Affordable Housing Requirements Update

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About the Affordable Housing requirements update

The City of Santa Clara is looking at options for updating its Inclusionary Housing Policies. Such considerations include an affordable housing impact fee applicable to rental apartments, a jobs housing linkage fee applicable to non-residential development and other updates to the city’s affordable housing policies. The overall goal of these policies is to increase the City’s ability to provide affordable housing with adequate choice of tenure, type and location for low- and moderate-income and special needs households.

Santa Clara’s Inclusionary Housing Policy

The City’s Inclusionary Housing Policy was established in 1992 and is described in the 2010-2035 General Plan. The Policy requires new developments of for-sale housing of 10 or more units to provide at least 10 percent of units at below market rates for moderate income households. The city does not currently charge an in-lieu fee for residential development and affordable housing requirements do not currently apply to non-residential projects.

The General Plan also outlines other Affordable Housing incentives including encouraging and supporting public and private efforts to provide affordable housing, density bonuses and other financial incentives for housing projects that include affordable and/or senior housing units, consistent with State law requirements.

What updates are being considered?

The Ad Hoc Affordable Housing Working Group have reached a consensus on the following requirements, in-lieu fees and impact fees towards providing Affordable Housing in the City of Santa Clara. These recommendations will be considered by the Council on July 11, 2017.

For-Sale Residential

  • 12.5 percent inclusionary requirement (moderate income)
  • In-lieu fee may be used rather than providing one affordable unit on site and for fractional units. The Affordable Housing Impact Fees for For-Sale Residential Development are as follows:

     Tenure Type  $ per square foot
     Single-Family Home  $30
     Townhome  $25
     Condominium  $20




Requirements can be met through a combination of units onsite, offsite and impact fees. A lower inclusionary requirement can be accepted if units are provided at a lower AMI level (e.g. 10% for units affordable to 80% AMI or lower, 6% for units affordable to very low income, etc.).

Rental Residential

  • Residential impact fee between $17-20 psf (range to be considered by City Council).
  • Voluntary provision of 10-15% affordable units onsite in lieu of paying impact fee (range to be considered by City Council).

    Requirements can be met through a combination of units onsite, offsite and impact fees. A lower inclusionary requirement can be accepted if units are provided at a lower AMI level (80% or lower.). Projects will have a restriction to retain rental status for a minimum agreed period or will be subject to the applicable For-Sale Residential Development Impact Fee if converted to a for-sale project within an agreed time period of initial development.


  • Retail
    • <5,000 square feet: No Fee
    • >5,000 square feet: $5 per square foot
  •  Hotel
    • $5 per square foot
  •  Office (including Industrial Office, R&D and Commercial Office
    • <20,000 square feet: $10 per square foot
    • >20,000 square feet: $20 per square foot
  • Other Commercial
    • $5 per square foot
  • Light Industrial
    • <20,000 square feet: $5 per square foot
    • >20,000 square feet: $10 per square foot
    • Low-Intensity Uses (e.g., Data Centers and Warehouses): $2 per square foot


The following types of development are exempt from the provision of inclusionary housing units and/or payment of the Affordable Housing Impact Fee.

  • Additions, remodeling or construction of a single residential unit or duplex unit on an existing lot of record, including Accessory Dwelling Units.
  • Commercial square footage within a vertical mixed-use development where the commercial space is integrated  into a single structure that also includes residential development at a density of 30 units per acre or greater and does not exceed 20,000 square feet.
  • Assembly uses (such as lodges, clubs, youth centers and religious assemblies)
  • Day care, nursery and school facilities
  • Hospitals
  • Other non-residential uses determined by the City Council to have a minimal impact upon the demand for affordable housing.


To allow market based development to adjust to the new fee requirements, the Impact Fee will be implemented as follows:

  1. On-going projects: any project with demonstrated site control at the time of the Fee Adoption will not be subject to the impact fee provided that Planning Approval has been granted for the construction of that project within three years after adoption.
  2. When a project has been deemed complete, it will be subject to the fee about within the effective dates:
    • 0-6 Months: No Fee
    • 6-12 Months: 1/3 of total fee applicable
    • 12-18 Months: 2/3 of total fee applicable [OR] full fee applicable after 12 months (to be considered by City Council)

Other Considerations

  • Fees will be due prior to occupancy (temporary or final)
  • Rates will be subject to an automatic Cost Escalator
  • Credit will be applied to projects with existing floor space or DU.
  • Fees to be reviewed one year after effective date

How can I learn more?

There will be a number of opportunities for you to get involved and talk with the staff working on this update. Please contact Anna McGill, Associate Planner to receive project notices, meeting announcements, and updates via email and telephone below.

Attend a meeting

A number community and stakeholder meetings were held from January to February, 2017, to gather input on the Affordable Housing Nexus Study and the proposed Affordable Housing Impact Fees. Staff presented the results of the community input to City Council at their February 21st 2017 meeting. At this meeting, the Council directed staff to organize a Stakeholder Group to host a series of four Affordable Housing Working Group Meetings in order to gain additional input from the community on the proposed Affordable Housing Impact Fees. The staff report and presentation from this meeting can be found in the Resources section below.

The Working Group meetings have been scheduled:

The Affordable Housing Working Group's recommendations will be presented to the City Council on July 11, 2017 at 7:00pm, City Council Chambers (1500 Warburton Avenue).

Please check back to this website for details on future Affordable Housing Update progress.

Comments or questions?

Contact Anna McGill, Associate Planner
(408) 615-2458 


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