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San Francisco County, CA November 6, 2012 Election
Proposition C
Housing Trust Fund
San Francisco County

Charter Amendment - Majority Approval Required

Pass: 211674 / 65.15% Yes votes ...... 113214 / 34.85% No votes

See Also: Index of all Propositions

Information shown below: Summary | Fiscal Impact | Arguments |

Shall the City amend its Charter to: create a Housing Trust Fund that supports affordable housing for low-income and moderate-income households; and change the affordable housing requirements imposed on some private residential developments?

Summary Prepared by The Ballot Simplification Committee:
The Way It Is Now: The City currently uses federal, State and local funds to support affordable housing programs for both low-income and moderate-income households. These include programs to:

  • create and improve affordable housing,
  • provide loans to assist with down payments, and
  • help eligible homeowners and renters stay in their homes. In addition, the City requires private residential developers to:
  • pay a fee to support low-income housing, or
  • make 12+15% of their on-site housing units affordable, or
  • create new affordable units off-site, equal to 17+20% of their project's units. Recent federal cutbacks and reductions in State funding have decreased the funding available for affordable housing programs. The Proposal: Proposition C would amend the Charter to establish a Housing Trust Fund (the Fund). The City would contribute $20 million to the Fund in 2013. Each year, the City contribution would increase by $2.8 million, up to $50.8 million in 2024. After 2024, the City would contribute an annual amount based on the $50.8 million but adjusted for changes in the City's General Fund revenues. The City would use the Fund to:
  • Build, purchase, and improve affordable housing;
  • Provide $15 million for a loan program for downpayment assistance for moderate-income homebuyers and emergency first responders, such as a police officers and firefighters; and
  • Provide up to $15 million for a program that would help eligible households avoid foreclosure or eviction, or improve the safety, accessibility, or efficiency of their homes. The City could use money from the Fund for neighborhood improvements such as streetscapes, childcare facilities and pedestrian safety projects. Proposition C would change the affordable housing requirements for private residential developments in two ways:
  • Reduce the on-site affordable housing requirement to approximately 12% for most projects.
  • Prohibit the City from increasing affordable housing requirements beyond those in place on January 1, 2013. This prohibition would apply only to certain projects. Proposition C would authorize the development of up to 30,000 low-income rental units in the City. The State Constitution requires local voter approval before using public funds to develop, construct, or acquire lowincome rental units. Proposition C would expire automatically after 30 years. However, the Mayor could cancel the amendment at any time before January 1, 2013, after considering the City's financial situation.

Fiscal Impact from The City Controller:
City Controller Ben Rosenfield has issued the following statement on the fiscal impact of Proposition C: Should the proposed charter amendment be approved by the voters, in my opinion, it would affect the cost of government for a thirty-year period beginning in fiscal year 2013-2014 in that it would set aside funds for affordable housing which would otherwise be available for any public purpose. The amendment specifies that the City create a San Francisco Housing Trust Fund and appropriate to it from the General Fund a base $20 million annual allocation in the first year (fiscal year 2013+14). For the following ten years the annual allocation would be increased by $2.8 million each year until the fund reaches an annual allocation of $50.8 million in fiscal year 2024+25. From fiscal year 2025-26 through fiscal year 2042+43, the $50.8 million would be adjusted based on the annual percentage increase or decrease in General Fund discretionary revenues. Under recent and current City policies and budgets a portion of the proposed funds would already have been allocated to affordable housing programs. However the amendment does not identify or create new revenue sources for this set-aside and to the extent that the funds do not fully cover the cost of the housing programs, other City spending would have to be reduced or new sources identified. This proposed ordinance is not in compliance with a non-binding, voter-adopted city policy regarding setasides. The proposed allocation to affordable housing would otherwise have been part of the City's General Fund discretionary revenue. Discretionary revenues are available for the Mayor and Board of Supervisors' to allocate in the annual budget and also result in increases to existing baseline-funded programs. The proposed fund would be used for affordable housing programs with eligibility determined by income level and other criteria. Programs could include land purchases for construction of affordable housing, down payment assistance and loans for occupants to continue to live in their homes. The fund could also be used for community investment in public infrastructure including street and landscape improvements. Under the proposed Charter amendment, projects that are subject to the City's inclusionary housing ordinance will have their affordable housing obligations reduced by approximately 20 percent, and such obligations would be capped and not subject to future adjustments.

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Arguments For Proposition C Arguments Against Proposition C
MORE JOBS. MORE HOUSING. San Francisco faces significant challenges in developing ways to boost our local economy to create jobs, and responding to the need for more homes in our city. Proposition C directly addresses both issues. Each year, Proposition C will invest between $20 and $50 million to build more homes in San Francisco. Proposition C is projected to create thousands of good-paying jobs over the next 30 years. NO NEW TAXES. Due to budget cuts, the state eliminated the Redevelopment Agency--the source of funding for much of San Francisco's housing construction that helped keep City rents and homeownership affordable. Proposition C restores money previously designated for housing construction to remain dedicated toward building more homes. This is accomplished without raising any sales or property taxes. EXPAND HOME OWNERSHIP. Proposition C will establish a $15 million homebuyer assistance program to help first-time homebuyers obtain interestfree loans. This measure will expand middle-class home ownership opportunities to support hard-working professionals like our teachers and nurses, and will provide rental options for lower-income individuals. HELP EVERYDAY SAN FRANCISCANS. Proposition C will provide more housing options to help San Franciscans stay in the city. It will:
  • Secure a long-term funding stream for the construction of modern housing.
  • Develop over 9,000 homes for working-class San Franciscans.
  • Establish a housing stabilization fund to help distressed residents stay in their homes. PLEASE JOIN US IN VOTING YES ON PROPOSITION C. Mayor Edwin M. Lee* Board of Supervisors President David Chiu* Supervisor Eric Mar* Supervisor Mark Farrell* Supervisor Christina Olague* Supervisor Jane Kim* Supervisor Scott Wiener* Supervisor David Campos* Supervisor Malia Cohen* Supervisor John Avalos*
  • For identification purposes only; author is signing as an individual and not on behalf of an organization.

Rebuttal to Arguments For
Proponents claim Proposition C will require "no new taxes." Who are they kidding? City Hall would spend an additional $1.5 billion over 30 years but there would be no new taxes? That statement doesn't pass the laugh test. Will the $1.5 billion grow on trees? Seriously, do Supervisors intend to fund redevelopment by cutting existing programs and services? Are they promising to repay any money borrowed via new bond measures out of the City's general fund? According to the San Francisco Examiner ( -vote-housing-fund-november-ballot ), $13 million would come from Proposition E, the gross receipts tax, if that measure passes, which would be a new tax. I guess when it's "other people's money" then it doesn't really count? Having municipal government involved in the mortgage business by giving taxpayer-financed home loans to people who could not otherwise afford to buy is a bad idea. This is the same kind of thing the federal government did via Fannie Mae and Freddie Mac that resulted in billions of dollars of bad debt written off at taxpayer expense and massive amounts of foreclosures which helped create the current economic mess. Why should renters be asked to subsidize buyers? A much better approach to creating affordable housing would be to cut the red tape and bureaucracy surrounding development, and let developers convert unused city buildings and property into homes for the working poor. Let's not inflate another housing bubble. Vote NO on Prop. C! Libertarian Party of San Francisco Starchild

Last year, governor Jerry Brown signed a bill passed by the legislature's Democratic majority and upheld by the state Supreme Court shutting down California's redevelopment agencies. The action was justified. Redevelopment agencies developed a reputation for waste, cronyism, racism, and lack of accountability. The Orange County Register called them "engines of corporate welfare" that "use eminent domain to confiscate private property and typically sell it cheaply to developers, who sometimes build shopping centers and auto malls" ( http:// -government.html ) The sad legacy of San Francisco's redevelopment agency includes destruction of the Fillmore, once a thriving African- American neighborhood: "883 businesses were shuttered and 4,729 households were forced out," according to the San Francisco Chronicle, and around "2,500 Victorian homes were demolished." ( -Western-Addition-history-ending-3203302 .php#ixzz23SxGJw3L ) Proposition C attempts to bring redevelopment back from the dead. Its text admits "the measure is structured as a revenue capture mechanism" like that "previously used by the former San Francisco Redevelopment Agency." Before it was abolished, the Redevelopment Agency had plans to "redevelop" over half of Bayview-Hunters Point, the city's major remaining black neighborhood, in part to "build affordable housing"-- the same rationale being used to sell Proposition C. But Proposition C won't make San Francisco homes more affordable. It would actually reduce affordability requirements for new projects, while subsidizing housing for people earning more than the median income. Worst of all, Proposition C would commit San Francisco to increasing payouts through 2042 + hundreds of millions of taxpayer dollars that won't be available for other priorities like schools, parks, infrastructure, or health care + plus an open-ended authority to issue bonds without voter approval! San Francisco needs affordable housing, not more unaccountable and unaffordable government schemes. Redevelopment was killed for good cause. Let's not bring it back from the dead! Vote NO on Proposition C. Libertarian Party of San Francisco Starchild

Rebuttal to Arguments Against
The opponents of Proposition C --the Libertarian Party --are uninformed regarding how this proposition works. Their arguments lack substance. Opponents of Proposition C spend the majority of their argument bashing the former Redevelopment Agency. But Proposition C does not "bring redevelopment back from the dead", as they claim. In fact, it does not establish any new agency or bureaucracy at all. DON'T BELIEVE THE LIES Here are the real facts about Proposition C.

  • Proposition C creates thousands of homes for middleincome earners and working families.
  • Proposition C doubles the funding for middle-income housing assistance and doubles the funding for affordable housing construction.
  • Proposition C will create jobs and grow our local economy.
  • Proposition C restores funding that was eliminated by the closure of the Redevelopment Agency.
  • Proposition C has accountability safeguards --including an independent audit --to assure that money is being well spent. BROAD SUPPORT FOR PROPOSITION C A diverse coalition of community groups has united to support Proposition C. These supporters include: SPUR, the Council of Community Housing Organizations (CCHO CCHO), San Francisco Chamber of Commerce, San Francisco Housing Action Coalition, Mercy Housing, Community Housing Partnership, Chinatown Coalition for Better Housing, and Coleman Action Fund. Vote YES on Proposition C! Mayor Edwin M. Lee* Board of Supervisors President David Chiu* Supervisor Eric Mar* Supervisor Mark Farrell* Supervisor Christina Olague* Supervisor Jane Kim* Supervisor Scott Wiener* Supervisor David Campos* Supervisor Malia Cohen* Supervisor John Avalos*
  • For identification purposes only; author is signing as an individual and not on behalf of an organization.

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Created: December 17, 2012 13:47 PST
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