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OCII authorizes steps to issue tax allocation bonds to fund affordable housing projects
Summary
The San Francisco OCII commission approved actions to move forward with issuing new-money tax allocation bonds (subject to oversight board and Department of Finance approval) to finance affordable housing obligations, with proceeds currently estimated at about $123.7 million to support 386 units across Hunters Point Shipyard and Mission Bay South.
The San Francisco Office of Community Investment and Infrastructure (OCII) voted July 20 to authorize steps toward issuing new-money tax allocation bonds to finance affordable housing obligations, subject to oversight board and Department of Finance approval under California Health and Safety Code section 34177.7.
The commission approved staff to finalize two core documents — a first supplemental indenture and a bond purchase agreement — that would enable a 2021 affordable housing bond issuance. John Daigle, who presented the item for OCII finance staff, said the agency’s enforceable obligations total 4,256 units, with 140 units in construction and 913 in predevelopment. He said the immediate plan anticipates using bond proceeds to finance 386 units across three projects: a 73‑unit development at Hunters Point Shipyard and two Mission Bay South projects of about 148 and 165 units.
"Proceeds anticipated here would be $123,655,000," Daigle said, describing how the money would be allocated to a project fund, a debt service reserve and cost-of-issuance expenses. He added that final numbers (including interest rates and principal amounts) will be set on the day of sale and could change because of project scope changes or market conditions.
Daigle also described the procurement and timeline: OCII selected Citigroup Global Markets as lead senior manager, with Baxter, McCarley and Berry as co‑senior managers after receiving 16 proposals. Pending the commission’s approval, staff will take the items to the oversight board on July 26 and then to the California Department of Finance; DOF has up to 60–65 days to act. If DOF takes the full time, staff expects to return to the commission in early October to approve the preliminary official statement and related documents before pricing and closing.
Commissioners sought clarifications about whether the authorization commits OCII to fund specific projects immediately. Daigle said the authorization does not bind OCII to any particular project; the bond proceeds are intended for predevelopment and other eligible affordable housing obligations and staff may reprogram funding if projects change. Deputy Director Brie Mahoger explained that outstanding obligations are concentrated in Shipyard 2 because large amounts of infrastructure and remediation remain to be completed there.
Commissioner Scott moved to approve the action; the motion was seconded and passed on a roll-call vote of four ayes, with Chair Bustos recorded absent. The item was adopted as Resolution No. 26‑2021.
Next steps include oversight-board consideration on July 26 and submission to the Department of Finance. Pricing and closing are expected in October, subject to DOF timing and market conditions.
