City of San Francisco Housing Bond Issue, Proposition A (November 2015)

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Measure info Amount: $310 million Matures in: 18 years Tax: $8.09 per $100,000 value

A housing bond issue, Proposition A, was on the ballot for voters in San Francisco, California, on November 3, 2015. It was approved.

Proposition A authorized the city to issue up to $310 million in bonds to fund affordable housing programs.

The city controller estimated the approval of Proposition A would result in the following property tax rates:

• 2015-2016: $4.35 per $100,000 of assessed valuation
• 2020-2021: $11.25 per $100,000 of assessed valuation
• Average from 2015-2016 through 2038-2039: $8.09 per $100,000 of assessed valuation

Mayor Ed Lee announced his intention to use this bond issue to construct and renovate 30,000 units of affordable housing over the next four-year mayoral term, provided voters re-elected him in November. Mayor Lee won re-election on November 3, 2015. On April 1, 2015, he called an advisory group meeting to determine specific priorities for the bond money.

Referring to Mayor Lee's initial proposal for a $250 million bond issue, Peter Cohen, a director for the Council of Community Housing Organizations, said, “The scale of the affordable housing crisis and the need for funding to address it over the next five years is much greater than $250 million — more like twice that amount. We appreciate the mayor’s commitment to a bond measure, and we urge him to push as far as possible.”

A two-thirds (66.67%) vote was required for the approval of this type of bond measure.

Housing was one of the most important issues in the city's 2015 election. Gabriel Metcalf, president and CEO of public policy research company SPUR, said, “It’s the No. 1 issue in every poll.” Five propositions on the ballot dealt with housing and development, either directly or indirectly, and proposed solutions for the housing availability issues facing the city were essential to candidate platforms. Voters decided housing-related propositions that addressed affordable housing bonds, restrictions on short-term rentals, a moratorium on market-rate construction in the city's Mission District, housing developments on surplus public lands and a specific development proposal on the waterfront.

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Election results

San Francisco, Proposition A
Result		Votes	Percentage
a Yes		148,513	74.26%
No		51,486	25.74%

Election results from San Francisco Elections Office

Text of measure

Ballot question

The following question for this measure appeared on the ballot:

“

To finance the construction, development, acquisition, and preservation of housing affordable to low- and middle-income households through programs that will prioritize vulnerable populations such as San Francisco’s working families, veterans, seniors, disabled persons; to assist in the acquisition, rehabilitation, and preservation of affordable rental apartment buildings to prevent the eviction of long-term residents; to repair and reconstruct dilapidated public housing; to fund a middle-income rental program; and to provide for homeownership down payment assistance opportunities for educators and middle-income households; shall the City and County of San Francisco issue $310 million in general obligation bonds, subject to independent citizen oversight and regular audits?

”

Full text

The full text of this measure is available here.

Background

Uncertainty prior to passage

David Latterman, a political consultant, said, “It’s a tough year — it’s going to be a relatively low turnout, and low turnout means a more conservative turnout. This is going to be a tough year for almost any bond, but if they can say no one’s taxes are going to be raised, that is different. A lot of time when bonds fail it’s not the issue itself — its just fiscal conservatism. It’s just 'I don’t want taxes to go up.’” Latterman followed up by saying that, in order to pass, the specific housing plan attached to the bond money would have to be balanced to appeal to a range of income levels, rather than being weighted mostly towards low-income housing. He said, “There is a political sweet spot they are going to have to find. I’m sure it’s there. They just have to find it.”

Status of SF affordable housing

In 2015, San Francisco featured some of the highest housing costs in the country. According to realtor.com, 72 percent of the median income in the city was needed to pay the average 30-year, fixed-rate mortgage. MPF Research, a real estate research company based in Carrollton, Texas, estimated the average monthly rent in the San Francisco metro area to be $2,802 at the end of 2014, which was second only to New York City.

Previous bond measures

The last successful city housing bond before this proposal was approved by voters in 1996 in the amount of $100 million. Housing bond measures asking for $250 million and $200 million respectively were defeated by San Francisco voters in 2002 and 2004. Both measures were designed to raise property taxes to pay off the debt.

Support

The San Francisco Labor Council supported a "yes" vote on Proposition A.

Editorials

The San Francisco Examiner editorial board endorsed a "yes" vote on Proposition A. The board argued that the housing bond authorized by the proposition would fund desperately needed low- and mid-income housing and that it was an important step in addressing San Francisco's housing crisis. The board wrote:

“	Proposition A, unanimously supported by the Board of Supervisors, authorizes a $310 million housing bond to construct and preserve desperately needed low- and middle-income homes in The City. The bond includes $80 million to repair and reconstruct public housing and $100 million to develop and preserve housing for low-income residents. The bond will also go toward funding a middle-income rental program, as well as homeownership down payment assistance opportunities for educators and middle-income households, and will not raise property taxes. It is an encouraging step towards addressing the housing crisis in The City.	”
—San Francisco Examiner editorial board

The San Francisco Chronicle editorial board also endorsed as "yes" vote on Proposition A. The board believed that the proposition was too small to make a significant difference in the housing crisis, but that its impact, while small, would be positive. The board wrote:

“	San Francisco voters should not be under the illusion that they are making more than a very modest incremental dent in the city’s affordable-housing crisis when they vote for Proposition A. Government could spend billions on new housing without curing the daunting gap between supply and demand. Still, this $310 million affordable-housing bond is a step in the right direction, and voters should readily embrace it. ... Perhaps the strongest argument against Prop. A that it is too small in the context of the city’s housing crisis. But don’t let the perfect be the enemy of the good. These dollars will have a positive impact. Vote yes on A.	”
—San Francisco Chronicle editorial board

Reports and analysis

Ballot simplification digest

The following summary of the measure was provided by the San Francisco Ballot Simplification Committee:

“	The Way It Is Now: State law requires that the City's General Plan describe San Francisco's housing needs, set goals for providing housing and develop programs to meet those goals. It is City policy to support the construction and rehabilitation of 30,000 new housing units by 2020, with at least 33% of those permanently affordable to low- and moderate-income households, and over 50% within financial reach of middle class households. The City’s funding for affordable housing comes from property taxes, hotel taxes, developer fees and other local sources. The use of City money triggers the availability of funding from other public and private sources. The City expects that money from these sources will not be enough to meet its future low-, moderate- and middle-income housing goals. The City’s spending of money from general obligation bonds is monitored by the Citizens’ General Obligation Bond Oversight Committee. The Proposal: Proposition A is an ordinance that would allow the City to borrow up to $310 million by issuing general obligation bonds. The City would use this money to build, buy, improve, and rehabilitate affordable housing in San Francisco. The City could use the funds to: finance the development, construction, preservation and rehabilitation of affordable rental housing near established transit corridors or within priority development areas; acquire, rehabilitate, and preserve existing rental housing to prevent the loss of rental housing and the displacement of long-time City residents; repair and reconstruct dilapidated public housing or provide infrastructure improvements that allow for the repair or improvement of public housing sites; fund middle-income rental housing units; assist middle-income City residents, including teachers, in purchasing their first home in the City; and acquire, rehabilitate, preserve, construct and/or develop affordable housing in the Mission Area Plan. Proposition A would allow an increase in the property tax to pay for the bonds, if needed. Landlords would be permitted to pass through up to 50% of any resulting property tax increase to tenants. However, it is City policy to limit the amount of money it borrows. Therefore, because of the retirement of existing debt and the growth of the property tax base, the City does not expect the property tax rate to increase. Proposition A also would require the Citizens’ General Obligation Bond Oversight Committee to review the spending of bond funds. One-tenth of one percent (0.1%) of the bond funds would pay for the committee’s audit and oversight functions. Approval of this measure requires two-thirds of votes cast. A "YES" Vote Means: If you vote “yes,” you want the City to issue $310 million in general obligation bonds on projects designed to: acquire, build, or renovate affordable housing, including in the Mission Area Plan; rehabilitate or reconstruct public housing; fund middle-income rental housing; and assist middle-income City residents in purchasing their first home in the City. A "NO" Vote Means: If you vote “no,” you do not want the City to issue these bonds.	”
—San Francisco Ballot Simplification Committee

Controller analysis

The following fiscal analysis of this measure was prepared by the city controller and appeared on the ballot:

“	Should the proposed $310 million in bonds be authorized and sold under current assumptions, the approximate costs will be as follows: In fiscal year 2015-2016, following issuance of the first series of bonds, and the year with the lowest tax rate, the estimated annual costs of debt service would be $8.3 million and would result in a property tax rate of $0.0044 per $100 ($4.35 per $100,000) of assessed valuation. In fiscal year 2020-2021, following issuance of the last series of bonds, the estimated annual costs of debt service would be $26.7 million and would result in a property tax rate of $0.0114 per $100 ($11.25 per $100,000) of assessed valuation. The best estimate of the average tax rate for these bonds from fiscal year 2015-2016 through 2038-2039 is $0.0077 per $100 ($8.09 per $100,000) of assessed valuation. Based on these estimates, the highest estimated annual property tax cost for these bonds for the owner of a home with an assessed value of $500,000 would be approximately $56.24. These estimates are based on projections only, which are not binding upon the City. Projections and estimates may vary due to the timing of bond sales, the amount of bonds sold at each sale, and actual assessed valuation over the term of repayment of the bonds. Hence, the actual tax rate and the years in which such rates are applicable may vary from those estimated above. The City's current debt management policy is to issue new general obligation bonds only as old ones are retired, keeping the property tax impact from general obligation bonds approximately the same over time.	”
—San Francisco Controller

Path to the ballot

Proposition A was put on the ballot by a vote of the city's board of supervisors.

Other elections

Mayoral election

See also: San Francisco, California mayoral election in 2015

Mayor Ed Lee was the incumbent candidate in the city's 2015 mayoral race. He proposed this housing bond as part of his “affordability and shared prosperity" agenda. His campaign featured the intention to construct or renovate 30,000 homes over the following four-year mayoral term. Mayor Lee was re-elected on November 3, 2015.

Board of supervisors

See also: San Francisco, California board of supervisors election in 2015

The consolidated city-county's District 3 board of supervisors position was up for election on November 3, 2015. Aaron Peskin defeated incumbent Julie Christensen.

Related measures

1. City of San Francisco Housing Development on Surplus Public Lands, Proposition K (November 2015) a
2. City of San Francisco Mission District Housing Moratorium Initiative, Proposition I (November 2015) d
3. City of San Francisco Mission Rock Development Initiative, Proposition D (November 2015) a
4. City of Tracy Active Adult Residential Allotment Program, Measure K (December 2015) a
5. Town of Mammoth Lakes Voter Approval of Short-Term Rental Zoning Initiative, Measure Z (October 2015) a
6. City of San Francisco Initiative to Restrict Short-Term Rentals, Proposition F (November 2015) d

Recent news

The link below is to the most recent stories in a Google news search for the terms San Francisco housing bond Proposition A. These results are automatically generated from Google. Ballotpedia does not curate or endorse these articles.

City of San Francisco Housing Bond Issue, Proposition A (November 2015) - Google News

See also

• City bonds on the ballot
• San Francisco City and County, California ballot measures
• November 3, 2015 ballot measures in California
• San Francisco, California municipal elections, 2015

External links

Suggest a link

• San Francisco Elections Office website