Fees and Incentives
High Density Multi-Family Residential Incentive Program
Approved by City Council on August 25, 2018.
The City has implemented an aggressive fee reduction program to incentivize and encourage high-density housing development in the Downtown. The Program has 2 main elements:
- Reduction of Capital Facilities Impact Fees and Park Impact Fees based on height
- Deferral of Water and Wastewater Impact fees
Market Rate CFF and Park Impact Fee Reduction
In addition, the city is prepared to allow a ceiling for fees on high-rise, high-density housing development in an effort to bring down per-door fees. Current fees for high-density residential projects pencil out to about $29,057 per unit.
For market rate high-rise multifamily properties, the city is proposing capping fees to the first two or three floors (depending on zoning) dedicated to residential housing on a given property conforming with the boundaries of the Downtown Station Area Specific Plan and the General Plan Downtown Core Boundary. Zoning restrictions are as follows:
- In the Downtown, with CD-7 or CD-10 Zoning: Four or more stories in height, with at least three floors dedicated to residential use.
- In the Downtown with CD-5, TV-M, TV-R, R-3-18, or R-3-30 Zoning: Three or more stories in height, with at least two floors dedicated to residential use.
Examples of how those costs would look are as follows:
Affordable Housing CFF and Park Impact Fee Reduction
A proposed Incentive Program has an additional fee incentive specific building affordable housing units on a site pursuant to the City’s Inclusionary Policy. The additional incentives would consist of a temporary reduction in Park Impact and Capital Facilities fees for affordable units to $2 per square foot for Park Impact Fees and $2 per square foot for Capital Facilities.
Assuming an average unit size of 800 square feet, affordable and inclusionary projects would cost $3,260 per unit under the Incentive Program versus $13,167 per unit under the existing fee schedule, illustrated here:
Water and Sewer Impact Fee Deferral
In addition, the City will offer a water and sewer impact fee deferral program for eligible downtown housing that have a minimum of three floors dedicated to housing. That program will have two options:
- Option 1: Deferral of water and wastewater demand fees for eligible projects until 75% of the residential units are occupied or for 6-months after final inspection, whichever is sooner.
- Option 2: Finance the water and wastewater fees for 5 years with interest.
Deferral offers an estimated $1,700 per unit incentives.
For any development to receive these per-room fee incentives, it must break ground before August 2023. “Breaking ground” is defined as securing a foundation permit.