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Commission weighs how to treat 'orphaned' ADUs and whether to claw back development fees
Summary
Staff told the commission that ADUs converted to standalone homes through an SB 9 split can avoid some development impact fees; commissioners asked staff to return with fee examples and possible time-based or prorated approaches to prevent immediate post-construction splits to avoid fees.
Commissioners spent substantial time on whether an existing accessory dwelling unit that becomes a standalone single-family home after an SB 9 lot split should be subject to development impact fees. Senior Planner Wolf and the city attorney explained that when an ADU is "orphaned" by a lot split it may not trigger the same fees as a newly built single-family dwelling because the ADU already existed on the parcel prior to subdivision.
"So in essence, when someone applies for an urban lot split to ... split away a single family home and an ADU, that ADU is not subject to any development impact fees and becomes a single family home," Senior Planner Wolf said. Commissioners discussed remedies including (a) applying fees based on square footage similar to certain commercial models, (b) prorating fees based on how long the ADU has existed (3, 5 or 10 years discussed), or (c) treating some conversions as new development subject to full fees. Wolf and the city attorney agreed to produce numerical hypotheticals: staff provided ballpark public-facilities fee figures (examples cited in the meeting included roughly $65,000 and a later single-family total of $76,300) and said they would return with calculations under several scenarios.
The commission indicated the financial-policy question is more appropriate for City Council consideration and instructed staff to prepare options and examples for council-level decisions rather than enacting a fee clawback in the municipal code at this meeting.
Provenance: topicintro SEG 781 ("I'll actually turn to planner Wolf to talk through the fact pattern we have regarding question number 3") ; topicfinish SEG 1760 (staff final fee discussion).
