AgdaPkt 2015-10-26 Study and Joint SA PFA

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7.A. - Page 1 REPORT To the Honorable Mayor and City Council From the City Manager October 26, 2015 SUBJECT Affordable Housing Impact Fees RECOMMENDATION (1) Waive First Reading and Introduce an Ordinance Requiring Affordable Housing Impact Fees for New Residential and Commercial Development and (2) Adopt a Resolution Establishing the Fee Amount and List of Uses and Exemptions for Payment of the Fee. EXECUTIVE SUMMARY Redwood City has a strong and ongoing commitment to affordable housing. With the Redevelopment Agency, the City subsidized and participated in the construction of over 700 affordable units that still house Redwood City residents today. However, the loss of the Redevelopment Agency funds and reduction in other state or federal funding has created a resource gap for the development of affordable housing. Coupled with a boom in the economy, availability of affordable housing has become a critical regional concern. In 2013 the City adopted a new housing element with a variety of policies and programs intended to increase housing supply and address housing affordability issues. Building on those policies, the City initiated the Partnership Redwood City program in March 2015 to establish new opportunities for partnerships with nonprofits, residents, and business groups to, among other community efforts, create new housing. One key aspect of Partnership Redwood City was consideration of affordable housing impact fees. Affordable housing impact fees help pay for creation of new homes for lower income residents. The fees can be charged to developers of new residential or commercial projects with rates depending on use types. Several communities such as Mountain View, San Carlos, Sunnyvale and Menlo Park have already implemented these fees. Individual cities may set the fee at different rates, depending on local conditions and legal limits. San Mateo County cities recently joined together to collectively study potential affordable housing impact fees, and those completed reports are on the City's website at www.redwoodcity.org/housingfees.