The City’s Planning and Land Use Management (PLUM) Committee voted at the end of August 2017 in support of implementing a fee on new development to build affordable housing for lower-income residents. The Affordable Housing Linkage Fee Ordinance, which requires approval from the Housing Committee and the City Council, includes an amendment by Councilman Curren Price for a three-year fee exemption for commercial and industrial projects in the SLATE-Z Promise Zone.
“As we consider instituting the Affordable Housing Linkage Fee Ordinance, we must balance the importance of economic development for the vitality of our future with the urgent need for affordable housing now,” said Price, a member of the PLUM committee.
“It’s not one or the other, but rather interconnected to improve our communities and ensure equitable opportunities for all Angelenos. We cannot afford to cause unintended consequences or create hardships in areas that desperately need significant economic development like the SLATE-Z Promise Zone.”
Under Councilman Curren Price’s leadership, South LA won a Promise Zone designation last year that allows the Ninth District to benefit from a unique community development program. The federal program, which was established in 2013, provides additional resources to help stimulate areas with high-poverty rates.
For example, the SLATE-Z Promise Zone has an 11 percent unemployment rate and 46 percent of residents live below the federal poverty line. Councilman Curren Price said by exempting the commercial and industrial projects in the SLATE-Z Promise Zone for 3 years, he can continue focusing on the revitalization of South LA by increasing economic activity in the area, bringing more jobs and enhancing community infrastructure.
Added Price, “The good news is we’re looking at a combination of other affordable housing initiatives to adequately and properly address the current situation across Los Angeles.”
If approved, the ordinance would require developers to pay a linkage fee based on the amount of residential and commercial square footage in a project. As proposed, fees would be based on market areas (low, medium, high) ranging from $8 to $15 a square foot for residential projects, and $3 to $5 a square foot for commercial development. It is expected to bring in an estimated $100 million per year to fund the development of affordable housing in response to Los Angeles’ housing shortage and homelessness crisis. As proposed, the full fee would be phased in over a year after the City Council approves a final ordinance.