City Council approves start of housing trust fund process, asks fast reports on linkage fee and other options

The Los Angeles City Council voted to begin establishing a citywide housing trust fund and directed city staff to report back on potential funding sources, including a commercial linkage fee and transient-occupancy-tax options.

Councilmember Nick Pacheco, chair of the Housing, Community and Redevelopment Committee, said the committee and motion authors are committed to creating a housing trust fund and that the initial reports are intended to start a longer process. “We are making a strong commitment,” Pacheco said during discussion of item 12.

The move follows a task force report that recommended funding options; Anita Zussman, vice president of legislative affairs at the Los Angeles Area Chamber of Commerce, told the council the business community needs more time to study impacts. “The adoption of a linkage fee would cost developers $10,000,000 to $18,000,000 a year,” Zussman said, urging committee referral and more time for review.

Carol Schatz, president of the Central City Association, likewise asked for more time and stakeholder involvement, saying some development types (for example adaptive reuse downtown) could be disproportionately affected by fees. “In two weeks the impacts of these fees simply cannot be studied,” Schatz told the council.

Housing advocates pressed for quicker action. Ty Glenn, an attorney with the Legal Aid Foundation of Los Angeles, described unsafe, overcrowded buildings and said money is needed to preserve and create affordable housing. “This is a crisis,” Glenn said. “Money is what will fix the situation.”

Councilmember Mike Feuer proposed adding to the two‑week report a review of what would be required to adopt inclusionary zoning and an in‑lieu fee so the council would know its options. Feuer said the reports are the start of a process, and additional studies (including nexus studies) would follow if the council chose to pursue any of the funding options.

Councilmember Jackie Goldberg, a primary sponsor of the motion, said the goal is to begin work this year even though full solutions will take longer. She stressed the reports should include stakeholders and that the effort must not be delayed so the issue can be considered in the current budget cycle.

After amendments and assurances that stakeholders — including commercial developers, banks and neighborhood representatives — would be included in the follow‑up work, the council approved the motion as amended. The clerk recorded the vote as 10 ayes; the motion directs the City Administrative Officer, Chief Legislative Analyst and Housing Department to prepare specified reportbacks, including two‑week reports on a linkage fee and transient-occupancy tax and an evaluation of inclusionary zoning/in‑lieu fee options.

What this means: The council approved a procedural step to create a housing trust fund and ordered rapid staff reports on several revenue options. Those reports will inform farther‑reaching decisions — including possible nexus studies, further public input and budgetary steps — before any fees or new revenue sources are adopted.