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Commission urges more work on proposal to allow rehabilitation as an inclusionary option
Summary
Planning staff presented legislation from Supervisor Daly to let developers pay in-lieu fees directly to nonprofits to acquire and rehabilitate existing housing as permanently affordable rentals (25% requirement). Commissioners and the Mayor's Office of Housing raised oversight, standard-setting and tenant-protection concerns and voted to request further study and stakeholder work.
Planning staff presented proposed amendments to the inclusionary housing ordinance that would add a fifth compliance option: project sponsors could pay an in-lieu amount directly to a qualified nonprofit to acquire and rehabilitate existing housing as permanently affordable rental units, with the nonprofit required to deliver at least 25% of the inclusionary requirement.
Staff and the Mayor's Office of Housing flagged concerns about lack of governmental oversight of funds, limited leveraging of other finance sources, no standard for rehabilitation quality, and potential impacts on rent-controlled tenants. Members of the public and some commissioners warned that sending money to nonprofits without strong program guidelines could encourage loss of rent-controlled housing and provide too little assurance of quality.
Several commissioners praised the idea of rehabilitating existing units as a faster and lower-cost alternative to new construction, but asked that the supervisor's office, the Mayor's Office of Housing and planning staff develop a refined program and oversight framework. The commission unanimously voted to recommend continued interagency work and stakeholder engagement rather than immediate approval of the ordinance as drafted.
Next steps: The commission asked staff to work with the Mayor's Office of Housing and nonprofit developers to convene a task force and refine program details (standards, tenant protections, leverage of other funds) before forwarding a legislative recommendation.
