The Board of Supervisors on Tuesday supported a proposal to suspend impact fees tied to the development of affordable units for a two-year period.
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Aiming to spur more affordable housing development, the Sonoma County Board of Supervisors has set a course to waive, at least temporarily, a set of fees charged to new projects and used to offset the public cost of utilities, parks and other services for new residents.
Impact fees have for been imposed for that purpose for decades by jurisdictions across the state, but as local governments struggle to expand affordable housing stock amid California’s housing crisis, the fees have become the subject of mounting debate.
Affordable housing advocates, especially, have pressed local governments for fee relief, and they won favor Tuesday with the Board of Supervisors, which unanimously supported a proposal to suspend the parks and traffic fee tied to the development of affordable units ― very low, low and moderate income ― for a two-year period.
The timeline is meant to allow staff to complete a study of the county’s current impact fee structure and potential alternatives.
“If this helps spur housing, lets spur housing,” said Supervisor David Rabbitt.
There are 1,924 affordable units currently proposed or in process in the county’s unincorporated areas, meaning the county could forgo some portion of up to $19.5 million in projected fees under the waiver if all those units were built. However, staff on Tuesday said the total lost revenue could be less given that some projects will are unlikely to complete the development process.
The fee reduction would be tied to projects once they apply for a building permit, said Jennifer Larocque, a county administrative analyst.
In the past 20 years, a quarter of projects in the county’s development pipeline have failed to reach the building permit stage, according to a staff report.
“We’re trying to reduce that dropout rate knowing that the majority of that 25% is likely affordable housing units,” Larocque told the board Tuesday.
She added that the county particularly needs to see an increase in production for homes designated at the very low and low income level.
Fees collected by for projects in the county’s unincorporated areas are distributed to benefit infrastructure, parks and housing. In fiscal year 2023-24, the county collected about $1.5 million in park and traffic fees.
The board’s Tuesday decision also endorsed a staff recommendation to allocate $1.5 million in general fund contingencies for the first year of the program to backfill any lost funds for the departments that include those fees in their budgets.
The fee waiver must return to the board for a formal vote before it takes effect. If it passes, Sonoma County will join Santa Rosa as the two largest local governments to suspend impact fees for affordable housing developments.
In November, Santa Rosa council voted to temporarily suspend all capital facilities fees for certain very low-, low- and moderate-income housing projects.
Over the past year, local developers and housing advocates have increased their pressure on the board and city councils to drastically reduce the fees for affordable units. Their argument: the fees assessed for each unit of housing they build — often tens of thousands of dollars per unit — combined with other building costs, hamper the development of affordable housing.
Adding to that pressure are the steep, state-mandated housing goals that Sonoma County and its nine cities must meet by 2031.
Under the housing blueprint, the county must add 3,824 new units in unincorporated areas by 2031, more than seven times the mandated 515 units in the area during the previous eight-year cycle.
On Tuesday, developers, housing advocates and some representatives from the county’s hospitality and health care industries were unified in calling for the board to reduce, if not waive, the fees. Many pointed to the county’s tight housing supply that, combined with high prices and inflation, has priced many low- and moderate-income residents out of the market.
Pat McDonnell, the housing team supervising attorney for Legal Aid of Sonoma County, asked the board to support reducing or waiving the fees, saying that the county does not approach the housing crisis the way it has approached other crises. He urged the board to change that by utilizing “any policy tool” at its disposal.
“We often don’t put everything on the table that we ought to when we talk about trying to resolve the crisis,” McDonnell said. “I encourage you to think of this crisis the way you would think of any other crisis. I encourage you to pull all of the levers, we are in such a crisis and it requires the leadership of this board to make sure that we get out of it.”