July 11, 2014, 48 hills

In recent weeks 48 hills has revealed that the Planning Department’s lax enforcement of San Francisco’s zoning laws has allowed the illegal conversion of hundreds of thousands of square feet of industrially zoned space into offices, thereby destroying scarce, irreplaceable venues for production, distribution and repair businesses and blue-collar jobs and squandering millions of dollars in development impact fees for Muni and affordable housing.

But it gets worse: The city’s so uninterested in enforcing zoning laws that nobody seems to know or care that there’s a startup company inside a biotech incubator making glow-in-the-dark roses in SoMa.

Situated at 665 Third Street, the biotech lab is in an area that’s not zoned for laboratories or life science facilities. And it’s engaging in what is, to say the least, a controversial scientific practice, one referred to as “genetic engineering on steroids.”

Here’s the story:  Continue reading →

June 9, 2014, 48 hills

When the Planning Department allows property zoned for Production, Distribution, and Repair – also known as PDR — to be converted illegally into offices, San Francisco loses more than precious light-industrial land. The city also forfeits hundreds of thousands, if not millions, of dollars that would have gone to Muni and affordable housing.

That’s because new development—not only new buildings but also development that involves a change from a lower intensity use, i.e., PDR, to a higher one, i.e., offices—is supposed to trigger development impact fees.

Impact fees are charged on new development to offset the costs of public infrastructure and services that are created by new workers in those buildings.

And there’s evidence that city planners are repeatedly letting developers off the hook for those costs.

Developers are also using a little-known provision in the planning code to get discounts on the fees they have to pay to convert industrial buildings to office – providing, critics say, an incentive to wipe out what’s left of the city’s workspace for blue-collar jobs.

In three buildings alone, 48hills has found, the discounts and illegal conversions may have lost $1.7 million in Muni subsidies alone, and millions more in affordable housing money.

Impact fee rates are set differently for each land use type, based on the demand generated by that use. So for example, office development pays more than PDR, because it is a more intensive land use that attracts more people – and thus generates greater demand on housing and public infrastructure.

The two most important such fees are the Transportation Impact Development Fee and the Jobs-Housing Linkage Fee. The logic: New office buildings attract new employees who need Muni service – and put a heavy demand on the housing market, driving a need for more affordable housing.

Now questions are being raised about whether the Planning Department is discounting TIDF and Jobs-Housing impact fees when property owners seek to retroactively legalize an illicit PDR conversion into office or to legally demolish PDR space and build new offices.  Continue reading →

May 29, 2014, 48 hills

At its May Day meeting, the San Francisco Planning Commission took a stand for blue-collar jobs, affordable housing, public transit, and government accountability: it refused to approve a staff recommendation to authorize the conversion of the industrially-zoned property at 660 Third Street into an office building.

Planning Department staff deemed the change a “routine” matter, so they placed the item on the commission’s consent calendar, meaning that they expected it to be passed without discussion.

Instead, the commission moved 660 Third Street onto its regular agenda and took public comment.

After hearing strenuous objections from representatives of the Council of Community Housing Organizations, Mission Economic Development Agency, Tenants and Owners Development Corporation, and the SoMa Leadership Council, among others, commissioners peppered staff and the applicant with pointed questions:

At a time when San Francisco manufacturing is undergoing a welcome revival, but manufacturers are leaving town because they can’t find space, why is the Planning Department asking us to shrink the city’s industrial building stock?

A sweeping plan to rezone Central SoMa is slowly making its way through the city bureaucracy and has yet to come before the Planning Commission.  Why, then, are we now being asked to rezone the area parcel by parcel?

Did staff discount the development impact fees for changing 660 Third Street from industrial to office use and thereby encourage the elimination of industrial space and deprive the city of desperately needed funds for Muni and affordable housing? How are these fees calculated, anyway?

The staff report says 660 Third St. is currently occupied by office tenants; how can that be, when the owner is asking for permission to convert the property to offices?

In other words, has the building already been converted – illegally – and if so, why has nobody in the Planning Department done anything about it?

Failing to get satisfactory answers, the commission continued the matter to June 12, at which time staff are to fill in the blanks.

We can fill in a lot of them right now. And the information will say a lot of about the city’s ongoing failure to protect the industrial space that is under assault from an influx of higher-paying tech-office uses.  Continue reading →

March 11, 2014, 48 hills

On March 13 the planning commission is scheduled to act on legislation intended to provide urgently needed new space for San Francisco’s burgeoning manufacturing sector—the “Production” component of what’s known in local plannerese as Production, Distribution and Repair or PDR.

But the original bill, by Supervisor Malia Cohen, had some serious problems that undermined the goal of providing PDR space in a part of this city that could be overrun with tech offices–and some of those issues still haven’t been resolved.

Thanks to Supervisor David Campos’s outreach to a broad range of stakeholders and Cohen’s recognition of unintended consequences in the draft legislation, it now looks as if an amended proposal is going to move forward.

Still, it’s a very tricky balance–and PDR advocates fear that city planners will allow developers to slide through loopholes, in part because the enforcement is likely to be lax, leading to office uses where manufacturing ought to be.

Continue reading →

March 3, 2014, 48 hills

In a story that’s become somewhat legendary of late, David Talbot, founder of Salon.com, asked whether San Francisco could survive the tech boom: “How much tech can one city take?”

There’s no part of town where that’s a more crucial issue than South of Market, where the city is making plans that could change the character of one of the last places in San Francisco that still has industrial jobs and businesses—what the city planners call Production, Distribution and Repair, or PDR.

And what’s at stake isn’t only SoMa’s PDR but also the neighborhood’s fragile motley character.

It’s hard to see how Central SoMa could accommodate much more tech and still retain its fast-disappearing heterogeneity. According to a report released last December by the commercial real estate services firm CBRE, tech already accounts for 3.5 million square feet, or 58 percent of leased office space, in “South of Market,” an area bounded on CBRE’s map by Bryant, the waterfront, King and 8^th; and 657,000 square feet, or almost 21 percent of the office space in “Yerba Buena,” which lies between Market, 3^rd, Bryant, and 6^th Streets.

Even the district’s office space is getting less diverse, as landlords tailor their holdings to satisfy tech tastes. Not incidentally, since the end of 2009, average asking rents in CBRE’s SoMa have increased by 87 percent, rising from about $30 to $57 per square foot a year, and by 95 percent in Yerba Buena.

Can this go on forever? No – but a city plan for Central SoMa assumes that tech companies are going to keep pouring into San Francisco, and into Central SoMa in particular, for the foreseeable future.

That assumption seems plausible in light of the CBRE study, which says that the outlook for the city’s tech sector is bright and, unlike the first tech boom, sustainable. This time, investors are passing up riskier firms for more established companies, while consumers are spending more and more money on technology.

But CBRE also sees “cautionary signs.” In San Francisco, as for the North American tech industry as a whole, things are getting “frothy” at the top, as valuations of “high expectation firms” are “surging well above more established benchmarks” (see WhatsApp). At some point, it all may crash – but by then, the damage to SoMa could be done.

So where does all of this come from, anyway? Why is SoMa – with the support of the City Planning Department – in the crosshairs of a plan that could drive out the very blue-collar jobs that the city claims to want to protect?  Continue reading →

January 30, 2014, 48 hills

Four years ago, Donny Beckwith lived and worked in San Francisco. He and his wife rented a one-bedroom apartment on Nob Hill for $1450 a month. “It was perfect for us,” Beckwith says. But when they started a family, they needed more space. “There was no way we could rent anything else in the city, and it was a good time to buy a house.” They bought one—in Castro Valley.

Beckwith still works in San Francisco, commuting to the same job he had in 2010. He manages Interior Moves, a South of Market business that receives, inspects, and installs high-end furniture. But if the city’s planning department has its way, he and the firm’s thirteen other employees will not be working in San Francisco much longer.

The planners want to change the zoning for a large swath of SoMa, including the 700 block of Harrison, where Interior Moves is a tenant. The new rules would allow the construction of offices, hotels and market-rate housing—now all prohibited—and would raise maximum building heights from 85 to 130 feet, or, in a “high rise alternative,” up to 400 feet. Rents would soar.

That, says Beckwith, “would drastically change our business. We’d have to go to the East Bay and cut our staff in half.”

They wouldn’t be the only ones. The planners themselves say that the proposed zoning would probably put at least 1,800 jobs “at risk.” That could mean the displacement of hundreds of small and medium-sized businesses.

While the displacement of residential tenants has become big news in this city, local blue-collar jobs and businesses are getting forced out of San Francisco, too—and if history is any precedent, the city is asking for a fight.  Continue reading →

February 11, 2014, Dissent

Since the 2010 defeat of federal cap-and-trade legislation, questions of strategy have provoked a lively debate among U.S. climate change activists. As Mark and Paul Engler reported in the Summer 2013 issue of Dissent, to date, the discussion has focused on the inside-the-Beltway strategy pursued by the chief proponents of the failed cap-and-trade proposal, with critics arguing that curbing carbon emissions can only be achieved if an insider approach is accompanied by a vigorous grassroots movement. But the specifics of an effective inside-outside strategy remain unclear, the Englers said, largely because social movement creation is “much less studied and much less understood than the arts of electioneering, lobbying, and legislative deal-making.”

Among those seeking to redress that neglect is the nation’s most prominent environmentalist, Bill McKibben. The bestselling author is also a co-founder of the 350.org network, which has spurred a global grassroots movement to address the climate crisis. Writing at Grist in January 2013, McKibben allowed that the “behind-the-scenes route” had been “worth a try,” given that insider lobbying had produced most of the landmark environmental legislation of the 1970s, but that the effort was doomed by fossil fuel money and insider contempt for the grassroots.

Since the 2010 debacle, two things have improved the outlook for meaningful environmental legislation: a series of disasters—hurricanes, floods, wildfires—has made the public far more concerned about global warming, and a grassroots movement to stem climate change has gathered enough force to push the “center-left swell in the direction it must go.” As evidence of this new potency, McKibben cited key achievements of 350.org: activist projects in 191 countries, fossil fuel divestment campaigns on 210 college campuses, and a delay in the Keystone pipeline approval process stemming from the biggest civil disobedience action in the United States in thirty years.

More recently McKibben has homed in on another reason for optimism: a shift that enables us “to conceive of, and pursue, movements in new ways,” namely the abandonment of rigid hierarchical control for fluid collaboration. In taking up this theme, McKibben broaches a challenge that has long bedeviled the left: how to exercise authority in a manner that is both effective and democratic. Mind you, “authority” is not in McKibben’s lexicon. Before pondering that absence, we need to consider his broader argument.  Continue reading →

January 10, 2014, 48 hills

Last Tuesday I went to an evening panel discussion at the San Francisco Planning and Urban Research Association (SPUR) entitled “What Urban Planning Can Learn from Tech and Vice Versa.” It was one of the most disconcerting forums I have ever attended.

Perhaps that was only to be expected, since what drew me there was an equally disconcerting experience: last December I read an article on The New York Times’ Opinionator blog called “What Tech Hasn’t Learned from Urban Planning.” The author was the moderator of Tuesday’s panel, Allison Arieff, SPUR’s editor and “content strategist.”

Arieff’s point of departure in the Times piece was a seeming contradiction:

The tech sector is, increasingly, embracing the language of urban planning—town hall, public square, civic hackathon, community engagement. So why are tech companies such bad urbanists?

 By “bad urbanists,” Arieff was referring to techies’ notorious insularity from the world outside their workplaces.

The oft-referred-to “serendipitous encounters” that supposedly drive the engine of innovation tend to happen only with others who work for the same company….I keep coming across instances where the tech sector flocks to the city and talks of community yet isolates itself from the urban experience it presumably couldn’t wait to be a part of.

That aloofness, says Arieff, is having a bad effect on the urban experience in San Francisco, where “tech tenants now fill 22% of all occupied office space” and last year accounted for “a whopping 61% of all office leasing in the city.”

Arieff marked the desolate state of the formerly lively Hills Plaza, adjacent to the burgeoning Google outpost, and the mid-Market environs of the new Twitter headquarters. She noted that Twitter’s move into the former Merchandise Mart was prompted by “considerable—and highly controversial—tax incentives from the city and overwhelming support from Mayor Ed Lee” in the hope of revitalizing the area. But “skyrocketing commercial rents” and a lack of pedestrian activity during the day were warding off small businesses, while evictions in the neighborhood were 38.2% higher in 2013 than in 2012.

So far I was right there with Arieff. Then things got problematic, as she invoked Jane Jacobs as the voice of urban planning and urbanism.  Continue reading →