San Diego is Adding Impact Fees Back to Some ADUs

By Sean Canning

Hi, I'm Sean Canning, Principal Architect at Ten Seventy Architecture. We're one of the leading experts in San Diego's new Accessory Dwelling Unit Regulations. And I wanted to make another quick video to talk about the city of San Diego reinstating their impact fee policy for certain multiple ADU projects.

So I guess a good way to start this video would be to try to explain what an impact fee is.

This is actually quite more difficult than I thought it would be. But basically, if you're going to build a new house in San Diego, one of the fees you're going to pay before you get your permit issued is called a "Development Impact Fee". Sometimes just referred to as an impact fee.

And impact fees ranged in price from neighborhood to neighborhood. I've seen them as low as $4,000 and go as high as $100,000.

So if you're going to build a new home, you're going to pay an impact fee. If you build two new homes, you're going to pay two impact fees. If you build a certain certain ADU, you may be subject to one impact fee.

So what does the impact fee actually cover? Well, I googled the definition here. Actually, I'm in San Diego's Municipal Code right here and Section 142.0640: Development Impact Fees for Public Facilities and Spaces.

It states "The purpose of this section is to implement the City's general Plan, which contains policies related to the maintenance of an effective Facilities Financing Program to ensure the impact of new development is mitigated through appropriate fees."

Okay, so what they're telling us here is they use these impact fees to maintain the "General Plan" (which includes things like parks, streets, utilities, etc.).

But they're also saying that they're using these to mitigate the impact of new development. And, as you know, San Diego has an incredible housing crisis right now, so I can only think this policy is a little strange.

Okay, let's dig into the municipal code and figure out exactly when these impact fees are going to be assessed on our ADU projects going forward. So it's pretty complicated, so I'm just gonna do my best to summarize it for you.

Basically, if you build to two ADUs, you're not going to pay these impact fees. And each of those ADUs can be 1200 square feet.

But if you want to build a third ADU, that's when they're going to hit you with this impact fee.

And there is a little asterisk here - because you'd actually have to build that ADU larger than 750 square feet. So if you were to keep a third, fourth, fifth and sixth ADU under 750 square feet, you're not going to be subject to these fees.

But if you do build one, that's about 751 square feet, they're going to hit you with their calling a "Scaled Development Impact Fee", which is based on the size of the view. Now there's a couple of other loopholes where you can avoid these fields.

For example, if ADUs four, five, and six we're rented out at affordable housing rates, you can avoid the impact fees. If you signed a contract with the city stating you live on the property for 3 years, you can also avoid those fees. And that seems like a pretty fair loophole to me.

So the only thing I want to say in closing is: If a City has a housing crisis the way that San Diego does, it's important for the Development Services Departments to encourage building.

And that's the purpose of these ADU regulations. And that's why these impacts these were waived for the last five or six years. To reinstate them at this point in our housing crisis in 2022, I'm just not sure it's a great move. I'm not sure it's a great look for the City of San Diego.

If have any further questions or comments about this topic (or ADUs in general) feel free to reach out and email me. My email is Sean@1070architecture.com

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