in the housing trust fund to provide some background. in 2006 the committee was formed. no small builders were informed and made up of nonprofits and large developers. supervisors it's important to state that the state did not include any member or representative from the small building committee at this time. as a result the following recommendations were recommended forward by the advisory committee. to include on site requirements towp 15% and off sight or in lieu up to 20% and include five units or more and provision for off site to be constructed in 1 mile aideus of that project. while this was stub stated by studies by

kaiser madison and the smaller was 100 plus unit project, and it's inconceivable by the committee and planning department can make recommendations for inclusionary housing requirement on five to nine housing projects and in fact they were never studied and the nearest size project was 100 units. the economy of scale and between that are incomparable and supervisors just to hold up the two pieces of paper. this is five to nine and this is 100 project. and the housing and yet we don't study the five to nine. we study a 100 unit project. the scale is not close. we should have studied the five to nine units. we didn't. we studied the 100 units, the smallest project and

to continue my speech supervisors. with this flawed analysis and lead to one success in the city since the policy's conception in 2006 and i repeat this failed policy has one successful project. thank you supervisors. >> supervisors, mayor lee and the members of the supervisor recognized to replace lost gqnresources for this and continuous and reliable revenue stream and stimulus for depressed local housing industry. the mayor had a big working group of the stakeholders. the group of industry specialists were called upon based on experience and industry sector expertise and

builders represented by members of the council of community housing and of the residential builders association. they represented the local medium and small builders. in short it was a representative group of stakeholders. despite conflicting priorities they came together with a common cause and all impacted with prolongd and severe economic depression in san francisco's construction industry and by burdensome policies drafted during enormous economic times and not responsive to the crisis in 2008. while this group hasn't all achieved consensus they realized working together was the only way to move the policies forward and in turn provide much needed housing in the city. i would like to

point out some of the socioeconomic projects of the five to nine projects part of the housing program. these builders are best characterized as small traditional mop and pop businesses. they. >> >> hire locally and supply companies and hire trances men. they shop here and go to school here. a large part are immigrants. the city has a life community yet the small to medium builder is rarely treated this way. part of the american dream iseclimb the later and achieve. in the construction industry they work with someone else and after they learn a trade or skill they move on. the five to nine projects are a crucial rung in this ladder and

by impacting this category you take a rung out and prohibiting advancement in the construction field. our fellow members would speak to this in more detail and we appreciate your support and we support this legislation and the amendment. thank you. >> good afternoon supervisors. my name is n on el carter and one of the owners of a business in san francisco. we are a solar design company. we hire from local training programs such as city build, goodwill and neighborhood design. the five to nine unit buildings are pretty much perfect and multi-family buildings. any large buildings are constricted by roof space and the five to nine are critical for our

business. we have -- we can all fit 100% of the gas consumption of the buildings and off set up to 90% of [inaudible] conassumptions in these buildings and thank you for your support. >> good afternoon supervisors. my name is shawn gorm an. i am an architect. i have been practicing in san francisco for almost 25 years. a lot of the work that i have done over the years has focused on the residential especially small projects and when i say small generally under ten units and it's pretty impressive in terms of the decline in these types of projects since 2006 as was represented in earlier testimony. over that period i really have seen nothing like it, and there's definitely a

correlation regarding the bmr requirement, and these projects are critical in terms of the urban in fill of the existing zoning in san francisco. you have neighborhood commercial zones which support the neighborhood commercial businesses are also supported by additional residential housing in those neighborhoods, and this type of housing is tailor made for those areas and it's not úçñ getting built. all we're seeing now is the huge projects going in south of market and thereabouts but you're seeing very little additional housing stock along the neighborhood transit corridors which i think is just a waste and we really need to change policy and i think this proposed legislation is a huge step in that direction. thank you for your

support. >> good afternoon supervisors. i am jim lavick and a small flooring contractor. we do 90% of the business for small and medium size builders. when this legislation was passed back in 2006 probably 35 to 40% of our business was under ten unit buildings and along with what is going on in the economy since then -- i mean you can imagine what it's like to do business in the city but elsewhere and 90% of our business is done in the city. supervisor kim said that legislation like this passes and it helps the small business in the city. we used to employ 48 people, 49 people back in 2004. we're now 12 so whatever you people can do to try to boost

our business it would be graciously appreciated. thank you very much for your support. >> good afternoon chairman mar, supervisors, and steven mc clory. i am here today to congratulate everyone on getting behind the new rules for the five to nine unit projects. i spoke with a few people today that work on our jobs and asked them when is the last time they were on one of those projects? and literally no one could remember being on a five to nine unit project and the numbers here today show that the reason is they just haven't been built. it's sad. it's a bit of a travesty that only 1bmr unit was produced and we missed out on that housing that would have been built and i worked in

construction -- i have been around construction my whole life since i was listen year's old. basically the -- >> >> 11 year's old. basically this is a stepping stone for us. you can look at it you don't go straight to kindergarten maybe to university. maybe we would like to but that's not the way it works, so if you only have done a single family home, remodel projects, did you prux and you ask for financing for a nine unit project that is more units they laugh at you as you're walking out the door with your head down, so this is the only way by changing the rules. that's the only way we can produce five to nine unit projects in the city again. as i say i congratulate every one getting behind these projects. we know they're not built. now

that we're back here we will see them being built again. it's a good thing for the builders and the homeowners and a general good thing for the city. thank you. >> good afternoon supervisors. elizabeth moore with shamrock streels company. we all know that these projects have declined since the passage of this legislation and obviously that results in reduced economic activity for the city, but specifically as a passionate advocate for efficient land use the department has a mandate to increase obviously in fill housing and under utilized sites and most are zoned for these projects and it resulted in a lot of unused land sitting there begging to provide housing for much needed for the city, and the other thing i wanted to say that speaks directly to

supervisor cohen's point. my company completed a six unit project in ocean view -- it took a long time but we were luck tow be grarkted into the previous legislation but nonetheless we barely broke even on the project and if we were subject to this as the requirement the project wouldn't have happen and the neighborhood would have been six housing down and just a specific example of the positive benefits that this legislation can have and thank you all for your support. >> good afternoon supervisors. jeff rock. i'm a small builder in san francisco and run a contracting and repair firm and i can say with my whole heart i

am glad to be in front of the legislative committees for the first time i am seeing something done to help the small builder and i congratulate you for that. just a real quick story that i think will help zero this in. i have been in business since the early 90's in san francisco. 100% of my work force is in san francisco and district six, ten, and 11. these are all people through building some of the five to nine projects and i build these in 2005 and for other people and people that own the properties. some are generational legacy properties that we put our people to work on, and subcontractors. in supervisor cohen we did a job and worked with community developers and picked up sub contractors way back when wayne

jones was there and we are using the same ones. now, they're not the guys building on the big buildings. they don't have the opportunity. if we don't create this economic life line we will lose these guys and i don't want to generalize and there are w< guys that build the high risers and go across the bridge and that's great. i want everyone to have it but let's keep it here too. ill employ more franciscans and we get a project like this and keeps us going for a while and more importantly for my guys and development of the worse force in this city it teaches somebody from the beginning of a project until the end of a project this is how you build. i was brought up through the trades as a carpenter. i had no idea how to get to the foundation to the roof and when

these guys -sg6nhand i have som ten years and they figure it out and want to go out on there own and more vibrant community with that and leadership roles are developed and mentors are being created. that really is the impact of this legislation and i truly believe that's why you guys are behind it. thank you. >> hi. my name is jim foley. ñ i work for don kitchen and bath and sell supplies and decorative plumbing and these are some of my clients here so when they build they don't just benefit but the supply house benefits, the manufacturer benefits, xqt sales people benefit, the truck drivers benefit and they really do spread it around and i have

been in business for 15 years. we are a smallish company so our target market we're in this five to nine market range. it was a good day when i sold a project with seven, zñeight, nine units on it and now they have gone away and most of my product goes to remodels or single homes and made it tough and i want to thank you for this contribution and when these men build they're spreading the wealth around to san francisco. thank you. >> good afternoon. i am david sternberg and we have been doing work in san francisco really since 1980 and we do a lot of these size projects and i will state for the record in the last -- since this thing passed in

2006 we had two six unit projects and no other projects in this category. both are not built. one of which has permit issued five years ago. just as an example one of which was five single family houses on five separate lots. each a little over 2,000 square feet and if you do the numbers on something like that -- first of all when you do these little projects it's almost as much work to do 50 units in san francisco it is to do three, six, or nine units so there is expense and time and effort so the margins are extremely thin on small projects like this, so just on this one for example that had five homes on five single lots. they wanted one home u( sell this three bedroom plus home for $350,000. the reality is they spent over $200,000 per lot to buy them. in all

respects they're not built but would cost $300 a square foot to build and at least $600,000 these are conservative numbers so in for $800,000 the reality is and soft costs and all of that and minimum of $900,000 sell for a million dollars and maybe a profit for $100,000 per house, so if they're losing on that house that they're building for eight or $900,000 forced to sell for $350,000 they're losing $600,000 which is more than the profit they would make on the whole project soy i think that is important to look at that and how that might work, and really in conclusion what i want to say is it's about time this rolled back around and i want to thank all of you for your support and

all the members of the committees who put this together. it's not an easy task i'm sure. i wasn't involved and i want to thank everybody involved and congratulate everybody for seeing it through. thanks. >> good evening commissioners. i am leo cassidy with the residential builders association. in 2006 division of -- basically for the affordable track already kicked the industry. you know. the analysis -- we thank you for this. it's strictly bringing people back to work and the banking will loan on these and i want to applaud all of you and thank you very much. >> good afternoon supervisors. i am mr. birmingham and with the san francisco beard of real

estates. i wanted to come here today to talk on behalf of the suppliers such as don from don's kitchen and supplies. since the nine to five units are included in the housing program at the same time the banking industry has had a rueinous effect on the suppliers. their credit has been crunchd and you can institutions to the city such as all wood doors in bay view and had jobs for decades, western plywood is gone. a lot of the construction suppliers have been very hard hit and the people that use them are the small builders. if we don't keep them building in san francisco they would look elsewhere like many of the suppliers have moved to

santa rosa and other areas and will have a bad effect where they're located and i urge you to get rid of this job killing provision in the inclusionary housing and bring us up to ten units and above and work in san francisco and keep working franciscans in the city. thank you very much. >> shawn kingon, residential speakers association. many of the speakers spoke about moving up the blue collar economic ladder. this isn't about housing goals and policies. to ulc it's very simple. this is a social or a cultural issue. other professions, doctors, lawyers, statutories, techies,

they can see the tangible proof. they can demonstrate that their industry is valued and rewarded in san francisco, but if you don't have a college degree, or if you're an immigrant, or english is not your native language why do you have to do to provide proof that you can too make tup the economic ladder? the testimony that we heard today, the sole fact in six years this policy has only yielded one bmr unit doesn't suggest that we are missing a step in the economic ladder. it tells us that we have a barrier. we have a barrier stopping people from moving up that ladder. if you're únin the trades and you have a desire to work hard, and if you're lucky enough to catch a break it's very important that you can walk or

drive around town and see a real live example. see tangible proof that you too can build a building like that, and we believe that if you see a real example we can provide the tangible proof that it might inspire and might create a sense of hope and it might create a sense of optimism for the next generation of builders to follow. we support the legislation and its amendment. thank c3nyou. >> supervisors, good afternoon. john conner. i am a speaker from the -- [inaudible] being repetitious and can i get a show of hands of people in support of it is legislation. i was a member of the working trust fund for many months and part of the goals of the housing trust fund

was a stimulus as well for smaller builders so they can get some of the projects can't get credit for many years get them off the ground. just to revirtback 1992 the first policy was adopted. in 2002 and ten units or more. 2006 dropped to less than five and then 1/20 of the five unit building. that was the analysis done at the time so i don't think there was any justification back in 2006 for reducing the inclusionary to five units. as a result one project has moved forward since 2006. there was two really good years of economic housing boom here from 2006 to when leavein

brothers collapsed and no projects submitted at that time so the downturn didn't effect. it was the legislation of the five to nine units. personally i build three buildings in this range of five to nine units between 2005 and 2009 and since then i didn't look for anything because i couldn't get finance to build the projects again and as far as that goes all of the contractors live locally in san francisco bar a couple. we go to local restaurants and coffee shops and delis and all of that. for the smaller project you have 15 people on the job site for one year. probably over 6200 work hours in one project and that is gone right now. that whole segment has been eliminated with this legislation so i do support the amendments.

i would like to thank all of the supervisors and especially supervisor chiu at the last minute scramble to get it together and we support the legislation and thanks to everybody here. >> thank you president chiu for leading this public comment. is there anyone else on the public that would like to speak? seeing none public comment is closed. so let me hand it over to president chiu. >> before we turn it over before the end the hearing i want like you to talk about what your perspective is on this legislation? >> thank you. anne marie rogers from planning staff. we reviewed this ordinance on august 16. at that time they recommended approval of the ordinance as drafted. they recommended approval for many of the reasons you heard about today because of the collaborative nature in which the ordinance came forward, because of the great need for

funding for afforable housing and additional funding if the companion ordinance, the vote was approved by the voters. because of the small numbers and representing 3% of the housing production in the last ten years and because the amount of money that could be gained is dwarfed by the amount that could be gained in the charter amendment is passed. while the amendments proposed today was not reviewed by the commission the department is sure we could implement those and provide the commission and the public with information on the update and i am sure the commission always appreciates more information on housing. >> thank you very much. and just as far as a couple of concluding comments. first of all i want to thank the members of the public that came out for

this and again thank all the stakeholders in what we're doing for the afforable housing trust fund. we know that the visible parts of the afforable housing trust fund provisions are going helpful to the developers and particularly for lower income housing in the city and larger rate developers but this particular piece of legislation as we heard today is really important to ensure we are reversing policies in the past that really kept back the small builders in san francisco and i want to thank you that are here representing that community and a community that represents a lot of the newer franciscans and the immigrant communities here. i do have a number of amendments and i want to thank supervisor kim for the work that her office and she and my office did on this and supervisor kim i don't know if you want to take a moment to explain what we're

talking about, but to be particular there were concerned whether or not the afforable housing trust fund charter amendment that states any cost obligation for inclusionary housing can't be raised as legislation. that was in place before that date. because we don't know -- we're hoping and the impact of this legislation is going to be very positive but we wanted to monitor that and the ovtive date as january 15 and we have protection there and we have a three year evaluation so we can insure in three years we take a look back and we had the right impact we wanted. there is a separate piece of trailing legislation that requires a regular five year look back but i know there are folks that thought it was important to h