On a split vote, the Board of Supervisors has declined to increase “in-lieu fees” for affordable housing as originally planned, giving the housing industry a small, temporary and mostly symbolic break in tough economic times.
The vote to hold off raising the fees Tuesday was 3-2. Supervisors Frank Mecham, Katcho Achadjian and Adam Hill voted against the increase, and Bruce Gibson and Jim Patterson voted to boost fees according to a timetable adopted earlier.
The county adopted affordable/inclusionary housing last year after a long and hard-fought battle. Under inclusionary housing, a developer has to set aside a percentage of his houses as “affordable.”
He also can opt to buy his way out — a so-called “in lieu” fee.
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There is also a commercial housing impact fee.
But the fees have not been bringing in much money, according to Ted Bench of the county’s Housing and Community Development division.
As of Oct. 9, he said, the county had collected $6,508. It takes $100,000 combined with other financial sources to build one affordable housing unit, Bench wrote in a staff report.
When the county adopted its affordable housing plans, it set forth a five-year schedule, with an increase planned every year. Gibson said the long phase-in was a concession to the building industry.
If they had followed the plan Tuesday, supervisors would have raised the in-lieu fee to $7,980 from $3,990 for a 2,100-square-foot, single-family residence.
Hill said “we’re not collecting anything because there’s nothing going on.” He said he supports the affordable housing plan, but “they tend to work only when there’s a healthy housing market.”
Achadjian agreed, adding that there may be more foreclosures ahead. “The market rules, no matter what we do,” he said.
Patterson argued that going off schedule would put us “that much further behind … in achieving our goal of providing affordable housing.”
Gibson said the county needs to stay on track or face the possibility that the five-year phase-in created by its affordable housing ordinance will not be met.
The San Luis Obispo County Housing Trust Fund opposed the fee increase. The fund provides financing and technical assistance to help private developers, nonprofit groups and local governments produce and preserve homes that low-income families, seniors on fixed incomes and people with disabilities can afford to rent or buy.
The Central Coast Home Builders Association also opposed the boost.
“Doubling the fees today is going to wind up getting you less than zero,” said Jerry Bunin, the association’s government affairs director. “Adding to the cost is not going to get more units built.”