Planning Commission recommends changes to demolition limits in equity districts, approves 301 Mission unit merger

The Planning Commission voted 5-2 on Thursday to recommend that the Board of Supervisors disapprove amendments tightening residential demolition rules in the Priority Equity Geographies Special Use District unless the proposal is modified first. The overlay covers parts of the city identified as most exposed to displacement, and the amendments would change how demolition, replacement housing and affordability are counted there.

The proposed changes would extend the lookback period used to judge a property's demolition history, adjust how replacement affordability is calculated, allow some rent-controlled units to be replaced with deed-restricted units, and add blocks south of Ocean Avenue to the district. Staff recommended disapproval unless modified, citing housing feasibility, the loss of rental and rent-controlled stock, weaker return rights for moderate-income tenants, the difficulty of delivering extremely low-income units without services, and the complexity of carrying the rules out.

Public comment ran overwhelmingly in favor. Residents and housing advocates described displacement pressure in their neighborhoods and urged the commission to support deeper affordability rather than the staff position. In its vote the commission backed the disapproval-unless-modified recommendation and also encouraged the Board of Supervisors to increase protections for extremely low-income tenants.

On a separate item, the commission approved a conditional use authorization 6-1 to legalize the merger of two penthouse units at 301 Mission Street that had been combined without a permit shortly after the building was completed and had never operated as separate homes. The sponsor argued the owner relied on assessor representations and would face reconstruction costs and the loss of a property tax basis. Staff said the result is a larger family-sized unit. One commissioner voted no on housing-stock grounds; the majority found there was no practical loss because the two units never existed separately. Approval came with conditions.

The commission declined to take discretionary review of a third-floor vertical addition to a two-story single-family house at 3837 18th Street, approving the project as modified on a 4-3 vote. Staff had recommended against review, finding no exceptional or extraordinary circumstances. The neighbor who requested review argued the addition would block light and leave the adjacent property boxed in, and asked for a side setback. The sponsor described roof and height reductions already made and presented a sunlight simulation. Commissioners debated whether the impacts justified review at all, and spent part of the discussion on how the discretionary review process itself works, before approving the modified project. Three commissioners voted against.

The commission also heard, with no vote, an informational presentation on a revised housing proposal at 3832 18th Street. The sponsor described a much smaller project than the seven-story concept first floated for the site, which was dropped for financial and life-safety reasons. The current plan keeps and improves the existing house and adds a unit inside the main building plus a detached cottage at the rear, pursued as a ministerial approval under SB 423, the state law that limits local review of qualifying housing projects. One member of the public objected that the change would turn a modest single-family home into a very different building, questioned how demolition would be counted under state density-bonus and implementation-plan rules, and predicted high sale prices for the new units. Commissioners were largely supportive, asking about the family-zoning height limit and why the taller version was abandoned. Staff confirmed that demolition of a non-historic building is not barred. No action was taken.

Earlier, the director told the commission that voters had approved the measure allowing the planning and building departments to complete their merger. The two departments have already combined their permit center, technology, administrative and policy functions, and a joint budget and fee review will come to the commission early next year. The director said both departments are projecting fee surpluses and that the departments hope to hold or possibly reduce fees, and announced a one-day department closure in November.

Staff also reviewed recent decisions elsewhere. The Board of Appeals denied an appeal of a permit suspension following unauthorized demolition work, and a conditional use authorization for the revised project is expected back before the Planning Commission. The Historic Preservation Commission approved certificates of appropriateness, and the Board of Supervisors passed several landmark and housing-related items on second read. A Board committee forwarded a group of landmark designations with positive recommendations, with one designation tabled amid owner opposition and another continued at the owner's request.

Several items moved without discussion. The commission approved a conditional use authorization for formula retail cannabis at 3326 Mission Street and a Planning Code amendment extending eligibility for unpermitted residential yard structures, both on the consent calendar, along with draft minutes from two October meetings. Those votes were unanimous.