Board Pkt 041426

File No. 260376 Committee Item No. Board Item No. 39 COMMITTEE/BOARD OF SUPERVISORS AGENDA PACKET CONTENTS LIST Committee: Date: Board of Supervisors Meeting Date: April 14, 2026 Cmte BoardMotion Resolution Ordinance Legislative Digest Budget and Legislative Analyst Report Youth Commission Report Introduction Form Department/Agency Cover Letter and/or Report MOU Grant Information Form Grant Budget Subcontract Budget Contract/Agreement Form 126 – Ethics Commission Award Letter Application Public Correspondence OTHER HR 1021 03/27/26 CSAC/LCC Standing 04/07/26 Prepared by: Calvin Ho Date: April 10, 2026 Prepared by: Date: ? ? ? ~ ? ? ? ? ? ? ? ? ? ~ ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ~ ? ~ ? ? ? ? ? ? ? ? ? ? FILE NO. 260376 RESOLUTION NO. Supervisors Sauter; Melgar BOARD OF SUPERVISORS Page 1 123456789 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 [Supporting House Resolution No. 2410 (Casey and Gomez) -Revitalizing Downtowns and Main Streets Act] Resolution supporting House Resolution No. 2410, the Revitalizing Downtowns and Main Streets Act, authored by United States Representatives Mike Casey and Jimmy Gomez, which will provide a federal tax credit to facilitate the conversion of office and other commercial buildings into housing. WHEREAS, San Francisco’s office vacancy rate continues to be very high, with 34.4% of office space in the city being vacant in the final quarter of 2025; and WHEREAS, San Francisco’s Housing Element requires the development of 82,069 housing units by 2031, including 32,881 units affordable at lower incomes; and WHEREAS, The City and County of San Francisco has previously affirmed its commitment to facilitating the conversion of office buildings into housing in order to produce much-needed housing from underutilized spaces and allow more people to live downtown; and WHEREAS, San Francisco voters passed Proposition C on March 5, 2024, which provided a one-time transfer tax exemption, for up to 5,000,000 square feet of the project, for property owners who convert office buildings to housing in San Francisco; and WHEREAS, On February 3, 2026, the Board of Supervisors adopted Resolution No. 38-26, signed by the Mayor on February 11, 2026, establishing the San Francisco Downtown Revitalization and Economic Recovery Financing District to finance eligible commercial-toresidential conversion projects with incremental tax revenues generated by those projects; and Supervisors Sauter; Melgar BOARD OF SUPERVISORS Page 2 123456789 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 WHEREAS, The federal government currently offers support for commercial-toresidential projects through tax credits (for rehabilitation of historic buildings and energy efficiency), loans, grants, and technical assistance; and WHEREAS, Despite previous efforts at the local, state, and federal levels, the remaining high costs of converting vacant office and commercial buildings into housing continue to make many conversion projects infeasible; and WHEREAS, A new federal tax incentive, modeled after the Historical Preservation Tax Credit, would help offset prohibitive costs so these projects can contribute to ending the affordable housing shortage in San Francisco and the rest of the United States; and WHEREAS, The Revitalizing Downtowns and Main Streets Act would provide a federal tax credit to facilitate the conversion of older, underutilized office and other commercial buildings into residential housing; and WHEREAS, This credit would cover a significant amount of eligible costs involved in converting commercial real estate to housing, making the projects more feasible; and WHEREAS, The Revitalizing Downtowns and Main Streets Act requires that no less than 20% of the residential units created by the credit are reserved for individuals whose income is at or below 80% of area median income (AMI) for a minimum of 30 years, with an option for states to require a longer affordability period; and WHEREAS, For difficult-to-develop and qualified low-income areas, affordability would be even deeper at or below 60% AMI; and WHEREAS, All of the affordable units created by this credit would be rent restricted to 30% or less of that income, significantly reducing rent burden for those who live in these new units; now, therefore, be it Supervisors Sauter; Melgar BOARD OF SUPERVISORS Page 3 123456789 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 RESOLVED, That the Board of Supervisors of the City and County of San Francisco supports House Resolution No. 2410, the Revitalizing Downtowns and Main Streets Act, to facilitate the conversion of empty office buildings into much-needed housing; and, be it FURTHER RESOLVED, That the Board of Supervisors urges the United States (U.S.) House of Representatives and U.S. Senate to enact the Revitalizing Downtowns and Main Streets Act; and, be it FURTHER RESOLVED, That the Clerk of the Board shall send a copy of this Resolution to Speaker Emerita Nancy Pelosi, Senator Alex Padilla, Senator Adam Schiff, Representative Mike Casey, and Representative Jimmy Gomez. I 119TH CONGRESS 1ST SESSION H. R. 2410 To amend the Internal Revenue Code of 1986 to provide an investment credit for converting non-residential buildings to affordable housing. IN THE HOUSE OF REPRESENTATIVES MARCH 27, 2025 Mr. CAREY (for himself, Mr. GOMEZ, Mr. LARSON of Connecticut, Mr. FITZPATRICK, Ms. SEWELL, Ms. TENNEY, Mr. BEYER, Mr. KUSTOFF, Ms. CHU, Mr. KELLY of Pennsylvania, Mr. PANETTA, Mrs. MILLER of West Virginia, Mr. DAVIS of Illinois, Mr. MOORE of Utah, Mr. EVANS of Pennsylvania, Ms. MALLIOTAKIS, Mr. SUOZZI, Mr. MORAN, Mr. BOYLE of Pennsylvania, Mr. LAHOOD, Ms. SA ´NCHEZ, Mr. MILLER of Ohio, Ms. MOORE of Wisconsin, Mr. AMODEI of Nevada, Mr. SCHNEIDER, Mr. CISCOMANI, Mr. HORSFORD, and Ms. DELBENE) introduced the following bill; which was referred to the Committee on Ways and Means A BILL To amend the Internal Revenue Code of 1986 to provide an investment credit for converting non-residential buildings to affordable housing. 1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 3 SECTION 1. SHORT TITLE. 4 This Act may be cited as the ‘‘Revitalizing Down5 towns and Main Streets Act’’. VerDate Sep 11 2014 22:12 Apr 02, 2025 Jkt 059200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H2410.IH H2410 ssavage on LAPJG3WLY3PROD with BILLS 2 •HR 2410 IH 1 SEC. 2. INVESTMENT CREDIT FOR CONVERSION OF NON2 RESIDENTIAL BUILDINGS TO AFFORDABLE 3 HOUSING. 4 (a) IN GENERAL.—Subpart E of part IV of sub5 chapter A of chapter 1 of subtitle A of the Internal Rev6 enue Code of 1986 is amended by inserting after section 7 48E the following new section: 8 ‘‘SEC. 48F. AFFORDABLE HOUSING CONVERSION CREDIT. 9 ‘‘(a) ALLOWANCE OF CREDIT.—For purposes of sec10 tion 46, the affordable housing conversion credit for any 11 taxable year is an amount equal to 20 percent of the quali12 fied conversion expenditures of the taxpayer with respect 13 to a qualified affordable housing building placed in service 14 by the taxpayer during the taxable year. 15 ‘‘(b) QUALIFIED CONVERSION EXPENDITURES.—For 16 purposes of this section— 17 ‘‘(1) IN GENERAL.—The term ‘qualified conver18 sion expenditures’ means, with respect to any quali19 fied affordable housing building, any amount prop20 erly chargeable to capital account— 21 ‘‘(A) for property for which depreciation is 22 allowable under section 168, and 23 ‘‘(B) in connection with the qualified con24 version of a qualified affordable housing build25 ing. VerDate Sep 11 2014 05:32 Apr 05, 2025 Jkt 059200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H2410.IH H2410 ssavage on LAPJG3WLY3PROD with BILLS 3 •HR 2410 IH 1 ‘‘(2) CERTAIN EXPENDITURES NOT IN2 CLUDED.—The term ‘qualified conversion expendi3 tures’ does not include— 4 ‘‘(A) LIMITATION ON PERIOD OF CONVER5 SION.—Except as provided in subsection (f), 6 any amount paid or incurred other than during 7 the 2-year period ending on the date on which 8 the taxpayer places the qualified affordable 9 housing building in service. 10 ‘‘(B) COST OF ACQUISITION.—The cost of 11 acquiring any building or interest therein. 12 ‘‘(3) SPECIAL RULE FOR BROWNFIELDS.— 13 Paragraph (1)(A) shall not apply with respect to any 14 expenditure for clean up of qualifying brownfield 15 property (as defined in section 512(b)(19)). 16 ‘‘(4) COORDINATION WITH REHABILITATION 17 CREDIT.—In the case of any qualified conversion ex18 penditures which are taken into account for pur19 poses of determining the rehabilitation credit under 20 section 47, the amount of such expenditures taken 21 into account under this section (determined without 22 regard to this paragraph) shall be reduced by 50 23 percent. 24 ‘‘(c) QUALIFIED CONVERSION.—For purposes of this 25 section— VerDate Sep 11 2014 22:12 Apr 02, 2025 Jkt 059200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H2410.IH H2410 ssavage on LAPJG3WLY3PROD with BILLS