CHAPTER 17.35
COMMERCIAL LINKAGE FEE
17.35.010 Purpose.
A. Mitigation of Affordable Housing Impacts Linked to Nonresidential Development. The purpose of this chapter is to (1) implement the goals and objectives of the general plan housing element of the city of Petaluma; (2) mitigate the housing impacts caused by new, changed and expanded nonresidential development in the city of Petaluma; (3) provide housing affordable to persons who earn between eighty and one hundred percent of the area median income. The city council has determined that affordable housing requirements are needed, has found the following requirements to be consistent with its general plan and, pursuant to Government Code Section 65913.2, has considered the effects of the fee with respect to the city’s housing needs as established in the city’s housing element, as amended from time to time pursuant to state law.
(Ord. 2171 NCS § 1 (part), 2003.)
17.35.020 Findings.
A. Need for Affordable Housing. The city council has found that persons of low and moderate income are experiencing increasing difficulty in locating and maintaining adequate, safe and sanitary affordable housing.
B. Housing Needs and Impacts Created by Nonresidential Development. Pursuant to the Sonoma County Workforce Housing Linkage Fee Study published by Economic and Planning Systems Inc. in December 2001, the city council finds that the construction or expansion of nonresidential development is a major factor in attracting new employees to the city of Petaluma and the county of Sonoma. A substantial number of these new employees and their families seek residence in the city and county and place a greater strain on an already impacted housing stock. Current and new employees who are unable to find affordable housing in the jurisdictions in which they work are forced to commute long distances. This situation adversely affects their quality of life, consumes limited energy resources, increases traffic congestion and has a negative impact on air quality. Employers have or will have problems attracting a labor force because of the shortage of housing affordable to many workers.
C. Means of Meeting Affordable Housing Demand. Increasing the production and availability of affordable housing is problematic. Prices and rents for affordable housing remain below the level needed to attract new construction. At the same time, escalating land costs and rapidly diminishing amounts of land available for development hinder the provision of affordable housing units solely through private action. Federal and state housing finances and subsidy programs are not sufficient by themselves to satisfy the affordable housing needs associated with employment resulting from nonresidential development. Programs and activities to expand affordable housing opportunities can be accomplished through public/private partnership action. It is the purpose of this chapter to establish a feasible means by which developers of nonresidential development projects assist in (1) increasing the supply of low- and moderate-income housing and (2) increasing the supply of housing in proximity to employment centers.
D. Imposing Housing Requirement on Developers Whose Projects Create the Need. It is appropriate to impose some of the cost of the increased burden of providing housing for low- and moderate-income people necessitated by such development directly upon the sponsors of a development, and indirectly upon the occupiers. The imposition of a commercial linkage fee requirement is an appropriate means to accomplish the purpose of this chapter. In calculating the commercial linkage fee requirement, the city council has taken into account other factors in addition to the simple calculation of contribution. These include impact on construction costs, special factors and hardships associated with certain types of development, and legal issues.
E. Rational Relationship Between Affordable Housing Need Created and Fee Requirement. The unit requirements and housing fees contained in this chapter are designed to create a rational relationship between the amount of housing need created by the land use and the size of the fee, taking into account the effect of such fee requirement on providing affordable housing opportunities and the economic feasibility of imposing such requirements.
(Ord. 2171 NCS §1 (part), 2003.)
17.35.030 Definitions.
As used in this chapter:
"Addition" shall mean adding gross square feet to an existing development project or building subject to this chapter.
"Affordable housing" shall mean the total cost of monthly housing payments does not exceed thirty percent of gross household income.
"City manager" shall mean the city manager of the city of Petaluma or his/her designee.
"Director of community development" shall mean the director of community development for the city of Petaluma, his or her designee, or such person as the city manager may designate.
"Expanded nonresidential development" or "expanded nonresidential development project" shall mean construction that results in a net increase in the gross square footage of an existing nonresidential space or any conversion of residential space to nonresidential space.
"Gross square feet" or "gross square footage" shall mean the area included within the surrounding walls of a nonresidential development. This area does not include enclosed parking for vehicles.
"Low- and moderate-income" shall mean a household with total annual income between eighty percent and one hundred percent of the area median income, adjusted for family size, and in accordance with the Area Median Income Schedule as published annually by the U.S. Department of Housing and Urban Development for the Santa Rosa MSA.
"Nexus Study" shall mean the "Sonoma County Workforce Housing Linkage Fee Study" published by Economic and Planning Systems, Inc., in December 2001 as may be amended from time to time.
"Nonresidential development" or "development project" for purposes of this chapter shall mean any project resulting in new or expanded nonresidential gross square footage.
(Ord. 2403 NCS §2, 2011: Ord. 2171 NCS §1 (part), 2003.)
17.35.040 Application and calculation of fee.
A. Payment of Fees Required. Every person constructing or causing to be constructed within the city nonresidential development projects and/or expanded nonresidential development projects as defined in this chapter shall pay to the city a fee computed as set out in this chapter.
B. Determination of Land Uses. For the purposes of this chapter, nonresidential land uses shall be divided into three classifications: commercial, retail, and industrial. When necessary, the director of community development or such other person as may be designated by the city manager shall determine the land use classification that most accurately describes the nonresidential development, or in the case of mixed use developments, the portion thereof, for the purposes of determining the fee to be imposed.
C. Computation of Fees. The fee charged for residential and nonresidential development shall be established from time to time by resolution of the city council and adjusted consistent with the provisions of such resolution and this chapter.
D. Adjustment of Fee. The fees specified herein shall increase or decrease annually by the same percentage as the latest "Engineering News Record Construction Cost Index—20 City Average" ("Index") annually increases or decreases. The adjustment shall be based on a comparison of the most recent Index to the Index in the month of the adoption of the fee, or the Index used for the prior adjustment of the fee. The Finance Director shall compute the increase or decrease in such fee. The first adjustment shall take place on July 1, 2012, and each following July 1st.
E. Time of Collection. Such fees shall be due and payable prior to issuance of a building permit, or if no permit is to be issued by the city, at the time a new business license is issued.
F. Application of Fee in Redevelopment Project Areas. Any nonresidential development or expanded nonresidential development located within the adopted boundaries of a city of Petaluma community development commission redevelopment project area shall pay a fee equal to one-half the amount established pursuant to subsection C of this section.
(Ord. 2403 NCS §3, 2011: Ord. 2171 NCS §1 (part), 2003.)
17.35.050 Fee credit or refund.
A. Fee Credit. A developer of any project subject to the fee requirement may apply to receive a credit against the total amount of fees due, or a portion thereof, if said developer provides affordable housing through some other means agreeable to the city of Petaluma.
B. Refund of Fee. If the affordable housing fee is paid and the building permit is later canceled or voided, or the permit which triggers the application of the fee fails to vest within the terms of said permit, the director of community development may, upon written request of the developer, order return of the fee if (1) the fees paid have not been committed, and (2) work on the private development project has not progressed to a point that would permit commencement of a new, changed, or expanded use for which a fee would be payable.
(Ord. 2171 NCS §1 (part), 2003.)
17.35.060 Use of fees.
A. Use and Disbursement of Monies in the Fund. Monies collected pursuant to this chapter shall be used in accordance with and in support of activities to implement the city’s adopted housing element, consolidated plan, and implementation plan. Activities shall be limited to direct expenditure for the development of affordable housing as defined herein or incidental non-capital expenditures related to such projects, including but not limited to land acquisition, applicable predevelopment costs, construction, rehabilitation, subsidization, counseling or assistance to other governmental entities, private organizations or individuals to expand affordable housing opportunities to low- and moderate-income households. Monies in the fund may be disbursed, hypothecated, collateralized, or otherwise employed for these purposes from time to time as the city council so determines is appropriate to accomplish the purposes of the affordable housing fund. These uses include, but are not limited to, assistance to housing development corporations, equity participation loans, grants, predevelopment loan funds; participation leases, loans to develop affordable housing or other public/private partnership arrangements. The affordable housing funds may be expended for the benefit of both rental and owner-occupied housing.
B. Accounting of Fees. All fees shall be deposited into a segregated account and all expenditures of funds from the same shall be documented and available for public inspection during regular business hours.
(Ord. 2171 NCS §1 (part), 2003.)
17.35.070 Exemptions.
Public facilities, public and private schools, and churches are exempt from the provisions of this section.
(Ord. 2171 NCS §1 (part), 2003.)
17.35.080 Fee escalators.
A. After January 1, 2007, this fee shall be annually increased to reflect the percentage increase in the cost of construction or public improvements as reported in the Engineering News Record—Construction Price Index for the San Francisco Bay Area.
B. This fee may be adjusted from time to time, based upon amendments or updates to the Nexus Study, or based on any other date and analysis which the city council determines to be applicable to the continued establishment of this fee.
(Ord. 2171 NCS §1 (part), 2003.)