Oakland Considers Dividing City Into Three, Divvying Up New Developer Fees

Oakland is three weeks into a 90-day rent freeze, and the clock is ticking: How can the city drive down spiraling housing prices (increasing faster than any city in the country) in a city where the average income is $30,000 a year and the average rent is now almost $3,000/month?

One of the proposals presently being mulled is a plan to divide the map into thirds (King Lear-style) and give developers a choice between either doling out more affordable housing or else paying an escalating series of fees, depending on where they want to build.

Zone One consists of downtown and the hills, and would necessarily be where the real money is, starting with a $7,000/unit fee on multi-family projects this year, then spiking to $13,000 next year, and $24,000 a pop in 2018.

(Townhomes and single-family houses would pay a higher per-unit cost: $28,000 in Zone One by 2018. But of course, this adds up to a much smaller bill overall than multi-family projects.)

If that’s too rich for anybody’s blood, Zone Two would stretch from West Oakland all the way to the east side of the lake and the Coliseum. Here, each new unit runs first $5,500, then $10,500 in 2017, and finally $19,250 in two years.

Zone Three is everything east of the other zones, and is the decided economy option, with fees starting at only $750 for the next two years, increasing to $3,750 in 2018, but then continuing to climb until topping out at $13,000/unit in 2020.

Developers could buy themselves an exemption by declaring 25 percent of on-site units affordable housing, with at least five percent in the "very-low" income bracket. The City Council could grant exceptions for off-site housing. Entirely affordable developments would be exempt from the fees altogether.

Thanks to the web of different zones, timetables, and development types, projecting how much money the city could wrangle from this plan is tricky, but the City Administrator reckons it to be about $8.65 million a year.

Oakland’s broad housing plan, released in March, called for building 17,000 new homes over the next eight years, but also for expending city resources to keepg 17,000 presently occupied homes affordable for residents.

• Rents Climb in Oakland [Curbed SF]
• Oakland Considers Outlawing Rent Hikes [Curbed SF]
• Oakland At Home [City of Oakland]