Commission allows developer to pay affordable housing fee instead of providing on-site units

On Feb. 23 the Planning Commission approved a sponsor request at 3500 19th Street to satisfy affordable-housing requirements by paying the in‑lieu fee rather than providing three on-site affordable units originally elected by the earlier approval.

Staff explained the project’s history: approved in 2008 with up to 17 dwelling units and three on-site affordable units (an 18% rate then). Under current planning code the affordable-housing program is fee-first and sponsors may elect to pay the in-lieu fee; off-site physical housing remains an option subject to a one-mile radius if pursued. Since publication of the case report staff received six emails opposing the fee option from neighbors.

Jim Rubin, counsel for the sponsor, said market and legal changes since 2008 (including the Palmer decision and the recession) have made financing difficult and that his client would pay the affordable-housing fee up front. In the hearing he stated, "we would pay the entire affordable housing fee, which is a million $59.50, within 90 days" (as recorded in the transcript). Commissioners expressed regret about losing on-site units but recognized limits on funding availability following the elimination of redevelopment funds and legal constraints. Commissioner Moore and others urged clarity from the Mayor’s Office of Housing on priorities for in‑lieu funds. The commission voted to approve the sponsor’s request to pay the in‑lieu fee; the motion passed unanimously 6–0 with Commissioner Wu recused.