City Council Meeting: June 27, 2006

Agenda Item: 1-Q  

To: Mayor and City Council 

From: Marsha Jones Moutrie, City Attorney

Subject: Resolution Revising the Affordable Housing Unit Base Fee For New Market-Rate Multifamily Development Pursuant to Municipal Code Section 9.56.070

Recommended Action

Staff recommends that the City Council adopt the attached Resolution which would revise the Affordable Housing Unit Base Fee for new market rate apartments to $24.10 per square foot of floor area and for condominiums to $28.15 per square foot of floor area effective on September 1, 2006.

Executive Summary

Last fall, the City Council adopted an ordinance modifying the City’s Affordable Housing Production Program, Chapter 9.56, and providing that the Affordable Housing Unit Base Fee shall be adjusted annually by resolution based on changes in construction and land costs. On June 13, 2006, the City Council approved the methodology for ascertaining changes in those costs and thereby for calculating the adjustment. This resolution has been prepared in accordance with the methodology approved by the City Council on June 13^th and is attached as Exhibit A.

Discussion

On November 8, 2005, the City Council amended the City’s Affordable Housing Production Program, Chapter 9.56, including Section 9.56.070. This amended provision provides that the Affordable Housing Unit Base Fee shall be adjusted annually by City Council resolution based on changes in construction costs and land costs. In order to implement the Council’s decision, staff formulated a proposed method of computation to reflect changes in construction costs and land costs. This methodology was detailed in an April 24, 2006 letter prepared by Paul S. Silvern of Hamilton, Rabinovitz & Alschuler, Inc. (“HR&A”) on behalf of the City. This methodology was approved by the City Council at its June 13, 2006 meeting.

HR&A subsequently prepared an analysis utilizing this methodology to calculate the appropriate adjustment to the Affordable Housing Unit Base Fee for FY 2006-07. This analysis demonstrates that a fee of $24.10 for apartments and $28.15 for condominiums is appropriate. The proposed resolution would revise the Affordable Housing Unit Base Fee accordingly, effective on September 1, 2006. On June 16, 2006, the City published notice of this hearing and the availability of the HR&A analysis. The City republished this notice on June 22, 2006. A copy of this analysis has been available in the City Clerk’s Office for public review since June 16, 2006 and is attached hereto as Exhibit B.

Budget/Financial Impact

There is no financial impact.

Prepared by: Marsha Jones Moutrie, City Attorney

Attachment: Resolution

Approved:	Forwarded to Council:
Marsha Jones Moutrie City Attorney	P. Lamont Ewell City Manager