Mountain View Voice

News - June 8, 2012

Council moves ahead with new housing fees

by Daniel DeBolt

The City Council acted quickly on Tuesday so as not to miss out on as much as $24 million in funds from apartment projects in the city planning pipeline.

In a 5-1 vote at the June 5 meeting, with council member John Inks opposed and Tom Means absent, the council asked city staff to draw up an ordinance to impose a fee roughly equal to 4.6 percent of the value of an apartment project to go towards affordable housing developments. The fee would be imposed only if 10 percent of the units in the project aren't set aside as affordable housing for people earning 65 percent of the area median income.

"The council wants units," said Mayor Mike Kasperzak. "When we have higher fees, that gives developer the incentive to provide actual units in exchange for not having to pay the fee."

The fee supported by the council would be equal to $18.95 per square foot, or $2.1 million for a typical 100-unit apartment complex composed of 1,100-square-foot units.

The fee would be just enough to encourage developers to build affordable units into a project. If not, fee revenue would go towards subsidizing affordable housing projects elsewhere in Mountain View. But the consequence of a higher fee is that some apartment projects may not be built, city staff said.

There was some concern that council was not acting fast enough and the city could miss out on housing fees from over 1,200 units being planned in six sites around the city. Kasperzak said that under the new plan, "We should be able to capture most, if not all, of the rental units in the pipeline."

Council members who disagreed with the approach said office developers should pay more towards affordable housing. In a compromise, a study that could recommend a big increase in housing impact fees on commercial developers will also come back for council review when the rental fee ordinance is presented for a council vote this fall.

Office developers "can't argue with the fact they are creating jobs and the need for housing," said council member Margaret Abe-Koga, who was reluctant to support a fee on housing developments.

Email Daniel DeBolt at ddebolt@mv-voice.com

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