San Francisco Mayor London Breed says the city should redirect $260 million in unused earthquake safety bond money towards affordable housing.
The proposed program would offer market-rate and below market-rate loans to developers seeking to preserve, acquire or improve affordable housing.
“This legislation is a creative solution to open up new financing tools that will protect vulnerable residents and preserve affordable housing,” Breed said in a press release earlier this month announcing the legislation.
The proposal, which went before a city committee this week, is expected to go before the Board of Supervisors later this year.
The legislation would implement a 2016 voter-approved initiative that allows the city to use unspent general obligation bond authority to preserve at-risk housing.
Voters approved the original bond measure in 1992 to help with earthquake safety requirements after the 1989 Loma Prieta earthquake but only a quarter of the $350 million bond authority has been used, according to the mayor’s office.
Supervisor Aaron Peskin, who co-authored the proposal, said the plan allows the city to preserve housing stock that could be lost in city’s expensive speculative market.
“A quarter of a billion dollars sits ready to be allocated for the acquisition and rehabilitation of some of our most at-risk rent-controlled buildings,” Peskin said in the press release. “I’m delighted that the City is finally ready to get this cheap money out the door and invested back into potential Small Site and Single Resident Occupancy (SRO) acquisitions.”
Under the proposal, $100 million would be available in below-market rate loans with the requirement of permanent affordability for the life of the property. The city could issue up to $35 million in bonds each fiscal year.
Developers who are making earthquake, fire, health and other safety improvements to buildings would also be eligible for loans under the program.
"Funding for affordable housing from the state and federal government has dried up and it is essential that the City provides all opportunities to preserve and expand affordable housing for our residents,” Breed said.
