Senate and Assembly Committees coming together to host critical hearing on impact fees

Tuesday, February 25, 2020

Sacramento, CA – Senator Mike McGuire, Chair of the Senate Committee on Governance & Finance, Senator Scott Wiener, Chair of the Senate Committee on Housing, Assemblymember Cecilia Aguiar-Curry, Chair of the Assembly Committee on Local Government, and Assemblymember David Chiu, Chair of the Assembly Committee on Housing & Community Development, are hosting a critical hearing this Wednesday on housing impact fees.

Through this joint hearing, the Committees will explore the balance between the need for robust public services supported by the proceeds of impact fees and the potential ramifications fees have on development and home prices. 

“California has a housing crisis, in big cities and small, and every policy is being scrutinized to ensure maximum build out of units in the most efficient period of time,” said Senator Mike McGuire, Chair of the Senate Government and Finance Committee. “We know there are trade-offs when it comes to impact fees – both benefits and challenges. We’re coming together on Wednesday to study fee impacts on service levels in our communities, housing availability and rent affordability. We hope folks will join us.”

“California has a major housing shortage, and it’s crucial that we focus on building more housing in the most efficient way possible, while also making sure our communities are set up for financial success,” said Senator Scott Wiener, Chair of the Senate Housing Committee. “Impact fees are an important piece of this puzzle. We need to take a closer look to see what’s working and what’s not. We’ll be using this hearing to reassess impact fees and hear from different stakeholders on the issue. I look forward to a robust conversation.”

“Without a doubt, more work needs to be done to ease California’s housing crisis. Impact fees are an important source of revenue for local agencies that support a wide range of community benefits like fire and police stations, road improvements, local libraries and parks, and affordable housing,” said Assemblymember Cecilia Aguiar-Curry, Chair of the Assembly Committee on Local Government. “As the impact fee reform discussion moves forward in the Legislature, it is imperative that we balance California’s housing goals with the reality of fiscal constraints at the local level and the desire for these community benefits. This informational hearing will provide a place for us to examine this balance, and hear from stakeholders that will help inform our future legislative conversations.”

“We have to face facts—it is extremely expensive and difficult to build housing in California,” said Assemblymember David Chiu (D-San Francisco), Chair of the Assembly Committee on Housing & Community Development. “When it costs upwards of $750,000 to build a single unit of housing in San Francisco and California has a 3.5 million housing unit shortage, we need to try something new. I am looking forward to this hearing and discussing ways to encourage housing production in California.”

At the hearing, titled “The Price of Civilization: Benefits and Costs of Impact Fees on Housing in California,” the Committees will receive an overview of the fiscal constraints that drive the need for local governments to impose impact fees, as well as a description of the legal requirements that guide how local governments establish impact fees, the amounts they may charge, and how they must collect the fees. The Committees will also hear from local government districts, like firefighting and park districts, on their uses of impact fees and the importance of these fees to their ability to provide service to new residents and mitigate effects on existing residents.

There were will be a second panel that will highlight California cities and counties that have adopted innovative strategies for setting impact fees to address their unique circumstances. The Committees will also hear from developers—both for-profit and non-profit—as well as the Terner Center for Housing Innovation on the effect of impact fees on supply, and ultimately, housing prices.

The hearing will be held this Wednesday, February 26 at 9:30 am in Room 4202 of the State Capitol. The hearing will be live-streamed at www.senate.ca.gov

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