Inside this issue:

• Introducing our new Director
• Cooperative Housing Training
• Project updates
• Cooperative Housing for Working Families
• Making History: Paving the way for Housing Cooperatives in SF
• Build SFCLT's Membership Base!

We Are Pleased to Introduce Our New Organizational Director Amy Beinart

The San Francisco Community Land Trust is pleased to introduce its new Organizational Director, Amy Beinart. Amy has been working in the field of community-based affordable housing development since 2001. Immediately prior to coming to the SFCLT, she was an independent consultant, providing technical assistance in project and asset management to nonprofit affordable housing developers as well as coordinating a collaborative of community-based affordable housing developers in efforts to increased civic participation of their low-income tenants and constituents. Before that, she was Housing Director of the Bernal Heights Neighborhood Center, a communitybased nonprofit housing developer and services provider in San Francisco.

Amy is excited to be working with the SFCLT to expand and strengthen the community land trust model in San Francisco to provide permanently affordable housing to low-income San Franciscans. “The land trust model is extremely exciting to me in that it ensures continuous community control of precious San Francisco real estate and brings greater depth to resident involvement and empowerment in managing and sustaining their own housing. It adds a creative and viable approach to addressing the desperate need for affordable housing in San Francisco.”

Cooperative Housing Training

BLOCKS Training Opportunity!

Nuts and Bolts of Cooperative Housing
With the California Center for Cooperative Development
Ensuring Permanent Affordability and Home Ownership

SFCLT Members receive discount!
A training for affordable housing developers, funders, policymakers and tenant organizers

SAN FRANCISCO February 27th, 2009 Cooperative Housing is a time tested model for affordable home ownership that creates a host of positives for homeowners, developers and communities including: long-lasting affordability to initial and subsequent owners, protections against predatory lending, reduced monitoring costs, and increased community participation. This full day seminar teaches how to create home ownership for low and moderate income households with Limited Equity Housing Co-ops and Manufactured Home Co-ops. Learn directly from experienced cooperative housing developers, funders, lawyers, and grassroots organizers. Speakers include Margaret Lund, Allan Heskin, Eileen Piekarz, and Karen Tiedemann.

Register now! Registration is sliding scale $95 to $125. Late fee after February 13.

SFCLT Members will receive a group rate discount. Go to Acteva (see below), click “additional registrants” and register under SFCLT and pay only $75 for this outstanding 1 day training. SFCLT members can also apply for scholrships, download application on thier website.

Is cost an issue? Reduced rate scholarships are available. Apply ASAP. Email This e-mail address is being protected from spambots. You need JavaScript enabled to view it for details. Register via acteva at http://www.acteva.com/ booking.cfm?binid=1&bevaID=172606

Nuts and Bolts of Cooperative Housing is offered by the California Center for Cooperative Development. California Center for Cooperative Development 430 F Street Suite A Davis, California 95616 530.297.1032 **See article by CCCD in this newsletter

Project Updates

Our first project at 53 Columbus Ave is nearing completion and residents have begun moving back home to their fully remodeled units. The Asian Law Caucus has moved in to their new offices on the ground floor and basement of the building. They continue to provide vital legal support services to members of the community. We estimate that all of the current residents of the building will be home by the end of February and the vacant units will be filled by the end of May. Meanwhile, the residents are moving forward with their work to form the 53 Columbus Housing Cooperative. This project is truly unique in San Francisco and in the State of California. We are breaking ground through the formation of this limited equity housing cooperative, the first new Limited Equity Housing Co-Op created in SF for over twenty years!

While this is exciting, it also brings with it several legal challenges. Malcolm Yeung, James Tracy and the City Attorney’s office spent countless hours preparing new legislation that was presented to the SF Board of Supervisors and passed in December. This Coop Conversion Ordinance will pave the way for rental apartment buildings to convert to resident owned and controlled limited equity housing cooperatives nder SFCLT. (See Co-op Conversion Ordinance article in this newsletter.)

We are also coming to the final stages in the acquisition of our latest project at 733 Baker St., the Bakers Dozen Coop. Once the transfer is complete we will be applying to the SF Mayor’s Office of Housing for funds to support some repairs on the property. We continue to work with the residents supporting them in becoming a fully self-managed housing cooperative. SFCLT Staff

Cooperatives Place Homeownership in Reach of Working Families

Difficult economic times often create opportunities to implement nontraditional problem solving strategies. The crisis in the housing market creates an opportunity to promote cooperative housing to communities looking for viable solutions to home ownership for low and moderate income families. The California Center for Cooperative Development is currently engaged in a multi-year program to educate policy makers, affordable housing developers, and consumers about Limited Equity Housing Cooperatives. Fueled by data showing that home ownership positively affects everything from improved school performance to reduced crime, an array of publicly funded programs exist to generate home ownership opportunities.

Traditional strategies focus on providing low and moderate income households with down payment and loan qualifying assistance to purchase single family homes. Flaws in this funding strategy have resulted in the squandering of public funds and left many program beneficiaries worse off than they were before the assistance. First, they lack effective mechanisms for preserving affordability when the initial household changes ownership and the subsidy benefit is not passed on to subsequent low income homebuyers. Second, the financial monitoring mechanisms proved ineffective because many homeowners refinanced to predatory, sub-prime lending schemes and thereafter lost their homes. This caused federal, state, and local agencies to lose their investments and left homeowners with credit scores so low that even rental housing is difficult to obtain.

Limited equity housing cooperatives (LEHCs) offer home ownership opportunities for low and moderate income households that do not have the flaws of traditional programs. The cooperative organizational structure can be used with any type of construction-including single family homes, condominiums, townhomes; even mobile home parks. LEHCs are financed with a blanket mortgage that covers the entire development. Homeowners own a “share” in the development that grants them occupancy rights to a particular unit or house. They pay monthly “carrying charges” that include their share of the mortgage payment and an investment in reserves to be used for maintenance and repairs.

The financing model allows members to move to a smaller or larger unit if their needs change without costly transaction costs. Enduring affordability is assured in the LEHC model because there is a cap on the re-sale appreciation value of the unit. The cooperative is a prudent investment for public subsidies because of this effective mechanism for preserving affordability over time and because the financing structure of the cooperative insulates the project from problematic refinancing schemes. Although there is a limit on the re-sale equity a homeowner can earn, the co-op member still reaps homeowner benefits. Cooperative housing members gain a homeowner tax deduction, payment stability, asset investment, and control over how funds are allocated to infrastructure repairs and improvements.

Cooperatives enhance social and community building mechanisms. Patty Milich, a 22-year member of Dos Pinos housing Cooperative in Davis, CA says that her low monthly mortgage payment has allowed her to finance her daughter’s college education. Claire Hirsch has been a member of Marathon Co-op in Los Angeles since 1986 and served as a board member for 12 years. Ms. Hirsch explains: “We are a pretty happy community. While we have house rules and sometimes there are problems, on the whole members really get alongwe know we have a good thing.”

By: CCCD CCCD is offering a full day education program on establishing a LEHC on February 27, 2009; detailed information is available at www.cccd.coop

Making History: Paving the way for Housing Cooperatives in SF

On December 16, 2008, cooperative proponents throughout San Francisco realized a significant victory before the San Francisco Board of Supervisors. The “Limited Equity Housing Cooperative Conversion” ordinance was passed unanimously, perhaps launching what could be the “coop revolution” in a city that, surprisingly, has seen very few of them in recent years.

Despite the benefits of collective, democratic living through affordable, equity restricted cooperatives, conversion of existing buildings into limited equity housing cooperatives were not permitted until the recent ordinance. San Francisco has some of the strongest renter protections on the books, and its condominium conversion provisions are no exception. For decades, San Francisco has placed high barriers around and has even prohibited certain types of condominium conversions. These prohibitions are critical to protecting tenants who would otherwise be evicted by property owners wanting to kick them out and sell the units as high dollar condominiums.

Ironically, in the genuine effort to protect low-income tenants, San Francisco inadvertently prohibited a form of housing that could accomplish that goal. The conversion protections not only prohibited condo conversions, they also prohibited conversions into cooperatives. Despite its benefits, cooperatives can also serve as a vehicle for displacement and speculation. “Market rate” cooperatives can differ very little from condominiums other than the form of ownership (coop owners hold shares) and slightly greater level of collective decision making. The condo conversion ordinance, however, prohibited conversion not only into “market” rate coops but into any type of coop, including LEHC’s.

LEHC’s differ from “market rate” cooperatives in that the amount of equity that a member can extract from his/her share is significantly restricted. The LEHC itself retains the unrealized equity and can use it to benefit the coop as a whole (like borrowing against that equity to rehab the building, etc.). Most importantly, LEHC’s discourage property speculation because equity returns are limited.

The San Francisco ordinance, however, takes LEHC’s several steps further in adding significant protections for lowincome residents. To qualify to convert under this ordinance, LEHC’s must:

Require that 66% of the occupants be at or below 80% of San Francisco Median Income;

• For low-income residents, restrict the initial buy-in of member shares to just 10% of the purchase price divided by the number of units in the building;
• Restrict resale price of all member shares based on a formula set by the San Francisco Mayor’s Office of Housing (MOH)
• Require that any resident evicted by a previous owner in the past two years be offered a right to return and purchase a unit;
• Require that MOH continuously monitor and report on the affordability of the converted buildings

With the passage of this ordinance, conversion into LEHC’s are now legally possible in San Francisco. This ordinance could not have been possible without the tremendous support of Supervisor Aaron Peskin and his office, the Columbus United Cooperative, Chinatown Coalition for Better Housing, San Francisco Tenants Union, the Eviction Defense Collaborative, the City Attorney’s Office.
By: Malcolm Yeung

Build SFCLT's Membership Base!

Many of you have paid membership dues in the past and have participated in membership events that we have had. Well, it’s time to renew your dues and get involved once again. Annual dues are only $24.00/ year or $40.00 to sponsor another member who cannot afford the $24.00. Some of the benefits of being a dues paying member of SFCLT are:

• Keep abreast of developments in San Francisco for affordable housing and housing justice initiatives.
• Help the SFCLT build a broad base of support to collectively push for more land trust properties in San Francisco.
• Have access to trainings and events about cooperative housing, community land trust developments and first-time home buying.
• Help the SFCLT become financially secure and independent. The more members we have, the more income we have that is not encumbered by outside government body, foundation or other donor.
• Have input on how we build the organization by voting for our Board of Directors, participating in annual meetings and committees.

 

So join up again!


You can mail a check to:


SFCLT
P.O. Box 420982
SF, CA 94142