under the proposal, The City would begin placing $20 million a year, ultimately increasing to up to $50 million, into a Housing Trust Fund. If placed on the ballot by at least six supervisors and approved by voters, then about $1.1 billion would be invested in affordable housing production over the next 30 years.
To help fund the plan, in early June the mayor is expected to introduce a tax measure for the November ballot. That measure, which is expected to encounter opposition from property owners, would increase by .2 percent the real estate transfer tax for sales of all properties valued at $1 million or more.
“Creating a permanent source of revenue to fund the production of housing in San Francisco will ensure that San Francisco is a viable place to live and work for everyone, at every level of the economic spectrum,” Lee said Tuesday. “Creating affordable and middle class housing will also help build our economy and create jobs in San Francisco.”
According to the Mayor’s Office, the fund would result in the development of 9,000 affordable-housing units, including the rehab of public housing sites such as Sunnydale and Potrero. And millions of dollars would go into a down payment assistance program to help qualifying residents buy homes. The program would offer no-interest loans to first-time homebuyers.
It would also allow The City to purchase at least 8 percent of a development’s units to create permanent below-market-rate units for moderate-income renters and homebuyers. And it would help reduce developer costs through mechanisms such as reducing by 20 percent how much on-site affordable housing developers must build.
The proposal grew out of a Housing Trust Fund Working Group assembled by the mayor, which included representatives from different sectors of the real estate industry, including Realtors, lenders, affordable-housing developers, market-rate developers, small property owners and members of the Board of Supervisors.