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Housing Advocates Await Plan For Newly Released $500M

San Francisco’s Proposition C ballot measure, passed in 2018, is now poised to distribute almost $500M to help mitigate the city’s homelessness and housing crises, thanks to court decisions in June and September.

Prop C was meant to raise $250M to $300M per year from a gross receipts tax on companies with annual revenues over $50M, with the proceeds earmarked for homelessness services. Since the measure passed, the city has collected $492M through the program, all of which has been in limbo as opponents challenged it in court.

Up to half is slated to go toward securing permanent housing, which can include construction, rehabilitation, acquisitions and supportive housing operations. Affordable housing developers say having so much funding dedicated to housing may free up capital for other levels of housing.

Row houses in the Excelsior District of San Francisco.

“Not only will the introduction of Prop C resources advance our ability to address homelessness with a range of approaches, which is needed because of its complex causes and impacts, it might also free up or leverage other resources that will help us address the broader affordable housing crisis we face,” Tenderloin Neighborhood Development Corp. CEO Don Falk said.

How exactly the funds will be used is yet to be determined, but housing advocates in the city say it is a decision of crucial importance.

Before the coronavirus pandemic, housing costs in the city were some of the most expensive in the world, leading to a rise in homelessness. Funds to alleviate that found traction on the 2018 ballot, with 61% of voters supporting the measure, but the measure was immediately challenged by business groups arguing that Prop C needed a two-thirds, rather than a simple, majority of votes. The courts decided against that argument earlier this fall.

Now affordable housing advocates say they’re waiting for a plan from the city on how those funds will be disbursed.

“With the release of these funds, we will as a city be able to move towards implementing the intention of Proposition C,"  said Norma P. Garcia, policy and advocacy director for affordable housing nonprofit Mission Economic Development Agency. "It looks like some of those details have yet to be worked out, but at least we’re heading in the right direction where it becomes a tangible reality versus an idea or concept tied up in court.”

One of those groups, the Saint Francis Homelessness Challenge, has crafted a framework it said it hopes both the city and a Prop C-created oversight committee builds upon. 

“We can definitely end street homelessness with the boost of Prop C funds, a comprehensive plan and political will in the 2020/2021 fiscal year,” Amy Farah Weiss, director of anti-homelessness organization SFHC, told Bisnow.

The SFHC’s plan includes the acquisition of empty housing and hotel units, thousands of which the city has already leased for homeless residents, essential workers and other vulnerable populations.

It also calls for the city to take advantage of existing policy tools like the Community Opportunity to Purchase Act, or COPA, a new housing program giving qualified nonprofits like MEDA the rights of first offer and first refusal on multifamily properties heading to market.

Also crucial, Weiss said, is a corresponding investment in “resident stewardship,” which are property management programs in newly acquired properties to provide for needs like food, sanitation and healthcare.

“The nuts and bolts of the resident stewardship model are included in SFHC 2020 framework, and we seek support from City Hall as well as philanthropists and businesses to get it implemented as soon as possible,” Weiss said.

Garcia said she hopes MEDA gets involved in the oversight committee, which had its first meeting last month, adding that any innovation coming out of the measure would be a silver lining to a long delay.

“I would not be surprised if in that process, we, as an affordable housing community, come up with new ways to make this implementation even more effective than what could have been imagined in 2018,” she said.