Planning Commission hears months-long debate over Affordable Housing Bonus Program; continues item for revisions

The San Francisco Planning Commission on Jan. 28 took up the mayor’s proposed Affordable Housing Bonus Program, a sweeping local alternative to the state density‑bonus law intended to spur new permanently affordable and middle‑income housing through targeted zoning relief and incentives. Planning Director Gil Kelly told the commission the AHBP was one tool among many to increase housing supply and affordability across the city.

Staff said the program would require a minimum 30 percent of units on‑site to be permanently affordable for qualifying income levels, and that 40 percent of the affordable units should be two‑bedroom units to better serve families. Over a 20‑year horizon, planners projected roughly 2,000 low‑ and moderate‑income permanently affordable units and up to 3,000 middle‑income units could be produced under the proposal. Staff and the Mayor’s Office said projects using the program would still undergo project‑level environmental review and that projects which would demolish rent‑controlled units or affect certain historic resources would be ineligible.

The hearing drew several hours of testimony from tenants’ groups, neighborhood coalitions, labor and housing advocates, merchant associations and developers. Opponents — including the San Francisco Tenants Union and San Franciscans for Community Planning — argued the AHBP, as drafted, risks increased displacement of long‑term residents and neighborhood‑serving businesses, that its outreach was insufficient and that AMI (area median income) thresholds in some provisions would effectively exclude many local residents from eligibility. Organized groups also pressed planners to exclude any property that contains rent‑controlled units; Connor Johnston, staff to Supervisor London Breed, said Breed intended to introduce an amendment permanently barring AHBP eligibility on rent‑controlled properties. Supporters including SPUR, the Housing Action Coalition and the Chamber of Commerce said the city needs new tools to produce units for middle‑income workers and to expand permanently affordable housing beyond current subsidy programs.

Commissioners used the forum to identify a list of detailed issues they wanted staff to address before any final recommendation: precise rules for lot mergers, clearer limits on maximum parcel consolidation, exemptions and district‑level filters, stronger legacy‑business protections and relocation assistance, tighter restrictions to prevent demolition of rent‑controlled housing, a better mapping of where value and development pressure would be concentrated, and clarified appeal and review procedures (how conditional‑use and consolidated review findings would work under the new code section). Staff also agreed to supply more detailed market studies and to explain the rationale for the AMI bands used in the proposal.

After more than four hours of public comment and four hours of staff and commissioner discussion, the commission voted to continue the AHBP item to Feb. 25, 2016 to allow staff to return with refined language and responses to the commission’s questions. The item remains a work in progress — staff and several supervisors’ offices have proposed amendments, including language expressly preventing the program from applying to properties with rent‑controlled units.

The commission did not take a final vote on the proposal and directed staff to return with additional detail on historic‑resource screening, small‑business protections, the mechanics of the consolidated review and appeal process, and a clearer mapping of parcels that are financially viable for the AHBP. The board of supervisors will be the next legislative venue for any ordinance if the commission forwards a recommendation.