SF Faces Hard Debt Ceiling by 2032 as Housing Fee Cuts Fail to Restart Building

San Francisco's Budget & Appropriations Committee received two sobering reports this week that together define the fiscal and housing constraints heading into the June budget cycle. The city will exhaust its general obligation bond capacity by 2032, with $1.18 billion in voter-approved debt sitting unissued — while recent fee cuts designed to spur housing have failed to produce a single measurable uptick in building permits.

• City hits GO bond debt ceiling by 2032; $1.18 billion in authorized bonds remain unissued, including $300M for projects that haven't broken ground

• Emergency firefighter water system faces a $1.3B+ funding gap that would take 25 years to fill at current pace

• Housing fee reductions since 2023 have not accelerated construction; SF issued the fewest building permits per capita among California's 10 largest cities in 2024

• $308,000-per-unit feasibility gap driven by macroeconomic headwinds overwhelms city-level fee relief

• Hall of Justice relocation faces December 2026 deadline as staff scramble to find new space for SFPD investigations

The basics: San Francisco finances major capital projects through two instruments: general obligation (GO) bonds, repaid by property taxes and capped at a rate set in 2006 ($120 per $100,000 of assessed value), and certificates of participation (COPs), capped at 3.25% of general fund discretionary revenue. The Budget and Legislative Analyst's report found both instruments are approaching their limits.