Dive Brief:
- Los Angeles Mayor Eric Garcetti has proposed that city developers pay into a fund that will be used to help the mayor meet his goal of building 100,000 more affordable housing units by 2021, KPCC reported.
- Garcetti also plans to use the fee, which still must be approved through a series of public hearings and the legislative process, to help extend existing affordable housing contracts set to expire soon.
- Los Angeles is currently experiencing a housing boom of luxury and market-rate units. But wages are not keeping up with housing costs, and there’s not enough available affordable housing to meet demand, according to KPCC.
Dive Insight:
Los Angeles studied linkage fees, another term for the fee Garcetti is proposing, in 2011, and the city determined that it could expect between $37 million and $112 million in fees a year, depending on the size of the fee.
Garcetti made no comment as to how much the fee will be or whether he will tie it to commercial development, residential development, or both. Other cities with similar fee programs often tie them to the square footage or number of units of a project.
In a separate program, Garcetti is offering an expedited application process for developers who include at least 20% below-market-rate units in their projects.
Garcetti’s fee plan is another version of the inclusionary housing mandates causing so much debate among builders and municipalities all over the country.
