Millbrae advances local density‑bonus ordinance to spur housing; council passes amendments, schedules second reading

The Millbrae City Council voted 5–0 on Nov. 25 to advance a city-provided density‑bonus ordinance designed to encourage more housing development within the downtown and Millbrae Station areas by supplementing state density‑bonus incentives.

Consultant Ian Moran of Harris & Associates and Community Development Director Andy Mogensen told the council the proposed city bonus would apply only to projects that already qualify for state density bonus, and that the city incentive is intended to improve project economics and encourage lot consolidation. “Ultimately, the goal is to incentivize overall housing development and increase housing supply within the city,” Moran said during his presentation.

Under the draft ordinance staff described to the council, rental projects that allocate 5% of units to low‑income households would receive a flat 15% city density bonus in addition to any state bonus. For ownership projects, a 15% moderate‑income allocation would trigger a city bonus that mirrors the state’s moderate‑income bonus. Staff walked council through two examples: a 10‑unit ownership project and a 100‑unit rental project. For the 100‑unit example, staff showed how state and city incentives together could yield as many as 95 additional market‑rate units while keeping the affordable‑unit count the same.

Council members pressed staff on several items: parking and impacts on public infrastructure, whether the city bonus asks for additional affordable units beyond state thresholds, and whether the city should attach a sunset or review date to the measure. Staff said development impact fees would continue to fund infrastructure needs and cited a current multifamily impact‑fee figure of roughly $36,000 per unit. Mogensen noted the city could revisit the policy with the housing element cycle and committed to annual reporting on local density‑bonus applications.

Council Member Rinaldi moved the staff-recommended motion with the manager’s amendments; the motion passed unanimously and included an annual update to council. The council also directed staff to bring the ordinance back for second reading and final action on Dec. 9.

The ordinance, as presented, is policy‑level and includes multiple discretionary design and programmatic choices that the council can still change before final adoption. Staff said the city’s approach intentionally focuses incentives in transit‑linked areas to encourage lot consolidation and to improve project feasibility in a market with high land and construction costs.