The Los Angeles City Council voted to create a new linkage fee on real estate development to finance new affordable housing.
The Los Angeles Times reports
that the fee’s proponents insisted that this will raise $100 million a year. The fee, which goes into full effect in 2019, will require developers to pay $1 to $15 a square foot, depending on the project and location, with higher fees in the more expensive sections of the city and lower fees in the working-class and at-risk neighborhoods.
Several development categories are exempt from the fee, including schools, hospitals and public museums plus residential additions smaller than 1,500 square feet are exempt. Developers can avoid the fee if they include a set amount of affordable, low-income or moderate-income housing in their buildings.
“Today, we see hope in the promise that Los Angeles can continue to grow and indeed must grow,” said L.A. Mayor Eric Garcetti. “That when we see luxury condominiums going up, that we can make sure that there is money paid in to build housing for the rest of us.”