Commission backs fee deferral approach to speed affordable housing reviews

City planning staff presented proposed amendments Feb. 5 to the city’s fee waiver ordinance that would allow development review fee deferrals for 100% affordable housing projects and establish a council‑adopted fee deferral policy to define eligible fees and deferral terms.

Senior planner Akana Jair Wardna said the changes build on state law (SB 937, effective Sept. 2024) that requires local agencies to defer impact‑fee collection for residential projects until final inspection or the certificate of occupancy. The proposed local updates would expand deferrals to development review fees — including building, plan‑check, community development, fire, parks, police, public works and water fees — while preserving the ability for certain waivers to be granted by council in discretionary cases and for staff to approve deferrals that meet specified criteria. Staff said deferrals would be documented via a fee deferral agreement and payment plan, and that deferrals could extend for up to five years unless a substantially complete building permit application is submitted.

Commissioners asked how the change would affect small private developers and accessory dwelling unit (ADU) waivers; staff said fee waivers on city‑owned land could be approved by staff under the proposed policy and that developers could still appeal for waivers to council. A public commenter from Harbor High urged the commission to reassess how the city defines affordability and to consider localizing area median income assumptions rather than using a countywide AMI metric.

The commission voted to forward the ordinance amendments and accompanying fee deferral policy to City Council for first reading on March 10. If council approves, staff said the policy and ordinance changes would proceed to a second reading on March 24 and take effect 30 days after adoption.