New Linkage Fee Passes in L.A.

The City of Los Angeles has passed the proposed linkage fee. The new fee implements a tiered fee schedule with fees for housing projects ranging from $8 to $15. We sat down with Jon Goetz, a principal at Meyers Nave, to a talk about the new fee and how it will impact developers.

GlobeSt.com: What is your reaction to the linkage fee passing?

Jon Goetz: The Los Angeles linkage fee is being adopted at a time when local governments are greatly concerned about the ability of their workforce and residents to afford to live within their local jurisdictions due to the increasingly unaffordable price of housing.  As the state has eliminated the redevelopment program and the federal government has reduced affordable housing funding, local jurisdictions are realizing that they can no longer rely on federal and state programs to finance affordable housing in their communities. More local jurisdictions are taking an increasingly active role by requiring affordable housing in new residential developments, and adopting fees and bond measures to finance affordable housing construction.  The Los Angeles linkage fee differs from the “inclusionary zoning” approach taken by other California cities and counties, in which a specified percentage of affordable housing units is required in each new housing development.  The linkage fee spreads the cost over both commercial and residential development, producing a larger and more diversified stream of funding.  The Los Angeles approach is similar to several other large California cities that have also adopted linkage fees, including San Francisco, Oakland and San Diego.