i see them here. >> olson lee, director of the mayor's office of housing. our goal is to put into context the affordable housing we have done. the family began our presentation -- before we begin our presentation, i wanted to put that into context. up until the point of the dissolution of the development agency, we were the envy of many communities around the state. not only did we pass a housing bond. we also had redevelopment funding that had committed 50% of local tax increment for affordable housing. in most communities with redevelopment agencies, the

committed only 20% to affordable housing. the other thing i would like to put into context is how the redevelopment agency and the mayor's office of housing, with the urging of the board and the public, used that money. we did not just to low-cost housing that met the definition of affordable housing. we took the extra step based on your encouragement to the special needs housing, housing for people disabilities, a variety of things that many of their communities do not do. they are supported even further by the store -- board and the general fund in terms of operating subsidies for those special populations. if you look at the goals and

production goals we have to do, you do not get a sense of the richness of the program that we together have put together that are serving a variety of needs, not just individuals with low- cost housing. i will put the goals into context. at the dissolution of the redevelopment agency, the 20 years of redevelopment tax income funds provided approximately 12,000 units of affordable housing. we're looking at goals that basically double that going forward. that gives you a sense of the context we're looking at in terms of the loss of redevelopment funds for affordable housing. teresa will be talking about how we structured financing,

leveraged outside resources, and the importance of local funds, whether it is a bond issuance, general fund, or tax increment. clearly tax increment financing is the largest local source over the last 20 years. it i would like to give thanks to the staff of the budget analyst, mo and sfra. this is a huge undertaking to pull this information together. it has been a valuable experience for us. we are very pleased to the board is taking so much interest in affordable housing. we truly believe in our mission to build and create more affordable housing. we appreciate the board's interest in our work. i would like to thank my staff, sally from the redevelopment

agency, and teresa who will be presenting on this item. i will be back to the recommendations and conclusions. -- i will be back for the recommendations and conclusions. thank you. >> good afternoon. i am from the mayor's office of housing. we will try to keep the presentation brief. we do have a lot of ground to cover. we will try to be as thorough but succinct as possible. we will be covering housing needs related to rhna and beyond. , how our office addresses those housing needs, highlight the accomplishments of our office and the redevelopment agency, housing funding used for affordable housing, having a pipeline to me before housing needs, and the recommendations and conclusions.

>> thank you for having us here today. rhna focuses on the future housing needs. it is important to also focus on the existing needs. i will be talking about other measures of housing needs in san francisco. we will consider the context in which we devote our affordable housing resources. it is not only to meet the needs of people coming into the city for new employment or for new household formation, but also to meet the needs of the existing population. a couple of ways we generally think about housing need in terms of the consolidated plan, housing element, and other affordable housing documents, one is households paying so much for housing that they cannot afford other things.

that is called cost burden. the other is also the living in overcrowded conditions and households living in substandard housing. we do not have great data on the overcrowded conditions or substandard housing. it is more common for us to look at overpayment on housing needs. that is what i will look at next. hud considers any household pay more than 50% of their income to be severely cost burden. he might have heard people mention pay more than 30% of income. because so many households pay more than 30%, we took a more conservative approach, looking at more manageable numbers in terms of policies solutions that may be able to address the need. we are finding about 53,000 households in san francisco are severely cost burden. they're paying more than half of their income.

if the 3650 -- 53,650. of those, 70% are very low income. 38,000 are very low income households, pay more than half of their income for rent. this is not a perfect reflection of need. it is and underestimates the true need. it is missing households who are reducing costs by living in overcrowded or substandard housing. when we look at a moderate income group, it is difficult to see what is going on. the hon data is focused on hud programs --the hud data is focused on the hud programs. it is difficult to see how the households with breakdown in more fine detail. the upper income households may

be choosing to devote a larger share of income to that to live alone or have a nicer apartment. those in the upper income groups can afford to spend more than 50% of their income and still have enough over -- left over for necessities. another way to think about housing needs -- supervisor chiu: supervisor wiener has a question. supervisor wiener: so, in terms of how you name the classifications, moderate is 81 to 95. above moderate is 95 plus? >> moderate should say 80 to 120.

hud does not provide that. it is an unfortunate and limitation of the data. supervisor chiu: do you track necessities? transportation? >> food, transportation costs. we do not track that. that is what hud would put in the category. another way to think about housing needs at different income levels is to examine the average cost per knicks. for different types of households. on average, we're seeing very low income households under 50% ami spent almost 60% of their income on housing. those earning between 50 and 80% of median income, second on the left, they are spending about 35% of their income on housing on average.

these residents are often low wage earners. they could be an office clerk or construction worker earning about $40,000 a year. moderate and above moderate households are paying less than 30% of income for housing. that does not mean there are no households in this category that are not cost burden. it does mean the average cost burden is under what hud considers reasonable. supervisor chiu: supervisor cohen has a question. supervisor cohen: when is the cost burden, union struggling to afford to pay? >> it is spending 30% of your household -- of your income on housing. that is what they consider you can pay and still have enough left over for the necessities.

cost burden, i am saying they're paying less than 30% of income on housing. hud would say you probably have enough left over for necessities. supervisor cohen: does have taken to a consideration the high cost of living in the bay area -- does hud take into consideration the high cost of living in the bay area? these are the same mechanisms to evaluate oakland as marin? >> is not a set number. it is a percentage of income. you would see it go down in places with lower wages like oakland. it is not going to. reflect cost of living. it will adjust its slightly -- it is not going to exactly reflect cost of living. it will adjust its slightly for different wage rates. it is kind of surprising we see these groups are able to's avoid

able high rental prices -- are able to afford san francisco's high rental rates. east bay ridge region wages are about 20% less than san francisco -- east bay and wages are about to what 2% less than san francisco. we have one more slide. hud's data is not detailed. this compares. market rent -- fair market rent. this slide brought up questions about what fair market means. it is 40% for a typical unit.

it is not artificially reduced by including households [unintelligible] rent-controlled. in san francisco, it is higher than average rent paid. that would include a lot of households benefiting from rent- controlled. it is lower than the average rent asked for a vacant apartment. it is the 40th percentile. that is why we're choosing it. it is the middle point we think is reasonable in terms of expecting a person could easily find an apartment at the 40th percentile points. yes? supervisor chiu: that is average citywide read? -- rent?

if it were higher than that, there would be an affordability gap? does mo break that down? it can be useful to look at the city as a whole. people are part of a particular community or neighborhood. they are not necessarily comfortable moving to different neighborhoods if they have been in one long time. >> i do not think hud looks at fair market at that level detail. we could look at census data on the neighborhood level. the top line of the chart represents a couple earning 80% of median income looking for a one-bedroom apartment. they are only willing to spend

30% of their income on rent. they're looking for something affordable to hud. they are going to find it almost half of the one-bedroom apartments bit their budget. larger households may have to stretch. the 4-person household will find a $500 price difference. the good news is households earning 100% is that their housing budget at 30% of income could still afford a typical standard apartment in the city. our city is in some sense serving moderate incomes through our rental market. i will move on to teresa. >> we will go briefly over the

program the mayor's office administers to address housing development for low-income renters and prospective home buyers as well as the inclusion dairy program -- inclusionary program. a lot of housing production we have done has been affordable rental development as well as preservation through new construction as well as acquisition and relocation of existing housing stock or to react adaptation -- or we adaptation of existing buildings. the housing we will typically help to finance is one of the 2% permanently affordable -- is 100% permanently affordable.

we look for long-term investment beyond 55 years. we have to be responsive to a number of housing programs and initiatives to meet housing needs, whether it is the consolidated plan to use as our guiding document, the 10-year plan to abolish chronic homelessness. we're now in our night year -- ninth year. there is a transitional aging youth housing plan. there is the continuum of care plan and the redevelopment area plan. this is just a partial list. those are the majority of things we look to as our guiding principles.

under our home ownership programs, we do things like the inclusion in program. we also have programs that help with downpayment assistance for people looking to buy homes. we administer mortgage credit certificates that provide credit to people looking to lower their tax burden if they will be buying a home. we have a program for teachers and police officers. we have small loan funding from the state we hope to use low- income homeowners rehabilitate their homes like low income seniors. the inclusion reprogram -- the inclusionary program is one of the strongest in the state. we're very proud of it. there are four options for meeting the requirements. first is the paying of the fee based on 20% of the total number

of units in the project. the other option is to build a 50% of the units on site in the market rate development. you can see the different ami's required weather in the ownership or rental. building of the low rate market units within a 1 mile radius of the primary project or off site unit, an allowance of dedicating land so that we can use it for affordable housing development. that is limited to certain neighborhoods and zoned areas. home prices have to be set at affordable levels for qualifying households. in 2011, a three-person household earning $80,000 would pay about two under $55,000 -- about $255,000 for a unit.

this is a project under development. this is 1200 ocean avenue by city college. all housing units are on site. to show an example, a 1-bedroom is $158. it shows the income ranges were the households would be served. there is also rental information. this project will have a whole foods market on the ground floor and be right across the street from an affordable housing development we are

funding. in terms of accomplishments, this shows the housing production from 2002 to 2011. we built over 10,000 units up to 120% of ami. a majority of units were targeted to less than 50% because of funding sources we used. since the inception of the mayor's office of housing, we have helped finance over 18,000 units. nearly 10% of all stock within san francisco and over 3500 units were built in the last five years alone. to show the diversity of where we build, we may concentrate development in particular

neighborhoods. we have a range of unit sizes up to five bedrooms. we have large developments. we do develop in all neighborhoods. we have small projects in the sun set, treasure island. there is income diversity within certain developments we help support. to illustrate the number of bedrooms we helped to found, over 70% of the units to bedrooms or larger our family unit. there may be concerned only fund single units. there may have been a point that the fund only did studio units, but all funding -- at least 7% has been four family units two

bedrooms or larger. this illustrates the incomes that will qualify for redevelopment. the majority are at 60% or below. a small percentage do target 80%. to address the concern about targeting only supportive housing, we have a 3000-unit gold on the plan to abolish homelessness. 2900 of those units have been identified and are in the process or have been completed. with one other development, we will meet our goal. one of the great accomplishments we are proud of is hope sf. there are four major developments. one is under construction. we have secured $30 million of non-local dollars for the second

sight -- site. accomplishments for the home ownership program, it illustrates the number of households served. we have help homeowners purchase homes. we have helped over 3000 families purchase homes in san francisco. the inclusionary housing program, over 300 units for rental. we have collected $40 million in affordable housing fees. we have other units in the pipeline. the home ownership programs in the redevelopment areas have produced over 1000 units. a very important thing we wanted to talk about is funding. one of the highlights is the funding sources we have used. it is no small tax -- task.

taxes have helped a lot. one thing we also wanted to highlight is that the mayor's office of housing does administer the federal funds. we take that into account in the local funding sources projections. that accounts for about 21% of the local financing sources. to illustrate the federal resources and projections, there is a downward curve projected starting in 2012. the whole program has been our largest funding source to fund new construction and rehabilitation. we experienced a 48% cut this year. that is one of the major

downward trends. we also take into account the tax increment. in 2012, it drops off with the dissolution of the redevelopment agency. since 2007, it has been a continuing downward trend in terms of local resources for housing from 2009 through 2012. to highlight deleveraging, local sources -- to highlight deleveraging, local sources, that includes federal sources. minister, tax increment, affordable housing bond, general fund the board of supervisors has administered, hotel tax.

we have leveraged almost $1 billion with the local resources. that is not a small task given the amount of funding we have contributed. in terms of the pipeline in the future, we predict about 730 units to be completed by the end of this year. these are broken down into family units, a senior units, and supportive housing units. those are the target populations we serve. with in 2013, another almost 500 units will be completed. by 2014, over 5000. in 2015, some projects have yet to be entitled. we're only projecting 500. that number will likely increase. after 2015, when we take into account housing parcells the mayor's office has taken over,

we will be developing almost 9000 within the foreseeable future of affordable housing units. related to rhna, you can see the units completed and the pipeline. it says about 9800. we have about 1900 units that have committed funding. another 3400 have un committed funds. we do have funding sources identified. i will turn it back to olson for the conclusion. >> in conclusion, we agree with a budget analyst's report on

reporting, tracking, the exclusionary program, as well as funding. i would like to leave the supervisors with one last conclusion. we have had a very robust affordable housing program. i think the slides have shown the importance of the redevelopment tax increment towards that robust program. clearly we need to look at ways of replacing that. this is in part why the mayor talked about a housing trust fund as a way of trying to offset not only the loss of federal money and cuts but the uncertainty as it surrounds the redevelopment funding overall. the oversight board is going to be submitting the payment schedo the department of finance this