i have really appreciated sitting next to you as a human. you are warm and wonderful and wish you the best of luck in what you do next. i'm looking forward to your success. >> commissioner koppel? >> thank you, mr. president. i as well will be sad not having you next to me. as sad as i am, i am that more excited for you and your opportunities to come and this is a small city and i'm sure we won't -- not run into you. we'll probably be seeing more of you than we think. [laughter] so best of luck to you in the new year and congratulations again. >> commissioners, if there is nothing further, sad to you see you. -- see you go. director's announcements. >> thank you. commissioner, i guess just on behalf of the department, thank you for all your great work. we will miss your energy and

your enthusiasm and just one item to point out is all your work on child care and moving that legislation through and i made a difference on our able to get support for that and move that legislation through. we really appreciate that. i will certainly miss your enthusiasm and hard work on this commission. so, thank you. >> commissioner moore recently told me i wasn't allowed to fraternize with staff. you waited three and a half years to tell me that? [laughter] >> this is the year and maybe uz ba it's year end, but it is also the year milestone, the last several weeks have been challenging here in city hall with the mayor's passing and it causes us all to reflect and think about change and how we are reacting to change. i'm about 10 days short of my 10th anniversary as planning director and that paiks me think. and the one thing i will just say is to first of all thank you all for 10 years of support.

that is not -- that is pretty extraordinary. and there are not many of my colleagues that have been in their position for 10 years. i appreciate your support and it has been a great honour to be here and i look forward to many more to come. and there will be a lot of uncertainty over the next few months. we all know that. it will be a challenging few months for all of us in city government, given the uncertainties and deadlines. but i think, you know, i think i am encourage by what i'm hearing out of room 200 in terms of staying the course with our work. i ask for your support in the coming months as well and really thank you all for the last 10 years. >> thank you, director. who was the last planning commissioner -- planning director that served 10-years? >> dean macris. he was here for one length of time for 12 years but his most

recent went he came back in acting capacity was about three years in addition to that. >> well, thank you for everything. we appreciate your work. >> commissions, item eight, review past evens of the board of supervisors and the historic preservation commission hearing. there is no board of appeals report. >> good afternoon, commissioners. here to share a few items with you from yesterday's historic preservation committee hearing. before the hearing, the cultural heritage assets met to briefly talk about cultural heritage districts, what they mean for the city, fi sort of goals that they would like to establish. and give direction to the planning department based on some community feedback. a large number of attendees were present that voiced their

support for various lgbtq districts. also president boyce gave support. the this hearing was in preparation for the full commission's review and comment of supervisor ronan's proposed legislation regarding cultural heritage districts which will also be on your calendar in february. the full commission, two items to share with you. the full commission recommended approval of the diamond heights safety wallow indicated at clipper and diamond heights. they initiated this designation last month. if i could get the overhead, please. the d.p.w. and the arts commission are both examining the sculpture for aesthetic deficiencies to determine the next best steps would be for rehabilitation and the community.

this is a community supported local designation. the item will now go before the full board in the beginning of the year and our understanding is supervisor sheehy is in support of the designation. the second designation that the commission considered was for the peace pagoda plaza in japan town. this item has been continued a number of times due to concerns over the japan town community's rehabilitation of the plaza at a future date. the japan town task force was present and didn't ask the commission to postpone their vote on including the plaza in the designation, although everybody agreed that the plaza should be ultimately included in a final landmark designation. after some q&a between the commission and the japan town task force, the historic preservation commission ultimately decided to keep the plaza as part of the landmark designation and to move it to

the full board for consideration. and, again, that will be heard in the new year and supervisor breed's staff was in attendance and is committed to having some sort of discussion between the historic preservation commission, japan town task force and the rest of the community on next steps forward. so, that concludes my comments unless you have any questions. >> thank you, mr. frye. >> seeing no other reports, we can move on to general public comment at this time. members of the public may address members of the commission. except agenda items. with respect to agenda item, your opportunity to address the commission will be afforded went the item is reached in the meeting. each member of the public may address the commission for up to three minutes. i did have a couple of speaker cards. >> yeah. jerry dratler and georgia sciudice.

>> i have some materials to hand out. >> place them there, please. >> oh, i'm sorry. good afternoon. my name is jerry dratler. i served on the civil grand jury and city commission. i was a member of the 2012 civil grand jury that wrote the report that was very critical of d.v.i. a friend suggested that i watch the segment of the december 14 planning commission meeting that focused on the bogus architectural plans prepared by mr. santos for 214 state street. my neighbours and i have the same bogus plan experience in 2016. when mr. santos submitted plans that failed to show the existence of a three-storey bay

at 25 17th avenue. my first response was to ask the same questions commissioner rich arts asked -- who is rodrigo santos and why is this allowed to happen? mr. santos is a structural engineer and former president of the san francisco building inspection commission. the organization charged with oversight over d.b.i. i sent a sunshine request to the d.b.i. and planning departments, both d.b.i. and planning said do not assess fines or penalties for filing false plans. this makes no sense. the response to my inquiry about prior violations was very interesting. d.b.i. said the building inspection litigation committee referred three of mr. santos' projects to the city attorney. one of the projects is 214 state street. the planning department says they have seven of mr. santo's protons under review.

i suggest that your planning commission have your attorney update you on the cases and ask your director of planning to discuss the status seven santos projects. you have copies of my sunshine request. i handed out a list of the 11 root causes of unpermitted construction and demolition if san francisco. that i presented at the november 2017 building inspection commission meeting. false or bogus plans is on the list as well as the planning department's notice of enforcement programme that does not assess penalties and fines. this also makes no sense. many of the commissioners in the november 2017 meeting suggested a joint meeting with the planning commission to tackle the root causes of unpermitted work. i suggest you talk with the excellent planning department employees who staff the kiosk on the first floor of d.b.i. to

better understand the type and frequency of violations they see every day to understands the profound impact these violations have on our city. thank you. >> thank you very much. next speaker. >> hello. jumping off of what he said about next year, it is going to be a lot of uncertainty, unfortunately. that's why i came today to put the requests that you do a couple of things. the first thing you can do is adjust the numerical demolition criteria in section 317.

you could start that today if you wanted to. or in the new year. i think you should amend the demolition criteria and replace the word "and" with the word "or." i think it could possibly resolve the issues surrounding tant mounts to demolition. i also think that you should amend the demolition criteria and section 317 to make a little more sense. some criteria should be in a. if a building is sound and habitable, then if it needs that criteria, why should that allow it to be torn down? i never fully understood that. it seems like if a building wasn't sound and wasn't compatible and had violations, maybe it should be torn down. if it didn't, why should that be criteria that allows it to be torn down if it is in good shape. and finally, i ask that you

request the zoning administrator to adjust the value for the administrative approval for demolitions in rh-1 districts. it was last adjusted in 2015 and it's currently at $1.63 million or you could just eliminate it as was proposed in the r.e. t. i know you have a lot of stuff. santa has a big sack on his sleigh of things for you to do next year. but i do hope you will do that and i wish you all a really merry christmas and all the best for the few year and particularly you, commissioner johnson. you have a wonderful year in your new endeavours and all of you take care and happiness and health and let's hope 2018 is better than 2017. this is for the minutes. thank you. take care. >> next speaker.

>> good afternoon. i wanted to take a couple of minutes just to say that i think the director bulletin that came out a week and a half ago on the whole streamlining tangle was very excellently done. i don't know if it was kate or john or combination, might have taken the whole army to figure that out. it was very well done and clarifies a lot. i think it cuts through the rhetoric we've been hearing around streamlining, streamlining, streamlining and now we know how it works. i wanted to step back to say this has been an interesting path for the last three years. we have a number of layers of changes in local and state law that have created the outcome fou where our affordable housing projects are 100% buy right all the way through, including d.r. that was the big catch. no d.r. on affordable housing. so, there is literally a clear pathway from start to finish. it started back in 2014, if folks remember the executive directive by mayor lee to figure out a way to speed up

the process for affordable housing. went through a number of things with john's staff about coordination and ombudsman and other streamlining within the bureaucracy, so to speak. then in early 2016, the board unanimously adopted the legislation that made federal projects ministerial or principally permitted which took away the planning commission mandatory review. then the state did a couple of things. if you remember in 2016, they passed a state density bonus law which made state density by right. which mean they get the extra height without tripping any planning commission hearings, per se. and the last piece of the stack is the sb-35 bill which goes into effect in seven days which says that affordable housing in san francisco for whatever is not already streamlined and will now be entirely streamlined, including the pre-- precluding the d.r. appeal and some people may argue that that is a bad thing.

you know, where we are these days and some of the projects that our houses have had to go through. fine. let's get them through without the appeals process. and as you know, now the planning department has to figure out how to do this entire process in 180 days. so, good luck with that. and that is a very fast timeline to get through the entitlements and then we can figure out the financing and build. there's been a lot on the topic and it's overdominated the talk of housing solutions. at the end of the day, it is money, resources, sights and the kind of policy that creates the priority for affordable housing as much as it is the entitlement process. this piece is settled and i know folks are still talking about more. it's like selling you the same pair of shoes twice. i think we're there on streamlining and buy right and i hope we can move as the next item will be into your agenda on how to get more affordable

housing overall. thank you very much. good luck. >> thank you. any additional public comments? seeing none, public comments is closed. commissioner richards? >> director, if you could forward to us via the secretary directors bulletin on the streamlining, i'd like to take a look at it if we haven't received it yet. >> ok. i thought you had. >> maybe we did. a couple of other things regarding the first speaker. it is incredible to me that people cannot reflect reality when they submit applications and drawings and things and that there is no penalty. and that -- i think that needs to change. absolutely. i think what happens in other organisations ends up in our lap and it affects public policy. here we are trying to save a unit here and save a unit there in the d.r. process and keep people in their homes. yet there is a lot of other

things that we don't know and they would be talking with the d.b.i. commission when we have that joint hearing next year and also if the director can maybe work with the city director to give us a memo on the rodrigo santos projects that would be great because we may be seeing them in the future. >> commissioners, ifs there is nothing further we can move on to item nine, case number 1996w.p. the 2016 housing inventory informational presentation. >> commissioner, i wanded to introduce you to a new staffer. she is a newly minted alumna of ucla luskin school of affairs. he graduated in summer and came to us as an intern this summer and our outstanding commission

and after -- after all, as teresa writes, her life before grad school started with stints at apple, square and google where she crunch lots of numbers and created compelling visualization of stats and figures that don't make our eyes glaze over. she may not yet know the san francisco planning code, but knows how to code. she is originally from portland and is a product from portland state where she earned a b.s. in geography. in addition, she has a lead green certification and is an ardent fan of "star wars" and has run a number of half and full marathons so we welcome her to the commission. and i think teresa will do a introduction first. >> good afternoon, commissioners. i'm principle planner and manager of the information and analysis group. our group seldom comes before the commission, if ever. our group prepares a number of

regular publication of which housing inventory is won. last week, you heard from one of our team on the commerce and inventory. today hearing is on the housing inventory which, at 50 years old, is the longest running continuous publication of the planning department. the housing inventory came about as unintended results with an ambitious and cutting edge, but ultimately inconclusive project. in 1966, the city received federal funding to compare computer simulation of the city's housing demand. this would be the city's first serious effort to integrate emerging computing capacities into urban planninging. back then computers were huge and often in institutes of learning. who would take hours to set up and even more hours to run the programmes.

despite the money important to this complex project, the model did not produce meaningful or useful results. however, there was one positive spin-off. the planning department decided to use the data compiled for the project to produce the first housing inventory in 1967. this is the first -- this is a copy of the first housing inventory published in september 1967. report detailing changes in the city's housing stock since 1960. and we have not stopped this annual tracking and reporting of housing trends in our housing stock. technically our report is to [inaudible] in the series because there were three years in the 2000s when we were not able to produce the annual reports. but we did track all the statistics and the annual

figures were compiled into one multiyear report. over time, some of the methodology changeded and new metrics were added. plus, technology we now use have advanced tremendously. the city-wide information analysis group is now poised to take on modernization of our long range planning information system and analytic capablabilities. for pursuing this effort over the past few years, we're exploring, learning and harnessing the power and potential of new software tools that enable easy data access, simulation, collaboration, visualization. ultimately we will apply all of these capabilities to our group's product and services. our focus now and in the coming year is the housing data. we're looking to increase path online information presence including dash boards and

interactive maps with customizable creation with compelling infographics and summaries. we're excited to explore and harness new informations technologies and geographic information system potential and we look forward to demonstrating our progress to you over time. but today we're proud to present to you the 47th in the series, the 2016 housing inventory. thank you. >> good afternoon, commissioners. i'm with the analysis group at the planning domestic. i will be presenting the 2016 housing inventory report. sorry. the inventory is the planning domestic's annual survey of housing production trends in san francisco.

it has been published regularly since 1967. this report is 47th in the series and presents housing production activity completed or authorized during the year 2016. the construction of new housing in 2016 totaled over 2715 units making this year a record year for housinging production. the year 2016 also saw a loss of 208 unit which is added together comes out with a condition of 5046 net units no housing stock. this total net edition is a 71% increase from the previous year and almost double the 10-year average addition, recommending an upward trend since 2011.

there were 30 units that were demolished, 72 units lost through legalization. 16 units lost due to unit mergers, 78 units lost to conversion and nonresidential units and 12 lost to correct official city records. affordable housing made up 16% of new units added to the housing stock in 2016. 802 total affordable units were completed including 449 inclusionary units and 65 second tear units. the number of affordable units completed increased 52% from the previous year. bringing affordable housing

units have 28 affordable households earning 20 to 30% a.m.i. 65 of those moderate income units are considered to be secondary units and not income restricted. next year we will have a inventory housing report to complete the secondary units. housing permits issued are an economic indicator of future housing production in the city. the department of building inspection permitted 4059 units for construction in 2016. this is 36% more than the total number of permitted the previous year. of the permits issued in 2016,88% of our buildings were for 20 or more units. san francisco accounted for 19% of total per mys issued in the bay area region.

in 2016, there were 4221 units entitled and filed with the planning domestic. the fub of ewe notes filed in 2016 nearly tripled from the number of units filed the previous year. some additional highlights include new condo construction, which decreased 4% from the previous year to 2019 units. conversions to condos decreased 37% from 2015. according to the department of building inspection, the for-profit and nonprofit buildings have decreased by four buildings and their respective rooms have decreased by 138. all of these are moderate

income units. the inventory report also describes the progress that the city has made toward reaching the housing needs allocation. the target as determined by the state department of housing and community development and the regional households that earn up to 120% of median income of less. as of the end of 2016, 10026 housing units counted toward meeting the city's vehicles. 30% of the total were affordable to households earning up to 120% of median income. production of market rate housing, making more than moderate incomes is at 55% of its unit target. these totals are slightly different from the housing inventory number and the state

allows numbers to account toward meeting up to a quarter of the goals. the full housing inventory report is available on the planning domestic's website at sfplanning.org. this concludes my presentation. >> good afternoon, everybody. welcome to the department. we'll open this item up for public comment. on the housing inventory. excuse me. >> you have a line-up of speakers. >> like selling you those shoes twice, right? >> i do have some handouts.

again, peter cohen. it is very fortuitous that last week you had the congress and industry report and last week you had the housing inventory because one is jobs and the other is housing and it raises the basic question of, gee, how is our job growth doing compared to our housing dpro*ets and how is our workforce taken care of? that is the take-home question. so we did a little work to figure that out. this has the topline conclusions of a bunch of number crunching that we've done over the last couple of days. this is not some highly refined piece of work but it is pretty darn good because we've been doing these analyses now the last few months. just here, this is intended to be a little bit folksy. so, what is the jobs housing

fit that we really need for that 128,000 workers that has been generated over the last 10 years. that is what your commerce and inventory report said, right? it's not just compared to the 5,000 units that were built this year and those built over the same period of time. that is one numerical comparison and i know the social media folks have had a field day with saying 28,000 compared to 128,000. see what a mismatch that is. it takes a little more thought. you have to put it into worker households. we really end up with about 77,000 households that have been generated over that period of time because of the workforce. that equates to 28,000 units when you look at a combination of single person households, multiperson households. this is all conventionally how things are done. then you can ask the question, how much of that workforce need has been generated over the

last 10 years, about 37%. about one-third of the total unit production need for the scale of workforce has been produced. either speed up supply like the streamliners say or we find more sights and money to build more supply. whatever it is. but the big question is for whom. not all workers have the same jobs. everyone talks about tech and office. but as several economists including maurico morhetty says it is five to one after every high-tech worker. this is a breakdown of how much housing by income level is affordability of those worker households we need. not just total units. as you can see, we've only done 12% of the need for affordable housing and 83% of the need for the high income.

interestingly enough, those folks also have the opportunity to access the full real estate market of resale, too. so it is a little different calculation. i can continue or come back. >> i'll give you two more minutes here. >> sure. so, when you say who do we need to have housing for, it is important we look at the workforce as people who make incomes, who make households and can only afford certain things. i'll put it up here for maybe some others. but just do the glass. it gives you an idea -- [coughing] talking about, you know, affordable housing. it ranges all the way from very low-income folks up to, you know, middle income family and everything in between. we've talk about this before in terms of policy. so, when we look at where we're not getting supply in our jobs housing fit, that dramatic

underproduction, it's all those folks for whom housing is not being built. and all we do is ask you to think through the por refined question, how much housing is being bill, is it if you have and for whom is it built and how do our policies really need to balance the access to housing that is coming on the market and what kind of policies, resources that we need to do to do that. i didn't even take two minutes, commissioner. thank you for the extra time. happy to answer more questions. it is a lot of weeds of detail. >> thank you. any additional public comment? georgia? >> hi. beginning of the month, i stumbled on to the land use and transportation committee hearing on this workforce and middle income housing. i don't know. did you all get that in i assume you did. i think it is mr. egan's report because he had it and i asked him for a copy and he was nice

enough to give it to me. to fall along with what mr. cohen said. i think, too, what i've been talking about with the demolitions, that this report found that there is too many tech workers now. there are middlele income jobs as mr. cohen just brought up. i don't know. maybe it would be good to have us compare all three reports and see what everything says together. and, you know, just to remind everybody the median income -- the median price for housing, single family home 2011 was $625,000. that's just 2011. and now it is almost 2018 and it is now -- the median income price for a single family home is $1.2 million. i don't know how. it seems like the three reports should go together more and this was really interesting so i home you get a copy of it.

it's workforce and middle income housing. >> can you forward that to us electronically? >> i don't know. this is a copy. economic, office and workforce development and it says planning department, too. so it's somewhere out there. thank you. >> thank you. any additional public comment on this item? seeing none, we'll close public comment. commissioners? commissioner richards? >> i guess question for mr. cohen. where did he go? i think about this a lot. if it costs to build a unit at $700,000 or $500,000 or whatever the number is these days, inherently they're unaffordable to a good many of those people on your continuum. they're going up in price so

much that you can't build them inexpensively. what would you do? >> commissioner, that is the question. and i guess what i'm saying is to shift to that from this idea that anything we build is working. the issue is that a lot of what we're building is working for some, but it is not working for the full range. so, we're to the point where the question you are asking is the smart one of, ok, what do we do? i would say, you know, things up to roughly about 80, maybe 100% of a.m.i. can and are currently with a variety of our city policies and subsidies basically being done through city investments. right? and there is different levels of subsidy and different kinds of incentives or requirements. there's different roles that the city plays directly or indirectly. so, frankly, from everything from 0 up to about 100% a.m.i., we're going to have to, as the public, figure out a way to subsidize or incent that kind of housing to be produced. that is why we have

inclusionary and home s.f., that's why we have all of our affordable programmes. because the natural market is never going to touch those price points. when you get up to the high end, you know, from maybe 150, depends on where you are in the city, there's market rate housing around 150% a.m.i. up to higher levels, that is where the market is sort of taking care of that end of the workforce spectrum. the challenge is going to be between maybe 100 to 120 and up. to that 10. that is part of the midle that a lot of us are talking about. there is kind of a big almost exostential question about housing affordability in this day and age. does that mean we now have to start subsidizing that level of housing? in a way that we never thought. i mean, we never thought that it would require direct subsidy for housinging at that level. but is that the only way to counterbalance just the given costs of the construction market? or is there some way that the real estate market could be

incented to bring prices down to that level? i honestly don't believe the second is going to work as we have this tremendous inequity ofwell and income. it 's always going to drive price high. but if there is some way to have naturally affordable middle income housing in san francisco, it would be interesting to see how that would actually work. it does work in more suburban jurisdictions. you are seeing that price point happen outside of san francisco. but because of our crazy real estate economics and construction prices, we haven't been able to figure that out and the natural market. so subsidy, nonsubsidy, that's where we need the honest conversation about housing our workforce. >> thank you. just a couple of points. i read the ucla report on what the counterproduction levels are going to need to be in order to reduce prices 10%. it said a 20% increase in the existing stock. which if you look at the

housing inventories, roughly 400,000, that would be producing 80,000 units to have a dent of 10% and we're producing 5,000 on a really good year, which was last year. i'm getting the impression we're not even treading water, we're slowly sinking. that we're not being able to keep up with demand and if you look at the median price just in the last seven year, it's basically doubled. if it doubles again in the next seven years, we're really screwed. i don't know what it will take. we have to figure out how to produce things a lot faster and a lot more of them the we need to increase supply, period. i'm talk magnitudes, not percents. we are talking four, five, six, eight times what we produce today. i don't think we have enough construction capacity to do that. so, we're up against a lot of limits. financing, construction, everything. and a 10% decrease on the

median of $1.2 million to $1 million is still vastly unaffordable to that continuum of people that will require a marshal plan. the other thing is looking at displacement and homelessness. this market is kicking people out into the street, directly, indirectly. whatever. we see it every week and we have d.r.s that come where people will be -- thrown out on to the street. and some other statistics, one that i can recall is 76% of homeless people in san francisco are san francisco residents or lived here. so the question then would be how did they end up being homeless? it is not all substance abuse and mental health issues. they were squeezed out somehow from where they were living and they're now homeless. that is why we have families that are homeless. and people that earn an ok income but can't afford a place to live.

the other data point we have from -- i forget what report it is. current zoning allows us to do 141,000 units without expanding any zoning. how do we actually incent those units to be built? and how can we bring them on the market? there is all these data points that are like -- i think we got a way forward if we have the political will. but we keep talking a lot and things that don't get much better. even though we have record years. >> commissioner moore. >> to mr. cohen, thank you for adding your conversation points to the mix. thank you to the department. it is quite difficult work. quite impressive as always. you prefaced your presentation with saying needed to absorb the city's growing workforce.

the question i like to ask is it is the rapid growth of the region which brings many people to the attractive city environment that we offer. but they do not work here. and that does not get accounted for because it creates a bulge by which we can hardly assess our own job housinging balance. how many people do really live and work here? so there is something that there is a huge bubble overhead, which we're accommodating and all of these numbers don't stand up to that scrutiny. >> if you'll see in our summary, commissioner, we have a couple of caveats. this is artificially a closed universe because it is not the way the real world works for the very reason you just said. it's also not the real world for every worker that lives in san francisco lives in san francisco. some people want to live out in antioch and want to commute.

because, frankly, the kind of public policy debate in the media and that you get in kind of the chattersphere, as we like to call it, likes to equate job production to housinging production. that's the frame that we're left with in terms of a narrative and that is why we use this closed universe. i entirely agree with you, commissioner. that exacerbates the challenge that we have not just folks living in san francisco who live down south or elsewhere, but it is the high end of the income spectrum. it adds more to that upper end bubble of income that drives housing price. where as everybody below that at whatever level is scrambling to compete. whether they work in san francisco or silicon valley. this is our big, big challenge. >> add a second part of the question. there's always a dark cloud. that arose last night after the

tax reform plan was approved in washington and how it will in particular affect the state of california with tax incomes being capped at there 10,000. -- at $10,000. but the ability to deduct income and mortgage and state taxes. how do you see that further exacerbating the problem? >> i think for folks who right now are owning their homes, they're probably going to have less appetite to be generous with resources for others. for those of us who they be thinking about revenue measures for next years and beyond, i think we're going to face a voter population is suddenly realisinging that money is taken out of tear pocket. that is one of implications. in terms of producinging affordable housing because it will affect the tax programme.

there is a number of analyses that have been done. but it is tens of thousands of units worth of affordable housing that will not be available to us in the next five to 10 years. what happened, the money we just won sacramento, the new permanent source of $250 million a year and the sb-3 bond that is going to be on the november 18 ballot, assuming we win it, the $3 billion bond. that will fill the hole that the federal government just took away for the next year's to come. we end up even once again. this has been the world of affordable housing. we seem to be running in place while simultaneously the private real estate market with all the thirst for living in san francisco is on fire and sort of further creating the disruption and displacement that commissioner richards talks about.

how do we get ahead of the curve when the feds and state keep pulling the rug out from underneath us is the challenge can. we keep going back to the well for san francisco voters. they are incredibly jealous. the solution is local investment. but it is hard when they have been slaped with this tax production hit. i want to take my chance to say commissioner johnson, i wish you well. i'm sorry i didn't say good-bye to you earlier. it has been nice to have you on the commission. >> thank you. the only thing that i may add is the real question that still stands if the room and it is not part of this discussion is what is the number of vacant units in the -- on the affordable market side. and what is the fub of units unused for deck ates almost sitting there underutilized.

those numbers are scary because they are in the numerical accounting of the reality of what is going on. i encourage all of us, all of us, to continue this discussion beyond with what we hear today. today is the annual report of this issue. it is far, far deeper and i hope that we can continue being really actively involved in asking ongoing questions. >> commissioner johnson. >> thank you. when i said at the beginning that the commission needs more time to focus on the big issues, this is what i meant so i'm really happy that we're having this discussion today. and there will be things that we'll have an opportunity to talk about -- or you guys, rather. i won't be here. to have an opportunity to talk about in 2018. peter cohen made a bunch of great points that i want to touch on as commissioner richard and commissioner moore. so, i'll just high light a few things. first in terms of report. obviously thank you to the staff again. always great to have the great graphics.

i've been to s.f. data, the site. but there is nothing like actually having it analyzed and in front of you to be able to see those trends. again, great twork to the staff. i'll point out a few things. there are a couple of chars to talk about. units aproved versus actually constructed and demolished and i want everyone to highlight that we definitely still have and we'll get to my thought on this, more units authorized that have not been built. we had years where thousands of units were authorized and maybe a few hundred actually built. and so in recent times we had a boom seeing cranes and the number of units authorized to units actually built are much more similar now, right? so maybe 4,000 approved but 4,000 also bill. we had a good three-year

stretch where 3,000 or 4,000 approve and maybe 8900, if that, built. i think that is really important. getting to commissioner richard's point and he pointed out a ucla study saying that there is going to be -- you know, you need to have this huge number of housing units to be built to make a dent if housing prices. we have the ability to start. i have been a proponent of getting those units on the market and the way to do that is to say your entitlements will go away if you do not build those units. i'm v. for revocation hearings. i think that timeline should be two years. get it together. put a shovel in the ground. three years what the professionals say you need, then fine. those hearings need to be scheduled. even when i'm not here, i'll continue to shake my fists to get those units on the market. i want to challenge if you don't build those units -- and this is what i'm talking about market rate housing at the moment, that we won't be able

to make a dent. we've seen the data from zillow and other providers or purveyors of information that rents are beginning to soften. is it softening enough to make it inexpensive or much more affordable? no. but it's softening in the sense that it is not going up and in some places it is going down. and you have developers of new condos having to redo their performance because of the supply coming on the market and saying what can we get, particularly in the rental market. i want to challenge the fact that unless you build tens and tens of thousands of units immediately, there is nothing that you can do. every step, every unit counts tom that point, i think that there is a couple of things i want to focus on and i'll get to the affordable housing and what i think about how to finance that particularly in light of tax reform that has recently passed. commissioner richards also pointed out that the report said that the current zoning has an unused capacity of

around 140,000 units. i think there is something we can do about that. the planning department and the commission can sponsor legislation to say that you are required to maximize the zoning on your lot if you are doing x% of work on your property. we should not have anymore single family homes in rh-2 and rh-3. i'm not talking about changing zoning or anything like that. we should be able to maximize the number of units we are getting in the current zoning that we have. we have a fight over heights and all of that. but we can build so much. if we added one floor to every building in san francisco, that is tens of thousands of new units. right? that is 20% of 400,000 right there. i really think we should think boldly about sponsoring legislation ourselves and working with the boater of supervisors to find somebody to bring it up to the board level. that is something we should be looking at.

the next thing i would say is maintaining affordability is about creating new housing stock and more importantly about protecting existing housing stock and making sure that people are actually living in it. for existing housing stock, i have been a proponent of it. sometimes i get shot down because it is a countercyclical programme to be the most effective. but i think the small sized acquisition programme, if we were to do version 2.0 of that with some tweaks, could actually be a very strong tool to both maintain existing housing stock and promote community ownership and wealth creation. that is how you keep people in their homes by keeping them in their homes, not by building a new one that they can have when they are displaced. the key to displacement is to keep people in their homes. that is how you do it. so, an accusation programme, you need money for that. so, how do you do it? there have been proposals most

recently for a public bank. that is a great opportunity to take advantage of the economic engine of san francisco and put it back to the housing stock for our city. rather than work on commissioner -- or mr. cohen mentioned, you know, it is tough to get some of corporate investors to the banks that have more of an international investment portfolio to want to invest in those sort of things. you know, a public bank of san francisco definitely could. i'm a huge proponent of that. then we get down to, all right, what else can we do? vacancy tax. it's hard to get data on how many vacant units are there. but we've all had the anecdotetal evidence of a building that's empty or half empty, whether it is market rate, not a rent controlled or maybe it is an s.r.o. or something. so, you know, that is something that we should be looking at and also add to the pot of funds to protect existing

housing stock which will -- and the people in there, right, which will decrease displacement which will decrease this fear that if you build new housing, that will push people out. that is a false equivalency that i've seen. those are things that i would say. i think i see a lot of the data in this report that backs us up. getting back to the actual charts that are in here, really look at that mismatch between number of units that are authorized and number of units that were actually producing. and, you know, start thinking about whether or not we need to recycle some of those entitlements and what they should be today. it might be time to rethink, you know, are those projects still relevant today. other than that, great work to the staff and hope the commission keeps talking about this stuff. >> thank you. commissioner? >> thank you. thank you to the staff for a

fantastic presentation. i really appreciate your work and the presentation. welcome. so i have a few observations and a couple of questions about the presentation. so as an observation, i would be really interestinging to see the spatial distribution of where these units have been built. and particularly the increase throughout the city because i suspect it is not evenly distributed toward the city and that, you know, is a point of discussion and ity that to commissioner johnson's point, there are vast parts of the city that are underbilled. but maximizing the zoning in those parcels not the same. in the mission, in the bayview as it is in st. francis woods. the impact they have on the surrounding neighbourhood and

the neighbourhood demographics very different. so i would be really interested if seeing what that really has looked like on the ground. what i fear when we talk about, ma might asing the zoninging and housing development is the impact on stock of rent control housing. and as we have not defined the tant demolition. but less affordable units that don't have the same people livinging in those neighbourhoods. by would be interested in seeing the spatial distribution. i would be interested if seeing that juxtaposed with the racial

demographic in neighbourhoods. where there's been the last couple of changes in the distribution -- demographic distribution in those neighbourhoods. and to mr. cohen's presentation -- thank you -- that was also added so much to the discussion. i really -- i wonder about issues of longevity and ten your in these numbers. we get and we're observing the real life. what happens is people get to their 30s and they partner with someone else and they have a couple of kids and if they're in a b.m.r. unit with a one-bedroom, it's really hard to, like, you know go on to the next step of your life because you can't have two kids. you can't have more income.

i'm wondering how our current production is kind of skewing the demographic changes in terms of families and all of that. that is another thing that was not in the presentation but i know you have it because i know [inaudible]. what the distribution is by five. how many of them are family units. that is interesting and we had tracked it in previous years and i know that it colored the conversation that we had when we had a supervisor yee who came to present about his family housing initiative so that would be really interesting to see as well. yeah. so, the question that i had for you was about the change -- the only decrease that i saw in the presentation was a new condo

construction, condo conversions. so i was wondering what your theories were on that. and what the trends were. that you were seeing. is it an issue of return for the investment? the condo conversion numbers are kind of startling to me. so -- >> yeah. >> thank you, commissioner. just going back to your first comment on the spatial distribution. we do have two tables in the report, table 24 and table 25, that list housing stock by planning districts and we also have housing units completed and demolished by zoning district as well. we don't look at size of bedrooms spatialically. we really don't have that information this this report. beyond in the appendix and table a1, we lists the top major market rate housing projects and in those two lists, we do list bedroom size,

but not any other section that i know of. but we do, for your question on condo [inaudible], we don't analyze the data to actually core late, you know, or try to figure out what the reasoning is behind it. but we are thinking it could be related to the number of rentals versus [inaudible] for sale. if it is a rental, it is not listed as a condo so that could be why maybe the number is decreation over time. -- decreasing over time. >> ok. thank you. >> commissioner richards? >> so, i guess when we see excellence all the time, we kind of expect it. and i guess to your team, i should be saying thank you. you always give us excellence and i take it for granted so i wanted to acknowledge i. it's excellent. i need to tell the director that we need to bury you deep inside the department so they do