Planning Commission forwards split recommendations on inclusionary housing after marathon hearing

The San Francisco Planning Commission on April 27 forwarded a detailed set of recommendations to the Board of Supervisors after a daylong hearing on proposed revisions to the city’s inclusionary affordable housing rules.

Planning Department staff told the commission the Board’s controller had modeled a feasible range for on‑site inclusionary requirements and found 14–18 percent broadly feasible for typical rental prototypes. Staff recommended maximum on‑site rates at the high end of the controller’s range for larger rental projects and a three‑tier income approach to close a gap in the city’s coverage of households between low and moderate incomes. Jacob Bentliff of the Planning Department summarized the controller’s approach and emphasized the study solved for residual land value to estimate when requirements would make projects infeasible.

The mayor’s Office of Housing and Community Development, represented by Deputy Director Kate Hartley, backed a tiered approach that would preserve deep affordability while expanding the program’s reach to moderate and middle incomes. Hartley explained the office would set unit prices and eligibility bands so households could be admitted where need existed and so units remain roughly below market in each neighborhood.

Supervisors Jane Kim and Aaron Peskin presented a competing ordinance that would lock higher on‑site percentages (the ordinance authors argued that if developers used state density bonuses it was feasible to capture more units on‑site). Kim urged the commission to honor the voter intent behind last year’s Proposition C and to press for bedroom mix and higher set‑asides for family‑sized units.

Public testimony filled hours of the hearing: tenant groups, senior advocates, veterans’ groups and neighborhood coalitions urged the commission to preserve or expand low‑income set‑asides and protect families from displacement. Developer and industry groups urged caution and pointed to the controller’s feasibility work, warning that overly high rates could reduce overall housing production.

After hours of deliberation the commission handled the ordinance in sections. It adopted staff recommendations on a schedule of phased increases, a gross‑square‑foot fee methodology to calculate in‑lieu fees, and reporting requirements for the Mayor’s Office of Housing. Commissioners also voted to keep the program structured to allow MOHCD to designate unit prices (rather than strictly tying eligibility to household incomes), and to require market studies where inclusionary prices approach neighborhood market levels. On the question of income bands the commission ultimately adjusted the staff proposal, moving to a configuration that sought to preserve the voter intent of prioritizing lower‑income units while widening coverage to reach households in the “missing middle.” The full packaged resolution, reflecting votes on individual sections, was transmitted to the Board of Supervisors.

What happens next: the commission’s resolution is advisory; the Board of Supervisors will consider the ordinances and the technical recommendations from staff and the commission. The commission also urged the Board and MOHCD to strengthen marketing, reporting and counseling so BMR units are accessible to underrepresented groups. Supporters urged swift Board action; opponents and some developers said litigation risks remain if the ordinances attempt to recapture density‑bonus gains via fees.

The commission’s action wraps a months‑long policy process that included a technical advisory committee, a city controller study and multiple rounds of amendments. The item drew by far the largest turnout of the April 27 meeting and set a complex set of questions for supervisors about feasibility, neighborhood AMI and the tradeoffs between more on‑site units and continued housing production.