In November 2018, voters approved Proposition C, imposing a Homelessness Gross Receipts Tax to prevent and address homelessness due to a historic housing crisis in San Francisco. The original legislation allocated fixed percentages of the Our City Our Home Fund to various programs such as permanent housing, homeless shelters, homelessness prevention, and mental health treatment. Any remaining fund balance at the fiscal year's end should be held for appropriation on eligible programs in future years.

For fiscal years 2023-2024 and 2024-2025, the ordinance amends the percentage allocations to allow expenditures on short-term rental subsidies to exceed specified limits and allocates up to $16,360,000 of interest earned to shelter and prevention categories. Additionally, it specifies increased expenditures for permanent housing, homeless shelters and hygiene programs, and homelessness prevention, exceeding the percentages previously set in the original legislation.

The changes would allow a reallocation of funds to more urgently address the needs of those experiencing homelessness by focusing on shelter, prevention, and housing resources to potentially reduce homelessness significantly over the next five years.

Due to the significant unencumbered balance in the Our City Our Home Fund and generated interest income from unspent revenues, the Board of Supervisors finds it necessary to urgently fund shelter, prevention, and housing to meet the current acute crisis of homelessness.

The Board of Supervisors may amend the measure by a two-thirds vote under the authority of Business and Tax Regulations Code Section 2811, to further the intent of the original legislation.

The accountability mechanism and ongoing decision-making regarding the allocations of the Our City Our Home Fund remain unchanged, with the Board of Supervisors retaining the authority to amend future allocations to further the goals of Proposition C, as the circumstances of the homelessness crisis in San Francisco evolve.