What San Diego's ADU Bonus Program Fee Costs

Outside San Diego's Coastal Overlay Zone, the community enhancement fee for a bonus accessory dwelling unit (ADU) has equaled the citywide impact fee for an apartment of the same size since May 20, 2026: $18,178 for a 600 sq ft unit at fiscal 2027 standard fire rates. For bonus ADUs of 750 sq ft or more, I'd get the city's written answer on which charges apply. I separate the bonus-program homes from the first ADUs before comparing costs, and I check the affordable-unit exclusion separately.

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Key Takeaways

  • Outside San Diego's Coastal Overlay Zone, the fiscal 2027 schedule puts the community enhancement fee for a 600 sq ft bonus ADU at $18,178, at standard fire rates.
  • My May 2026 San Diego comparison excludes the first detached accessory dwelling unit (ADU) from the community enhancement fee. I distinguish it from homes using the bonus program.
  • Outside the Coastal Overlay Zone, San Diego's bonus-program fee follows citywide rates, so it changes with home size rather than neighborhood; only the fire charge is higher in areas the city lists as underserved.
  • We design higher-density accessory dwelling unit (ADU) projects around privacy for occupants and neighbors, at the scale of the surrounding neighborhood.

Regulations Cited

  • SDMC 141.0302(d)(9), Community Enhancement Fee (9-2026 edition)
  • SDMC 142.0640(b)(1), ADU impact fee exemptions (7-2026 edition)
  • Resolutions R-316269 (June 2025) and R-316744 (May 20, 2026)
  • City Planning fee schedules, FY 2026 (Aug. 20, 2025), FY 2027 (Sept. 10, 2026)
  • SDHC Land Use Affordable Housing Programs Fee Update (Sept. 18, 2025)

Checked against these sources as of November 2026.

Full Transcript

00:00BaileyIf you're planning to use San Diego's a DU Home Density Bonus Program, there's a new cost you need to know about the city. Introduced a community enhancement fee calculated based on the square footage of your bonus units, and combined with the program restrictions we've recently covered here on this channel, and it now raises a serious question about whether the city actually wants people using this program. In the first place. So Sean, walk us through what this community enhancement fee actually is and how the city is calculating it.

00:35Sean CanningWell, thanks for the introduction, Bailey. Okay, so probably about six months ago, eight months ago, the city of San Diego updated their municipal code, particularly the A DU regulations and especially the regulations around the A DU Home Density Bonus Program, also known as the ad bonus program. So. One of the major benefits of building ADUs were they were not subject to impact fees.

Most people don't even know what an impact fee is, but if you are gonna build a new house, you're subject to one impact fee for that house and impact fees vary neighborhood by neighborhood. The impact fee is supposed to cover parks. It's supposed to cover fire schools, things like that. Basically everything your property taxes pay for the impact fee is also supposed to supplement.

Now, this was one of the major obstructions. It was the reason people weren't building the. Predecessor to ADUs, which was called a companion unit because people would call me up and say, Hey, I wanna build a companion unit. And I'd say, okay, are you aware about the $10,000 impact fee? And they'd say, what do you mean, $10,000 impact fee?

And I would show them how they, their project would be subject to that fee and they would say, oh, this is gonna price out the project. I don't wanna do the project anymore. So when the state came in with their A DU regulations. The major change was they banned impact fees. So for a while there were no impact fees on any ADUs, and the city of San Diego went above and beyond the state and they added the A DU Home Density Bonus Program.

Now, for a while, that program was not subject to any impact fees, but. Recently the city has now added these fees back in, but they just changed the name. So they're calling them community enhancement fees. So lemme do a quick screen share here and I'm gonna explain how all these are applied.

02:29Baileythis is straight from chapter 14 of the municipal code, and here it's listing A DU Home Density Bonus Program. Community Enhancement Fee. The applicant shall pay an A DU Home Density Bonus Program, community enhancement fee, as established by San Diego. Resolution calculated based on gross floor area of the affordable ADUs and bonus ADUs, except that the gross floor area.

02:50Sean CanningArea of any affordable ADUs that meets the following shall not be included. And there's some provisions here if you do very low income, maybe you can avoid this. Um, and the premise is located in an area identified as high or very high fire resource, California tax credit allocation, uh, C-T-C-A-C, opportunity area.

I don't even know what that is. It's probably a very small scenario. Okay, so. I guess to understand this, we have to understand what the impact fees are and how much they cost, and which neighborhoods have to pay these. So here is our 2026. Impact fee schedule. Now these are just the impact fees in the city of San Diego.

So I wanna clarify this. This doesn't necessarily apply to Oceanside or Chula Vista. This is just for City of San Diego. Other municipalities are gonna have their own way to calculate these fees, and they probably also do have these fees, but this is the column that's important, the per dwelling unit fee.

So we can go down this list and let me zoom in a little bit more so we can just get it a little larger on the screen. Okay, so if you were to build a home in burial, Logan, this is basically the community that I live in, you're gonna pay a fee of $18,387 per home. Now, if you were to build one in the college area, this is an area where we need more housing.

You're gonna pay $20,224 per home. So if you put up a 10 unit apartment complex. You're gonna pay $200,000 in fees to build that apartment complex. Now, this is a combination of the fire fee, library fee, park fee, and transportation fee. Now, I will say in Barrow Logan, we have a lot of parks. They're not necessarily nice parks.

Some of them are nicer than others, but that is one of the reasons why our fee is so high. You can see there's a 15,000 feet just for the park, and when you total everything up, that's where you're getting this number. So the community enhancement fee is based off of these impact fees. The way the community enhancement fee works is it's scaled to the size of the A DU you're gonna build.

So lemme take it a step back. The state regulations still say that the buy right. Per state, A DU regulation ADU that you're gonna build cannot be subject to this fee. But since the city of San Diego has gone beyond with the A DU Home Density Bonus Program, those are gonna be the ADUs that are subject to this.

So not the BuyRight state a DU regulation ADUs not if you're building the first detached A DU, you're not subject to this. It's when you start to use that A DU Home Density Bonus Program. Okay, but let's take a closer look at this and let's try to draw some conclusions here because these fees. Could be used to supply additional fees for fire, library, park, and transportation, but they could also be used as a deterrent to deter people from using these density bonus programs.

So let's take a look at which of which neighborhoods have the highest fees. So we've already identified Barrier Logan, the college area. Let's keep going down the list here. So Golden Hill 17 or basically $18,000 in fees now. As we go down, we can see Mission Beach has a pretty low fee, so this is good. So I would say this is encouraging development YI guess the, IM important way to understand this is generally the A DU Home Density Bonus Program is gonna be used by people trying to develop to, to add more density, likely to rents the properties.

Uh, the developer will never do these projects if they don't pencil out. And the more fees the city adds to these projects. The less likely the developer will build in these areas. So you could kind of extrapolate this data to say, the higher these fees, the less likely you're going to get development to occur.

And the lower these fees, like this one right here, Rancho Bernardo, well that may be, and a good option for a developer. Or actually look at this one. 1900 send pa. Oh, well this is for multiple dwelling units, so that one probably doesn't apply directly. So which of these fees are the highest? And is there a second page here?

No, that's it. Okay. So we got $16,000 in Uptown. We got 14 and a half thousand dollars in Torry Pines, $23,000 in Tiara Santa. Now this, we did a previous podcast and we identified Tiara Santa on a cha on a difficult spot to use the A DU Home Density Program because of the specific zoning that they have.

Let's see if we could find La Joa. Okay, so this is interesting, LA Joa. While difficult to use the A DU Home Density Bonus Program just because of the very specific atypical single family, uh, zoning it has. The community enhancement fee would not be too high in this area, but OTE Mesa. That would be an area where it would be probably cost prohibitive to use the ad home density bonus program.

And this one in particular stands out the college area, because this is a, this is a neighborhood where we drastically need more housing. Um, they're actually working on a, a whole community plan update for this neighborhood. Just because it's recognized by the city as a neighborhood that needs more housing to support the college, the colleges.

Okay, so let me explain how these fees are going to apply to the community enhancement fee. If you're gonna build a 1200 square foot a DU, which is the maximum size you can build, and you're gonna build that in the college area, a 1200 square foot a DU is gonna be subject to 100% of this impact fee, which is now just renamed a community enhancement fee.

If you're gonna build a 600 square foot a DU in the college area, which is 50% of the maximum size you can build, you're gonna be subject to 50% of. This community enhancement fee, if you build an 800 square foot, your uh, a DU, you're gonna be subject to 66% of this fee. So that is how it's applied. Most people don't realize these fees are gonna impact their projects until it's too late.

These fees are also the reason why you're almost always better off building an A DU than building a dwelling unit because if you build the same 600 square foot, uh, home as. A dwelling unit, you're gonna be subject to the full. Impact fee. And if you build that 600 square foot home as an A DU, if possible, you're gonna be subject to 50% of this fee.

So these fees could be both used to actually enhance the community, but they could also be used as a deterrent, or inevitably they become a deterrent for people to develop in these areas. This is one of the reasons why we don't get that much development in the Barrier Logan area, because Barrier Logan is still an up and coming neighborhood.

But fees like this basically prevent developers from building in these neighborhoods.

I think these are essential services, you know, the fire department, parks library, transportation, but I think there would be a better way to, um, tax the residents and the citizens to fund these essential services. doing it in a way like we just discovered, that clearly seems aimed as like a weapon to, um, disincentivize development. Um, I suppose zooming out though, taking into account what we just covered here, what are your thoughts on the current state of multi-unit development in San Diego? 'cause it seemed like the a DU bonus program when it first came out was a huge step in the right direction. Then of course there were some, you know, bad actors we could say that took advantage of it, um, in maybe ways it wasn't intended, which caused a lot of uproar. And now it seems like the city is like gradually scaling it back down.

Yeah, so I have a lot of thoughts about this. Okay, let's. Let's forget about the A DU Home Density Bonus Program for a second. If you're gonna build a home, you're gonna be subject to the regulations of the municipal code. You can build a great home under those regulations, and you can design something beautiful that everybody loves.

But you could also design something really ugly that people hate. So the regulations are not necessarily good or bad. It's how you use the regulations. Um, you can weaponize them or you can use them for the greater good. Now going back to the a DU bonus program, uh, I do agree that this was a great step in the right direction for San Diego.

Now what I think may be happening, because the program has been walked back quite a bit, they've started to restrict it from certain, uh, wealthier neighborhoods. They've started to add fees back to it, so it's certainly gonna be less effective than it was. But if I was a politician and I wanted to be pro-housing, but also avoid controversy one way, one kind of backdoor way I can do this is I could be an advocate for the.

A DU bonus program, but I can start to add fees back along the way, which would, uh, basically prevent people from using the program. So. I think maybe you're getting a little bit of that going on because the, basically the politicians in San Diego kind of speak outta both sides of their mouth. On one side they're saying, we want more housing, and we're advocating for more housing, and we've eliminated a lot of the hurdles or are eliminating a lot of their hurdles as we speak.

But on the other side, what we're seeing is. We're seeing more nimbyism, we're seeing more roadblocks, and we're seeing more fees. And while they're saying that they're reducing regulation, we're actually seeing timelines of permitting increase. And so they're, they're publicly saying one thing, but in, in reality, we're actually seeing something completely D.

12:26BaileyYeah. Well, I think that's a good place to leave it. If people want to get in touch with to you about an A DU project, what would be the best way to do it? Because we've identified a lot of challenges, but. Probably no one is more better versed in the code than you are. So I think if anyone can get the project done on a reasonable budget, it would be you.

So what is the best way for them to get in touch with you?

12:48Sean CanningWell, yeah, we we're very well versed in the A DU Home Density Bonus Program. We've done quite a few of these projects. We do have a five point system for developing what we consider pocket neighborhoods. There's a, actually a free guide that maybe we can make available in the show notes here and. We're not here to recommend maxing out these properties.

What we're here to do is recommend smart. Uh, smart design and design projects where we have higher density, but we maintain privacy and respect for all of the occupants of these properties and the neighbors. And we're trying to design these projects at the scale of the adjacent neighborhood. Um, so.

We're trying to use the program for good. If you have a project where you're considering adding a lot of density and you want to use the A DU Home Density Bonus Program, uh, visit our website, 10 70 architecture.com. Check out our Instagram. You can probably see some of these projects and you can look at, at the portfolio on the website, or you can send me an email directly, which is Sean, SEAN, at 1 0 7 0 architecture.com.

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How Much Is San Diego’s ADU Bonus Program Fee?

Outside San Diego’s Coastal Overlay Zone, the community enhancement fee for a bonus accessory dwelling unit (ADU) has matched the citywide impact fee, the city’s one-time charge on a new apartment of the same size, since May 20, 2026: $18,178 for 600 sq ft at fiscal 2027 standard fire rates. At 750 sq ft or more, I’d confirm which charges apply.

The ADU Home Density Bonus Program allows additional ADUs beyond the state allowance, and some affordable units are excluded from the fee. The fee started in August 2025 with three pieces of the impact fee, the fire, library and mobility charges that help fund public facilities and services. The park charge, the largest piece, came later, after the city said the 2025 resolution had left it out by mistake.

Bonus ADU sizeBefore the park chargeWith the park charge
600 sq ft$6,186$18,178
1,200 sq ft (see below)$8,819$25,911

Those figures use the standard fire charge. Where the city lists an area as underserved for fire facilities, the fire charge adds $229 to $327. Separately, the San Diego Housing Commission has charged a $2,000 ADU Bonus program fee since November 1, 2025. I want those costs on the page while you’re deciding what to build, because finding it after you’ve committed to a plan is a very different conversation.

The city’s documents leave the fee treatment of bonus ADUs of 750 sq ft or more unresolved, so the 1,200 sq ft row may not be the whole charge. I’d get written confirmation of which charges apply before treating a single schedule amount as the project’s fee budget.

The exclusion covers affordable ADUs deed-restricted to very low- or low-income households on lots in high or highest resource areas of the state’s tax credit opportunity map when the application is deemed complete. A moderate-income affordable ADU still carries the fee.

Does the Community Enhancement Fee Apply to My First ADU?

No. In San Diego, the community enhancement fee doesn’t apply to the first detached ADU, a state-allowed unit. Outside the Coastal Overlay Zone, it applies to the affordable and bonus units built through the city’s ADU Home Density Bonus Program, minus any excluded affordable unit, so I separate those homes before comparing costs.

The calculation uses gross floor area, the floor area the city counts, across the affordable and bonus ADUs. That makes identifying the homes in the bonus program part of the fee calculation, before you get to their sizes.

That answer covers this one charge; I don’t treat it as a promise that adding an ADU has no costs.

Does the ADU Bonus Fee Vary by Neighborhood?

Not much. Outside the Coastal Overlay Zone, San Diego’s community enhancement fee follows citywide rates, so a bonus ADU of a given size carries about the same fee anywhere, except a higher fire charge in underserved areas. The neighborhood totals I compared, $18,387 per home in Barrio Logan and $20,224 per home in the College Area, come from a separate community table.

The bonus fee doesn’t use that table, and the city now assesses new development on its citywide rates. For each project, I want to know what the total is meant to cover. Fire, libraries, parks and transportation all appear in those rates, so I look at the whole amount before comparing one unit size with another.

Barrio Logan is where I live, and I think about how charges like these affect adding housing there. A fee that’s easy to overlook while looking at a property can become a serious obstacle once it’s in the project budget.

A low fee also doesn’t tell me whether the program is available on the lot. I look at zoning, the city’s rules for what can be built where, alongside the fee before I compare one site with another.

Does a Smaller ADU Pay Less Than a Regular Home?

Since May 20, 2026, a bonus ADU outside San Diego’s Coastal Overlay Zone pays what an apartment of its size pays: $18,178 for 600 sq ft at fiscal 2027 standard fire rates. A smaller unit still pays less, because the rates step down with size, and when more than two ADUs are proposed, the city’s development impact fee exemption applies to the two smallest.

Before the park charge was added, a 600 sq ft bonus ADU carried $6,186, about a third of what a 600 sq ft apartment paid.

I keep that development impact fee exemption separate from the community enhancement fee on the program’s affordable and bonus homes; the main house isn’t one of those two ADUs.

If the larger layout is what you need, the full-size fee belongs in that comparison. If a smaller layout works, I want its lower fee considered while the design is still taking shape.

Can These Fees Make My ADU Project Too Expensive?

Yes, fees can be the point where I’d decide a San Diego bonus project doesn’t pencil out, meaning its costs no longer make financial sense. I wouldn’t build a rental project on the assumption that extra units make every fee worthwhile. The fee belongs in the decision about whether to build.

People used to call me about companion units, the earlier name for ADUs, and lose interest when they learned about the impact fee. Their response was direct: that fee would price the project out. I take that reaction seriously when working through bonus-unit costs.

I can see these charges contributing to community services, and I can also see them discouraging a project. To me, a housing program’s usefulness depends on whether someone can afford to use it.

My concern is the cost a homeowner or developer has to carry to get a workable project. I want the fee included from the start, while you’re still deciding whether the additional homes make sense for your property.

Can I Add More ADUs Without Crowding My Neighbors?

Yes, I think San Diego can add more homes while protecting privacy and respecting the adjacent neighborhood. We approach bonus-program projects as pocket neighborhoods, small groups of homes designed with occupants and neighbors in mind. We aren’t here to recommend maxing out every property just because a program makes more units possible.

The municipal code, the city’s rules for development, gives us a framework. I can design a beautiful home within those rules, and I can design something people hate. I care about how we use them.

I want the fee decision and the design decision to happen together. A project that looks affordable on paper still needs to work for the people who will live there and the neighbors beside it.

Start by marking which homes need the bonus program and pricing each at the size you’re considering, then check that the plan respects the privacy of occupants and neighbors. If you’d like someone to run the fee math on those bonus ADUs with you, we offer a complimentary consultation.

Questions You Might Still Have

What Is an Impact Fee Supposed to Pay For?

An impact fee is a charge on new housing intended to help pay for public facilities and services. In 2026, San Diego's citywide impact fees cover parks, fire, libraries and mobility, meaning transportation.

Can I Use San Diego's Schedule for a Project in Oceanside or Chula Vista?

No, my 2026 fee comparison uses the City of San Diego's schedule. Oceanside and Chula Vista have their own rules, so I wouldn't use these figures to price a project there.

Is the Park Fee the Whole Impact Fee?

No. In San Diego's citywide schedule the park charge is the largest part, and fire, library and mobility charges are added to it. For bonus ADUs outside the Coastal Overlay Zone, the park charge became part of the community enhancement fee on May 20, 2026.

Does Following the Municipal Code Guarantee a Well-Designed Home?

No. I can design a beautiful home under the city's building rules, and the same rules can also produce a home people dislike. The design depends on how we use those rules.

Has Ten Seventy Architecture Worked on ADU Bonus Program Projects?

We've done quite a few ADU Home Density Bonus Program projects. We focus on higher density with privacy for occupants and neighbors.

Episode
23
Published
Updated
Length
14 min

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