Commission allows Haight Street project to satisfy inclusionary requirement via fee after sponsor misses unit-size threshold

The Planning Commission voted Nov. 4 to amend conditions on a previously approved Haight Street project so the development will meet its inclusionary-housing obligation through payment of an in‑lieu fee rather than providing on‑site below‑market-rate (BMR) units.

Staff (Chris May) explained that an affidavit filed earlier indicated intent to pay the fee, but plan sheets had shown on-site BMR units during review; subsequent submittals clarified the sponsor's intent to use the in‑lieu fee method of compliance. The sponsor's architect, Jeremy Schaub, said the proposed BMR layouts fell short of the code's minimum unit-size thresholds by modest margins (as little as 12–16 square feet in some units), and redesigning the units would require significant façade and layout changes.

Under the city's 2021 impact‑fee schedule, staff estimated the in‑lieu payment at approximately $371,373 for this project. Staff also explained that for projects under 25 units the formula uses 20% of residential gross floor area and that inclusionary fees are lower for smaller projects, which can make in‑lieu payments appear small relative to new construction costs. After discussion about oversight and the policy balance between on‑site housing and fees, the commission approved the amendment 5-2; Commissioners Moore and Imperial voted no.