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City and Academy of Art reach term sheet: affordable units, fees and campus housing benchmarks
Summary
City staff presented a signed term sheet with the Academy of Art University that would fund affordable housing, require on‑campus housing benchmarks and settle planning‑use disputes; public commenters asked for stronger guarantees on replacement units, limits on dispersed properties and clearer enforcement.
City attorneys and Planning Department staff presented a signed term sheet on Feb. 2 that outlines a settlement framework with the Academy of Art University (AAU) intended to resolve long‑running disputes over student housing, conversions of residential units to student use, and alleged unpermitted housing practices.
Key elements of the term sheet presented to the Planning Commission: - Affordable housing: AAU is committed to providing roughly 142–174 new affordable units targeted at households at or below 50% of area median income; proposed housing would be restricted to a long‑term lease (the term sheet describes a 66‑year affordability covenant). - Financial remedies: AAU will contribute approximately $7 million to the city’s Small Sites acquisition fund to mitigate the loss of about 140 rent‑controlled units that staff say were made unavailable to the general market through AAU occupancy. - Student housing and metering: AAU agreed that future housing for students will be provided through construction on appropriately zoned parcels or conversion of non‑residential PDR structures; AAU committed to house 45% of on‑site students by July 1, 2019 and 50% by July 1, 2022. Annual occupancy and campus‑housing reports will be submitted to the Planning Department, with a formula allowing for deferred benchmarks under specified conditions. - Project approvals and enforcement: The university will withdraw or transition certain pending applications; the term sheet anticipates a detailed development agreement, settlement agreement, stipulated injunction and consent judgment to secure obligations and enforcement.
Public reaction was substantial and often critical. Speakers from neighborhood groups, tenant advocates and housing analysts said the term sheet understates the value of housing removed from the market and argued $7 million is insufficient compared with replacement costs cited by the Mayor’s Office of Housing and Community Development. Speakers asked for stricter limits on the university’s scattered property portfolio, tighter rules or prohibitions on shuttle buses where transit access exists, and clear assurances that the university will not continue to operate student beds in non‑conforming residential units.
Staff and the city attorney said the term sheet is a framework and that many technical details remain to be negotiated and memorialized in the development agreement and related court‑enforceable documents. Staff also said AAU will update its Institutional Master Plan (IMP) by May 1, 2017 as part of the settlement process and that the commission and public will have future opportunities to review specific topics such as housing and transportation.
