SF Board of Education Approves Ground Lease Agreements for Affordable Housing for SFUSD Educators
San Francisco (February 28, 2022) - The SF Board of Education voted on February 24 to approve the ground lease agreements between the San Francisco Unified School District (SFUSD) and MidPen Francis Scott Key Associates, LLC for the development of low-income and moderate-income educator housing.
“Our city has some of the highest rents and housing prices in the country yet we receive the same funding from the state as other more affordable California cities. We need local revenue and support to help keep our educators housed. I am grateful for the partnership between the City and SFUSD to provide more options for our staff to find affordable housing,” said Board of Education President Gabriela López.
In September 2017, SFUSD entered into a Memorandum of Understanding with the City & County of San Francisco’s Mayor’s Office of Housing and Community Development (MOHCD) to develop affordable housing for educators. Following the issuance of a Request for Proposals in October 2017, MOHCD and the district selected MidPen Housing Corporation as the developer for the project. The plan is to develop the Francis Scott Key annex for an educator housing development, now referred to as Shirley Chisholm Village. The site will be divided into two parcels for low-income and moderate-income housing, totaling 135 units of housing for educators.
The proposed ground leases will be for 75 years, with options to extend for an additional 24-year term.
“We believe that when educators are able to live in the community in which they work it promotes more stability for staffing, community involvement and stronger ties between teachers and families,” SFUSD Superintendent Dr. Vincent Matthews said. “These lease agreements are a significant step toward realizing our efforts to offer more affordable housing opportunities to SFUSD staff.”
On Nov. 10, 2020, the Board of Education approved two options to ground lease – one for low-income housing and one for moderate-income housing – to allow MidPen to apply for financing with a 9% tax credit.
On Jan. 26, 2021, the Board of Education approved an Amended & Restated Option to Ground Lease, which consolidated the prior two options into one for the purpose of allowing MidPen Housing Corporation to apply for 4% tax credit financing. As a result, the Board of Education simultaneously terminated one of the prior options as unnecessary. However, financing for the project was not approved.
Accordingly, in order to obtain the necessary financing, SFUSD and MidPen reverted back to the two options to lease structure. The Moderate-Income Option to Lease provides development of one parcel of the FSK site for approximately 100 moderate-income (no greater than 120% of Area Median Income) affordable rental units for educators. In order to apply for project financing, MidPen requires this Option to Ground Lease Agreement for Moderate Income housing. By separate item, the Board was asked to approve an Option to Ground Lease for Low Income housing. Both options contain a provision that they must be exercised concurrently.
In addition to its work to develop educator housing, SFUSD assists its educators by sharing housing resources from the City and County of San Francisco and community partners, such as The Teacher Next Door (TND) Program, the Down Payment Assistance Loan Program (DALP), monthly housing clinics, and legal advice and representation.