Committee adopts clarifying amendment and forwards $146.8 million COP appropriation for affordable housing to full Board

The Budget and Appropriations Committee of the San Francisco Board of Supervisors on July 13 unanimously adopted a clarifying amendment and voted to forward an ordinance appropriating certificates of participation (COPs) proceeds totaling $146.8 million to the full Board with a positive recommendation.

Supervisor Hillary Ronan, chair of the committee, presided over the meeting. The ordinance would place $112,000,000 of COP proceeds with the Mayor’s Office of Housing and Community Development for a Notice of Funding Availability prioritizing land acquisition for 100% affordable developments, repairs for public housing and federal housing co-ops, affordable housing for educators, elevators in the city’s single-room-occupancy (SRO) portfolio, and acquisition for nonprofit sites. An additional $34,800,000 was identified for associated financing costs; the BLA (Budget and Legislative Analyst) summarized the total appropriation as $146,800,000 and said the ordinance places the funds in reserve pending sale of certificates.

The BLA told the committee the ordinance does not itself authorize issuance of new debt; a separate Board action after capital-planning review will be required to issue COPs. The BLA provided a preliminary estimate of total debt service of about $251,000,000 based on the legislation’s debt-service reserve fund. The analyst noted the city’s fiscal policy limits annual debt service to 3.25% of general-fund revenues and estimated spare capacity in the COP program at roughly $80 million to $120 million depending on future revenues. The BLA also said issuing debt that pushes the city beyond the policy cap would require a two-thirds Board vote or reordering capital projects.

Supervisor Dean Preston urged a non-substantive technical amendment to clarify wording that currently combines 'CDLAC designated high need/resources area.' He said advocates and staff (including the deputy city attorney and the controller) agreed the phrase is confusing and proposed changing three instances in the ordinance to read 'CDLAC designated high-resources area and/or high-need area' to reflect the intended coverage. "There is actually no such thing as a CDLAC high needs area," Preston said, arguing the amendment would achieve the ordinance’s intent without changing policy.

Several supervisors praised the package as a significant step for affordable housing. Supervisor Chan thanked Chair Ronan and Vice Chair Asha Safai for negotiating with the mayor’s office and noted the inclusion of API community priorities. Supervisor Gordon Marr and others acknowledged community stakeholders and urged prompt implementation once authorized.

Public comment reflected both support and opposition. Charlie Shamas of "ChuChu, Council of Community Housing Organizations" thanked the committee and said the COP approach offers a timely financing mechanism for affordable housing and anti-displacement strategies; he urged that Black, American Indian, immigrant and other communities of color be prioritized. "This is definitely a bold and innovative approach towards resourcing our city’s affordable housing and anti-displacement strategies," Shamas said. In opposition, Eileen Bogan (Coalition for San Francisco Neighborhoods) argued COPs allow issuance of hundreds of millions in debt without voter approval, are typically short-term and higher-cost, and cited external debt figures. Bogan said, citing Fitch Ratings, the city already holds about $1.3 billion in outstanding COP debt and $2.5 billion in outstanding general obligation bond debt, and she opposed further COP issuances. Anastasia Yovanopoulos of the Anti-Displacement Coalition supported expanding program priorities to include neighborhoods at risk of gentrification and thanked Supervisor Preston for clarifying the approach.

Following public comment, Chair Ronan moved adoption of Supervisor Preston’s clarifying amendment; the motion was seconded and passed on a recorded 4–0 vote with Member Walton excused. Supervisor Chan then moved, and Chair Ronan seconded, that the ordinance as amended be forwarded to the full Board with a positive recommendation; that motion likewise passed 4–0 with Member Walton excused.

Next procedural steps identified in the meeting: items acted on today are expected to appear on the full Board of Supervisors agenda on July 19 unless otherwise stated, and debt issuance would require a separate Board authorization and capital-planning review before COPs are sold.

Votes at a glance

• Motion to excuse Member Walton: passed (4 ayes, Walton excused).
• Motion to adopt Preston clarifying amendment: passed (4 ayes, Walton excused). Mover: Chair Hillary Ronan; second: Member Gordon Marr.
• Motion to forward the ordinance, as amended, to the full Board with a positive recommendation: passed (4 ayes, Walton excused). Mover: Supervisor Chan; second: Chair Hillary Ronan.

The committee completed its business and adjourned.