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(a) Waiver or Reduction Based on Absence of Reasonable Relationship.
(1) The sponsor of any development project subject to a development fee or development impact requirement imposed by this Article may appeal to the Board of Supervisors for a reduction, adjustment, or waiver of the requirement based upon the absence of any reasonable relationship or nexus between the impact of development and either the amount of the fee charged or the on-site requirement.
(2) Any appeal authorized by this Section shall be made in writing and filed with the Clerk of the Board no later than 15 days after the date the Department or Commission takes final action on the project approval that assesses the requirement. The appeal shall set forth in detail the factual and legal basis for the claim of waiver, reduction, or adjustment.
(3) The Board of Supervisors shall consider the appeal at a public hearing within 60 days after the filing of the appeal. The appellant shall bear the burden of presenting substantial evidence to support the appeal, including comparable technical information to support appellant's position. The decision of the Board shall be by a simple majority vote and shall be final.
(4) If a reduction, adjustment, or waiver is granted, any change in use within the project shall invalidate the waiver, adjustment, or reduction of the fee or inclusionary requirement. If the Board grants a reduction, adjustment or waiver, the Clerk of the Board shall promptly transmit the nature and extent of the reduction, adjustment or waiver to the Development Fee Collection Unit at DBI and the Unit shall modify the Project Development Fee Report to reflect the change.
(b) Waiver or Reduction, Based on Housing Affordability.
(1) An affordable housing unit shall receive a waiver from the Rincon Hill Community Infrastructure Impact Fee, the Market and Octavia Community Improvements Impact Fee, the Eastern Neighborhoods Infrastructure Impact Fee, the Balboa Park Impact Fee, the Visitacion Valley Community Facilities and Infrastructure Impact Fee, the Transportation Sustainability Fee, the Residential Child Care Impact Fee, the Central South of Market Infrastructure Impact Fee, and the Central South of Market Community Facilities Fee if:
(A) the affordable housing unit is affordable to a household earning up to 120% of the Area Median Income (as published by HUD), including units that qualify as replacement Section 8 units under the HOPE SF program;
(B) the affordable housing unit will maintain its affordability for a term of no less than 55 years, as evidenced by a restrictive covenant recorded on the property’s title;
(C) the Project Sponsor demonstrates to the Planning Department staff that a governmental agency will be enforcing the term of affordability and reviewing performance and service plans as necessary, and
(D) all construction workers employed in the construction of the development that includes the affordable housing unit are paid at least the general prevailing rate of per diem wages for the type of work and geographic location of the development, as determined by the Director of Industrial Relations pursuant to Sections 1773 and 1773.9 of the Labor Code, except that apprentices registered in programs approved by the Chief of the Division of Apprenticeship Standards may be paid at least the applicable apprentice prevailing rate under the terms and conditions of Labor Code Section 1777.5.
(2) Projects that meet the requirements of this subsection are eligible for a 100 percent fee reduction until an alternative fee schedule is published by the Department.
(3) Projects that are located within a HOPE SF Project Area are eligible for a 100 percent fee reduction from the TSF, applicable both to the affordable housing units and the market-rate units within such projects, and to any Non-Residential or PDR uses. Projects within a HOPE SF Project Area are otherwise subject to all other applicable fees per Article 4 of the Planning Code.
(4) Residential uses within projects where all residential units are affordable to households at or below 150% of the Area Median Income (as published by HUD) shall not be subject to the TSF. Non-residential and PDR uses within those projects shall be subject to the TSF. All uses shall be subject to all other applicable fees per Article 4 of the Planning Code.
(c) Waiver for Homeless Shelters. A Homeless Shelter, as defined in Section 102 of this Code, is not required to pay the Rincon Hill Community Infrastructure Impact Fee, the Transit Center District Impact Fees, the Market and Octavia Community Improvements Impact Fee, the Eastern Neighborhoods Infrastructure Impact Fee, the Balboa Park Impact Fee, the Visitacion Valley Community Facilities and Infrastructure Impact Fee and the Transportation Sustainability Fee.
(d) Waiver Based on Duplication of Fees. The City shall make every effort not to assess duplicative fees on new development. In general, project sponsors are only eligible for fee waivers under this Subsection if a contribution to another fee program would result in a duplication of charges for a particular type of community infrastructure. The Department shall publish a schedule annually of all known opportunities for waivers and reductions under this clause, including the specific rate. Requirements under Section 135 and 138 of this Code do not qualify for a waiver or reduction. Should future fees pose a duplicative charge, such as a Citywide open space or childcare fee, the same methodology shall apply and the Department shall update the schedule of waivers or reductions accordingly.
(e) Waiver or Reduction of Fees for a Public Park in the Central SoMa Plan Area. A development project may elect to provide land and other resources in order to construct a public park on an approximately 40,000 square-foot portion of Block 3777 as called for in the Central SoMa Plan, and in doing so may be eligible for a waiver against all or a portion of fees otherwise applicable to such development as set forth in this subsection 406(e). As part of the approval process for such a project, the Planning Commission may waive all or a portion of the Eastern Neighborhoods Infrastructure Impact Fee, the Central SoMa Infrastructure Impact Fee, the Transit Impact Development Fee, and the Transit Sustainability Fee, and may specify how such waiver would be distributed among the aforementioned fees, provided such total amount does not exceed the value of the park, which shall be calculated based on actual costs to acquire the land.
(f) Waiver Based on Calamity. The replacement of existing Residential, Non-Residential, or PDR uses on a lot subject to, and meeting all the provisions of, Planning Code Section 188(b) for the replacement of buildings damaged or destroyed by fire or other calamity, or by Act of God or the public enemy, shall not be considered in the determination of applicability of any impact fee in Article 4 of this Code and new Gross Floor Area within a building subject to and meeting all the provisions of Section 188(b) shall not be subject to any impact fee in Article 4. However, any additional land uses or addition of Gross Floor Area beyond what is needed to replace the damaged or destroyed building(s) shall be subject to any applicable Article 4 impact fees.
(g) Waiver for Projects in PDR Districts. In a PDR District, a development project that meets the eligibility criteria in subsection (g)(1) of this Section 406 shall receive a waiver from any development impact fee or development impact requirement imposed by this Article.
(1) Eligibility. To be eligible for the waiver in this subsection (g), the project shall:
(A) be located in a PDR District;
(B) contain a Retail Use or PDR Use and no residential uses;
(C) propose the new construction of at least 20,000 square feet of Gross Floor Area and no more than 200,000 square feet of Gross Floor Area;
(D) be located on a vacant site or site improved with buildings with less than a 0.25 to 1 Floor Area Ratio as of the date a complete Development Application is submitted;
(E) submit a complete Development Application on or before December 31, 2026, including any projects that have obtained Final Approval prior to the effective date of the ordinance in Board File No. 230764 that have not already paid development impact fees.
(2) Extent of Waiver. The waiver in this subsection (g) shall be limited to development impact fees or development impact requirements for the establishment of any new Gross Floor Area of PDR or Retail Use.
(3) Sunset. This subsection (g) shall expire by operation of law on December 31, 2026, unless the duration of the subsection has been extended by ordinance effective on or before that date. Upon expiration, the City Attorney shall cause subsection (g) to be removed from the Planning Code.
(h) Waiver for Projects in the C-2 and C-3 Districts. In the C-2 and C-3 Districts, a development project that meets the eligibility criteria in subsection (h)(1) of this Section 406 shall receive a waiver from any development impact fee or development impact requirement imposed by this Article.
(1) Eligibility. To be eligible for the waiver in this subsection (h), the project shall:
(A) be located in a C-2 or C-3 District;
(B) contain any of the following uses: Hotel, Restaurant, Bar, Outdoor Activity, or Entertainment;
(C) submit a complete Development Application on or before December 31, 2026, including any projects that have obtained Final Approval prior to the effective date of the ordinance in Board File No. 230764 that have not already paid development impact fees.
(2) Extent of Waiver. The waiver in this subsection (h) shall be limited to development impact fees or development impact requirements for the establishment of any new Gross Floor Area of the Hotel, Restaurant, Bar, Outdoor Activity, or Entertainment Use.
(3) Sunset. This subsection (h) shall expire by operation of law on December 31, 2026, unless the duration of the subsection has been extended by ordinance effective on or before that date. Upon expiration, the City Attorney shall cause subsection (h) to be removed from the Planning Code.
(i) Conditional Waiver or Reduction of Fees for Central SoMa Plan Area Projects Impacted by the Downtown Rail Extension. A development project that enters into an agreement with the Transbay Joint Powers Authority to construct foundation and shoring systems that will reduce the lateral force from the project onto the tunnel and not encroach on the tunnel alignment required for the Downtown Rail Extension, which agreement is to the satisfaction of the Department of Building Inspection, and submits a building or site permit application that includes the agreed-upon foundation and shoring systems, may be eligible for a conditional waiver of the Transportation Sustainability Fee (Sections 411A et seq.) and the Eastern Neighborhoods Infrastructure Impact Fee (Sections 423 et seq.), as set forth in this subsection (i). As part of the approval process for such a project, the Planning Commission may conditionally approve waiver of all or a portion of the Transportation Sustainability Fee and of the Eastern Neighborhoods Infrastructure Impact Fee, provided that such waiver is conditioned on the satisfaction of the actions in the preceding sentence. If the final approved building permit or site permit foundation addendum includes the agreed-upon foundation and shoring systems, the project shall receive a waiver of those fees in an amount commensurate with the net increase in cost of the agreed-upon foundation and shoring system as compared to a baseline foundation system, as calculated by the Planning Department. If the final approved building permit or site permit foundation addendum does not include the agreed upon foundation and shoring systems, the City shall withhold issuance of the first certificate of occupancy until the conditionally waived fees are paid.
(Added by Ord. 108-10, File No. 091275, App. 5/25/2010; amended by Ord. 3-11, File No. 101247, App. 1/7/2011; Ord. 47-11, File No. 110009, App. 3/16/2011; Ord. 14-15
, File No. 141210, App. 2/13/2015, Eff. 3/15/2015; Ord. 200-15
, File No. 150790, App. 11/25/2015, Eff. 12/25/2015; Ord. 222-15
, File No. 155521, App. 12/18/2015, Eff. 1/17/2016; Ord. 2-16
, File No. 150793, App. 1/19/2016, Eff. 2/18/2016; Ord. 26-18, File No. 171193, App. 2/23/2018, Eff. 3/26/2018; Ord. 296-18, File No. 180184, App. 12/12/2019, Eff. 1/12/2019; Ord. 63-20, File No. 200077, App. 4/24/2020, Eff. 5/25/2020; Ord. 47-21, File No. 201175, App. 4/16/2021, Eff. 5/17/2021; Ord. 193-23, File No. 230764, App. 9/15/2023, Eff. 10/16/2023; Ord. 248-23, File No. 230446, App. 12/14/2023, Eff. 1/14/2024; Ord. 39-24, File No. 231164, App. 3/7/2024, Eff. 4/7/2024)
AMENDMENT HISTORY
New division (c) added and former division (c) redesignated as (d); Ord. 14-15
, Eff. 3/15/2015. Division (b)(1) amended; new divisions (b)(3) and (4) added and former division (b)(3) redesignated as (b)(5); division (c) amended; Ord. 200-15
, Eff. 12/25/2015 and Ord. 222-15
, Eff. 1/17/2016. Divisions (b)(1) and (b)(1)(B) amended; Ord. 2-16
, Eff. 2/18/2016. Division (b)(1)(B) amended; Ord. 26-18, Eff. 3/26/2018. Division (e) added; Ord. 296-18, Eff. 1/12/2019. Division (b)(1)(B) amended; division (f) added; Ord. 63-20, Eff. 5/25/2020. Division (b)(1) amended; Ord. 47-21, Eff. 5/17/2021. Divisions (g)-(h)(3) added; Ord. 193-23, Eff. 10/15/2023. Divisions (b)(1), (b)(1)(A), and (b)(5) amended; divisions (b)(1)(B)-(C) deleted; new divisions (b)(1)(B)-(D) added; Ord. 248-23, Eff. 1/14/2024. New division (i) added; Ord. 39-24, Eff. 4/7/2024.
Any notice required by this Article to be given to a project sponsor or owner shall be sufficiently given or served upon the sponsor or owner for all purposes hereunder if: (a) personally served upon the sponsor or owner, or (b) deposited, postage prepaid, in a post office letterbox addressed in the name of the sponsor or owner at the official address of the sponsor or owner maintained by the Tax Collector for the mailing of tax bills, or if no such address is available, to the sponsor at the address of the development project, and (c) to the applicant for the site or building permit at the address on the permit application. Any failure of the Department or the City to give any notice required under this Article shall not relieve the project sponsor of its obligations under this Article.
(Added by Ord. 108-10, File No. 091275, App. 5/25/2010)
(a) Except in the case of a project for which MTA is responsible for the determination and collection of the TIDF under Section 411.9(d) of this Article, if a first construction document or first certificate of occupancy, whichever applies, is inadvertently or mistakenly issued prior to the project sponsor paying all development fees due and owing, or prior to the sponsor satisfying any development impact requirement, DBI shall institute lien proceedings to recover the development fee or fees, plus interest and any Development Fee Deferral Surcharge, under Section 107A.13.15 of the San Francisco Building Code.
(b) (1) Where MTA is responsible for determination and collection of the TIDF under Section 411.9(d) of this Article, MTA has made a final determination of TIDF due under that Section, and the amount due from the project sponsor remains unpaid following 30 days from the date of mailing of the additional notice of payment due under that Section, MTA may initiate lien proceedings in accordance with Article XX of Chapter 10 of the San Francisco Administrative Code to make the entire unpaid balance of the fee that is due, including interest at the rate of one and one-half percent per month or fraction thereof on the amount of unpaid fee, a lien against all parcels used for the development project.
(2) MTA shall send all notices required by Article XX to the owner or owners of the property and to the project sponsor if different from the owner. MTA shall also prepare a preliminary report, and notify the owner and sponsor of a hearing by the Board of Supervisors to confirm such report at least ten days before the date of the hearing. The report shall contain the owner and project sponsor's names, a description of the development project, a description of the parcels of real property to be encumbered as set forth in the Assessor's Map Books for the current year, a description of the alleged violation of Sections 411.1 et seq., and shall fix a time, date, and place for hearing. MTA shall transmit this report to the sponsor and each owner of record of the parcels of real property subject to the lien.
(3) Any notice required to be given to an owner or project sponsor shall be deemed sufficiently served for all purposes in this Section if
(A) personally served upon the owner or project sponsor, or
(B) if deposited, postage prepaid, in the U.S. Mail addressed to the owner or project sponsor at the official address of the owner or project sponsor maintained by the Tax Collector for the mailing of tax bills or, if no such address is available, to the sponsor at the address of the development project and to the applicant for the site or building permit at the address on the permit application.
(Added by Ord. 108-10, File No. 091275, App. 5/25/2010; amended by Ord. 247-12
, File No. 120523, App. 12/18/2012, Eff. 1/17/2013)
AMENDMENT HISTORY
Formerly undesignated material amended and designated as division (a); division (b) added; Ord. 247-12
, Eff. 1/17/2013.
(a) Citywide Development Fee and Development Impact Requirements Report. In coordination with the Development Fee Collection Unit at DBI and the Director of Planning, the Controller shall issue a report within 180 days after the end of each even-numbered fiscal year that provides information on all development fees established in the Planning Code collected during the prior two fiscal years organized by development fee account and all cumulative monies collected over the life of each development fee account, as well as all monies expended. The report shall include: (1) a description of the type of fee in each account or fund; (2) the beginning and ending balance of the accounts or funds including any bond funds held by an outside trustee; (3) the amount of fees collected and interest earned; (4) an identification of each public improvement on which fees or bond funds were expended and amount of each expenditure; (5) an identification of the approximate date by which the construction of public improvements will commence; (6) a description of any inter-fund transfer or loan and the public improvement on which the transferred funds will be expended; and (7) the amount of refunds made and any allocations of unexpended fees that are not refunded. The report shall also provide information on the number of projects that elected to satisfy development impact requirements through the provision of "in-kind" physical improvements, including on-site and off-site BMR units, instead of paying development fees. The report shall also include any annual reporting information otherwise required pursuant to the California Mitigation Fee Act, Government Code 66001 et seq.
The report shall be presented by the Director of Planning to the Planning Commission and to the Land Use & Transportation Committee of the Board of Supervisors. The report shall also contain information on the Controller’s annual construction cost inflation adjustments to development fees described in subsection (b) below, as well as information on MOHCD’s separate adjustment of the Inclusionary Affordable Housing Fee described in Section 415.5(b)(3).
(b) Annual Development Fee Inflation Adjustments. Prior to issuance of the Citywide Development Fee and Development Impact Requirements Report referenced in subsection (a) above, the Controller shall review the amount of each development fee established in the Planning Code and, with the exception of the Inclusionary Affordable Housing Fee in Section 415 et seq., shall adjust the dollar amount of any development fee by two percent on an annual basis every January 1 in order to maintain a reasonably conservative connection between construction costs and development fees for the next calendar year for a mix of public infrastructure and facilities in San Francisco. The Planning Department and the Development Fee Collection Unit at DBI shall provide notice of the Controller’s development fee adjustments, and MOHCD’s separate adjustment of the Inclusionary Affordable Housing Fee on the Planning Department and DBI websites and to any interested party who has requested such notice at least 30 days prior to the adjustment taking effect each January 1. The Inclusionary Affordable Housing Fee shall be adjusted under the procedures established in Section 415.5(b)(3).
(Added by Ord. 108-10, File No. 091275, App. 5/25/2010; amended by Ord. 55-11, File No. 101523, App. 3/23/2011; Ord. 263-13, File No. 130549, App. 11/27/2013, Eff. 12/27/2013; Ord. 50-15
, File No. 150149, App. 4/24/2015, Eff. 5/24/2015; Ord. 188-15
, File No. 150871, App. 11/4/2015, Eff. 12/4/2015; Ord. 251-19, File No. 190548, App. 11/15/2019, Eff. 12/16/2019; Ord. 193-23, File No. 230764, App. 9/15/2023, Eff. 10/16/2023)
AMENDMENT HISTORY
Commencing on July 1, 2011, and every five fiscal years thereafter in conjunction with the Annual Citywide Development Fee and Development Impact Requirements Report described in Section 409, above, the Director and the Controller shall jointly prepare and publish a comprehensive report on the status of compliance with this Article, compliance of any development fees in this Article with the California Mitigation Fee Act, Government Code section 66001 et seq., including making specific findings regarding any unexpended funds, the efficacy of existing development fees and development impact requirements in mitigating the impacts of development projects, and the economic impacts of existing development fees and development impact requirements on the financial feasibility of projects and housing affordability in particular, taking into account, to the extent possible, the feasibility of the fees in different areas of the City. In such report, the Director and Controller may recommend any changes in the formulae or requirements or enforcement of any area-specific or Citywide development fee or development impact requirement in this Code, prepare additional economic impact studies on such changes or recommend that additional nexus studies or financial feasibility analyses be done, to improve the efficacy of such fees or requirements in mitigating development impacts or to reduce any unintended deleterious economic or social effects associated with such fees or requirements. In making their joint report and recommendations, the Director and the Controller shall consult with the Directors of OEWD, MOH, the MTA, or other agency whose fees are affected and shall coordinate the report required by this Section with any other development fee evaluations and reports that this Article requires to be performed. The Director and the Controller shall present the Report to the Commission at a public hearing and to the Land Use & Economic Development Committee of the Board of Supervisors at a separate public hearing.
AMENDMENT HISTORY
[TRANSIT IMPACT DEVELOPMENT FEE]
(b) Partial Suspension of Section 411 et seq. In accordance with Planning Code Section 411A.3(e), the provisions of Section 411A are intended, with certain exceptions, to supersede the provisions of Section 411 et seq., as to new development in the City as of the effective date of Section 411A. Accordingly, Section 411A.3(e) suspends, with certain exceptions, the operation of Section 411 et seq., and states the circumstances under which such suspension shall be lifted.
AMENDMENT HISTORY
Editor's Note:
Former Administrative Code Ch. 38 ("Transit Impact Development Fee") was substantially amended and redesignated as this Sec. 411 through Sec. 411.8 by Ord. 108-10, App. 5/25/2010. See Administrative Code Ch. 38, Secs. 38.1 through 38.45, for the legislative history of Code provisions pertaining to the TIDF prior to Ord. 108-10.
Former Administrative Code Ch. 38 ("Transit Impact Development Fee") was substantially amended and redesignated as this Sec. 411 through Sec. 411.8 by Ord. 108-10, App. 5/25/2010. See Administrative Code Ch. 38, Secs. 38.1 through 38.45, for the legislative history of Code provisions pertaining to the TIDF prior to Ord. 108-10.
(a) In 1981, the City enacted an ordinance imposing a Transit Impact Development Fee on new office development in the Downtown area of San Francisco. The TIDF was based on studies showing that the development of new office uses places a burden on the Municipal Railway, especially in the downtown area of San Francisco during commute hours, known as "peak periods." The TIDF was based on two cost analyses: one by the Finance Bureau of the City's former Public Utilities Commission, performed in 1981, and one by the accounting firm of Touche-Ross, performed in March 1983 to defend a legal challenge to the TIDF.
(b) In 2000, the Planning Department, with assistance from the Municipal Transportation Agency, commissioned a study of the TIDF. In 2001, the Department selected Nelson/Nygaard Associates, a nationally recognized transportation consulting firm, to perform the study. Later in 2001, Nelson/Nygaard issued its final report ("TIDF Study"). Before issuing the TIDF Study, Nelson/Nygaard prepared several Technical Memoranda, which provided detailed analyses of the methodology and assumptions used in the TIDF Study.
(c) The TIDF Study concluded that new non-residential uses in San Francisco will generate demand for a substantial number of auto and transit trips by the year 2020. The TIDF Study confirmed that while new office construction will have a substantial impact on MUNI services, new development in a number of other land uses will also require MUNI to increase the number of revenue service hours. The TIDF Study recommended that the TIDF be extended to apply to most non-residential land uses. The TIDF Study found that certain types of new development generate very few daily trips and therefore may not appropriately be charged a new TIDF.
(d) The TIDF Study further recommended that the City enact an ordinance to impose transit impact fees that would allow MUNI to maintain its base service standard as new development occurs throughout the City. The proposed ordinance would require sponsors of new development in the City to pay a fee that is reasonably related to the financial burden imposed on MUNI by the new development. This financial burden is measured by the cost that will be incurred by MUNI to provide increased service to maintain the applicable base service standard over the life of such new development.
(e) Subsequently, the City selected Cambridge Systematics, Inc. to prepare a TIDF Update Report, including an updated nexus study for the TIDF. This Report was completed in 2011, and in accordance with the applicable provisions of this Code, used updated data to calculate base service standard fee rates for the Economic Activity Categories subject to the TIDF. The Report also analyzed trip generation rates for these Economic Activity Categories using updated data, and divided the Retail/Entertainment and Cultural/Institution/Education categories into subcategories in order to reflect the comparative diversity of trip generation rates among these land uses.
(f) Based on projected new development over the next 20 years, the TIDF will provide revenue to MUNI that is significantly below the costs that MUNI will incur to mitigate the transit impacts resulting from the new development.
(g) The TIDF is the most practical and equitable method of meeting a portion of the demand for additional Municipal Railway service and capital improvements for the City caused by new non-residential development.
(h) Based on the above findings and the nexus studies performed, the City determines that the TIDF satisfies the requirements of the Mitigation Fee Act, California Government Code Section 66001, as follows:
(1) The purpose of the fee is to meet a portion of the demand for additional Municipal Railway service and capital improvements for the City caused by new nonresidential development.
(2) Funds from collection of the TIDF will be used to increase revenue service hours reasonably necessary to mitigate the impacts of new non-residential development on public transit and maintain the applicable base service standard.
(3) There is a reasonable relationship between the proposed uses of the TIDF and the impact on transit of the new developments on which the TIDF will be imposed.
(4) There is a reasonable relationship between the types of new development on which the TIDF will be imposed and the need to fund public transit for the uses specified in Section 411.6 of this Code.
(5) There is a reasonable relationship between the amount of the TIDF to be imposed on new developments and the impact on public transit from the new developments.
(Added by Ord. 108-10, File No. 091275, App. 5/25/2010; amended by Ord. 247-12
, File No. 120523, App. 12/18/2012, Eff. 1/17/2013)
AMENDMENT HISTORY
New division (e) added and former divisions (e) through (g) redesignated as current divisions (f) through (h) accordingly; division (h)(4) amended; Ord. 247-12
, Eff. 1/17/2013.
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