Council Imposes New Fees on Developers

Developers will start paying their "fair share" to help mitigate new traffic in Santa Monica.

A Transportation Impact Fee was approved by the City Council on Tuesday night to help defray the costs of constructing public transportation improvement projects. The price tag for those projects over the next 20 years is forecast at nearly $134.3 million.

The fees approved unanimously this week could generate $50-60 million, or between 37 and 45 percent of the cost of building transit infrastructure to meet the city's "no new net PM trips" goal.

Under the new ordinance, housing developers will pay as much as $7,800 per room and commercial developers $30.10 per square foot, the region's second-highest—after those of the Los Angeles International Airport neighborhoods of Venice, Marina del Rey and Playa Vista.

The Santa Monica Chamber of Commerce and developers have argued the fees, combined with those developers are already required to pay for affordable housing, parks, and arts, among others, would drive them to neighboring cities where costs are lower.

"The cumulative effect of these fees would have the unintended consequence of being a barrier to the quality of development that the [Land Use Circulation Element] envisions for a small percentage of Santa Monica land including projects that would be fiscally beneficial to the city," Chamber of Commerce President Ellis O'Connor told the council.

But an analysis by a city-hired consultant found they would cause "a very minor" change in their returns on the total development cost and would not deter most projects from going forward.

Transportation impact fees are already being negotiated in Santa Monica under development agreements, special agreements signed with developers who ask to build over-sized hotels and mixed office/shopping/residential projects that don't adhere to the city's zoning and land-use rules. In exchange, the developers contribute to community projects and typically agree to hire locally, among other concessions.

City planning commissioners recommended the fees and looked at them as a way to stall development, which has picked up steam in spite of the recession and drawn ire from locals tired of the resulting gridlock. They've been requested for several years now by the commission and the City Council.

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