City Council Approves Linkage Fees to Fund Affordable Housing

After many months of discussions, the Los Angeles City Council on Wednesday approved a new ordinance establishing a system of linkage fees to support affordable housing development in the city.  Under the new law, developers of market-rate housing will have to pay a fee, varying by project and location, into a fund that will be used to build affordable housing, which is in desperately short supply at the moment.

City Council Member David Ryu – who along with Council Members Paul Koretz and Mike Bonin – sponsored a last-minute amendment that would increase the fees on projects in higher-priced development areas (including their own districts) – said the fee system was “a long time coming.”  And as evidence of its importance, Ryu noted a recent survey which found that Los Angeles residents’ second biggest fear, after safety concerns, is becoming homeless.

Council Member Gil Cedillo acknowledged before the final vote that the fee system won’t solve the city’s whole housing crisis, but he said it’s “one tool that’s needed to deal with a friggin’ huge problem.” He said that people who work in Los Angeles should be able to afford to live in the city, which many – including firefighters now heroically fighting local wildfires – cannot.

The motion passed unanimously, with all 14 council members present supporting it.  (Council Member Mitch Englander, who had voted to oppose previous drafts of the measure but indicated that he might support the final version if certain amendments were included, was not present.)  The Council also passed an “urgent forthwith” designation for the ordinance, which provides immediate processing for the new rules, which will take effect in stages over the next year, beginning 120 days from now.

While the linkage fees will support development of low income housing in Los Angeles, several Council Members also mentioned yesterday the also-urgent need to provide more housing for the “missing middle” – those people who earn between 120 and 150% of the Area Median Income.  Toward that end, the Council also passed a motion yesterday that sparks a process to exempt middle income housing projects from the new linkage fees, and to explore other kinds of incentives for developers of middle income housing.