Oakland City Council Approves New Affordable Housing Impact Fee

The Oakland City Council voted Tuesday night to approve a new affordable housing impact fee, taking another step to address rapidly rising rents in the city.

As they did two weeks ago, when the council passed a 90-day moratorium on rent increases for most apartments in Oakland, community members packed the council chambers to call for broad action to curb the city’s escalating cost of living and halt displacement.

In the 18 months from August 2014 to March 2016, the median rent for a one-bedroom apartment in Oakland increased 40 percent, from $1,600 to $2,250 a month, according to listing service Zumper.

“We don’t want to solve this problem in three years. We want to solve it now," Oakland resident Margaret Cunningham told the council, echoing concerns from other speakers that the impact fee would not help anyone in the city currently struggling to secure housing.

The new ordinance permits the city to charge developers who want to build market-rate housing a one-time fee intended to help fund subsidized affordable housing. Previously, the city negotiated with developers on a case-by-case basis to determine if an impact fee would be paid and how much it would amount to.

The fee is determined based on the number of units in the development and differs based on three geographic zones. The ordinance will also usher in smaller transportation and capital improvement fees.

The impact fee ordinance was originally proposed in a report on the city's housing crisis prepared by Oakland’s Department of Housing and Community Development and social-equity action group PolicyLink last year.

Though the impact fee is the first action the council has taken to directly address the city’s affordable housing shortage, the city administrator’s office expects it will only fund about 600 new affordable units over the next 10 years.

If all goes according to the city’s plan, the measure will take affect on Sept. 1.