In a city where solutions to address the housing crisis are fiercely debated, a broad coalition is backing Proposition C, which would more than double the money San Francisco dedicates to building and preserving affordable housing each year.
Affordable housing advocates, yes-in-my-backyard enthusiasts (such as San Francisco YIMBY) building trade unions, community organizers, Mayor Daniel Lurie and the entire board of supervisors are uniting to boost an existing program that creates affordable units and helps keep tenants in their homes.
The measure comes in the wake of years of stagnant construction, alongside a piping-hot rental market and soaring evictions. Its potential lies in its ability to create funding for housing outside of the boom-and-bust cycles that have plagued residential development in recent years.
“The cost of living is soul-crushing at this point, and everyone feels it,” said Quintin Mecke, executive director of the Council of Community Housing Organizations. The “big tent,” he said, is reflective of a single, constant thread running through everything: What is being done about affordability?
In 2012, voters approved the creation of the Housing Trust Fund. In its first year, the city set aside $20 million. It increased the annual allocation until recently, when it hit about $52 million, where it currently stands. The city will continue to make these set-asides through 2043.
The broad coalition of Proposition C supporters says the city needs to spend much more on affordable housing. If the measure passes, beginning in 2029, contributions will grow each year until they reach $125 million and could thereafter grow up to 3% per year. They will carry on through 2058.
“The status quo is not working, and we must continue to take bold action,” Lurie said at a launch party for the proposition in August. “Prop C is a transformative investment that will keep that work going and jump-start affordable housing in San Francisco. It renews funding we already collect and gives San Francisco something we desperately need: stable, dependable local dollars that allow us to plan ahead and keep affordable housing projects moving.”
The measure requires a simple majority to pass, and its sole registered opponent is the San Francisco Republican Party, which noted that the Housing Trust Fund has failed to adequately address the affordability crisis and spreads more money across too many programs to be effective.
But proponents touted the Housing Trust Fund’s historic success as a reason for the city to add support to a proven model. The fund has supported more than 3,675 affordable homes since inception, including new construction, emergency repairs, rehabilitation, land acquisition, eviction-and-foreclosure prevention and more, wrote Anne Stanley, communications manager at the Mayor’s Office of Housing and Community Development.
“Prop C does not create a new program. It doesn’t ask voters to take a leap of faith on something untested,” Rebecca Foster, chief executive officer of the San Francisco Housing Accelerator Fund, said at the August launch party. “It renews a program with a strong track record.”
The measure comes when San Francisco most needs it, supporters said, as housing construction has stalled and the city enters another phase of displacement due to the economic boom spurred by artificial intelligence companies and their stratospheric valuations.
“We have to acknowledge that in a city like San Francisco, the economic recovery doesn’t come without cost, and that cost is often borne by the lowest-income members of the city,” said Malcolm Yeung, chief executive officer of Chinatown Community Development Center. “If we’re going to have any chance of maintaining the economic diversity and the working-class diversity of San Francisco, you’ve got to have more affordable housing.”
However, supporters said local government could run out of money in 2029 before finishing building affordable housing projects it has committed to funding if it doesn’t approve new money or renew existing sources.
Concurrently, state officials have charged San Francisco with the tall order of creating nearly 47,000 units of affordable housing by 2031. City officials estimate that could cost $25 billion more than they have budgeted for housing in their latest 10-year plan.
“The city doesn’t have a local source sufficient to fund the thousands of already-approved affordable homes sitting in our pipeline,” Foster said. “Renewing the Housing Trust Fund now helps us close that gap before those projects are delayed or lost.”
Measure could combat displacement
On Aug. 27, dozens of community members, nonprofit workers, affordable housing advocates and elected officials gathered in the courtyard of Ping Yuen, a 400-unit project in Chinatown built six decades ago. People in the crowd, many of them Asian elders using an interpreter, listened to local leaders outline the importance of affordable sites like this one.
For many older adults, families and working-class people, San Francisco has become unaffordable.
“Across District 11 and across our city, I hear the same questions again and again: Can my family, can my children, afford to stay in San Francisco? Here in Chinatown, that question is deeply familiar. For generations, this community has fought displacement to keep seniors in their homes, families together, small businesses open and our culture rooted in San Francisco,” said Supervisor Chyanne Chen, who represents the Excelsior and Outer Mission.
“They are asking for a fair chance to stay in the city that we all help build,” she said. “This is why Proposition C matters. Housing policy can sound very complicated, but for families, for everyone who’s here today, it is very real.”
Proponents of the measure say that it will benefit all San Franciscans, even if they don’t live in affordable housing.
“The Housing Trust Fund has been one of San Francisco’s primary sources for building and preserving affordable housing, helping first-time buyers close on a home that they thought was out of reach, keeping seniors and at-risk tenants from losing the homes they already have,” Foster said.
District 7 Supervisor Myrna Melgar, who led the charge at the board to get the measure on the ballot, said the measure would bring a broad positive effect for San Francisco.
“Even if you don’t live in subsidized affordable housing, you’ll benefit from it because, you know, who does live here? It’s our teachers, it’s our janitors, people who make up the city whose services you rely on to live in this place,” she said.
Escaping boom-bust cycles
If Proposition C passes, the predictability and significant expansion of funding would put the Mayor’s Office of Housing and Community Development in a position to plan the city’s affordable housing development pipeline for 30 years to come, Yeung said. “I don’t think you can kind of underestimate what that means in terms of getting away from a boom-and-bust cycle.”
Municipalities frequently rely on capital bonds to raise money for affordable housing. But those need a two-thirds approval from voters, which is hard to get and plan around long-term, Yeung said.
Proposition C, which only requires a simple majority to pass, could put the city in a different position and help affordable housing developers navigate San Francisco’s economic peaks and troughs.
Before the COVID-19 pandemic, when the economy was stronger, market-rate developers were building more and paying the city a steady stream of inclusionary housing fees. Nonprofits used that money to buy land with the intention of building affordable housing, but they had to compete with the private sector to acquire property.
Then the pandemic hit. Land became cheaper, but construction slowed and “everything dried up,” Melgar said. When market-rate developers stopped building, revenue from inclusionary fees and taxes went as well, leading many affordable housing projects to stop pre-development. “Proposition C fixes that,” Melgar said.
‘Floor, not a ceiling’
For supporters, Proposition C is just the start. Today, there are 10,100 affordable housing units anticipated or in the process of being developed in partnership with the Mayor’s Office of Housing and Community Development. Many are ready to be built but don’t have the funds to move forward.
“The first Housing Trust Fund really was, in many ways, a watershed moment in the history of affordable housing politics in the city because we got something done,” Yeung said. “But I think the lesson from that was that it wasn’t nearly enough.”
Proposition C “is a floor, not a ceiling,” Melgar said, “which means that we have to keep doing the work locally, regionally and at the state.”
Proponents also emphasized that every local dollar can be used to unlock at least $3 in matching state and federal funds, and noted that the city can issue bonds against the fund. Lurie and Melgar announced they would be issuing a $70 million bond for affordable housing preservation next year.
This measure isn’t the only one focused on increasing money for affordable housing. Advocates say they hope voters approve multiple ballot propositions that could help address the city’s housing shortage.
“We will always need more, and the overall need, by the city’s own estimate, is $25 billion. So, we need to start inching our way one way or the other towards ‘B’ ” Mecke, from the Council of Community Housing Organizations, said. “This is one step in that direction.”
