8A Public - Laserfiche WebLink

Home

File Number: 25-347 ·Analyze ADU development impact fees with the goal of reducing, loaning, granting, or waiving those costs in exchange for providing rents affordable to low- or moderate-income households. The City Council Housing & Homelessness and Infrastructure Work Plans also include amending development impact fees and preparing a market feasibility study to support housing production and capital projects at City facilities. The City retained NBS Government Finance Group to prepare a comprehensive evaluation of development impact fees and retained Bay Area Economics (BAE) to assess market feasibility for a variety of development prototypes. NBS’s Park Development Impact Fee Study dated May 14, 2025 (Attachment D) documents the methodology, data, and legal basis for the proposed fee updates and Quimby Act dedication requirements. ANALYSIS To balance the need to fund critical infrastructure while reducing barriers to much-needed housing development, staff recommends that the City Council: ·Adopt revised Park Land Acquisition and Park Improvement fees; ·Amend the City’s parkland dedication requirements for residential subdivisions, and the in-lieu fee payable if parkland is not being dedicated; ·Establish a fee waiver program that would: o Waive Park Development Impact Fees for affordable housing developments by non-profit developers; o Provide a 50 percent reduction in Park Development Impact Fees for affordable housing developments by for-profit developers, including inclusionary housing units in mixed-income developments; and o Waive Park Development Impact fees and DFSI for ADUs over 750 sq ft (ADUs less than 750 sq ft are exempted from impact fees per State Law). Market Feasibility To understand the financial impacts of current and potential development impact fees, the City conducted a feasibility analysis across various development types. Fees were calculated per capita and scaled based on unit size. Staff consulted development finance professionals and industry stakeholders to assess how the proposed fees could affect project viability. Key market feasibility findings included: ·Market-rate multifamily rental projects already face significant financial hurdles due to high construction costs, stagnant rents, and high financing costs (including interest rates). ·Affordable housing projects continue to have substantial funding gaps, even when impact fees are reduced or waived. ·Developers weigh many factors beyond City control-such as location, market absorption, and regional competition-along with factors the City can influence, like processing timelines, zoning capacity, and impact fees. Nexus Study Methodology NBS evaluated the City’s current Park Facilities Development Impact Fee as well as potential new fees for other categories of City facilities. Given the results of the market feasibility study, NBS was directed to focus on updating the Park Facilities Development Impact Fee to comport with recent updates in legislation. The Park Development Impact Fee Study calculated fees that would maintain the current Page 3 City of San Leandro Printed on 9/4/2025