October 19, 2017

AB 1505 – What Now For Impact Fees?


One of the interesting outcomes of the State housing package is the impact it may have on Housing Impact Fees (HIF)—tools that cities have recently adopted to finance affordable housing development.  After the case known simply as “Palmer” was decided, cities had to abandon their residential rental inclusionary housing policies—policies that required that developers of market rate housing include a percentage of the homes as affordable.  Now that AB 1505 has been signed by the Governor, effectively overriding Palmer and reaffirming local government’s land use authority to establish inclusionary policies, many cities are abandoning their HIF ordinances.  Case in point: San Jose, which plans to begin implementing its Rental Inclusionary Ordinance effective January 1st, the date AB 1505 becomes effective.  How other cities, including cities like Santa Clara that are now considering the adoption of HIFs, react is yet to be seen.