415.11

SEC. 415.11. SEVERABILITY. If any subsection, sentence, clause, phrase, or word of Sections 415.1 et seq., or any application thereof to any person or circumstance, is held to be invalid or unconstitutional by a

decision of a court of competent jurisdiction, such decision shall not affect the validity of the remaining portions or applications of the Section. The Board of Supervisors hereby declares that it would have passed Sections 415.1 et seq. and each and every subsection, sentence, clause, phrase, and word not declared invalid or unconstitutional without regard to whether any other portion of Sections 415.1 et seq. or application thereof would be subsequently declared invalid or unconstitutional. (Added by Ord. 158-17, File No. 161351, App. 7/27/2017, Eff. 8/26/2017) SEC. 415A. TEMPORARY REDUCTION OF INCLUSIONARY REQUIREMENTS FOR RESIDENTIAL AND LIVE/WORK DEVELOPMENT PROJECTS APPROVED PRIOR TO NOVEMBER 1, 2023. (Added by Ord. 187-23, File No. 230769, App. 9/14/2023, Eff. 10/15/2023, Oper. 11/1/2023; Ord. 201-23, File No. 230855, App. 10/12/2023, Eff. 11/12/2023, Oper. 11/1/2023) SEC. 415A.1. PURPOSE. In order to encourage the construction of residential and live/work development projects that have been Finally Approved prior to November 1, 2023, but have not procured a First Construction Document, the City hereby establishes a temporary program to: (1) reduce certain inclusionary affordable housing fees and obligations; (2) extend the time such developments have to obtain a site permit after project approval; and (3) allow the modification of certain findings required by Planning Code Section 206.6 (“State Density Bonus Program: Individually Requested.”) (Added by Ord. 187-23, File No. 230769, App. 9/14/2023, Eff. 10/15/2023, Oper. 11/1/2023; Ord. 201-23, File No. 230855, App. 10/12/2023, Eff. 11/12/2023, Oper. 11/1/2023) SEC. 415A.2. DEFINITIONS. The following terms shall have the following definitions: “Pipeline Project” means a residential or live/work project that (1) is subject to the Inclusionary Affordable Housing Ordinance, Planning Code Section 415.1 et seq., and (2) was Finally Approved prior to November 1, 2023, and (3) has not been issued a First Construction Document prior to November 1, 2023. “Finally Approved” or “Final Approval” shall mean (1) approval of a project’s first Development Application, unless such approval is appealed; or (2) if a project only requires a building permit, planning approval of the first site or building permit, unless such permit is appealed; or (3) if the first Development Application or first site or building permit is appealed, then the final decision upholding the Development Application, or first site or building permit, on the appeal by the relevant City Board or Commission. “Finally Approved” or “Final Approval” shall not include any modification of the approval under Section 415A.5. (Added by Ord. 187-23, File No. 230769, App. 9/14/2023, Eff. 10/15/2023, Oper. 11/1/2023; Ord. 201-23, File No. 230855, App. 10/12/2023, Eff. 11/12/2023, Oper. 11/1/2023; amended by Ord. 68-24, File No. 240070, App. 4/4/2024, Eff. 5/5/2024) AMENDMENT HISTORY Definition of “Finally Approved” amended; Ord. 68-24, Eff. 5/5/2024. SEC 415A.3. APPLICATION. This Section 415A shall apply to Pipeline Projects. This Section 415A shall not apply to (1) any mixed-use project that has entered into a development agreement executed pursuant to Chapter 56 of the Administrative Code or other similar binding agreement with the City on or before November 1, 2023, or (2) projects that have chosen to comply with affordable housing requirements by dedicating land, including but not limited to projects meeting the requirements set forth in Sections 419.5(a)(2) or 249.33(b)(16), or (3) projects that have paid development impact fees, including inclusionary impact fees, on or before November 1, 2023. (Added by Ord. 187-23, File No. 230769, App. 9/14/2023, Eff. 10/15/2023, Oper. 11/1/2023; Ord. 201-23, File No. 230855, App. 10/12/2023, Eff. 11/12/2023, Oper. 11/1/2023) SEC. 415A.4. MODIFICATION OF PIPELINE PROJECTS. On or before November 1, 2026, project sponsors of Pipeline Projects shall be entitled to request a modification under Section 415A.5 to that project’s conditions of approval, conditions on a project permit, notice of special restrictions, or other requirements related to: (1) specified requirements of the Inclusionary Affordable Housing Program, Planning Code Section 415.1 et seq., or other applicable inclusionary housing requirement; (2) conditions that require a project sponsor to obtain a site permit within a certain timeframe after project approval; and (3) findings required by Planning Code Section 206.6. Except as specifically set forth herein, or as modified under the procedure set forth in subsection 415A.5, Pipeline Projects shall comply with all other conditions of approval, conditions on a project permit, or notice of special restrictions and any applicable requirements of the Planning Code, including the requirements set forth in Sections 415.1 through 415.11. Project sponsors may request the following modifications: (a) Affordable Housing Fee. If a project sponsor of a Pipeline Project elected to pay the inclusionary housing fee pursuant to Section 415.5, the project shall be entitled to a modification of the inclusionary housing requirements set forth in Section 415.5(b)(1)(A), 415.5(b)(1)(B) or 415.5(b)(1)(C), or if applicable 415.3(b)(2)(A) through (2)(C), as follows: (1) For Ownership or Rental Housing Pipeline Projects consisting of 10 units or more, the applicable percentage shall be 16.4%. (2) For any Pipeline Project consisting of 10 units or more located in an area with a specific affordable housing requirement set forth in a Special Use District, Area Plan, or in any other section of the Code, including 415.3(d), 419, or 428, the applicable percentage shall be 54.5% of the rate for Rental Housing Projects in the specific area, rounded to the nearest tenth of one percent. This reduction shall not apply to fees subject to the Temporary Fee Reduction Program set forth in Section 403. (3) Notwithstanding subsection (2), in no case shall a Pipeline Project be entitled to a modification of an affordable housing fee that would result in an applicable percentage lower than 16.4%. (b) On-site Affordable Housing Alternative. If a project sponsor of a Pipeline Project elected to provide on-site affordable units pursuant to Section 415.5(g), the development project shall be entitled to the following modifications to the on-site percentages in Sections 415.6(a)(1), 415.6(a)(2), or 415.6(a)(3), or if applicable, the on-site percentages set forth in Sections 415.3(b)(1)(A) to (b)(1)(D), or Section 206.3: (1) For Pipeline Projects consisting of 10 units or more, but less than 25 units, the applicable percentage shall be 12%. (2) For Pipeline Projects consisting of 25 units or more, the number of Affordable Units constructed on-site shall be 12% of all units constructed on the project site. Such projects shall ensure that a minimum of 8% of the units are affordable to low-income households, 2% are affordable to moderate-income households, and 2% are affordable to middle-income households. (3) For any Pipeline Project consisting of 10 units or more that is located in an area with a specific affordable housing on-site requirement set forth in a Special Use District, Area Plan, or in any other section of the Code, including Sections 415.3(b)(1)(E), 415.3(d), 419, or 428, the applicable percentage shall be 54.5% of the rate for Rental Housing Projects in that specific area, rounded to the nearest tenth of one percent. For any Pipeline Project consisting of 10 units or more that was approved pursuant to Section 206.3, the applicable percentage shall be 54.5% of the rate in Section 206.3(f). (4) Notwithstanding subsection (3), in no case shall a Pipeline Project be entitled to a modification of an on-site affordable housing obligation that would result in an applicable percentage lower than 12%. (c) Off-Site Affordable Housing Alternative. If a project sponsor of a Pipeline Project elected to provide off-site units pursuant to Section 415.5(g), the development project shall be entitled to a modification of the requirements in Section 415.7(a) as follows: (1) For Pipeline Projects consisting of 25 units or more, the applicable percentage shall be 16.4%. Such projects shall ensure that a minimum of 9.4% of the units are affordable to low- income households, 4% are affordable to moderate-income households, and 3% are affordable to middle-income households. (2) For any Pipeline Project consisting of 25 units or more located in an area or Special Use District or in any other section of the Code, including Sections 415.3(d), 419, and 428 with a specific affordable housing requirement, the applicable percentage shall 54.5% of the rate for Rental Housing Projects in the specific area, rounded to the nearest tenth of one percent. (3) Notwithstanding subsections (1) and (2), in no case shall a Pipeline Project be entitled to a modification of the off-site affordable housing alternative that would result in a percentage lower than 16.4%.

(d) Site Permit and First Construction Document Timing Requirements; Conditions of Approval. (1) Notwithstanding any contrary provision in this Code, project sponsors of Pipeline Projects shall be entitled to a modification under Section 415A.5 of any conditions of approval or conditions on a project permit, requiring procurement of a site permit within a specified time, but in no event may such a deadline be extended past May 1, 2029. (2) Notwithstanding any contrary provision in this Code, any modification under Section 415A.5 shall require as a condition that the project sponsor procure a First Construction Document on or before May 1, 2029. Failure to meet this condition shall invalidate the modification. Pipeline Projects that fail to procure a First Construction Document on or before May 1, 2029 shall be subject to the Inclusionary Affordable Housing requirements in effect on May 1, 2029 that are applicable to a project at the same location, size, and tenure. (e) Density Bonus Projects: Affordability Levels, Concessions, Incentives and Waivers. If a Pipeline Project elected to proceed under the State Density Bonus law, Government Code section 65915 and/or Planning Code section 206.6. 1 (State Density Bonus Program: Individually Requested), the project sponsor may request the following modifications to a condition of approval or regulatory agreement pursuant to Section 415A.5, provided that the project continues to meet the requirements of the State Density Bonus law and/or Section 206.6: (1) the number of units to be restricted as affordable units and the affordability levels of those units; (2) the number and type of concessions, incentives, and waivers granted under 206.6(e). (Added by Ord. 187-23, File No. 230769, App. 9/14/2023, Eff. 10/15/2023, Oper. 11/1/2023; Ord. 201-23, File No. 230855, App. 10/12/2023, Eff. 11/12/2023, Oper. 11/1/2023) AMENDMENT HISTORY Section re-added; divisions (a)-(b), (b)(1)-(3), and (c)(1)-(3) amended as (a)-(b), (b)(2)-(4), and (c)(2)-(4); new divisions (b)(1) and (c)(1) added; Ord. 201-23, Eff. 11/12/2023. CODIFICATION NOTE 1. So in Ord. 187-23 and 201-23. SEC. 415A.5. PROCESS FOR MODIFICATION OF INCLUSIONARY AFFORDABLE HOUSING PROGRAM REQUIREMENTS. The purpose of this Section 415A.5 is to provide for the efficient review and approval of requests for modifications to conditions of approval, conditions on a project permit, or notice of special restrictions, for projects eligible for such modifications under Section 415A. The Planning Commission shall be responsible for reviewing and approving such requests, or may delegate those functions to the Planning Director. (a) Planning Commission Review. Notwithstanding Section 415A.5(b), any modification of the conditions of approval, conditions on a project permit, or notice of special restrictions consistent with Section 415A that would result in the significant modification of approved plans shall require review and approval by the Planning Commission under the modification process otherwise applicable to the project, including but not limited to Planning Code Sections 303(e), 309(j) or 329(f)(7))1 . All modifications pursuant to this subsection 415A.5(a), including any appeal of such modifications, shall be granted prior to November 1, 2026. A significant modification shall include, but is not limited to: (1) a change in the number of Residential or Group Housing units by more than 20%, or a change of more than 10% in Gross Floor Area; or, (2) a change of use from Dwelling Units to Group Housing. (b) Administrative Modifications. Notwithstanding Section 415A.5(a), if the Planning Commission has delegated its authority to the Planning Department to review and approve requests for modifications consistent with Section 415A.5, the following modifications shall be reviewed and approved by the Director of the Planning Department, and the Planning Commission shall not hold a public hearing for discretionary review. Modifications under this subsection 415A.5(b) shall not be subject to review under Planning Code sections 303(e), 309(f), 309(j) or 329(f)(7). Any modifications pursuant to this Section 415A.5(b) must be granted prior to November 1, 2026. If so delegated, the Planning Director shall be authorized to modify: (1) the applicable inclusionary fee required consistent with Section 415A.4(a). (2) the applicable percentage of off-site units required consistent with Section 415A.4(b). (3) the applicable percentage of on-site units required, consistent with Section 415A.4(c). (4) for projects that elected to develop using the State Density Bonus Law, Government Code section 65915 or State Density Bonus Program: Individually Requested, under Planning Code section 206.6, the number of on-site Affordable Units, and the affordability levels of those units if such levels require modification for the project to continue to qualify for the same amount of density bonus previously approved, and findings required by Section 206.6(e) related to eligibility for a density bonus, concessions and incentives and/or waivers of development standards, consistent with Section 415A.4(e). Notwithstanding the previous sentence, modifications to a density bonus project that are significant as set forth in subsection (a), shall be reviewed by the Planning Commission. (5) performance standards consistent with Section 415A.4(d), including the time of validity, expiration and renewal. (c) Additional Conditions. Any modification to conditions of approval under this Section 415A.5 shall include a condition that a project must secure a First Construction Document on or before May 1, 2029 and if a project sponsor fails to secure a First Construction Document on or before May 1, 2029, the inclusionary requirements applicable to the project shall be those requirements in place at the time a First Construction Document is secured applicable to a project of the same size, location, and tenure. (Added by Ord. 187-23, File No. 230769, App. 9/14/2023, Eff. 10/15/2023, Oper. 11/1/2023; Ord. 201-23, File No. 230855, App. 10/12/2023, Eff. 11/12/2023, Oper. 11/1/2023) CODIFICATION NOTE 1. So in Ord. 187-23 and 201-23. SEC. 415A.6. SUNSET PROVISION. This Section 415A shall expire by operation of law on May 1, 2029, unless extended by an ordinance effective on or before that date. Upon expiration of this Section 415A, the City Attorney shall cause the section to be removed from the Planning Code. (Added by Ord. 187-23, File No. 230769, App. 9/14/2023, Eff. 10/15/2023, Oper. 11/1/2023; Ord. 201-23, File No. 230855, App. 10/12/2023, Eff. 11/12/2023, Oper. 11/1/2023) SEC. 415B. TEMPORARY REDUCTION IN REQUIREMENTS FOR NEW RESIDENTIAL AND LIVE/WORK DEVELOPMENT PROJECTS. New Ordinance Notice Publisher's Note: This section has been ADDED by new legislation (Ord. 201-23 , approved 10/12/2023, effective 11/12/2023, oper. 11/1/2023). The text of the amendment will be incorporated under the new section number when the amending legislation is effective. In order to encourage construction of residential and live/work development projects subject to the Inclusionary Affordable Housing Program, Planning Code Sections 415.1 et seq,1 this Section 415B shall apply to housing and live/work development projects that are Finally Approved, as defined in Planning Code Section 415A.2, between November 1, 2023 and November 1, 2026, provided that such projects receive a First Construction Document within 30 months from Final Approval. Such deadline shall be extended in the event of any litigation

seeking to invalidate the City’s approval of such project, for the duration of the litigation. Housing development projects that fail to obtain a First Construction Document within 30 months of Final Approval shall be subject to the requirements of Section 415.1 et seq. in effect on the date a First Construction Document is finally obtained. Except as specifically set forth herein, all other Inclusionary Affordable Housing requirements in Sections 415.1 et seq1 shall continue to apply. (Added by Ord. 187-23, File No. 230769, App. 9/14/2023, Eff. 10/15/2023, Oper. 11/1/2023; Ord. 201-23, File No. 230855, App. 10/12/2023, Eff. 11/12/2023, Oper. 11/1/2023) CODIFICATION NOTE 1. So in Ord. 187-23 and 201-23. SEC. 415B.1. AFFORDABLE HOUSING FEE. If a project sponsor elects to pay the affordable housing fee under Section 415.5, the project shall comply the requirements set forth in Section 415.6(b)(1), except as follows: (a) For any housing development consisting of 25 units or more, the applicable percentage shall be 20.5%. (b) For any housing development located in an area with a specific affordable housing requirement set forth in a Special Use District, Area Plan, or in any other section of the Code, including 415.3(d), 419, or 428, the percentage shall be 68% of the rate applicable to Rental Housing Projects, rounded to the nearest tenth of one percent. This section shall not apply to fees subject to the Temporary Fee Reduction Program set forth in Section 403. (Added by Ord. 187-23, File No. 230769, App. 9/14/2023, Eff. 10/15/2023, Oper. 11/1/2023; Ord. 201-23, File No. 230855, App. 10/12/2023, Eff. 11/12/2023, Oper. 11/1/2023) SEC. 415B.2. ON-SITE AFFORDABLE HOUSING ALTERNATIVE. If a project sponsor elects to provide on-site Affordable Units pursuant to Section 415.5(g), the housing development shall be subject to the following required percentages rather than the percentage of units set forth in Section 415.6(a): (a) For any housing development consisting of 25 or more units, the number of Affordable Units constructed on-site shall be 15% of all units constructed on the project site. Project sponsors shall ensure that a minimum of 10% of the Affordable Units shall be affordable to low-income households, 2.5% of the Affordable Units shall be affordable to moderate-income households, and 2.5% of the Affordable Units shall be affordable to middle-income households. (b) For any housing development located in an area with a specific affordable housing requirement set forth in a Special Use District, Area Plan, or in any other section of the Code such as Section 415.3(d), 419, or 428, the percentage shall be 68% of the rate applicable to Rental Housing Projects in such area, rounded to the nearest tenth of one percent. (Added by Ord. 187-23, File No. 230769, App. 9/14/2023, Eff. 10/15/2023, Oper. 11/1/2023; Ord. 201-23, File No. 230855, App. 10/12/2023, Eff. 11/12/2023, Oper. 11/1/2023) AMENDMENT HISTORY Section re-added; undesignated paragraph amended; Ord. 201-23, Eff. 11/12/2023. SEC. 415B.3. OFF-SITE AFFORDABLE HOUSING ALTERNATIVE. If a project sponsor elects to provide off-site units to satisfy the requirements of Section 415.1 et seq. pursuant to 415.5(g)(1)(B), the housing development project shall be subject to the requirements of Section 415.7(a), except as follows: (a) For any housing development consisting of 25 units or more, the applicable percentage shall be 20.5%. Project sponsors shall ensure that a minimum of 11.5% of the Affordable Units shall be affordable to low-income households, 5% of the Affordable Units shall be affordable to moderate-income households, and 4% of the Affordable Units shall be affordable to middle-income households. (b) For any housing development that is located in an area with a specific off-site affordable housing requirement set forth in a Special Use District, Area Plan, or in any other section of the Code including Section 415.3(d), 419, or 428, the percentage shall be 68% of the applicable rate for Rental Housing Projects in the area, rounded to the nearest tenth of one percent. (Added by Ord. 187-23, File No. 230769, App. 9/14/2023, Eff. 10/15/2023, Oper. 11/1/2023; Ord. 201-23, File No. 230855, App. 10/12/2023, Eff. 11/12/2023, Oper. 11/1/2023) SEC. 415B.4. INCLUSIONARY FEE ANNUAL FEE UPDATES. Notwithstanding any other provision of the Code, during the period that this Section 415B applies: (a) the amount of the inclusionary housing fee shall be adjusted consistent with the factors set forth in Sections 415.5(b)(2) and 415.5(b)(3), but in no case shall the fee be increased by more than 2% annually; and (b) the provisions of 415.6(a)(5) shall not apply. (Added by Ord. 187-23, File No. 230769, App. 9/14/2023, Eff. 10/15/2023, Oper. 11/1/2023; Ord. 201-23, File No. 230855, App. 10/12/2023, Eff. 11/12/2023, Oper. 11/1/2023) SEC. 415B.5. SUNSET PROVISION. This section 415B shall expire by operation of law on November 1, 2026, unless extended by an ordinance on or effective before that date. Upon expiration of this Section 415B, the City Attorney shall cause the section to be removed from the Planning Code. (Added by Ord. 187-23, File No. 230769, App. 9/14/2023, Eff. 10/15/2023, Oper. 11/1/2023; Ord. 201-23, File No. 230855, App. 10/12/2023, Eff. 11/12/2023, Oper. 11/1/2023) [AFFORDABLE HOUSING: MARKET AND OCTAVIA AREA PLAN; UPPER MARKET NEIGHBORHOOD COMMERCIAL DISTRICT] SEC. 416. MARKET AND OCTAVIA AREA PLAN AND UPPER MARKET NEIGHBORHOOD COMMERCIAL DISTRICT AFFORDABLE HOUSING FEE. Sections 416.1 through 416.5, hereafter referred to as Section 416.1 et seq., set forth the requirements and procedures for the Market and Octavia Area Plan and Upper Market Neighborhood Commercial District Affordable Housing Fee. The effective date of these requirements shall be either May 30, 2008, which is the date that the requirements originally became effective, or the date a subsequent modification, if any, became effective. (Added by Ord. 108-10, File No. 091275, App. 5/25/2010; Ord. 312-10, File No. 100046, App. 12/23/2010; Ord. 25-11, File No. 101464, App. 2/24/2011; Ord. 210-21, File No. 210868, App. 11/19/2021, Eff. 12/20/2021) SEC. 416.1. FINDINGS. The Board of Supervisors hereby finds that: A. The additional affordable housing requirements of this Section are supported by the Nexus Study performed by Keyser Marston and Associates referenced in Section 415.1(11) and found in Board File No. 081152. The Board of Supervisors has reviewed the study and staff analysis and report of the study and, on that basis, finds that the study supports the current inclusionary affordable housing requirements combined with the additional affordable housing fee. Specifically, the Board finds that the study: (1) identifies the purpose of the additional fee to mitigate impacts on the demand for affordable housing in the City; (2) identifies the use to which the additional fee is to be put as being to increase the City's affordable housing