City Hall Watch: Developers allowed to defer fees in bid to aid economy 

Beginning July 1, developers in San Francisco will have the opportunity to defer some city fees under an effort to stimulate construction.

As much as 85 percent of the required fees developers must pay The City no longer have to be paid upfront under an optional deferral program approved in a 10-1 vote Tuesday by the Board of Supervisors.

Legislation creating the program was introduced by Mayor Gavin Newsom, who had proposed a 100 percent deferral that was scaled back by a board committee.

“We must ensure that we do not jeopardize other objectives held dearly by many in the community, namely that public benefits are delivered in tandem with new development,” Supervisor Sophie Maxwell said, as justification for the scaled-back version.

There will now be a down-payment fund and The City would receive a portion of the fees upfront. In six specially defined areas of The City, developers will pay 20 percent of total fees, while developments outside those areas are required to pay a 15 percent down payment.

City officials had identified nine developments, totaling 2,500 units, that are prepared to undergo construction if the fee-deferral program was offered. A 20 percent down payment would generate $8.2 million, which would go into the fund to pay for infrastructure needs.

A planned 269-unit residential development at 900 Folsom St. would owe $3.2 million in impact fees. The developer would pay $683,000 upfront and defer the remainder.

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