The Cupertino Courier

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City council approves new affordable housing fees

By Cody Kraatz

The Cupertino Chamber of Commerce and the Cupertino City Council reached a compromise on the city's affordable housing policy, with the council passing a revised fee schedule on June 19.

The city assesses fees on commercial and residential developments, using those fees for the construction and rehabilitation of affordable housing.

The chamber favored no fees at all because it felt they discouraged business, but is satisfied with the compromise.

"The more fees you have the less likely you are for growth," said Christine Giusiana, executive director of the chamber. In lengthy discussions with the city, the chamber took the position that affordable housing should not take priority over encouraging business and property development in the city.

"I think the idea and the concept of below market rate housing is clearly a good thing for the community. Cupertino voters have voted down housing projects that included BMR housing in the past," said Scott Stauffer, president of the chamber's board.

The new fees for residential projects will be $2.50 per square foot for projects with two to six units, up from $1.19 per square foot. Those with seven or more units are required to sell or rent 15 percent of them below market rate.

The new fee for office, industrial, hotel, retail and research and development projects will be $4.75 per square foot in most areas of the city, up from $2.32 per square foot.

The North Vallco district and part of South Vallco will have a reduced $2.38-per-square-foot fee for the Planned Industrial zone to encourage expansion by companies like Apple, Inc., and Hewlett Packard. The Vallco redevelopment area, which includes the Cupertino Square mall, would be exempt from those fees.

Also, commercial buildings on the ground will get credit for their current square footage, so if companies level them and rebuild they will only be charged fees based on the additional square footage. The fees will increase each year in step with the Consumer Price Index.

The city has about $700,000 in fees to spend right now on affordable housing, said Vera Gil, senior planner.

"We always want to provide affordable housing," said Gil, adding that BMR housing requires substantial subsidies from the city. "It's hard to create affordable units. It just takes a lot of money to bring down the rents and make it affordable to the families that are going to live there."

The city determines market rates based on income guidelines from the U.S. Department of Housing and Urban Development, making apartments available to people with low and very low incomes and homes available for people with median and moderate incomes.

For more information, visit www.cupertino.org/housing.