Last week, the Academy of Art University agreed to pay $60 million to settle a lawsuit filed by the City of San Francisco. Under the proposed deal, the university will pay the city $20 million in cash over the next five years, and will spend another $40 million to build 160 units of affordable housing.
The lawsuit centers on land-use violations racked up by the university over the last decade. Those include converting rent-controlled housing buildings into spaces for academic use, turning office buildings into classrooms, transforming a church into an auditorium and changing apartments into dorms.
In 2015, Scott Sanchez, a San Francisco zoning administrator, told Forbes, “[a] planning commission president once said he didn’t know if it was ignorance or arrogance that led them to do what they’ve done. I don’t think it can be said that it’s ignorance anymore.”
After the deal was announced, Academy of Art University President Elisa Stephens released a statement saying, “[w]e are very pleased to reach this agreement, which allows the Academy to make significant contributions to San Francisco while maintaining our academic excellence and providing for our students. We look forward to implementing the agreement.”
The Stephens family currently runs the school, which was founded as the Academy of Advertising Art in 1929 and has a student body of approximately 15,000. Billed as the largest privately owned art and design school in the US, the Academy of Art University is spread out across over 40 buildings in San Francisco, making the Stephens family the city’s largest property owner.
Of the 160 units of affordable housing that the Academy of Art University will be building, half will be completed in 18 months. Rent will be kept affordable for 66 years.