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State cracks down on SF housing gridlock, launching ‘first-ever’ review aimed at speeding up construction

The Mission Rock housing project on 3rd Street in San Francisco on Thursday, July 14, 2022. | Juliana Yamada/The Standard

San Francisco isn’t building enough housing, and the state housing department is taking the city to task. 

California’s Department of Housing and Community Development said on Tuesday that it will review San Francisco’s housing policies, the latest in a stepped-up effort to hold the city accountable to state housing targets. 

The review will be led by the Housing Accountability Unit, an enforcement branch of the housing department created last year. Gustavo Velasquez, Director of the Department of Housing and Community Development (HCD), wrote in a statement that the department is “deeply concerned about processes and political decision-making in San Francisco that delay and impede the creation of housing.” 

The review, which HCD is calling a “Housing Policy and Practice Review,” aims to identify and clear obstacles to new housing construction, including “discretionary decision-making patterns” that lead to delays. Velasquez added that the department is working with Attorney General Rob Bonta to pursue any violations they find.

The announcement comes one day after the state housing department issued a letter criticizing the San Francisco Planning Department’s current effort to make room for new housing. Under a state mandate called the Regional Housing Needs Allocation, the planning department must submit a compliant plan to build 82,000 new housing units between 2023 and 2031 by January 2023 and recently filed a draft with the state. 

In a letter to Rich Hillis, Director of the Planning Department, HCD program manager Paul McDougall wrote that some of the timing projections included in the draft didn’t match the eight-year cycle, among other findings. If the city falls out of compliance with the state target, it would jeopardize access to state, federal, and regional programs and grants that fund rezoning and affordable housing construction.

San Francisco has struggled to keep up with state housing targets, and trails behind other large metropolitan areas, including Austin and Seattle, in new construction. 

Bonta said in a statement that the crackdown is meant to address high costs of housing, echoing arguments by pro-housing groups that increasing housing at all affordability levels will reduce housing costs by making units less scarce.

“In California, we are facing a housing crisis of epic proportions, and it’s going to take all of us, working together, to solve it,” Bonta said. “We will continue to work with HCD to enforce our housing laws to alleviate this ongoing crisis.”

Top local officials, including Mayor London Breed and state Sen. Scott Wiener, applauded the state housing department’s scrutiny of the city’s housing policies. 

Last month, Breed vetoed a much-debated fourplex bill passed at the Board of Supervisors on the grounds that it would hurt, not help, new housing construction. That prompted Wiener, a longtime critic of San Francisco’s housing policies, to call on the state to sue San Francisco to enforce state housing law. 

Meanwhile, Breed is backing a November ballot measure that seeks to streamline new housing that meets certain affordability minimums. A rival ballot measure, co-sponsored by Supervisors Connie Chan and Aaron Peskin, competes directly with that measure and has earned scorn by pro-housing groups. 

Annie Gaus contributed to this report.