Mission Local24%
San Francisco drops affordable housing requirement from 15% to 5% 2%
By Aaliyah Español-Rivas0%
7/15/2026, 1:33:42 AM
BS Summary: This article contains 7 faulty reasoning types, including Straw Man, Framing Effect, and Post Hoc (False Cause), with Optimism Bias as the most egregious example at 8% saturation with 57 hits. Analysis detected 225 faulty-reasoning hits from 714 analyzed words, generating a BS Score of 11.6% and a BS Rank of 2% (15,984 of 16,256 articles). This article is better (less manipulative) than 98.30% of the article peer group.
The San Francisco Board of Supervisors voted 9-2 on Tuesday to cut to 5 percent the percentage of units that developers of market-rate housing must set aside for affordable units in their projects.
Up until today, the rate — called the “inclusionary housing” rate — was 15 percent citywide with an exception for the Mission District, which stood at 17 percent.
The dissenting votes were from Supervisors Shamann Walton and Chyanne Chen.
District 9 Supervisor Jackie Fielder sought to again carve out the Mission, and succeeded: Her amendment calling for an 8 percent requirement for the Mission District narrowly passed in a 6-5 vote.
Supervisors Matt Dorsey, Alan Wong, Stephen Sherrill, Danny Sauter, and Rafael Mandelman all voted against Fielder’s amendment.
The board also voted to exempt developers of properties with fewer than 24 units from the requirement entirely.
Previously, any development of 10 units or more had to include a certain percentage of affordable housing, or to pay a fee that went into an affordable housing fund.
The ordinance was part of a deal Melgar struck with the mayor and affordable housing groups earlier this year.
In return for the groups dropping opposition to reducing the inclusionary rate, Melgar introduced a fund for building and renovating affordable housing that could grow to nearly $4 billion.
That charter amendment also passed today in a 11-0 vote.
The fund will allocate a percentage of future increases in the city’s property tax revenue, and would grow to $125 million a year.
It will be on the November ballot.
The Inclusionary Housing Ordinance was first passed in 2002 and requires market-rate housing developers to provide some amount of affordable housing, either within a market-rate development, off-site, or through paying an in-lieu fee to fund other affordable housing projects.
Every three years, the city controller’s office releases a report on the city’s inclusionary housing requirements.
The most recent, a memorandum released by Controller Greg Wagner in April 2026, concluded that market-rate housing development in San Francisco has slowed due to several factors — among them higher interest rates and increased cost of construction.
The memo concluded that, given these challenges, even a 5 percent requirement might be too high.
“Requirements significantly above 0% would further threaten feasibility,” the memo reads,” and would not create additional affordable housing.”
In advance of the vote, Susana Rojas, the executive director for Calle 24, told Mission Local about the impact that the lowered rate would have on the Mission.
“Our compromise of having it be at 8 percent in the Mission is really not ideal, but it's better than not having inclusionary housing at all,” Rojas said.
Dorsey said that he understood “the desire and the importance of having a number that’s greater than zero,” but added: “I don’t believe we should single out neighborhoods and freeze them out for new housing — market-rate or affordable.”
Supervisor Melgar, who co-sponsored Fielder’s amendment, disagreed with Dorsey’s take.
“I just want to point out that 5 percent of 100 is five, and it’s more than zero,” Melgar said.
“This is a temporary moment,” Melgar continued, pointing out that the new percentages voted in today are, like the previous ones, set to expire in three years.
“In three years when our economy recovers, when we no longer have a Republican president making everything more expensive in our country, the rate will go back up,” she said.
I have every expectation that the inclusionary rate will be reset higher by a future body of the Board of Supervisors.”
Supervisor Connie Chan also voiced support for Fielder's amendment, saying she would not vote to pass the primary legislation unless Fielder’s amendment was passed as well.
Changes like these to citywide housing mandates are nothing new — the required percentages of inclusionary housing tend to rise when new construction is booming, and fall when housing development stalls.
The last round of changes, proposed by then-Board of Supervisors President Aaron Peskin and then-Mayor London Breed in 2023, also reduced requirements.
At that time the requirement went from 22 percent to between 12 and 15 percent for inclusionary housing constructed on the site of a new market-rate development, and from 33 percent to 16-21 percent for inclusionary housing constructed off-site.
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