new york city is 33%. boston is 35%. l.a. is 39%. in terms of the surrounding neighborhood, 42%. berkeley, 43%. daly city, 59%. supervisor olague: where are you getting this from? >> it is from the 2010 census data most recently released. again i thought it was interesting that of the approximately 123,000 owner occupied units in san francisco, about 26% of those owner occupied units on their buildings for rian clear. about 74% have a mortgage. of the 74% that have a mortgage

if we compare what percentage of those are also burdened by their mortgage, they pay over 35% of housing costs, it is 40% of those individuals. here you see that no surprise, although the median sales price for a home has dropped dramatically from 837,000 to 668,000, all that means is that houses that were astronomically out of reach are now still out of reach. you can see that for 80% ami, there is a $390,000 affordability gap. even at 90% there is a $112,000 affordability gap. this is for a two-bedroom in terms of the median sales price and the ami is based on a three- person family. now, for 80% ami, a low income

family could afford only -- percent. only 7% of the homes in 2011 would be affordable to people at 80% ami, you have a greater percentage of likelihood of finding something affordable depending on the neighborhood. in the bayview, 46% are favorable -- affordable. in bayshore, 27% were for will. if you go up to 120% ami, you can see that chart. more homes become available. at 120%, 87% of the homes in the bayview more affordable for people at 120%.

at 150%, people at 150% can afford 39% of the homes for sale which is a slightly higher percentage. it can afford almost 40% of all the homes and it means in five different approach especially those down in the southern part in those neighborhoods you can afford 80% to 90% of homes for sale. it depends on where you would like to live. on the ownership side, what are we producing? two of those three programs are no longer in existence. you have the below market rate ownership program. the agency used to build a% of affordable buildings. what are -- we are left with is

the below market rate unit. over the past cannot -- nine years we build 760 ownership units, 84 units a year. you can see in the world of 124,000 units, our 84 units a year barely makes a dent. we have even fewer ownership units on line. we have 339 units in the pipeline. it will be a challenge as you can see. because there are not this kind of resources available for ownership production. it is a pie chart where you can see where this existing units, we had 2800 affordable ownership units. 58% are targeted at 120 ami and below add another 38% for below. that is not a large percentage.

why do we build more? we -- the leverage that is possible, there are two projects. you can see for mission walk, it requires 55% of the dollars to come from the city where as for mosaic it requires 35%. there is a difference of leverage that makes it more difficult to build. we have offered other kinds of financial incentives to families besides actual production. we do have downpayment assistance programs, programs targeting police in the community, teacher nexturf programs. that has reached almost 3000 middle and come families and they go below the 90-100% that

bmr gives. they go to 120%. with our assistance program, the average ami is 82%. an income of 65,000 the year. which seems remarkable that someone could purchase a home at 82% ami but they manage to bring it together. with all these numbers, again, we go back to the conclusions i talked about at the beginning. we talked about rental apartments out of reach and the target from 0-50% ami, the smaller affordability gap for 50-80% but there are fewer deed restricted units. we are talking about

ownership. for sale houses are out of reach. and our down payment programs to 120%. for above moderate, they are relatively well served by the met -- rental market. it becomes difficult at the larger bedroom size. there is a smaller ownership affordability gap. so in terms of some of the policies that director lee will talk about, we want to throw out some ideas for discussion. one item for discussion is a possible restructuring of the

bmr rental program that can serve up to 80% ami. we coul reserve a portion of that at the current affordability levels. require more units but not create additional cost of developers. there is some geographical concern if you go up to 80% because in some neighborhoods, 80% is market rate for rentals. and then for 80-120% ami looking for affordable ownership ties -- housing, again, we could talk about increasing the downpayment assistance loan program. we could talk about restructuring in part the below market rate program. currently it goes up to 90% or 100% ami. we could bring that up to 120% ami. reserving a portion caps out at

90 to 100% ami. want to go past a certain point, ami does become market rate. supervisor wiener: how many bmr ownership units do we have? >> we have 1000 units. we're not going to be building a great deal more. those units are limited to resale and a limited number coming up under bmr. >> iowe have 1060 and we do not anticipate adding more. >> that is correct. supervisor wiener: the inclusion rental program is to lower income. tehe bmr program for moderate

income people it would be fair to say is sort of running out of steam a little bit? since it did not anticipate an increase in the number of those units targeted to 90%-100% of ami? >> it is still a valuable vehicle for producing a certain amount of below market rate but in terms of comparing the number of units that would be generated out of the bmr program to the overall number of housing units, it is a small percentage. >> you're going forward with 1060 and in the future will not add much more. >> we have 300 or so in the pipeline. more and more developers are choosing rental as their option as opposed to ownership. supervisor wiener: right. that option is not great to be as much -- robust as we may be once thought it would be? >> perhaps. unless the market turns around. supervisor wiener: thank you. >>supervisor olague: it seems to

me in many ways the bmr program has been effective in housing folks of median income to some degree. i was going to ask aslo -- also as far as below rate market rentals, have you seen much of an impact resulting from the pauma decision and who chooses in the developers -- who choose to go rental or has it had not much of the fact back -- and the fact? >> it has an effect and it is a complicated legal issue. i will leave it at that. supervisor cohen: if you were able to in your analysis, if you considered or started scratching the surface of looking at other assets.

there is discussion within the san francisco unified school district to look at the assets that the school district has to convert that into homes for teachers that are just starting out in the workforce. can you speak to that? is it part of the analysis and if it was not, why? >> we have not looked at those other assets. >> we have to look at a broader range. this is to make the data a bit more manageable. we imagined there would be suggestions. to examine other options. supervisor mar: the school had a study that looked at other

property and they looked at feinstein school and the old sites as potential sites. and looking for partnerships like that. that is an ongoing issue for the board of education and the superintendent. my guess is that they're talking with the city as well. >> before turning over to director lee, the last slide was 120-150%. we do not have existing programs for the 120%-150%. we looked at other financing product whether it was city financing or perhaps something that is equivalent to what has been put out for other city employees. for example, the police in the community project is something that has been negotiated by the police department and has no

income limit. the teacher next door program goes up to two under% -- 200% ami. they may not require city resources but we might be able to find some outside resources to subsidize those. >> one of the policy recommendations you made was to increase the down payment for the loan assistance program. i was curious if you had -- you were successful in identifying where that pool of money could come from. >> we wanted to leave that discussion for the policymakers. supervisor olague: thank you. >> with that i invite director lee to come out for the extended discussion. >> thank you for that presentation.

i am prepared to answer any questions the supervisors may have or least attempt to with regard to the presentation and aware the city may be on the affordable housing production. among the things i wanted to note is the city has adopted a major development plans including hunters point shipyard, mission bay which has all lot -- a lot of units of housing. 32% are going to be bmr's and they go up to 100% of medium income. -- median income. they're not completed. the shipyard is about to initiate their phase one on the hill. there are additional parcels at mission bay which are going to be developed for affordable

housing. we have gone through a 20- year period with the cities had resources from the tax increment. it coincides with the decision by the board and by the city to adopt tax increment financing through the redevelopment agency which provided many of the resources both at moh and the agency into this point for the subsidy of affordable housing development. the mayor has charged the mayor's office of housing with looking at additional resources for a housing trust fund in part to replace not only the loss of redevelopment funds but also the huge cuts that we have had in the home and cdbg programs.

this is a story that -- it is an ongoing story. this is not the end. we're in the middle of production and we're taking this opportunity to take another look at whether we can do this job better and more efficiently. supervisor wiener: thank you. i wanted to thank you for taking seriously that one can invest in and value low-income housing while also acknowledging the need to improve affordability for middle income people. unfortunately, you hear some people have the immediate reaction that if you're talking about middle income housing it must mean that you are going to somehow deinvest in low-income housing. i do not think that is the case. it is not my intent or anyone else. the fact that remains that we

look at an elementary or middle school teacher according to the chart provided by your office is that 90% of ami, i do not think anyone would suggest that an elementary or middle school teacher living by himself or herself that 90% of ami is somehow well-to-do and does not need any help from anyone. and so i want to thank you for understanding thises some -- this is somewhere that we need to focus on both. to focus on one that you are not devaluing the other. supervisor mar: if there are no questions. whitaker will move to public comment -- supervisor wiener: we will

move to public comment. supervisor mar: there are -- supervisor wiener: i will call some more names as well. for public comment, we will beat 2 minutes per person. at 30 seconds you will hear a soft bill. at 2 minute to hear a loder bill which means you should finish speaking. i will call names. the budget analyst, would you like to add anything? we will go quickly to the budget analyst. >> just to give a brief overview of what our on it looked at and a couple of the findings that relate to today's discussion.

we expected an audit of the city's housing policies including the planning department's role in a four will housing needs of the city. we looked at the implementation of transit oriented housing. housing in districts that are identified as transit clusters. we also looked at broadly at the affordable housing policies and took a closer look at the inclusion very housing program and its impact on affordable housing production. and we also looked at the finance of affordable housing projects and the management of the inclusion rehousing program. the areas i want to discuss, we would be happy to return to a more in-depth presentation and conversation. the first one is we looked at the regional housing needs

assessment that our seven-year targets for the city in meeting housing production goals for various income levels and found that the city historically has had some challenges to meet these production goals for very low, low, and moderate income. i do not know of the supervisors have a copy of the report but on page one of the executive summary, we have a table showing the production goals and the city's ability to meet those goals from 1996--- 1996 to 2000. on page 19, table 1.1 will show you -- give you a feeling for where we are going in the current seven-year production cycles for the current goals

we're trying to meet. in that table, which is a projection of where the city might be in june of 2014. this is based on data as of last august. from the planning department. i will discuss where we were in the last seven-year period. below 50% of ami, the city as on target to meet two-thirds of the goal and in the last period, the city met 83% of its goals. and for low-income we're on the projection to meet 16% of the assigned goals whereas in the last seven years we've met half. for moderate income, we are on target to meet 1/4 and that is a slight improvement for the last seven-year period.

for market rate housing, we're on target to exceed the goals by 13%. we exceeded that by 53%. overall, we are on target to meet the -- goals fori just wane seven-year period that we currently started started when the housing market was coming down. there is still another two to three years left in the period. the other thing i want to talk about is the uncertainty of future funding sources. there is three reasons why we found that the city is facing

uncertain financing for the future. the tax increment that came in from the areas went to a significant portion of the affordable housing development. the second is the decline of the local housing market. the inclusion mary housing that relies upon that. the third is reduced contributions resulting in budget reductions at the u.s. department of housing and urban development as well as uncertainty in the housing trust fund which was to receive a significant amount of its funding from fannie mae and freddie mac. our recommendations are on page 69. we made a few recommendations, one was to have non recurring

and volatile revenues to affordable housing. the third was the mayor's office on lowering the threshold on passing b general obligation bonds on affordable housing to a 55% vote. they is a historic president -- president in the city of san francisco. the last recommendation was to explore expanding cooperation with housing and urban development and teir section 221 programs. >> thank you very much. we will now go to public comment. let me call up a few more names. steve, ed donaldson, tracy

parents, peter cohen, jenny, i cannot read the least name. alvaros sanchez. >> i am a community organizer. i am going to read the administrator's beach. i will go ahead. greetings, supervisor. i am a north beach resident. i have seen a lot of changes in this neighborhood. it has the highest level of the evictions in the city. when the owners purchased the building, are resided with all of my neighbors and i.

the veterans who served our community and country in the beach. i often wonder what happened to the senior, disabled, and long- term residents that might cause -- call neighbors. proponents have identified this as a win-win. condo units can pay into the trust fund. i and many san franciscans support affordable housing for all. it concerns me. property developers are able to bypass a condo lottery system by paying into the trust fund. i can only imagine the number of tenants in control units. the city would use an immense member of controlled units, many with house some of the

city's most adorable residents. i ask supervisors and sentences against to perk -- san francis cans to create a long-term housing strategy where diversity is upheld. i am translating for her. >> [speaking foreign language]

>> i am a memory -- member of the united collaborative. thank you for allowing me this opportunity to speak before you and talk about affordable housing. why your having this discussion, you might also consider the needs of long-term residents such as myself. it is hard to find a place to rent. it is important to protect exist -- existing housing stock units. and not allow apartments to convert without a plan. >> speaki[speaking foreign lang]