California slams San Francisco for ‘enormous’ barriers to housing construction

Building a home in San Francisco takes longer and costs more than anywhere else in California, a new report finds, exacerbating the state’s homelessness crisis and keeping many workers from living in the city.

Gov. Gavin Newsom has demanded that cities allow more construction as residents struggle to make ends meet and start moving to other states in search of cheaper places to live. But some local governments still give housing opponents generous permission to slow or block projects.

Governor Newsom’s Division of Housing has determined that no city has more housing barriers than San Francisco, according to an investigation released Wednesday. Report It’s the first time to try to force San Francisco to do better and show other municipalities what it takes to build a prosperous, equitable city.

“The enormous restrictions and barriers they’ve imposed on new housing development is really bad,” said Gustavo Velasquez, director of the state’s Department of Housing and Community Development. “Housing is overpriced because there isn’t enough of it.”

In San Francisco, city housing officials approve housing at a snail’s pace because they allow anyone to object, even if a project meets all of the city’s requirements. That means a cranky neighbor can seriously slow down a project.

The city also allows far more environmental review — in some cases, scrapping proposals because they cast too many shadows — and gives the local Board of Supervisors far more say than other jurisdictions.

With the help of researchers at the University of California, Berkeley, they found that it takes an average of 523 days for a developer to get through the early stages of developing a project. After that, it takes an average of 605 days to get a building permit for specific installations like plumbing and electrical hookups.

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Even a proposed apartment building that meets all of the city’s rules is automatically approved in many California cities, taking more than two years to get the green light in San Francisco.

As a result, many of the workers the city needs to function — including teachers, police officers and firefighters — are unable to find places to live and must move beyond San Francisco. In some cases, low-wage workers live in their vehicles or on the street because of low-cost housing in the city.

“People born and raised in San Francisco can’t stay there and raise their own families,” Mr. Velasquez said.

In a stark example of San Francisco’s slow approval process, two years ago the Board of Supervisors approved 495 apartments in downtown Nordstrom shoppers used for valet parking. Now, with construction costs rising, the project is in trouble because it doesn’t pencil out financially — and the Nordstrom store has closed.

The city has tried to fund housing for workers in some cases, but even its own projects have fallen by the wayside. A teacher housing complex near Golden Gate Park funded by a previous mayor in 2017 isn’t expected to have its first tenant until next fall — seven years after the project began.

California officials say the state needs 2.5 million more homes to ensure homeless people have a roof over their heads and people of all income levels can afford places to live. It has set targets for how much housing each city must build and threatened to cut off state funding if they fail.

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The state charged San Francisco with building 82,000 new homes by 2031, a goal the city adopted in January to achieve. But nine months later, San Francisco is already off track.

To fulfill its promise, the city must build more than 10,000 new homes each year, including 5,800 affordable units. That means 27 units must be approved each day, but the average is less than one.

Mr. Velasquez said new state laws intended to speed up housing construction aren’t enough to fully transform how San Francisco builds housing — and that in some cases, the city is violating state laws. For example, the city’s slow pace of approving building permits has prevented San Francisco from fully complying with a new state law aimed at increasing affordable housing.

Moira O’Neill, a research scientist at UC Berkeley who spoke with several experts to write the new report, said many developers and architects no longer work in San Francisco because the city’s cumbersome process added too many delays. This results in higher costs.

Mayor London Breed said in a statement that he agreed “wholeheartedly” with the state’s decisions and is pushing to change how the city handles approvals and amend local laws to make housing easier to build.

But Supervisor Aaron Peskin, who has fought new housing in some neighborhoods during his decades at City Hall, cited the high cost of construction and the inability of developers to secure financing as reasons for delaying new housing. He said the state should help cities figure out how to pay for affordable housing without ordering them to meet specific targets.

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“The government is telling us that it needs to build 46,000 new affordable homes over the next eight years, but has yet to invest in that target,” Mr. Peskin said he is seeking to place a $300 million affordable housing bond in March. Vote to help work.

In the report, the government identifies 18 steps the city should take. These include eliminating the right of any individual to overturn plans that comply with city rules and speeding up the process of obtaining building permits once a plan is signed off.

If the city doesn’t change its practices, the state could eventually cut off state funding and revoke local control over development in San Francisco.

The government can allow developers to build whatever they want — say, even a skyscraper in a residential area — as long as the units are reasonably priced.

Ms. O’Neill said San Francisco has progressive, inclusive rules such as strong tenant protections and wide open spaces for dense housing. But it also includes housing practices that have resulted in a city that excludes middle- and low-income workers.

“It’s a progressive city, but there’s this contradiction,” he said. “It’s really important, not only for California, but for the country, to highlight how the rules of procedure can be used exclusively and prevent people from being able to move.”

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