At the February 23, 2022 City Commission meeting, as part of the City’s approval of the lease amendments for the Collins Park Artist Workforce Housing Project – the first City public-private partnership for workforce housing in the City – it became readily apparent that the City needs to do more to incentivize affordable and workforce housing, including waiving the appropriate City fees to the extent possible in order to bring down project costs, as the rent limits associated with affordable/workforce housing make it very challenging to obtain financing for these projects, particularly in an environment of rising interest rates and inflationary pressures on construction costs.

One such example is the City’s sustainability fee under Section 133-6 of the City Code, which is calculated at 5% of the total construction cost identified in the building permit, and charged to any owner that fails to obtain a LEED gold certification.  For affordable and workforce housing projects – which include caps on rent – the costs of achieving LEED Gold and/or adding on a City fee of 5% of the overall Project cost, could make these important projects cost-prohibitive and economically unfeasible.  As important as it is to incentivize LEED gold certification and sustainability in the City, the City Commission may wish to strike a better balance to serve other important public objectives, such as providing for the availability of affordable housing.  By way of example alone, for the Collins Park project, I understand the sustainability fee represents approximately $800,000 in additional project costs. 

As part of this referral, I would request that the Administration also identify and make recommendations regarding any additional fees which could be reduced or waived to support affordable and/or workforce housing in the City.