San Francisco committee advances package trimming inclusionary rates and changing development fees after heated debate

The Land Use and Transportation Committee on Monday moved to forward to the full Board a two‑part housing package that reduces some inclusionary housing obligations and reforms development impact fees, with President Aaron Peskin and Chair Mirna Melgar voting in favor and Vice Chair Dean Preston dissenting.

The measures — brought as companion ordinances after a Technical Advisory Committee (TAC) review and a controller feasibility study — would lower certain on‑site affordable housing percentages and change how the city sets, locks and allows deferrals of development impact fees. Peskin described the package as the product of “very, very careful and deliberate negotiations” among the mayor’s office, controller, developers and affordable‑housing stakeholders and said the changes are intended as a three‑year, temporary measure to improve feasibility for stalled projects.

Ted Conrad of the Office of Economic and Workforce Development told the committee the impact‑fee reforms would: cap annual fee escalators at a flat 2 percent instead of the current construction‑cost index; lock the fee rate at the time a…