SEC. 413.1. FINDINGS.
The Board hereby finds and declares as follows:
(a) Large-scale entertainment, hotel, office, laboratory, and retail developments in the City have attracted and continue to attract additional employees to the City, and there is a causal
connection between such developments and the need for additional housing in the City, particularly housing affordable to households of lower and moderate income. Such commercial uses
in the City benefit from the availability of housing close by for their employees. However, the supply of housing units in the City has not kept pace with the demand for housing created by
these new employees. Due to this shortage of housing, employers will have difficulty in securing a labor force, and employees, unable to find decent and affordable housing, will be forced
to commute long distances, having a negative impact on quality of life, limited energy resources, air quality, social equity, and already overcrowded highways and public transport.
(b) There is a low vacancy rate for housing affordable to persons of lower and moderate income. This low vacancy rate is due in part to large-scale commercial developments, which
have attracted and will continue to attract additional employees and residents to the City. Consequently, some of the employees attracted to these developments are competing with present
residents for scarce, vacant affordable housing units in the City. Competition for housing generates the greatest pressure on the supply of housing affordable to households of lower and
moderate income. In San Francisco, office or retail uses of land generally yield higher income to the owner than housing. Because of these market forces, the supply of these affordable
housing units will not be expanded. Furthermore, Federal and State housing finance and subsidy programs are not sufficient by themselves to satisfy the lower and moderate income housing
requirements of the City.
(c) The City has consistently set housing production goals to address the regional and citywide forecasts for population, households, and employment. Although San Francisco has seen
increased housing production each successive decade since the 1970s, the City has not been able to close the gap between its housing production goals and actual production.
(d) There is a continuing shortage of low- and moderate-income housing in San Francisco. It is desirable to impose the cost of the increased burden of providing housing necessitated by
large-scale commercial development projects directly upon the sponsors of the development projects by requiring that the project sponsors contribute land or pay a fee to the City to
subsidize housing development as a condition of the privilege of development and to assist the community in solving those of its housing problems generated by the development.
(e) The Bay Area has seen dramatic increases in land acquisition costs for housing, the cost of new housing development and the affordability gap for low to moderate income workers
seeking housing. Commute patterns for the region have also changed, with more workers who work outside of San Francisco seeking to live in the City, thus increasing demand for housing
and decreasing housing availability.
(f) As the regional job center, San Francisco has historically had the highest ratio of jobs-to-housing units in the Bay Area.
(g) The required housing exaction shall be based upon formulas derived in a periodic jobs housing nexus analysis. Consistent with the requirements of the California Mitigation Fee Act,
the jobs housing nexus analysis shall demonstrate the validity of the nexus between new, large scale entertainment, hotel, office, laboratory, and retail development and the increased
demand for housing in the City, and the numerical relationship between such development projects and the formulas for the provision of housing set forth in Section 413.1 et seq.
(h) The Board of Supervisors has reviewed the Jobs Housing Nexus Analysis (“Jobs Housing Nexus Analysis”), which is on file with the Clerk of the Board in Board File No. 190548,
and adopts the findings and conclusions of that study, and incorporates the findings by reference herein to support the imposition of the fees under Section 413.1 et seq.
(Added by Ord. 108-10, File No. 091275, App. 5/25/2010; amended by Ord. 251-19, File No. 190548, App. 11/15/2019, Eff. 12/16/2019; Ord. 193-23, File No. 230764, App. 9/15/2023, Eff. 10/16/2023)
AMENDMENT HISTORY
Former divisions A.–C. and K. amended and redesignated as divisions (a)-(c) and (e); former divisions D. and F. amended and combined as division (d); former divisions E., G.–J., L., and M. deleted; new divisions (f)-(h) added; Ord. 251-19, Eff.
12/16/2019. Division (h) amended; Ord. 193-23, Eff. 10/16/2023.
SEC. 413.2. DEFINITIONS.
See Section 401 of this Article.
(Added by Ord. 108-10, File No. 091275, App. 5/25/2010)
SEC. 413.3. APPLICATION.
(a) With the exception of uses listed below in subsection (b), Sections 413.1 et seq. shall apply to any development project:
(1) that increases by 25,000 or more gross square feet the total amount of any combination of the following uses; entertainment, hotel, Integrated PDR, office, research and
development, retail, and/or Small Enterprise Workspace, and
(2) whose environmental evaluation application for the development project was filed on or after January 1, 1999.
(b) Sections 413.1 et seq. shall not apply to:
(1) Any development project other than a development project described in Subsection (a) of this Section, including those portions of a development project consisting of the net
addition of square feet of any type of space not described in Subsection (a) of this Section;
(2) Those portions of a development project described in Subsection (a) of this Section located on property owned by the United States or any of its agencies or leased by the United
States or any of its agencies for a period in excess of 50 years, with the exception of such property not used exclusively for a governmental purpose;
(3) Those portions of a development project described in Subsection (a) of this Section located on property owned by the State of California or any of its agencies, with the exception of
such property not used exclusively for a governmental or educational purpose;
(4) Those portions of a development project described in Subsection (a) of this Section located on property under the jurisdiction of the San Francisco Redevelopment Agency or the
Port of San Francisco where the application of Section 413.1 et seq. is prohibited by California or local law;
(5) Any office development project approved by the Commission prior to August 18, 1985 that was not subject to the Interim Guidelines; or
(6) Any office development project approved by the Commission prior to August 18, 1985 that was subject to the Interim Guidelines. If the action of the Commission affecting such
office development project is thereafter modified, superseded, vacated, or reversed by the Board of Appeals, the Board of Supervisors, or by court action in a manner affecting the amount
of housing required under the Interim Guidelines, the permit application on remand to the Commission shall remain subject to the Interim Guidelines.
(7) Any major phase or development project in Mission Bay North or South to the extent application of Section 413.1 et seq. would be inconsistent with the Mission Bay North
Redevelopment Plan and Interagency Cooperation Agreement or the Mission Bay South Redevelopment Plan and Interagency Cooperation Agreement, as applicable.
(8) Any of the following free-standing uses. For purposes of this subsection (b)(8), the term “free-standing” shall mean an independent building or structure used exclusively by a
single use and any Accessory Uses, and that is not part of a larger development project on the same environmental evaluation application.
(A) any free-standing Pharmacy use which does not exceed more than 50,000 square feet of retail or other space; or
(B) any free-standing General Grocery use which does not exceed more than 75,000 square feet of retail or other space; or
(C) any mixed-use space consisting of Residential space and Pharmacy retail space not exceeding 50,000 square feet, or General Grocery retail space not exceeding 75,000 square
feet.
(Added by Ord. 108-10, File No. 091275, App. 5/25/2010; Ord. 270-10, File No. 100917, App. 11/5/2010; amended by Ord. 202-18, File No. 180557, App. 8/10/2018, Eff. 9/10/2018)
AMENDMENT HISTORY
Divisions (a)-(a)(2), (b), and (b)(8)-(b)(8)(C) amended; Ord. 202-18, Eff. 9/10/2018.
SEC. 413.4. IMPOSITION OF HOUSING REQUIREMENT.
(a) Determination of Requirements. The Department shall determine the applicability of Section 413.1 et seq. to any development project requiring a first construction document, and
if Section 413.1 et seq. is applicable, the number of gross square feet of each type of space subject to its requirements, and shall impose these requirements as a condition of approval for
issuance of the first construction document for the development project to mitigate the impact on the availability of housing which will be caused by the employment facilitated by the
development project. The project sponsor shall supply any information necessary to assist the Department in this determination.
(b) Department Notice to Development Fee Collection Unit at DBI. After the Department has made its final determination of the net addition of gross square feet of each type of
space subject to Section 413.1 et seq., it shall immediately notify the Development Fee Collection Unit at DBI of its determination in addition to the other information required by Section
402(b) of this Article.
(c) Sponsor’s Choice to Fulfill Requirements. Prior to issuance of a building or site permit for a development project subject to the requirements of Section 413.1 et seq., the sponsor
shall elect one of the options listed below to fulfill any requirements imposed as a condition of approval and notify the Department of their choice of the following:
(1) Contribute land of value at least equivalent to the in-lieu fee, according to the formulas set forth in Section 413.1 et seq., to MOHCD pursuant to Section 413.6; or
(2) Pay an in-lieu fee to the Development Fee Collection Unit at DBI according to the formula set forth in Section 413.5; or
(3) Combine the above options pursuant to Section 413.7.
(e) Development Fee Collection Unit Notice to Department Prior to Issuance of the First Certificate of Occupancy. The Development Fee Collection Unit at DBI shall provide
notice in writing or electronically to the Department prior to issuing the first certificate of occupancy for any development project subject to Section 413.1 et seq. that has elected to fulfill all
or part of the requirements with an option other than payment of an in-lieu fee. If the Department notifies the Unit at such time that the sponsor has not satisfied the requirements, the
Director of DBI shall deny any and all certificates of occupancy until the subject project is brought into compliance with the requirements of Section 413.1 et seq.
(f) Process for Revisions of Determination of Requirements. In the event that the Department or the Commission takes action affecting any development project subject to Section
413.1 et seq. and such action is subsequently modified, superseded, vacated, or reversed by the Board of Appeals, the Board of Supervisors, or by court action, the procedures of Section
402(c) shall be followed.
(Added by Ord. 108-10, File No. 091275, App. 5/25/2010; Ord. 55-11, File No. 101523, App. 3/23/2011; amended by Ord. 251-19, File No. 190548, App. 11/15/2019, Eff. 12/16/2019)
AMENDMENT HISTORY
Divisions (c)-(c)(3) amended; Ord. 251-19, Eff. 12/16/2019.
SEC. 413.5. COMPLIANCE BY PAYMENT OF IN-LIEU FEE.
(a) The amount of the fee which may be paid by the sponsor of a development project shall be determined by the following formulas for each type of space proposed as part of the
development project and subject to this Article 4.