Laserfiche WebLink
LIHF Methodology <br /> In summary, the Report's LIHF methodology/nexus is based on quantifying the impacts <br /> that new market rate housing units and workspace development have on the local <br /> economy relative to the demands this new housing/workspace development creates for <br /> affordable housing. As indicated in the Report, the basic premise of the nexus argument <br /> for fees on new housing is that new households create a demand for goods and <br /> services which are met to a degree through jobs with wages that are below what is <br /> required to obtain market rate housing. As a result, a nexus fee is based on mitigating <br /> the impact that these new homes will have on demand for affordable housing. To that <br /> end, developing the nexus for fees on housing include three separate steps as follows: <br /> Step 1. Estimate the typical subsidy required to construct units affordable to <br /> households at various income levels (the "affordability gap"). <br /> Step 2. Determine the market-rate households' demand for goods and services, the <br /> jobs created by that demand, and the affordable housing needs of workers in those <br /> jobs. <br /> Step 3. Combine the affordability gap with the anticipated demand for affordable <br /> housing to compute a maximum LIHF. <br /> Related to the above, some of the Report's key findings are: <br /> • The per-unit subsidy required to construct affordable housing units in Pleasanton <br /> ranges from approximately $57,800 to $163,900 depending on the target affordable <br /> income level. <br /> • Typically, larger sized market housing units create greater demand for affordable <br /> housing than smaller sized units. <br /> • Approximately 57 public sector jobs are required to support each 1,000 units of <br /> market rate housing. <br /> • Each 100 market rate units generates on an average a demand of six (6) housing <br /> units affordable to "very low income" households at 50% of the Area Median Income <br /> (AMI). <br /> A similar approach was taken to update the fees on Commercial/Office/Industrial (C/O/I) <br /> development. The nexus study shows that new C/O/I development increases total <br /> employment in the City, and that some of the jobs do not pay well enough to provide for <br /> employees to afford market-rate housing, thus increasing demand for affordable <br /> housing in Pleasanton. Retail development has a particularly strong impact on <br /> affordable housing demand, as retail workers are among the lowest-paid occupations. <br /> Page 3 of 12 <br />