Since the 1970s, San Fransisco has been content to cloak itself in amber by developing new housing at a sluggish rate. For decades, the city constructed just 2,000 new units per year, even as the number of jobs in SF grew three times as fast. To be clear, this is not solely an SF phenomenon; over the last half-century, exclusionary housing policies and single-family zoning created a severe housing shortage across California, just as they did in urban cities across the United States. The results have been largely inarguable. Because the housing supply has failed to keep up with demand, housing prices have exploded, accompanied by a corresponding increase in unhoused people. As one of the most important cities on the planet, SF has become a poster child for this problem and an epicenter in California’s struggle to combat the housing crisis. Yet, despite the ubiquity of the crisis, years of legal red tape make reform a challenging prospect. Staunch anti-development support, once in complete control of SF politics, is still fighting hard to stave off change. As a result, pro-housing and anti-development supporters have increasingly faced off against each other over reform efforts in recent years. And in a city known for its consistently mild climate, conflict over housing has been heated to sweltering heights in 2023.
While San Francisco may be sharply divided over housing, the top echelons of California’s executive government have made their perspective quite clear. Governor Gavin Newsom, possessing clear presidential ambitions, sees the California housing crisis as an existential threat he must deal with. His Statewide Housing Plan calls for constructing 2.5 million new homes by 2030–more than five times the number of homes built in California during the preceding eight years. San Francisco is key to that plan due not only to its regional importance but also to the liability the extremely publicized city poses to Newsom’s political prospects. In response to San Francisco’s continued refusal to address its lack of housing, Newsom has leaned into the previously untapped power of the state government to force the city to act.
While Newsom repeatedly tangled with cities throughout California that refused to increase housing adequately, his administration’s conflict with San Francisco came to a dramatic head beginning in 2022. That year, SF blocked the passage of a new Housing Element–legislation that must pass every eight years. According to California law, the California Department of Housing and Community Development (HCD) determines regional housing needs and tells local municipalities the number of housing units the state expects them to build. While cities are required to submit a Housing Element that complies with the HCD, historically those that fail to comply (which is extremely common) have faced no real threat of legally enforced punishment. Among the various laws on the books to motivate city compliance, the Housing Accountability Act of 1990 is the most theoretically powerful. This piece of legislation offers what’s known as “The Builder’s Remedy”: in local municipalities that refuse to pass Housing Elements in line with state requirements, developers can ignore local zoning ordinances and develop freely (as long as the project reserves 20% of the project for low-income folks). While the state has widely ignored this law in the past, Newsom has chosen to employee it in his aggressive fight to expand housing. He's already used the law against non-compliant places such as Huntington Beach, and with San Francisco refusing to get in line, the governor was ready to drop the hammer. If San Francisco didn’t approve a Housing Element that met the expectation of the HCD, California would strip it of tens of millions of dollars in state grants for low-income housing, and the city would lose total control of its zoning.
After months of fighting, SF finally complied. They passed a Housing Element in January that promised to build 82,000 new units by 2032. The legislation mandated zoning reforms and changes to help combat the city’s slow development timeline. On paper, this is a monumental reversal for a city that had become principled on fighting new development. Indeed anti-development politicians have responded to the threat of state intervention by tacitly withholding their reservations concerning some projects needed to fulfill the Housing Element’s promise. In one case, Supervisor Rafael Mandelman helped pass a 19-story apartment in the Castro that he disliked because he said, “I don’t think it’s a project we can [legally) say no to.” High-profile projects in the Mission and to replace Nordstrom downtown that SF legislators had rejected have also seen a reversal of fortune.
Yet, to achieve the goals of such an ambitious Housing Element, SF is not moving nearly fast enough to keep pace with the 2031 deadline. Over February, March, and April of this year, SF approved just eight permits for new units per month. Moreover, the city has not passed any legislation to enact the Housing Element’s biggest promises of reform. The reasons for this are somewhat complex. However, in broad terms, a combination of existing bureaucratic roadblocks against housing development and anti-development supporters have served to ground SF housing reforms before they’ve gotten a chance to even get off the runway.
San Fransisco’s laws surrounding housing development (and, to a degree, state laws) make a dramatic increase in the rate of construction implausible. Many laws exist on the books intended to slow the pace of development to a crawl. The average residential development requires builders to obtain over 87 permits, spend 500,000 thousand dollars on fees, and wade through over 1,000 days of meetings and hearings. The most extreme of the obstacles contributing to these burdens is “discretionary review.” Most other cities in California use “ministerial review,” which is “a process for development approval involving little or no personal judgment by the public official as to the wisdom or manner of carrying out the project.” However, San Francisco’s discretionary review allows its planning commission to block and change any development if there are “exceptional and extraordinary circumstances”--a vague phrase that historically has been broadly flexible. In practice, this means that the public is extensively notified of neighboring developments, at which point any citizen can petition the commission to review a development. Then, they can block it. Even buildings the city has legally approved can be halted late in the process. SF’s housing development directs the city to allow large-scale development without discretionary review. These barriers are still standing, as no significant legislation has passed to significantly reform them (or to hasten the timelines for any new projects). However, San Francisco Mayor London Breed recently had a core piece of her Housing For All initiative passed by the Planning Commission, a crucial early step in the legislative pipeline. The legislation would rewrite the planning code to eliminate many time-consuming bureaucratic barriers to housing development. Mayor Breed has consistently fought against the city’s anti-development backers, even going so far as to support Newsom’s state interventions.
SF’s other major legal impediment to housing production is its existing zoning code. The city has a long history of exclusionary zoning, which refers to zoning meant to ban common types of land use in an area (mainly to preserve a city’s existing composition). In SF, single-family zoning is the most dominant example of this (over 38% of the land), especially in the flat, western half of the peninsula. While the neighboring Bay Area city of Berkeley–the birthplace of single-family zoning– recently voted to end the practice, SF has essentially held fast. Building anything other than single-family detached houses in city areas under this zoning is a no-go. As a result, dense development such as apartments and duplexes is illegal, severely limiting the land in which SF can significantly increase its housing supply. Research by Harvard and Wharton University found that SF’s zoning policies lead to a 109% increase in housing prices from 1991-2016. While SF promised in its Housing Element to rezone for the allowance of 36,000 new units, as with its other promised reforms, the city has not followed through by passing any substantial legislation. However, Mayor Breed has proposed policy to “eliminate existing housing density limits" along the city’s transit corridor. Likewise, the city will introduce a new zoning plan in early 2024 as part of Breed’s Housing For All program.
For the anti-development forces within SF, these legal barriers are crucial protection from outside parties looking to reshape the city. Their defense and utilization of these laws stand in the way of the Housing Element’s ambitions. Referred to as NIMBYs by their detractors (an acronym meaning “Not in My Back Yard”) for their constant disapproval of new local construction, these politicians and voters have fought hard against various housing proposals for several reasons, including environmental, aesthetic, traffic, financial, and ethical concerns. However, the impact of these fights has been uniform: even in the aftermath of this year’s Housing Element, a myriad of objections continue to easily stifle the flow of new housing. As a result, the city has increasingly ensured the continued conflict between pro-housing and anti-development forces.
The battle over a project on Irving Street in the Sunset District is a good example of this reality. Neighbors have been fighting for almost three years against the construction of a seven-story, 90-unit affordable housing project. In an extremely public campaign against the proposal back in 2021, local neighborhood groups claimed the project would lead to “Slums in the Sunset,” and developers intended to “kick out the Chinese, bring in the gangs.” There have been multiple injunctions and failed appeals against the fully approved proposal. Yet, even with the recent passage of the Housing Element, the housing development is still stalled in another appeal. The anti-development backers now claim that the soil vapors from the laundry mat, which existed on the spot decades ago, pose an environmental threat to the health of potential residents. Meanwhile, the mayor’s office hammered the proposal’s setback, arguing the construction is “critical to addressing the affordable housing shortage.”
Similarly, a proposal to build just ten townhomes on a Nob Hill single-family home was stalled in June by the Board of Supervisors (overturning the Planning Commisioner’s approval) primarily because the building would cast shadows on a near-bye rec center used by kids. In response, pro-housing “YIMBY” advocate Jane Natoli criticized the decision and warned of the threat posed by the Builder’s Remedy, stating, “If we continue to abuse local control, we’re going to lose local control.”
And while systemic legal reform is crucial to pro-housing forces attempting to radically change the city's construction, it’s clear that, despite Mayor Breed’s ambitious convictions, it will be an uphill battle for her coalition. That SF has passed no major piece of legislative reform in the half year since the Housing Element’s certification is a direct product of anti-development political power. For example, not even an extremely moderate single-family zoning alteration was able to escape the grasp of the city’s bureaucratic standstill. Designed to allow “single-family homes to convert to smaller-scale apartments,” the legislation was surprisingly halted by last-second amendments from anti-development Supervisors Aaron Peskin and Dean Preston. The lawmakers claimed they introduced amendments to “prevent abuse by real estate speculators and provide for greater affordability.” This sentiment fits with a larger anti-development political ideology, expressed repeatedly by Peskin and Preston, that sees corporate development as inherently untrustworthy and exploitative. Preston has constantly ripped Newsom and the state for failing to provide SF money for affordable housing. For context, however, if city officials intend to follow the Housing Element’s goals, public financing alone for new housing would cost 98 billion dollars (seven times SF’s yearly budget). For this reason, Newsom has begged the city to “just build housing” (private or otherwise) and not lean on ideological excuses.
Whether anti-development forces can continue to obstruct housing legally is the question of the decade for SF. After initial hope inspired by the Housing Element, pro-housing supporters have grown increasingly frustrated with the city for dragging its feet on new housing. In one Op-Ed, a YIMBY voter railed, “Many supervisors have started to backtrack on the promises they all voted for just a few months ago” and “have introduced legislation to implement dramatically watered-down versions of the city’s promises to the state.” Newsom and the state appear to have little patience on the matter. In theory, if the HCD believes SF is failing to fulfill the promise of its Housing Element, it can “revoke its finding of compliance” and haul out the Builder’s Remedy. The HCD recently reminded the city of this in a stern letter over the pace of new construction. But, while the Builder’s Remedy seems to empower new development on paper, it’s untested and will have to go through a brutal battle in the courts.
However, the state and pro-housing supporters are willing to try anything and everything in this pitched fight. In 2022, Newsom directed the California Department of Housing and Community Development to conduct his administration’s newly conceived Housing and Policy Practice Review. The goal is to study why the city takes the longest to create housing projects out of any city in the state and find solutions. Implemented in response to the city’s blocked passage of a new Housing Element, the review is intensive and ongoing. Meanwhile, housing developers used a loophole in the city’s zoning code to propose a 50-story tower amid the Sunset Neighborhood’s field of single-family homes. The contrast appears almost comical in the submitted images, and neighbors have attacked the project. Yet, as the California and SF housing crisis worsens, these broadsides by pro-housing and anti-development forces against each other seem destined to grow more common. So far, the legal and political barricades against development have generally held firm. But what happens next in this intense battle is anyone’s guess.
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