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Committee debates developer payment plans; staff warn of added collection burden
Summary
Councilors split on allowing payment plans for fee-in-lieu: proponents say it gives small developers flexibility and could yield higher eventual fees; staff warn monthly/quarterly invoicing would create significant administrative work and collection responsibilities.
An amendment to allow developers to propose payment plans (Amendment A) drew sustained debate at the Finance Committee. The amendment would let developers pay the fee-in-lieu any time between project start and issuance of a Certificate of Occupancy; the amendment also allows the Office of Affordable Housing to determine later payment dates if feasible.
"If they pay later, then the new fee structure for that year is implemented," Councilor Alma Castro said, noting that deferring payment could allow the city to collect a higher fee. Councilor Buster Bustamante warned, "I don't want the city to get into basically becoming a bank," expressing concern about creating a loan-like program without interest and the burden of collections.
Director Fabiola Chavez acknowledged both points: the city can administratively offer payment flexibility but spreading collections across time would require invoicing and additional cashier office processing. She told the committee she plans to add staff in the affordable housing department—project managers and administrators—to help manage the workload if the committee directs the change.
Committee members asked whether the director would retain discretion to approve payment plans. Chavez said underwriting is already performed and that any payment-plan process could include checks so the city does not extend plans to developers with adequate cash flow. The committee did not finalize a binding policy in committee; it forwarded the topic with the bill to the governing body for final action and for staff to prepare administrative procedures if directed.
