HomeMy WebLinkAboutOrdinance 2032 (Update of Commercial Linkage Fees)CLERK’S CERTIFICATE
I, LINDSAY LARA, City Clerk of the City of San Rafael, and Ex-Officio Clerk of
the Council of said City, do hereby certify that the foregoing
ORDINANCE NO. 2032
AN ORDINANCE OF THE CITY OF SAN RAFAEL
AMENDING TITLE 14 OF THE SAN RAFAEL MUNICIPAL
CODE (ZONING) TO AMEND SECTION 14.16.030
(AFFORDABLE HOUSING REQUIREMENT), ADOPTING
A COMMERCIAL LINKAGE NEXUS STUDY, ADOPTING
UPDATED COMMERCIAL LINKAGE FEES, AND
ADOPTING A COMMERCIAL LINKAGE FEE PROJECT
LIST
is a true and correct copy of an Ordinance of said City, and was introduced at a REGULAR
meeting of the City Council of the City of San Rafael, held on the 4th day of December
2023; a SUMMARY of Ordinance No. 2032 was published as required by City Charter in
the MARIN INDEPENDENT JOURNAL, a newspaper published in the City of San Rafael,
and passed and adopted as an Ordinance of said City at a REGULAR meeting of the City
Council of said City, held on the 18th day of December 2023, by the following vote, to wit:
AYES: COUNCILMEMBERS: Bushey, Hill, Kertz & Mayor Kate
NOES: COUNCILMEMBERS: None
ABSENT: COUNCILMEMBERS: Llorens Gulati
WITNESS my hand and the official
Seal of the City of San Rafael this
19th day of December 2023
______________
LINDSAY LARA, City Clerk
4865-9803-8927 v1 1
ORDINANCE NO. 2032
AN ORDINANCE OF THE CITY OF SAN RAFAEL AMENDING
TITLE 14 OF THE SAN RAFAEL MUNICIPAL CODE (ZONING)
TO AMEND SECTION 14.16.030 (AFFORDABLE HOUSING
REQUIREMENT), ADOPTING A COMMERCIAL LINKAGE
NEXUS STUDY, ADOPTING UPDATED COMMERCIAL
LINKAGE FEES, AND ADOPTING A COMMERCIAL LINKAGE
FEE PROJECT LIST
WHEREAS, Section 14.16.030 of the San Rafael Municipal Code (SRMC) requires
nonresidential development projects within the city to contribute to the attainment of affordable
housing goals and requirements by promoting and increasing, through actual construction
and/or alternative equivalent actions, the development of rental and ownership housing units for
very low, low and moderate income households; and
WHEREAS, the City of San Rafael, the County of Marin, and five other jurisdictions in Marin
County hired Strategic Economics and Vernazza Wolfe Associates (“Consultants”) to conduct a
commercial linkage fee nexus study, completed November 16, 2023 (“Commercial Linkage Fee
Study”), that demonstrated the nexus between the need for affordable housing and new
commercial development and calculated reasonable fees that could be charged by the
participating jurisdictions to new commercial development as commercial linkage fees. The
Commercial Linkage Fee Study is attached hereto as Exhibit A and incorporated by reference;
and
WHEREAS, on June 20, 2023, the City Council held a duly noticed public meeting and received
an informational report outlining the findings of the Commercial Linkage Fee Study and the
unified fee proposal, accepting all public testimony and the written report of the Community
Development Department; and
WHEREAS, on October 10, 2023, the Planning Commission held a duly noticed public hearing
and reviewed and recommended for adoption: (a) the Commercial Linkage Fee Study, (b)
proposed amendments to SRMC Title 14 related to the affordable housing requirement for
nonresidential development projects, and (c) updated commercial linkage fees; and
WHEREAS, on December 4, 2023, the City Council held a public hearing to consider adoption
of: the Commercial Linkage Fee Study, an ordinance making the proposed amendments to
SRMC Title 14, and a methodology for applying commercial linkage fees; and voted to adopt the
study and introduce the ordinance, and that ordinance will come up for adoption at the City
Council meeting of December 18, 2023; and
WHEREAS, in connection with the amendment to SRMC Title 14 and the Commercial Linkage
Fee Study, the San Rafael City Council finds it necessary to establish a new methodology for
applying commercial linkage fees; and
WHEREAS, the Commercial Linkage Fee Study substantiates a methodology that will charge
new development projects only for the costs necessary to mitigate the impacts related to those
new projects; and
4865-9803-8927 v1 2
WHEREAS, there is a reasonable relationship between the Commercial Linkage Fee’s use and
the development projects on which the Commercial Linkage Fee will be imposed because the
fee will only fund costs reasonably related to each new development; and
WHEREAS, the Commercial Linkage Fee does not exceed the estimated reasonable cost of
providing the affordable housing facilities for which the fee is imposed; and
WHEREAS, the Commercial Linkage Fee is not levied, collected or imposed for general
revenue purposes, but is levied specifically to fund facilities of the types set forth in the
Commercial Linkage Fee Study; and
WHEREAS, the Commercial Linkage Fees bear a reasonable relationship to the use of
affordable housing facilities by new development; and
WHEREAS, the Commercial Linkage Fee Study establishes a proposed amount and provides
an evaluation of the need for an updated Commercial Linkage Fee and establishes the nexus
between the imposition of the new fee and the estimated reasonable cost of providing the
service for which the fee is charged; and
WHEREAS, the Commercial Linkage Fee Study identifies the City’s existing level of affordable
housing service, identifies the proposed new level of service, and includes an explanation of
why the new level of service is appropriate; and
WHEREAS, the Commercial Linkage Fee Study includes information that supports the City’s
actions, as required by subdivision (a) of Section 66001 of the Government Code; and
WHEREAS, the Commercial Linkage Fee Study reviewed the assumptions of the prior fee
study, which supported the existing Commercial Linkage Fee, and evaluated the amount of fees
collected under the existing fees; and
WHEREAS, the City is adopting a Commercial Linkage Fee Project List, which is attached
hereto as Exhibit B and serves as its capital improvement plan pursuant to subdivision (a)(6) of
Section 66016.5 of the Government Code, for the development and maintenance of affordable
housing facilities; and
WHEREAS, the Commercial Linkage Fee Project List indicates the approximate location, size,
time of availability, and estimates of cost for all facilities or improvements to be financed with the
fees; and
WHEREAS, the City is setting rates for the Commercial Linkage Fee, which are attached hereto
as Exhibit C, and once effective, will be incorporated into the City’s Master Fee Schedule; and
WHEREAS, the City Council finds that the impact fees and charges imposed by this Ordinance
are necessary and reasonable to implement the goals and objectives of the City’s General Plan
and are permitted by California state law; and
WHEREAS, the Commercial Linkage Fees are “exempt charges,” within the meaning of
Section 1 of Article XIII C of the California Constitution and the Taxpayer Protection and
Government Accountability Act (Initiative No. 21-0042) because they are a charge imposed as a
condition of property development; and
4865-9803-8927 v1 3
WHEREAS, pursuant to Government Code sections 66016.5, 66018, and 66019, the City must
adopt the Commercial Linkage Fee only after notice and public hearing; and
WHEREAS, pursuant to Government Code sections 66016.5, 66018, and 6062a, a notice of a
public hearing on the proposed fee update was published on November 4, 2023 and
November 23, 2023 in the Marin Independent Journal, a newspaper of general circulation; and
WHEREAS, pursuant to Government Code sections 66016.5, notice of the time and place of the
meeting, including a general explanation of the matters to be considered and a statement that
required data is available was provided at least 30 days prior to the meeting to those members
of the public who filed a written request with the City; and
WHEREAS, at least 14 days prior to the public hearing referenced above, the City made
available for public inspection information required under the Mitigation Fee Act; and
WHEREAS, pursuant to Government Code section 66017, fees imposed on a development
project that apply to the filing, accepting, reviewing, approving, or issuing of an application,
permit, or entitlement to use shall not take effect until at least 60 days have passed since the
final action on the adoption or increase of the fee.
NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF SAN RAFAEL DOES
ORDAIN AS FOLLOWS:
SECTION 1. FINDINGS.
The City Council of the City of San Rafael does hereby find that the above referenced recitals
are true and correct and material to the adoption of this Ordinance.
SECTION 2. Subsection 14.16.030(D) – General Requirements-Nonresidential Development
Projects and Subsection 14.16.030(E) – Housing In-Lieu Fee Fund of Section 14.16.030-
Affordable Housing Requirement of the San Rafael Municipal Code are hereby amended to
read as follows. Additions are shown in underline, and deletions are shown in strikethrough.
Section 14.16.030 – Affordable Housing Requirement
D. General Requirements—Nonresidential Development Projects.
1. Application. An affordable housing requirement is hereby imposed on all developers of
nonresidential development projects, including all construction of additional square
footage to existing nonresidential developments and conversion of residential square
footage to nonresidential use, subject to the following exceptions:
a. Any project involving new construction under five two thousand five hundred
(2,500 5,000) square feet;
b. Residential components of a mixed-use project, which shall be subject to the
requirements of subsection B of this section;
c. A mixed-use project where the number of affordable units equals or exceeds the
housing required by subsection (I)(2) of this section for the gross square footage
of nonresidential uses;
d. Projects where a building permit application has been accepted as complete by
the city prior to January 5, 2005; however, any extension or modification of such
approval or permit after such date shall not be exempt;
4865-9803-8927 v1 4
e. Projects that are the subject of development agreements in effect prior to
January 5, 2005 where such agreements specifically preclude the city from
requiring compliance with this type of affordable housing program;
f. Any nonresidential building that is damaged or destroyed by fire or other natural
catastrophe if the rebuilt square footage of the nonresidential portion of the
building does not increase upon reconstruction;
g. Project for which no nexus can be established between the proposed
nonresidential development and an increase in the demand for affordable
housing.
2. Number of Affordable Units or Linkage Fee Required.
Proposed nonresidential development projects shall pay a commercial linkage fee,
prior to building permit issuance, on a per square footage basis at the rates adopted
by the City Council by ordinance or resolution. provide twenty percent (20%) of the
total number of residential units needed to provide housing for project employees in
very low-, low- and moderate-income households, as set forth in Table 14.16.030-3
of this section Alternative to the linkage fee, a proposed nonresidential development
project may provide an equivalent number of units for low-income households, based
on the following calculation: Total fee obligation / Affordable housing in-lieu fee
established by ordinance or resolution of the City Council = Number of low-income
units required. Any decimal fraction greater than 0.50 shall be interpreted as
requiring one additional dwelling unit.
For uses not listed in Table 14.16.030-3 of this section, the community development
director shall determine the number of affordable units required based on
comparable employment densities to uses listed. In making such a determination,
the decision of the community development director shall be based on data
concerning anticipated employee density for the proposed project submitted by the
applicant, employment surveys or other research on similar uses submitted by the
applicant or independent research, and/or such other data the director determines
relevant.
Table 14.16.030-3
Number of New Very low, Low and Moderate
Income Units Required for
New Nonresidential Development
Development Type Number of New Very Low-, Low- and
Moderate-Income Units (per 1,000 square
feet of gross floor area 1)
Office 2 or Research and Development uses 0.03
Retail, Restaurant or Personal Service uses 0.0225
Manufacturing or Light Industrial uses 0.01625
Warehouse uses 0.00875
Hotel or motel uses 3 0.0075
;note; 1 ;hg;Floor area excludes all areas permanently used for vehicle parking.
;note;2 Includes professional, business and medical offices.
;note;3 Accessory uses to a hotel or motel, such as restaurant, retail and meeting facilities shall
be subject to requirements for a retail use.
4865-9803-8927 v1 5
3. Provision of Units or In-lieuCommercial Linkage Fee. Required affordable housing units
shall be provided on the same site as the proposed nonresidential development, at an
off-site location within the city, through dedication of suitable real property for the
required housing to the city, or through payment of an in-lieu commercial linkage fee, at
the discretion of the planning commission or the city council. The planning commission
or city council may accept off-site units or an in-lieu fee if it is determined that inclusion
of the required housing units within the proposed nonresidential development is not
reasonable or appropriate, taking into consideration factors including, but not limited to,
overall project character, density, location, size, accessibility to public transportation, and
proximity to retail and service establishments; or where the nature of the surrounding
land uses is incompatible with residential uses in terms of noise or other nuisances,
health or safety hazards or concerns. Where the application of the affordable housing
requirement in Section 14.16.030.B results in less than one (1) unit or one (1) or more
affordable housing unit and a fractional unit, the applicant may choose to pay an in-lieu
fee for the fractional unit without the required findings noted above. Affordable housing
units provided as part of the proposed nonresidential development or at an off-site
location shall meet the requirements of Section 14.16.030.B and I and shall be
completed prior to or concurrent with the completion of construction of the proposed
nonresidential development, as the conditions of project approval shall specify.
4. Calculation and Payment of Commercial LinkageIn-lieu Fee. The amounts and
calculation of the housing in-lieu fee shall be based on the following:
In-lieu fees shall be calculated as a percentage of the projected construction costs of the
units. Construction costs of the units shall mean the estimated cost per square foot of
construction, site development and land costs and permits and fees, as established by
standard construction cost indices and/or surveys of local development projects such
fees shall be established by resolution of the city council, as amended from time to time.
Unless otherwise preempted by law, or otherwise approved by the planning commission,
or city council, or community development director, the in-lieucommercial linkage fee
shall be paid prior to the issuance of a building permit for the proposed project.
E. Housing In-Lieu Fee Fund. The residential housing in-lieu fees and the commercial linkage
fees shall be placed in a segregated citywide housing in-lieu fee account. The funds in the
housing in-lieu fee account, along with any interest earnings accumulated thereon, shall be
used solely to increase and expand the supply of housing affordable to very low-, low- and
moderate-income households, including, but not limited to, the following:
1. Design and construction of housing affordable to households of very low, low- and
moderate-income households, including costs associated with planning,
administration and design;
2. Acquisition of property and property rights, including acquisition of existing housing
units and the provision of long-term affordability covenants on those units;
3. Other actions that would increase the supply of housing affordable to very low, low-
and moderate-income households;
4. Costs of program development and ongoing administration of the housing fund
program;
5. Expenditures from the housing in-lieu fee fund shall be authorized solely by the city
council and controlled and paid in accordance with general city budgetary policies.
SECTION 3: ENVIRONMENTAL REVIEW
The City Council finds that this Ordinance is not subject to the California Environmental Quality Act
4865-9803-8927 v1 6
(“CEQA”). This action is not a project within the meaning of the CEQA Guidelines Section 15378
as it has no potential for physical effects on the environment because it involves an adoption of
certain fees and/or charges imposed by the City and does not commit the City to any specific
project, and said fees and/or charges will be used to fund future projects and/or activities, each of
which future projects and/or activities will be fully evaluated in compliance with CEQA when
sufficient physical details regarding said projects and/or activities are available to permit meaningful
CEQA review (see CEQA Guidelines, Section 15004(b)(1)). Pursuant to CEQA Guidelines section
15378(b)(4), the creation of government funding mechanisms which do not involve any
commitment to any specific project which may cause significant effect on the environment, is not
defined as a “project” under CEQA. Therefore, approval of the fees and/or charges is not a
“project” for purposes of CEQA, pursuant to CEQA Guidelines, Section 15378(b)(4); and, even if
considered a “project” under CEQA, is exempt from CEQA review pursuant to CEQA Guidelines
Sections 15061(b)(3) and 15273 because it can be seen with certainty that there is no possibility
that approval of the fees and/or charges may have a significant effect on the environment.
SECTION 4. The City Council finds and determines that the Commercial Linkage Fee Study,
attached hereto as Exhibit A, complies with California Government Code section 66000 et seq.,
and is consistent with the General Plan, and hereby approves and adopts the Commercial
Linkage Fe Study.
SECTION 5. The City Council hereby approves and adopts the Commercial Linkage Fee
Project List attached hereto as Exhibit B.
SECTION 6. The City Council hereby sets rates for the Commercial Linkage Fee as shown in
Exhibit C, attached hereto and incorporated by this reference. Once effective, the Commercial
Linkage Fees, set forth in Exhibit C, shall be incorporated into the City’s Master Fee Schedule.
SECTION 7. Pursuant to Government Code Section 65852.2(f)(3), the Commercial Linkage
Fee shall not apply to accessory dwelling units of less than 750 square feet.
SECTION 8. The Commercial Linkage Fee rates, the Commercial Linkage Fee Study, and the
Commercial Linkage Fee Project List may be amended from time to time by ordinance or
resolution of the City Council.
SECTION 9. The Commercial Linkage Fee shall automatically increase starting on July 1,
2025, and each year thereafter, in accordance with changes in regional construction costs. The
amount of the adjustment shall be based on May over May construction cost changes according
to the “Construction Cost Index” for the San Francisco Bay Area, as reported monthly in the
Engineering News Record.
SECTION 10: SEVERABILITY
Every section, paragraph, clause, and phrase of this Ordinance is hereby declared to be
severable. If for any reason, any section, paragraph, clause, or phrase is held to be invalid or
unconstitutional, such invalidity or unconstitutionality shall not affect the validity or
constitutionality of the remaining sections, paragraphs, clauses or phrases, and the remaining
portions or this ordinance shall continue in full force and effect unless amended or modified by
the city.
SECTION 11: EFFECTIVE DATE AND PUBLICATION
4865-9803-8927 v1 7
This Ordinance shall be published once, in full or in summary form, before its final passage, in a
newspaper of general circulation, published and circulated in the City of San Rafael and shall be
in full force and effect 30 days after its adoption. If published in summary form, the summary shall
also be published within fifteen (15) days after the adoption, together with the names of those
Council members voting for or against same, in a newspaper of general circulation published and
circulated in the City of San Rafael, County of Marin, State of California.
Within fifteen (15) days after adoption, the City Clerk shall also post in the office of the City
Clerk, a certified copy of the full text of this Ordinance along with the names of those
Councilmembers voting for and against the Ordinance.
THE FOREGOING ORDINANCE was first read and introduced at a Regular Meeting of the City
Council of the City of San Rafael, held on the 4th day of December 2023, and will come up for
adoption as an Ordinance of the City of San Rafael at a Regular Meeting of the Council to be held
on the 18th day of December 2023.
AYES: Councilmembers: Bushey, Hill, Kertz & Mayor Kate
NOES: Councilmembers: None
ABSENT: Councilmembers: Llorens Gulati
KATE COLIN, Mayor
Attest:
LINDSAY LARA, City Clerk