The City Council Tuesday is scheduled to consider a compromise plan for a fee on commercial construction to fund the city of San Diego's affordable housing projects.
The deal is expected to end a struggle between housing advocates and business leaders over the future of the fee, which was instituted in 1990. Six years later, the levy was halved as an economic stimulus.
Last year, the City Council approved restoring the charge to its original level — but as the city's independent budget analyst pointed out, the hike would have ranged from over 300 percent to more than 700 percent on certain types of building projects.
Opponents collected enough petition signatures to get the council to rescind the increase, which led to the compromise to be considered Tuesday.
The council voted two weeks ago to approve the framework of the agreement in concept and have the City Attorney's Office return with a draft ordinance.
Provisions include returning the fee to its 1990 level, phased in over three years beginning on Jan. 1; exempting developers of manufacturing, warehouse and nonprofit hospital projects from paying the fee as an economic development incentive; and maintaining current fee levels for research and development construction for the same reason.
Two controversial points in earlier versions of the compromise — a sunset provision that would put the levy back to its 1996 level in three years if certain reform measures weren't implemented and a requirement for annual fee adjustments based on a construction cost index — are no longer being considered by the City Council.
The deal was hammered out by the San Diego Housing Commission, which runs the city's affordable housing programs, and the Jobs Coalition, a business group. Final details were ironed out by Councilwoman Myrtle Cole.
