invest in municipal transit and how we plan with the new subway systems coming in. i'd love to take the commission on a walking tour. but with only a few minutes of general public comment, i was going to talk to you guys through a tour of the north side of o'farrell street and o'farrell street is about 24 blocks long. and it starts at grant avenue. i'm going to take the first one grant avenue and call it zero o'farrell street and there we host imporio armani. another high retail store, macy's buildings, block to block, one is entirely macy's. across the street is the central t-line going in there, that's the union square market street stop. and then in the second macy's store there is tommy hilfiger,

[speaker not understood] beauty, bakery, pink berry, beauty lapped. -- land. we hit the thai noodle house, [speaker not understood], chipotle, we're coming across the hyde 200 block, [speaker not understood], the hotel with custom designer jewelry store inside the retail space. the gift stage, lefloor nail and hair salon, fred's liquor mart and food mart. here's where we cross mason street and hit the o'farrell parking garage which is about 300 yards long, 8 stories high, and on their retail level they

have alamo, thrifty, [speaker not understood]. we have another hotel, 450 which is the building which is totally fenced off. and then 474. if we want to knock out a gateway into mid-market unction we need to address 474 o'farrell street and three blocks north to south and east to west out of mid-market. thank you, guys, have a good day. >> thank you. any additional public comment? sue hester. i was going to speak next week, but i think what dale said about the warriors deserves to be heard. i plead with the people on this commission to request your staff to come back with a report as soon as possible about the timing of environmental review on this project.

a of right now there is no application before the planning department. but they plan on having the scoping meeting at the same time as the planning commission on the 13th. i have never before had a scoping meeting for an environmental review to have to choose between attending the scoping meeting or the planning commission. and been a long time, the c-e-q-a is 1970s. so, there has never -- they have never [speaker not understood] a program. but the schedule that is being done on the environmental review is a crash course in environmental review and you don't have any information. if you wait until after the scoping meeting is done, which is likely, you won't have any ability to effect the timing.

so, please have an information report on a very soon meeting of the planning commission on how fast the environmental review is going. and whether it is advisable, legal, whatever, to count a program, the scoping meeting on any e-i-r and the planning commission. like i said, this is unprecedented in so many ways. thank you. >> any additional public comment? okay. next item, please. >> commissioners, it will place you under your regular calendar and we'll be taking up item 5, which was taken off consent, case no. 2012.0725c, 475 eucalyptus drive, request for conditional use authorization. >> good afternoon, president fong and commissioners.

i'm rick crawford of department staff. this case is a request for conditional use authorization to expand an existing residential care facility for the elderly from five beds to ten beds in the rh-1-d residential family detached district. the expanded facility would include six beds for ambulatory patients and four beds for nonambulatory patients. the project site is within a fully developed mixed use area surrounded by residential uses to the west and the north and commercial and institutional buildings to the east and the south. the facility is within the cluster of institutional uses on eucalyptus that serves as a buffer between the residential neighborhood and the shopping center. the project is an expansion of the small residential care facility and as such is not expected to effect traffic, parking or transit operations in the neighborhood. the size of the proposed use is in keeping with the character of the adjacent residential neighborhood and the building on the site would remain residential in character with

no external evidence of the use within. the department has received one comment in -- excuse me, objecting to the project because of concern about traffic and parking. the department recommends approval the project with conditions as the project promotes the provision of -- excuse me, of community-based residential care for the elderly, complies with the applicable requirements of the planning code and is consistent with the objectives and policies of the general plan. i'd be happy to answer any questions. thank you very much. >> thank you. project sponsor? my name is fernando [speaker not understood]. i am the project sponsor. this is my wife lorna. if you have any questions regarding the plan expansion or the number of beds, we would appreciate it. very much. >> thank you. we may have questions for you.

thank you. is there any public comment on this item? you can have a seat for now. thank you. thank you. >> seeing no public comment, that portion is closed. commissioner moore. >> my questions are really questions to staff. adapted reuse of residential and appropriate location is a very good thing, particularly with the use that is proposed. there is one piece of information that is missing for me in this particular thing. we're talking an rh-1 house, beds from 5 to 10 is a densification which i can only judge if it is properly brought in the context of the size of the building. so, the way this is presented is as on the consent calendar, we are approving something we don't quite know what we are approving. obviously there is a good intent of caring for ambulatory

and people needing assistance. however, i think we need to know or at least have staff sign off on timeliness of densification. that is my objection. if i have this information, in addition to that i think i would like to know that the state itself, which is regulating facilities of this kind, is in support of the densification and the standards by which it can be densified can be met. >> commissioner antonini. >> i think those are good questions commissioner moore brings up. >> single-family house, a number of bedrooms, it is being used for residential care facility right now. they feel they've got room to put in some more people and i would ask the sponsor maybe to address how they're going to arrange people within the building. but there will be -- there

won't be any more people in this building than there would be if it was occupied by a larger extended family. >> i don't think that a single-family house of that vintage is designed for 10 people plus the people taking care of it. so, as a minimum, i would ask that staff provide at least a plan that shows the number of beds or speaks to a standard by which densification is possible. i'm not trying to take on the role of state licensing. but as a planning commissioner sitting here approving this, i think that information should be the standard of what the department would deliver to this commission. the fact that you are saying that it would work is not enough for me. >> i would, i guess, i'm sorry, commissioner. >> yes. >> i would certainly be in agreement with that, not to belabor the process. because this is a consent item. i don't believe we have a floor plan of how this is -- how many bedrooms there are and how the beds -- >> actually, i do have a --

>> just wanted to add one other point here. i'm supportive of the project on another basis. it's one of two small single-family homes that are located between st. stevens church and the very beautiful contextual center that is a gym and parish hall that looked like it was built at the time of the rest of the neighborhood. its was built two or three years ago, fantastic building. [speaker not understood]. you're in an area that is almost institutionalized. so, a usage that is a little different than just a single-family there, it's permitted use, it probably fits very well because there's less of a desire or possibility of a single-family use in that area in the more traditional sense. >> commissioner borden. >> maybe you could tell us the square footage of the house, the number of bedrooms that

exist and then the number -- if you happen to know what, i guess the state code that regulates how much square footage per patient or person living there that's required. i know this is a separate certification process for them. maybe you can talk about what that means. even if we approve it here, is there then a state body that has to issue some sort of permit? >> yes, there is a state license that is required and there is a state process they have to go through after they have come through the planning commission. the building itself, it's a two-story building. there are four faith rooms on the ground floor and three additional patient rooms on the second floor. there's a large living room area on the second floor with a kitchen. and there's also a smaller common living room space on the

ground floor. so, there's seven bedrooms for 10 people. >> how about bathrooms? >> there are -- there is one full bathroom on the ground floor and one full bathroom on the second floor. so, there are two bathrooms. >> can you item me the square footage? >> i'm sorry. [inaudible], two full bathrooms on the second floor. >> do you know the square footage of the house overall, by any khans? chance? 4,000 square feet. >> and again, with the licensing requirements with the state, maybe in the future, you know, not that we have to know everything about it, but is there a standard amount of square footage? >> [speaker not understood]. >> maybe the project sponsor can speak to that. the minimum square foot for one person is 8 feet by 10 feet. and the rooms are more than that.

the rooms are -- downstairs it's 10 feet by 12 feet. the main room is -- >> is there a requirement for rooms? >> 8 by 10. >> you said you have 7 bedrooms. is there a requirement each person have their own room? >> not each person because upstairs, the three bedrooms upstairs are quite large. it can accommodate two. it's 20 feet by about 16 feet. >> that's fine. i'm just asking because i know -- i know this is assisted living is different from a hospital, one patient per room. >> assisted living is different from residential care facility. >> right. and i guess in terms of do we know anything, i guess this is to mr. crawford. there's not -- do we check their license before -- >> yes, they are licensed. >> and there were no issues or complaints that you are aware

of -- >> no, they are in good standing with the state agency. >> there were other facilities, church, et cetera in the neighborhood. are those at all relevant or related to this facility? >> they're independent of the other institutions. >> okay, thanks. >> can i add one thing to that, please? * we started running a residential care facility way back in march of 1976. >> commissioner moore. >> i would just, aside from the application [speaker not understood] next time this comes forward, i would request supportive material which speaks of square footage, number of rooms, layout, et cetera, is given to us because we are kind of like in the gray area. there is a state licensing, but we still need to take responsibility that what we are approving is approvable. and at least a cursory review by which a physical documentation of what we are a moving has to be part of the

work the department delivers to this commission a. [speaker not understood]. >> thank you. move to approve. >> second. >> we have a motion and a second for approval. >> apologies, technical difficulties. commissioners, on the motion to approve, commissioner antonini? >> aye. >> commissioner borden? >> aye. >> commissioner hillis? >> aye. >> commissioner moore? >> aye. >> commissioner sugaya? >> aye. >> commissioner wu? >> aye. >> and commission president fong? >> aye. >> so moved, commissioners. that motion passes unanimously. you are now on item 11, an informational presentation on the inclusionary housing procedures manual. the mayor's office of housing is working on an update to the manual that may include amendments to the planning cod. >> good afternoon, again, commissioners. ann marie rodgers, department staff. this is an information only item for you today.

the mayor's office of housing is going to go through this procedures manual for our inclusionary housing program. you may recall the last time the commission adopted this was in 2007 and you are the only body for the city of san francisco that does this adoption action. you will hear a little bit about the presentation, about the -- from the mayor's office and so why don't i turn it over to them. it's daniel adams from the mayor's office and [speaker not understood] will give the presentation today. >> thank you, ann marie. dan, [speaker not understood]. thank you for this opportunity to present an update to our procedures manual. it is -- represents a documentation of best practices and lessons learned over the last five years. it reflects input from consumers, from stakeholders, from developers. we're excited to be able to present it today. i'm going to turn it over to chan drab eagan from our office to go over the key issues,

modifications that have been made and call those out for you. i did want to make clear this does not include updates that will result from the recently passed housing trust fund. the modifications here do not conflict with those future adjustments nor do they complicate those future adjustments, but they are not included at this time. so, we will be coming back at a later date with adjustments to the inclusionary program that will result from the passage of that ballot initiative. as was mentioned, this is an informational hearing only. we are here to present, to hear your feedback. we'll be returning at a later date to solicit your approval of the procedures manual as well as approval of some conforming legislation. some of the modifications do require adjustment to the planning code that requires legislation. that legislation has been drafted but is yet to be introduced. i believe we'll be coming back in december to finalize the approval of the procedures manual as well as to review and

approve the conforming legislation. so, chan drab will call out which pieces, modifications are going to require legislative action. * chandra thank you again for your consideration and i'll turn it over to chandra. >> [speaker not understood], i'm due in a week-and-a-half and i need to sit at this point. my name is chandra eagan and i'm from the mayor's office of housing and i've worked on the inclusionary housing program for the last six years. so, i was here for the last procedures manual update in 2005. i was also with my first child at that point. so, this must be what i do to get ready for that. the inclusionary housing program as i think you all know became a part of the planning code in 2002. it's a city-wide program that requires developers to pay an affordable housing fee, but then build deeply affordable housing. or if it qualifies for the

options they can build their units on-site or off-site. most recently we have land dedication as an option in eastern neighborhoods. that's been really exciting in taking a lot of our attention. so, today as dan adams mentioned, we're here to talk about the update to the manual that implements the code. so, we have a manual that's grown over time and has become more refined and it's been really exciting to work on it in the last year or so, actually a couple of years. because as dan mentioned it is a culmination of the last five years of learning about the program. we've had really stable staff over the last five years. we've had really vocal renters and buyers. this is a response mostly to consumer input and consumer questions, the need foremore transparency, the need for more questions to be answered, the need for the process to be more explicit. so, we feel like we've created a manual that is now very, very user friendly.

i think we'll get smarter as we implement it and take some feedback from the public. and then alongside that there are a few issues that respond to developer concerns. however, the main focus of this manual is to respond to consumer concerns. the primary area in which we addressed developer concerns as much as fleshing out the land dedication itself in eastern neighborhoods. so, we were charged with setting up the rules and processes for that. and we have a few pages, maybe three or four even in the manual that is a result of months and months of conversations about such. and then we did not address key issues we know are still floating out there that are larger than this manual update. and among those, you'll know this from the memo we provided you, there is concern or interest in being more mares it about how units are located, on-site units are located within a principal project when

they work with the planning department to pick the unit themselves, what those units need to look like, do they need to be just like the market rate units. we already know the answer is no. but to what extent do they need to or not need to. and then there's conversation going on about parking, the unbundled parking policy the planning department and commission implemented years ago and how it applies to the below market rate units. we have a policy in place. we haven't touched it for ownership unit. [speaker not understood]. i'd like to talk to you while i'm here as part of doing our informational hearing now because i've been the one primarily working on this over the last few years about the significant changes that you'll see in the procedures manual for owners -- for the ownership program, the rental program and the ones that affect developers most and i can answer question about the program in general as well.

we have about 1200, to set some framework, we have about 1200 units that have been produced through the program. that's since '92, 1992 because it was actually a policy for 10 years. we didn't produce any units during those years. primarily from the time it became city-wide law in 2002. we have about 1200 ownership and rental units mostly ownership. we've had a very small rental program to this day. and that's why we've made a lot of changes to our rental program in the procedures manual. potentially we'll have to make a few more with our next updates. we've collected about $50 million in affordable housing fees through the program to build deeply affordable housing. and we're about to potentially acquire our first two parcels of land through the land dedication option on which we will build deeply affordable housing in partnership with a nonprofit developer who will build it. we'll work with them, put out a request for application and whatnot. so, it's exciting. so, ask me any questions

throughout that you'd like. i'll start with the ownership program. so, our ownership program has about 850 units that are currently owned and we're probably producing about just i'd say maybe 50 to 60 units a year right now. last year we didn't, just like the rest of the city and the economy, i think we had two buildings that closed that have inclusionary requirements and it was not significant. we had a few ownership units, a few rental units and that's it. this year it looks like we'll have 12 buildings close, maybe 60 -- maybe more, about 40 ownership units and a lot of rental units. we have about 60. rental program is starting to outpace our ownership program which is in sync with what's happening in san francisco. many developer are choosing to receiptction -- rent for a period of time. that's addressed in the manual as well. what do we do for buyers, owners and developers who are building ownership units?

first, we updated and clarified -- i'm just following along the memo that was provided with your packet. and if you need a copy, i have extras here. first we updated and clarified a lot of the -- many of our financing rules, including require choirtion a loan for your approval before someone applies for a unit. that's supposed to help make sure that qualified buyers are buying but also developers can be reassured their units will sell in a timely manner. we clarified our down payment requirement, default and foreclosure rules which are more significant of course the last five years. big focus of our programming. but we've actually had very few foreclosures in this program. we've always required loans to be sound. so, compared to the regular market, we're doing remarkably well. i think we've had somewhere between 10 and 15 total in the

entire [speaker not understood] of the program. and then we've clarified rules for units that are unable to pay financing because another thing that's changed recently is is it's become more serious when a building has too many rental units in it, the buyers -- people want to sell their units can't, the people who can't sell them to people who can get financing because fannie mae, for instance, won't buy those loans. and then we've had a number, because of the age of our program, we have a handful of buildings that are having some legal issues with condominium legal issues so they also can get financing. we have some exceptions for that. it updates and clarifies the number of application rules including what happens when you change an application after you apply and requesting a reconsideration of an application. it updates just a few of our ownership restrictions. nothing serious, but it does update our occupancy requirements, our transfer procedures, inheritance which was in the ordinance and needed to be spelled out in the procedures manual. it happens when you remove

owners from title, resell restrictions, capital improvements, not on the list are first-time home buyer rule. we changed it slightly. you still have to be -- have not owned a home in the last three years from the date of application. that's our rule. we think that's fair. it's not a lifetime restriction. it's just the last three years. we removed the other property. you connell own another property. we tack it on to income, the other property. the documents we use to research our units, it updates and clarifies the lottery process, particularly our preferences. we had a lottery process since 2006. but it makes it clear how the preferences work. it's going to update our pricing mechanism for new units. i think this is interesting. we have a really tight pricing formula that makes it difficult sometimes for people to obtain loans because you have to be at the top of the maximum income for that unit and have down payment and be ready in every other way. so, what we'd like to do is add

a conditional use authorization in so that the units are priced the same exact way so it's revenue neutral to the developer. nothing changes there. that would most likely be typically at 0% of median income, but we'll sell them at 100% of median income. we'll check some more buyers. probably not enough to crowd out the 90% ami buyers at all, but we'll give people a little wiggle room so they can be more loan ready. not just with the developers who are excited to get their units sold in a timely manner, and also assist our buyers. we're going to update our pricing mechanism for s-r-o units. we didn't have s-r-o units selling in our program five years ago. now we do. we have luxury, i don't know if you call them luxury s-r-o units that have bathrooms and kitchens, but definitely a new phenomenon for our program. so, we have a new pricing that will be 75% of the studio price. it updates our income rules only slightly. we're just giving a larger exemption for asset test because most people do need to bring in somewhere between 40

and $60,000 for down payment occasionally. we're exempting that from an asset test we have. we're extending our marketing period from 28 to 45 days for new units, new ownership units. it remains at 28 for rental units which is a sufficient amount of time we think. we're actually going to update our resale period from 14 to 21 days as well. so, we don't want the resale units to have to market as long as the new sale units because these are current owners, 90% median income. we need that to move along faster. we layout special allowances for people unable to resell their units in a timely manner including the rental allowance and allowance for the next buyer to go above the maximum income. for the unit. and then we allow project sponsors who are unable to find a buyer when units are new to do the same. and we're allowing children under 24 to remain off loan and title. and i just want to point out a

few things require conforming ordinance amendments. so, the -- any increase in income beyond what's stated in the use restrictions such as the conditional use authorization for the new unit and the allowance for the project sponsors to raise the qualifying income level after six months of marketing or the exception for the current owners to raise the qualifying income level after six months of marketing will require an ordinance change and allowance from the ordinance. but i just want to clarify the pricing never changes. this is sometimes confusing to people. the pricing stays the same. it's just you can broaden your net and bring in more people to the program. so, it's only the qualifying income level that would go up, not the price of the unit. and then we also need to update the ordinance to allow the pricing for the s-r-o units. so, that's the changes proposed for the ownership program. are there questions? okay. okay.