With Family Homelessness Up, San Francisco Looks to Extend Short-Term Rental Subsidies

Supporters of the reallocation say putting more money toward short-term subsidies will allow more people to move into housing faster. The plan would create around 800 new rental subsidies, including 350 slots for families, 250 slots for adults and 200 slots for youth.

The subsidies are funded by new Homelessness Gross Receipts Tax revenue, which is generated through a ballot initiative voters passed in 2018. The proposed ordinance would lift the cap on short-term subsidy spending for the second year of the proposed budget.

As of May 2026, the city is funding 2,925 rapid rehousing rental subsidies. Of those, 1,673 are for adults, 749 are for families and 503 are for transitional-aged youth, according to the Budget and Legislative Analyst.

“The 12% is really quite limiting,” said Emily Cohen, deputy director for communications and legislative affairs at the Department of Homelessness and Supportive Housing, at a budget committee hearing on Wednesday. “We really see this as an opportunity to drive more investments toward families and adults.”

The budget committee unanimously passed the ordinance proposal on Wednesday, and it heads to the full Board of Supervisors on July 14. Changes to the gross receipts tax require two-thirds of the board to approve.

Maritza Salinas lives in transitional housing with her three children and has navigated the city’s homelessness system for years. She was recently offered a short-term rental subsidy that would help cover about $1,400 per month on rent.

But she said that would hardly cover rent for a two-bedroom, which costs $5,600 per month on average in San Francisco, according to Zillow.

“For a family of four, where am I going to find a place to live? It’s impossible,” Salinas said. She was able to increase the subsidy to $3,200, which she described as a “blessing.” But she’s already thinking about what she will have to do at the end of the short-term subsidy period.

“Yeah, it feels good, but then after two years, where are we going to be?” she said.

Another concern from advocates is that the majority of residents who receive rental subsidies often have to look outside the city for landlords who will accept them.

“Clearly there’s also a capacity issue,” Supervisor Connie Chan said at Wednesday’s meeting. “There are times that we could offer a voucher, but then they end up being outside of San Francisco, and a lot of families want to stay in San Francisco, and we want them to stay.”

Chan voted to remove the short-term rental subsidy cap, saying it was important to get more families rapid support for housing and off the streets.

But she urged the committee to consider using the millions of dollars that the homelessness tax has generated on reserve to invest in longer-term housing solutions.

“We need housing, actual housing, not just shelters and hotels, so we need to make a parallel path to not only extend rental subsidies but build capacity for long-term housing,” Chan said.

The plan would not change the funding categories that voters approved in 2018, said Sophia Kittler, the mayor’s budget director, and it extends the temporary cap waiver that the board approved in previous budget cycles.

Homelessness Gross Receipts Tax revenue is allocated into four primary spending areas: at least 50% on permanent housing, 25% on mental health services, 15% on prevention programs and 10% on temporary shelter and hygiene programs.

In last year’s budget cycle, the mayor proposed increasing the funding allocation for temporary shelter, which the Coalition on Homelessness also fought against in favor of maintaining more funding for permanent housing options.

“To have a thriving San Francisco, we need to make sure that our poorest people in San Francisco can afford to live here,” Friedenbach said. “We’re depending on working-class people to make the city thrive, but then don’t have housing that they can afford.”