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Committee moves to recapture inclusionary fee from last state density-bonus project
Summary
The Land Use & Transportation Committee voted to send an ordinance to the full Board asking that state density-bonus projects pay an inclusionary fee on bonus units; planning staff said the measure would affect one remaining unentitled project at 344 Fourteenth Street and would raise about $1 million for affordable housing.
The San Francisco Land Use and Transportation Committee on March 19 advanced an ordinance asking the Board of Supervisors to require projects using the state density bonus to pay an inclusionary fee on any additional units or floor area created by the bonus, closing a limited grandfathering exception.
Chair Aaron Peskin said the measure sought to treat projects consistently and recapture value for affordable housing after earlier amendments had left a small set of projects grandfathered. "Here is, a million dollars," Peskin said, urging colleagues to support sending the ordinance to the full board with a positive recommendation.
Jacob Bentliff of the Planning Department identified the only remaining project that would be affected as 344 Fourteenth Street — a development on Fourteenth between Mission and Valencia — and described it as a mostly residential proposal on a surface parking lot that also includes small enterprise workspace and PDR. Planning staff said the project would total 56 units, include roughly 6,200 square feet of PDR and about 13,000 square feet of small enterprise workspace, and that the inclusionary fee would apply only to the floor area attributable to the state density bonus.
Staff and supervisors walked through the math: the base project was characterized as 42 units, which at the 18% on-site inclusionary requirement would yield eight on-site affordable units, with roughly 14 additional units provided through the density bonus; the proposed fee would apply to the bonus portion and flow into affordable housing funds. Planning staff said the fee estimate for that bonus portion was "a little shy of a million" dollars.
A public commenter representing the San Francisco Housing Action Coalition warned that the proposal might be illegal under state law, and planning staff noted that San Francisco already collects fees from state density-bonus projects in general and that this ordinance is intended to close a grandfathering gap affecting a small number of pipeline projects. Planning also said it had not asked the project sponsor whether the developer could proceed if the fee were imposed; the department focused on policy consistency rather than feasibility discussions with the sponsor.
The committee sent the ordinance to the full Board of Supervisors with a positive recommendation and no recorded objection. The committee record shows the item will appear on the March 19 Board agenda unless otherwise noted.
The next step is Board consideration, where attorneys and advocates may raise legal questions about the interplay between local inclusionary rules and state density-bonus protections.
