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Surplus property could help housing issues

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Mayor Ed Lee on Tuesday called for a charter amendment for the November 2016 ballot to require more below-market-rate housing from private developers in new housing projects. (Mike Koozmin/S.F. Examiner)
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A city ordinance that has failed to produce more than a pair of below-market-rate housing sites for the formerly homeless in 13 years could be strengthened in the upcoming election, Supervisor Jane Kim said.

San Franciscans will have a chance Nov. 3 to expand The City’s surplus property ordinance by voting for Proposition K, a measure unanimously supported by the Board of Supervisors and Mayor’s Office.

Instituted in 2002, the surplus property ordinance says if The City has unused land, then San Francisco would build below-market housing for the formerly homeless in that space.
But in the more than a decade it’s been in place, only two of such sites have been developed, Kim said. One site houses veterans at 150 Otis St. in South of Market, while the other has space for families at Broadway and Sansome Street.

That’s in part because The City doesn’t know how much surplus land it has that is ripe for building below-market-rate housing, said Kim, who endorsed the proposition.

“What we’re finding is that departments were keeping property and saying it wasn’t surplus,” said Kim. “That’s the problem with the existing ordinance, so that I don’t have a sense of how much we have out there.”

Prop. K hopes to increase the number of potential building sites for below-market-rate housing by requiring city agencies and departments to report all of their land one-fourth acre or larger, rather than only submitting land they deem surplus, Kim said.

The city administrator will then compile a list of the land and determine independently what is surplus or underutilized.
Prop. K expands the definition of what lands are considered for development to include underutilized land — such as a piece of land that is only partially used — and opportunity sites, like space above the ground floor of a business.

If the measure passes, a hearing would be triggered at the Board of Supervisors every April 15 to review the surplus lands list. The list would then reach the Mayor’s Office of Housing June 1 for evaluation.

The Mayor’s Office would decide whether or not to purchase the land for development.

“It’s another tool in the toolkit, which is land,” said Kim. “The cost of land is … one of the most expensive pieces in any development project.”

Prop K. would keep money flowing between city agencies, Kim said. If the Mayor’s Office of Housing decided to purchase the land under Prop K., it would pay the department or agency for it.

“We do pay the value of what we’re building,” she said, noting that the prices wouldn’t be as high as market-rate. “If we’re building 100 percent affordable, then the land value is based on what we’re building.”

Prop. K also would allow housing to be built for a wider range of income levels in The City under the ordinance, not just the formerly homeless. That includes individuals who make under $84,550 a year, or about 60 percent of San Francisco residents, Kim said.

Market-rate units could also be built on sites of 200 units or more under Prop. K, as long as a minimum 33 percent of units are below-market-rate.

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