housing. there was always the question of land that was available former public land that was traded in the process to ensure there was on going, there was a higher level of affordable housing. but the one thing that redevelopment also did was also stream line development, to facilitate development so that there were certainty in development and that certainty paid for affordable housing. in many of the cases, it was the market rate, it was the development. the non-affordable housing development that would go first generate the tax increment for which we would later bond and build affordable housing. in light of the fact that redevelopment was going away, we didn't know the extent to which development was going away and out of that sort of concern

about what are we going to do for affordable housing, the idea of the housing trust fund came out. the mayor asked for the big tent, got the big tent and got a lot of support from all walks of life in the city to put on the ballot the housing trust fund. the size of the housing trust fund was sized in part to not have an impact on the general fund. it was reflecting the debt service that was being paid, that was being freed up as redevelopment bonds both housing and non-housing bonds were expiring. so they were trying to minimize the impact on the general fund over all. it was an incredible success. 1.5 billion $1.5 billion over 30 years vment . the only issue between the mayor and

all of our needs and wants and desires, it's not enough. but it's something that no other community in california was able to duplicate, has not duplicated to this day and it was a tremendous shot in the arm to continue the work in those redevelopment project areas outside of those redevelopment project areas because we had to pick up, we, the mayor's office of housing orphan redevelopment projects outside of those project areas. this public trust fund made that happen but it was still not enough. we'll talk a little bit more about house the housing trust fund combines with the other financing that is necessary to try to move the city forward and build affordable housing. so, creating the housing trust fund was not enough for the mayor because the mayor once lived in public housing and as the mayor, he's not going to be satisfied with the condition of public housing.

he shares your passion for the public housing. so between, the prior administration that started to help sf but given the trouble status of the housing authority, the mayor had no choice but to end it, not mend it. that's why we are involved in helping the housing authority reposition the housing authority and amend the horrible conditions of that affordable housing. you will see the mayor's seven point plan is not about losing affordable housing and not an allowing affordable housing to deteriorate over time. our work in terms of the residential demonstration project is a pilot of this national program. it's really a way for the federal governments to try to figure out how do we make public

housing better than it was under the federal support because the folks from the dc do not share the passion that the leadership of the board in terms of serving affordable housing so the seven point housing plan will produce 30,000 units over the next 6 years. it does it for a variety of affordability levels to those identified in the earlier slide and for those slightly above that because given the super heated market today, they are still struggling. the goal of 30,000 units provides affordable units for 70 percent of san

franciscans today. so the keypoints of the mayor's plan. eviction prevention. as many talked about the experiences either personally with eviction or evictions from acquaintance and the mayor's seven point plan addresses that with additional funding to assist in eviction prevention. preserving an existing affordable units. somebody else mentioned that we should plan for 7 generations. having been around for 24 years in the field of housing, it feels like 7 generations. but it's about maintaining our affordable housing stock. to your point supervisor breed

and i have worked on many of the developments in your district and the need to refinances, refresh them, maintain their affordability. that is something we need to do to maintain that stock of affordable housing because we don't want to lose them to deterioration, we don't want to lose them to financial instability. we need to maintain them over all. we have the down payment system program to help bridge the gap between what people can afford and what is happening in the market. obviously we talked a little bit about this already. this seven point plan includes revitalizing housing and it's important to the mayor and those residents with public housing units. we want to build more affordable housing and this is something that obviously all of you share as well as all the people that

spoke before us. we want to build more affordable housing. we also understand the supply of housing. it's a competition. the competition is based upon how many dollars you have in your pocket and those with the most dollars win. so, if we limit the supply of the housing, then and then the people with the most dollars will win whether it's existing housing or new housing. the other thing we talked about is how do we do this faster. that's part of the working group and sarah talked a little bit about that and it's not just about focusing solely on the building of new affordable housing but how do we get to finish faster. that's one of the concerns that people have raised, not only the affordable housing developers have had to go through a

constant environment or reviews our appeals. that is the concern, the question of how quickly can we bring of product from conception to financing to completion affects sort of the economics of that transaction because of the uncertainty as it relates to it. people are concerned about hitting the market in a timely manner for our affordable developers. it's about minimizing cost because time is cost. time is cost for the market rate developers but it's also about hitting the market when they can feel they can make the financing work. so what was the affordability challenge? as we talked earlier, over 70 percent of our households in san francisco whether they are currently housed or not feel housing insecurity. so our goal and our mission in the

mayor's office of housing community development has tried to create more affordable housing and try to minimize that housing and security for everybody. so what are our housing production needs? obviously, our commission of public housing we serve everybody from no income to 50 percent of median income and it's one of the great benefits of public housing in that you do not need to have income to still be housed. traditional affordable housing, these are the folks that we serve in our traditional affordable housing and these are the people that sort of the job diversity of san francisco that do aurlt other things that the programmers don't. right? and then the other part is the workforce housing and this is the housing that goes up to 150 percent of median income. these are folks that they

still have housing insecurity. they probably can rent, perhaps at the margin, they definitely can't buy at the margin. you know, there was some discussion about people over 120 percent of median income being the one 1 percent and that's really not true. there are working folks like you and me. in fact people who earn a lot less and they have housing insecurity also. so what do we want to do? we want to broaden who we serve because i think that based upon this housing crisis, we need to broaden who we serve. there are a lot of people who we need to help. we need to grow the pie. this is a theme that people repeated. yes, we

need to grow the pie because we need the funding to increase affordable housing production. and we also need to be committed to continuing housing production for all income levels. so, how do we finances affordable housing today? so, right now, again, this is in part because you know, many of the folks in the public echoed a theme that we are not doing anything for affordable housing. i think that, as supervisors you passed the two 2-year budget just recently. this is from our two 2-year budget. this is what we are going to spend over the next two 2 years for affordable housing. that's not a small budget. i thank you very much for your contributions for making that happen and we will spend it wisely and create as much affordable housing as possible.

>> can i have some clarity? >> go ahead, supervisor breed. >> >>supervisor london breed: thank you. mr. lee, is this for this particular 14-15 -fiscal year, you are saying it's 39 percent what? i'm trying to understand the 39 percent number? >> i'm glad you asked the question. 39 percent of the funds i have for affordable housing comes from the market rate development. these are fees paid for whether they are job link fees for office buildings or inclusionary fees whether they are residential whether they are neighborhood fees including the market octavia fees. they all come into a pot at the mayor's office of housing and we use those funds to build fousing. even with -- affordable

housing. even with the passage of the trust fund, the market fees are still 40 percent of my budget on a going forward basis. clearly the housing trust fund will grow over time. but this is a very very large sum of money to build affordable housing with. >>supervisor london breed: so do you know how many units this total equals? >> it various desh varies from unit to unit but off the cuff, it would be, approximately 320 units. >> and in comparison to, you may not of course have the number of market rates we anticipate to come online for this particular fiscal year in order to do a comparison of what that means in terms of

percentage. >> well based upon the mayor's 30,000 unit plan, the number of deeply affordable units were approximately 10,000 of that and 5,000 units were in the middle income. this would be a part of that 1/3 of units that would be affordable for folks at probably close to 60 percent of median and below. >> okay. >>supervisor jane kim: thank you. i know that one of the concerns that came up was that adding another conditional use authorization process could delay or halt development in market rate units which those impact fees we depend on for

affordable housing production. i guess the question i have is do you support conditional use authorization for heights and other variances that we currently have in our planning code that slowdown development and potentially halt production? >> on behalf of the mayor's office. i think the mayor's office wishes the approval process overall would be a smoother process. you know, one of the things that this housing working group has been looking at is this whole question of you know how do we expedite, because every project is a battle. and it really shouldn't be that way. because we need, as you said, it's not antidevelopment. we

need the development both of market rate housing to generate the fees. i think what we've done in this process and we are all for citizens participation and involvement, but we have slowed down the process tremendously. one of the criticisms of san francisco when we are trying to get the legislation through the state legislature was, well they made a mess of it themselves. they have slowed everything down and they don't build housing and why should the state legislature build on that. the city of seattle, comparable to the city of san francisco, geographically constrained, difficult to develop. they build more housing than we do day in and day out. our 30,000 goal, people think it's a bunch of

rhetoric. we are not doing enough, right? it's still not enough. in terms of the requirements where the cu and dr's whatever the thing, we are slowing the creation of the things that we need to solve the problem. so, i think that's what we would really like to be assured of that projects can move forward. that's the whole point of having neighborhood plans, right. that we are going to do neighborhood plans, we are going to fight the battle ones. this is one of the good things about redevelopment. you don't fight the individual battle every single time. you fight the battle about displacement and about public benefit and affordable housing and when it comes to individual building approvals, it's, it's not without drama but it is a lot smoother

process and i recall at one point at the redevelopment agency, i noticed that the mission bay land was more expensive than the land outside of mission bay. i asked the developer why you are paying more for mission bay land? it's a way to get my entitlements and i have certainty and nobody is going to ask for more and we've all agreed to it and we can move forward. i think the whole notion in terms of the cu and certainty process, not everybody wants to negotiate every deal, right. i think the greater certainty for all developers is a good thing. >> so i think that's a great conversation piece. i have also heard exactly what you talked about is about the certainty that what developers are looking for, not necessarily the fees. mission bay is a great example. we

built very close to 30 percent of affordable housing, 35 percent at transbay and yet no slowdown of housing production in those redevelopment area plans. >> so the question is how do we do certainty. how do we create a level of certainty in this process? >> and guarantee affordable housing. it's a question. that is the question. so i think that is something that the city should be looking at. i would argue that actually you know if we are going to say that any cu and any variance slows down the planning process then probably one of the biggest barriers varies on height and density. why not remove those barriers, and why not build the housing and get more affordable housing if we are getting a value of all these variance, why not get

all of them? >> i would refer that to planning. the whole notion of there are building forums that are important, right? i think there is urban design issues and other issues that are important. we have a different way of doing that in the redevelopment context. we have a design for development document that is there. we have the heightened bulk that is set out there as part of a larger study. the issue there again is not to say that those limits are unimportant an we should just do away with it. it's the question of handout you do we balance all of those things in terms of the additional capacity, the additional public benefit, the height and shadows and all of those things that we are all

concerned about and the number of parking spots and do it in a way that provide certainty for those folks so they can move quickly. that is the key. >> you just said that design is important and that's why we create variances to ensure height and all of that in our planning, but why can't affordability be as important as a value in our planning code. why does that not preserve a layer in our extra process? >> i would say the city has deemed affordability as important. we have inclusionary fees as related to affordable housing. the question is really how do we finances affordable housing, right? all of this comes down to how do we pay for affordable housing. with all do respect, we can pass many many resolutions that say we want affordable housing. we don't pay for it, we don't get it. so the issue is, if it's

about paying for it, then we should figure out how to pay for it as opposed to creating an additional hurdle for development. but i'm all for reducing some of the other hurdles for development also. we can go the whole question of form based zoning and a lot of things we can do to facilitate. the values that we all share is that we do want to build out of that this boom we are creating more housing. i don't think that is the dispute that we have. i think the question is what's the means in which we try to create that affordable housing. are we using the cu method and some other method to ensure that is built. >> i think you are right. we have a variance on the height in bulk because we look at the balance. that is the measure

as well because we have the balance. sorry, this isn't a question. we are looking at the planning code as a tool to institute a variance to ensure affordability and i would argue that those variances are a greater barrier to build affordable housing and greater barrier to build affordable housing as the one i have introduced in april. the last thing i will say i hope it did not come across and i did not hear a comment of anybody being critical of the mayor against affordable housing. now i certainly think the mayor has made it clear that affordable housing is his absolute prior and his highest value and our legislation in no way criticizes the mayor or even implies that affordable housing is not the priority

of this administration. i think actually the way we drafted the legislation, the balance doesn't really get triggered for another 4-5 years. we believe this mayor will continue to support affordable housing production. what we want to ensure is the future at administration and future board of supervisors will share that commit commitment as well because we have the availability. breed burry >>supervisor london breed: i was not suggesting that your housing balance would halt, that i would think it would support the affordable housing that i care about and that's what i'm mostly concerned about as it relates to the housing balance measure based on my understanding of it and the way affordable housing works in san francisco. so i

just wanted to ask director lee if you could be specific or clear about what you think the barrier to addressing affordable housing would be if this housing balance initiative passed at the ballot? >> well, again the development of committee can probably comment on this. it's really about the uncertainty and where they get heard both at the commission or if it's an appealed at the board. but the planning commission even if it approves or denies the cu based upon affordability it has no ability to make the affordable housing happen. it's really the board and the mayor through the budgetary process to have that ability or some other mechanism. >> but we would be required by this initiative to do so.

even in the flank -- planning department says yes or no, bylaw we would be held accountable. >> bylaw, that's something they told me to never talk about the law. it's about the, you know, again -- >> so i guess, let me be clear. bylaw, if we are held accountable to do this, would that create potentially a delay in the ability to collect impact fees and all the other things around -- that's kind of what i'm getting at if i'm trying to understand at how that works. >> it really is about and i have this great chart. i will move on to the in next chart because you will see the point i'm trying to get to. >> i would like to address that question. >> i know there is a chart

somewhere. talk about the need for the fees. this is a graphic representation. the city's inclusion and housing fees over time. you see in the boom we got money and in the bust we didn't and we actually gave money back. so clearly for my office, for our anlt -- ability to fund affordable housing i need the private sector to be working hand in hand with me so i can pay people for affordable housing. this is the other chart i wanted to show you. this is

the bmr rates. clearly during the boom as they were building market rate housing some of them were built off sight. the affordable housing production in the mayor's out is not only finances but based upon what we regulate from the laws of the city and the market rate people have provided fouz affordable housing through their development, again not 30 percent but providing some level of affordable housing, 15-12 depending on the time which they have developed and some used 20 percent because they have used taxes and bonds but clearly they are a partner in creating affordable housing in the city. lastly, in addition to the benefits that go directly to the mayor's office of housing, these developments pay real

property taxes that go to the general fund. we had a meeting with the budget director and the controller talking about is there a way that we can capture some of this boom for the general fund and what they said was, we already appropriated into general fund. we have to figure out on going ways of meeting the cost of running government, to try to reduce the amount of deficits. this money is spoken for, but it's anticipated and so the need to continue to develop affordable housing, excuse me, market rate housing is also a need to continue the fund and add to our general fund. we can do all the wonderful things that we want to do that is a part of our two 2-year budget. okay. at this point i'm going to turn it over to sarah dennis. >> good evening supervisors.

thanks for sticking around. i know you are aware that the housing crisis is real. as you know the mayor set out a goal with 30,000 rehabilitation units. olson brought out the goal from what are the units that fall within that, i do want to note that in those 10,000 affordable housing units we have open thousands of affordable units this year. the development of almost 1700 units will rent below middle income levels in september the newest residents will move into the shipyard with 5,000