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San Diego City Council To Decide On Developer Fee

The San Diego City Council is scheduled to decide Tuesday whether to rescind approval of an increased fee on construction, which would go toward affordable housing projects, or place the issue before voters.

Special Feature WATCH: San Diego Businesses Protest City Council’s Increase Of ‘Jobs Tax’

San Diego companies and business organizations prepare to fight — at the ballot box — City Council's decision to increase development taxes.

The Council voted to increase the fee late last year by a 5-4 margin. Business leaders who oppose the increase, including former mayor and current Chamber of Commerce CEO Jerry Sanders, call it a "jobs tax." They gathered enough signatures to force Council action.

The fee, which provides funding for affordable housing projects, had been halved in 1996. The council voted to double the levy to where it had been, 1.5 percent of construction costs.

While the city's overall fee on the total construction cost is doubling, opponents say some types of businesses would be charged increases of more than 700 percent, while making only a minimal impact on San Diego's affordable housing shortage.

The city calls the fee a "Workforce Housing Offset.''

Supporters of the fee increase point to studies that show San Diego's housing market is among the least affordable, and more affordable housing would make the city more attractive to businesses.

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