The overall estimated renewal needs for preserving existing affordable housing is approximately $1.6 billion over the next 10 years, including acquisition and rehabilitation of existing at-risk rent stabilized housing. While the sources identified at the beginning of this chapter, including recently passed bonds, will go toward addressing this need, the Plan allocates approximately $170 million to meet these needs.

The preservation of affordable housing includes maintenance and capital improvements to existing affordable units (both MOHCD and/or HUD funded projects) and preventing the loss of existing affordable rent stabilized units through acquisition and conversion from market-rate to permanently affordable units.

MOHCD-Subsidized Housing

MOHCD-financed housing is 100% affordable housing that is owned and managed by private developers and monitored by MOHCD. These buildings are deed-restricted to ensure permanent, long-term affordability, and need reinvestment for systems and unit upgrades approximately every 20 years. Many older buildings would also benefit from seismic retrofits. About 15,500 units in MOHCD’s portfolio do not have any project-based rental or building operating subsidies to leverage additional debt, so the City will need to provide a capital subsidy to recapitalize. The total estimated need is $1.5 billion over the next 10 years, excluding seismic retrofits.

HUD-Subsidized Housing

HUD-subsidized housing is affordable housing that is owned and managed by nonprofit or for-profit developers and monitored by HUD. Some HUD-subsidized buildings also have an MOHCD capital subsidy, but the affordability restrictions of exclusively HUD-subsidized units expire when the HUD contract expires, and rents may be converted to market rate rents. Projects that have opted out of HUD contracts, or have year-to-year or soon-to-expire contracts, are at high risk for loss of affordability. About 1,400 units of HUD subsidized housing fall into this high-risk category over the next 10 years. The City would need an estimated $127 million to engage private owners in preservation deals to ensure permanent or long-term affordability for existing HUD-subsidized housing.

MOHCD's planned preservation efforts also include acquisition and rehabilitation of at-risk housing for households between 0-120% AMI through the Small Sites Program, which protects small to mid-size multifamily rental buildings through acquisition support. These efforts prevent the displacement of existing residents and loss of affordability from Ellis Act and owner move-in evictions. Funding sources that can be used for the Small Sites Program include 10% of Inclusionary and Jobs/Housing Linkage Fees, 25% of condominium conversion fees, 40% of excess Educational Revenue Augmentation Fund (ERAF) allocated to MOHCD, the voter-approved 2019 General obligation bond, and the Housing Trust Fund. Additionally, the City makes below-market loans available for eligible projects through the Preservation and Seismic Safety (PASS) Program. This program was appropriated with up to $260 million when voters approved the modification of the 1990s-era Seismic Safety Loan Program in November 2016.

The estimated need to continue the City's level of effort in for acquisition and rehabilitation of affordable units according to the draft 2023-2031 RHNA targets for the next cycle is approximately $1.8 billion through FY2033. Preservation program needs for this period is approximately $1.6 billion.

SFHA – San Francisco Housing Authority

The most recent needs assessment of the SFHA portfolio was conducted in 2009 and determined a need of $269 million. This includes sites already converted and those slated for conversion. The needs of the post-conversion portfolio are likely to exceed the $3 million annual pot expected to be available through HUD. Funding for maintenance, including annual federal operating subsidies, have been and are expected to continue to be inadequate, making deterioration of these units a continual challenge.