San Francisco leaders have unveiled a new affordable housing proposal they plan to place before voters this November, seeking to expand the city’s Housing Trust Fund to over $3 billion over the next three decades while simultaneously easing some development requirements that officials say have stalled new housing construction. The question is will it work, with a city budget already under stress, and built upon an existing program that has yielded little?
At a press conference on the steps of City Hall Tuesday, District 7 Supervisor Myrna Melgar joined Mayor Daniel Lurie and a broad coalition of labor leaders, affordable housing advocates, and nonprofit developers to announce the proposal, which would augment existing annual Housing Trust Fund allocations from about $52 million to $125 million, with future growth tied to property tax increases.
“This is a transformative moment,” Melgar said. “We will build it, we will preserve it, we will protect our communities.”
The proposed charter amendment, cosponsored by District 10 Supervisor Shamann Walton, District 3 Supervisor Danny Sauter, District 2 Supervisor Stephen Sherrill, District 6 Supervisor Matt Dorsey, and District 4 Supervisor Alan Wong, comes as city officials warn that local affordable housing funding could largely dry up after 2028 amid cuts to federal and state housing programs and a prolonged slowdown in construction activity.
Lurie dubbed the measure “the most significant affordable housing investment in San Francisco’s history,” arguing that the city needs stable local funding as housing production has slowed dramatically.
“Housing is simply not getting built at the pace we need,” Lurie said. “Families don’t know if they can stay in San Francisco. Young people are questioning whether they can build a future here.”
San Francisco’s Housing Trust Fund, a dedicated, 30-year set-aside within the city’s General Fund to create, acquire, and rehabilitate affordable housing, was created by a voter-approved measure in 2012. Heavily boosted by then-Mayor Ed Lee, and passed with 65 percent of the vote, it has since been a letdown.
A 2015 analysis by the San Francisco Planning and Urban Research Association (SPUR) argues that parts of the “grand bargain” the Housing Trust Fund represents are failing. Projects were still subject to ad hoc negotiations and appeals, and the report also argues that the rate of inclusionary housing — units provided by developers as deed-restricted affordable housing as part of market-rate construction — in some projects could have been higher.
In 2017 the inclusionary requirement was then raised significantly, again with mediocre results and criticisms from other corners that the rate was raised too high. A recent report from the Housing Technical Advisory Committee concluded that many housing projects in San Francisco are no longer financially feasible under current rules. Requirements were lowered in legislation passed in 2023; now, the committee recommends lowering the rate by two-thirds, to 5 percent.
Rebecca Foster, CEO of the Housing Accelerator Fund and a member of the advisory committee, said the current economics of development “simply do not pencil.”
But to make the changes politically feasible, something has to be given to the politically powerful nonprofit housing community. Hence, a renewal of the Housing Trust Fund “grand bargain.”
“We are not going to solve this crisis unless San Francisco starts and keeps reliably building housing,” Foster said. “Affordable housing and market-rate housing alike.”
But to make the changes politically feasible, something has to be given to the politically powerful nonprofit housing community. Hence, a renewal of the Housing Trust Fund “grand bargain.”
“Not only does it protect critical funding, with promoting new funding for the affordable trust fund, but also make sure that we can actually start seeing buildings get built, utilizing an inclusionary rate that encourages building,” Witt Turner, a spokesperson for the Housing Action Coalition, told The Voice in an interview. “Not only at market rate levels, but encourages building actual inclusionary housing.”
Advocates for affordable housing preservation emphasized that the proposal would also help fund the acquisition and stabilization of existing housing. Lurie said the city plans to back a $70 million preservation bond next year, funded by trust fund revenues, allowing nonprofit groups to purchase rental properties and maintain them as permanently affordable housing.
Speakers throughout the event highlighted the impact of housing costs on working-class residents, seniors, and public employees.
Mario Flaherty, secretary of the San Francisco Fire Fighters Local 798, said a city down payment assistance program tied to the trust fund helped him buy a home in San Francisco.
“This city functions better when the people who serve it can actually afford to live here,” Flaherty said.
Nonprofit housing leaders framed the proposal as essential to preventing displacement. Wendy Yang, president of the Ping Yuen Residents Improvement Association in Chinatown, said affordable housing allowed her to remain in San Francisco as a low-income senior.
“If it wasn’t for affordable housing, I would not have been able to continue living in San Francisco,” Yang said through a translator.
Others stressed that the proposal emerged from an unusually broad coalition that included labor unions, nonprofit developers, tenant advocates, and market-rate housing interests — groups that have frequently clashed over housing policy at City Hall. Malcolm Yeung, chief executive officer of the Chinatown Community Development Center, called the coalition “cats and dogs living together at last.”
But not all representatives speaking on the nonprofit side were so gracious.
Introduced by San Francisco Community Land Trust director Kyle Smealie as a Land Trust tenant, Theresa Dolalas told the crowd “At times, this administration’s approach has felt deeply lopsided and inequitable. While the mayor says that San Francisco is doing well in all of his medias, many residents are watching one side of the city struggle and sacrifice, while another side continues to rapidly benefit from investment and development opportunities.”
As it turns out, Dolalas is a member of the South of Market Community Action Network, an organization that has consistently agitated against encouraging market rate housing development. The San Francisco Community Land Trust uses city and other funds to acquire distressed rent-controlled rental housing and convert it to deed-restricted cooperative housing.
How resilient — or brittle — the coalition is now will be seen between now and November.
