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S.F. progressives’ affordable housing measure poised to compete on ballot with Mayor Breed’s plan

A San Francisco measure to streamline affordable housing projects pushed by progressives appears poised to get on the November ballot where it would compete with a similar measure backed by Mayor London Breed, but it already faces a challenge from Breed’s allies that could lead to a lawsuit.

Supervisor Connie Chan now has five other supervisors in support, meaning there are the six votes necessary to approve putting it on the Nov. 8 ballot. A vote is expected at the Board of Supervisors meeting July 26.

Supervisors Aaron Peskin, Hillary Ronen, Shamann Walton, Dean Preston and Gordon Mar are listed as co-sponsors for Chan’s legislation.

“I support the charter amendment and appreciate the thoughtful final policy tweaks because it’ll incentivize construction of new housing for moderate income families that is urgently needed in the Sunset and throughout our city,” Mar, the most recent co-sponsor, said in a statement.

The measure would compete with the Affordable Homes Now measure, backed by Breed. The mayor pushed to get the measure on the ballot through signature-gathering after supervisors did not advance the mayor’s previous efforts to voters. One of those allies, the Housing Action Coalition, argued Tuesday that Chan’s measure didn’t undergo necessary environmental review and threatened legal action if the measure is placed on the ballot.

The challenge is the latest battle in the war between Breed and her allies and the progressive majority of the board over dueling measures as city leaders bicker over how to fix San Francisco’s massive housing crisis. Breed and her allies argue building more market-rate housing as well as more affordable housing is key, while progressive supervisors say that the city has already exceeded its state-mandated goals for market-rate units, but is behind on its affordable housing production mandate and should focus on subsidized units.

The two measures both streamline 100% affordable housing projects, teacher housing and mixed-income projects with certain amounts of affordable units, but differ in how affordable the projects need to be. The measures have divided politicians, unions and some affordable housing developers.

Chan and her supporters, many of whom spoke during public comment at a hearing Tuesday, said only her measure would create “truly affordable” housing. Breed’s allies said Chan’s measure sets the bar for affordability so high that it’s financially infeasible to build and wouldn’t actually result in new housing.

The letter attacked Chan’s measure as a “cynical ploy to confuse and distract voters and divide the pro-housing vote.”

Chan dismissed the challenge as a “bogus claim” and said the “so-called appeal is just a letter to the Board of Supervisors.” The Housing Action Coalition said its letter was an appeal, but the Planning Department said a determination about whether a project qualifies for CEQA couldn’t be appealed to the board.

“Sounds like they’re very desperate and scared that San Francisco voters will find out that their measure wouldn’t produce real affordable housing,” she wrote in a text message.

The mayor-backed measure requires a mixed-income project to meet the city’s 21.5% affordable unit requirement plus another 15% more affordable units. For instance, if a project is required to have 20 affordable units, it would have to add three more to qualify.

It would allow individual units in 100% affordable housing projects to go up to 140% of the area median income, or AMI, although the total project average must remain at 120%. All affordable units in mixed income projects have to be in the same tiers as existing housing policy.

In her proposal, Chan dropped the percentage of affordable units required in mixed-income buildings from 36.5% to 29.5% last week after “a lot of conversations with developers, both market-rate and nonprofit, to try to have a better understanding of which is truly feasible and what is the best we can do to get the most affordable housing,” she said.

Chan’s measure also requires that additional on-site units include at least 30% two-bedroom units and 20% three-bedrooms. Her proposal sets the cap for affordable units at 120% of the AMI.

The letter argues Chan’s measure is both “illegal and unethical” because it didn’t undergo the necessary review under the California Environmental Quality Act. The YIMBY measure is not subject to CEQA because it got on the ballot through signature-gathering.

The Housing Action Coalition filing a CEQA challenge is rich in irony, because the group regularly slams its opponents for weaponizing the same law to block housing projects, such as a controversial nearly 500-unit project on Stevenson Street last year. Supervisors voted in favor of an appeal to halt the project because of concerns about gentrification and environmental impacts.

Todd David, senior adviser at the Housing Action Coalition, defended the use of a law they’ve lambasted.

“The irony that I see is a Board of Supervisors who regularly utilizes CEQA to block housing is now ignoring CEQA to block housing,” he said.

Chris Elmendorf, a law professor at UC Davis, said that the legal arguments in the letter were “actually very good.” He is a San Francisco voter, but is not working for either side, and said he believes the Breed-backed measure is “a reasonable step” to curtail multistep approvals that can kill projects.

“It’s hilariously good,” he said of the legal arguments using CEQA to fight the supervisors’ measure. He compared it to hoisting the supervisors “by their own petards,” quoting a Shakespeare phrase that means someone is “blown into the air by one’s own bomb.”

The city’s Planning Department did look at whether the supervisors’ measure should undergo CEQA review, but determined that the proposal didn’t qualify as a “project” under the law because it wouldn’t result in a “direct or indirect change in the environment.”

The letter cited case law to challenge this argument, saying that the measure would impact environmental factors such as transportation impacts, noise and air quality.

Elmendorf said the city’s reasoning that this policy won’t affect the environment “does not pass the laugh test, the smell test, the anything test.”

The Planning Department said CEQA analyzes physical environmental impacts, but the measure doesn’t propose construction or change any physical development controls, only modifies the review process using existing controls.

Breed’s backers also criticized Chan’s proposal for keeping a step for supervisors to approve city funding for most affordable housing projects, which they say can slow or kill projects.

Sam Moss, the executive director of affordable housing developer Mission Housing Development Corp., supports Breed’s measure. He stressed that affordable housing financing is a competitive market, and a measure that leaves funding with supervisors instead of professional city staff “worries me a great deal.”

“Every single day that it doesn’t pass is a threat to all the other funding we get to build affordable housing,” he said.

Other affordable housing developers don’t share that concern. John Avalos, head of the Council of Community Housing Organizations, said only Chan’s measure will create “affordability that is most needed.”

Chan said the criticism was “ludicrous.”

“It is the fiscal responsibility that the Board of Supervisors is elected to carry out to govern and to have oversight over public dollars spending,” she said. “To challenge a charter authority for the Board of Supervisors to have oversight over public dollars ... now you’re just undoing governance.”

Chan also pushed back on the idea that retaining supervisors’ power over funding could kill projects.

“Have you seen any supervisor voting down a 100% affordable housing project?” she said.

Moss said projects get funded in the end, but “each committee takes time, up to six months to go through the process. Then you’re subject to the political winds of that moment.”

Moss pointed to two cases — one where supervisors postponed approval of a public housing rebuild to get information on why it was so expensive and another where a supervisor wanted a higher level of affordability in a project, although the city said it wasn’t feasible. Both were approved in the end.

Critics said retaining this step keeps projects vulnerable to CEQA. The Planning Department said another state law, SB35, exempts almost all affordable housing projects from review.

Mallory Moench (she/her) is a San Francisco Chronicle staff writer. Email: Twitter: @mallorymoench

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