Without pointing fingers or naming names, Supervisor Mark Farrell has drafted legislation which would specifically require that any and all proceeds generated from the refinancing or sale of an affordable housing development in San Francisco, which was supported in whole or in part by taxpayer funds, shall only be used only for the development of additional affordable housing or preservation of the affordable housing which already exists.

In addition, the legislation would direct the Mayor’s Office of Housing and Community Development to generically ensure that developer fees “do not exceed industry standards.”

From the proposed Affordable Housing Cash-Out Proceeds Restriction ordinance:

It has come to the Board’s attention that in connection with the development, construction, and financing of an affordable housing development assisted with taxpayer funds, the owner of the development may receive a developer fee in connection therewith and such fee may be used by the developer for purposes unrelated to the development, construction, or preservation of affordable housing.

It has also come to the Board’s attention that in connection with the refinancing of an affordable housing development assisted with taxpayer funds, the owner of the development may choose to refinance the project to provide funds to renovate and rehabilitate the affordable units. Often, in order to refinance the development, an owner will create a new entity formed by the current owner and a new equity tax credit partner and sell the development to the new entity. The current owner will then receive from the purchase price paid by the new entity “Cash-Out Proceeds.”

It has also come to the Board’s attention that in some circumstances, Cash-Out Proceeds have been used for purposes unrelated to the creation, development, and preservation of affordable housing.

But again, the proposed legislation was written without naming names or identifying the actual circumstances of which the Board has become aware.

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Comments from “Plugged-In” Readers

  1. Posted by Sierrajeff

    OMFG. It’s Trump-level ignorance meets “progressive” values. Between housing policy, transit (and sit and sit and sit) policy, and the rampant and destructive homelessness and filth, I think I’ve just about given up on this city.

    • Posted by Wendall Majewski

      I’d laugh alongside you but unfortunately I’m crying. I’m working on my escape plan as well.

      It feels like naivety has given way to willful ignorance which is much more depressing.

    • Posted by Torger Cobus

      As an architect, I constantly ask myself why I remain here.

  2. Posted by SFRealist

    Nice.

  3. Posted by scott f

    I’ll name names: John Elberling’s TODCO.

    Some legit affordable housing developers use refinancing proceeds to help pay for on-site supportive services, so hopefully the bill will make it clear that’s “related to the creation, development, and preservation of affordable housing,” and allowed.

  4. Posted by Kraus

    John Elberling of TODCO via his Yerba Buena Neighborhood Consortium (YBNC) has been doing this — taking money from the refinancing of his taxpayer-subsidized housing projects and using it to fund his political agenda.

  5. Posted by Bart Samsung

    the man who funded a campaign to get people to vote to take away homeless people’s tents is now going after the non profits that make housing with a trump-like accusation that’s just designed to rile up the latent right wingers in town. And you all fell for it. Let me all know how you like your President Trump and Governor Thiel, comrades.

  6. Posted by Calvin

    He names Elberling in his press release.

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