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Affordable Housing Fee is applicable to most residential and commercial projects. The fee for commercial projects is assessed on a per square foot basis and was most recently updated in 2018, based on a study prepared by Economic & Planning Systems, Inc., which considers, among other elements, the employee density and generation rates for typical commercial, industrial, and office uses. The code allows the City Council to consider a reduction of this fee under certain circumstances, including: 1) that a proposed use would generate substantially fewer workers than the uses which have established the fee; and 2) that the building design is unable to house another use without substantial renovation. If the standard fee were applied the project would be required to pay an Affordable Housing Fee in the amount of$2,156,893 for the increased square-footage. Public Storage has requested the City Council consider a reduction of this fee by 98.8 percent) based on the criteria set forth in the PMC and particularly in light of the project's very low actual employee generation rate, compared to that assumed as the basis for the fee. (The applicant's requested amount to pay is stated at $25,898 in the letter; however, based on revised project square footage, a 98.8% reduction would result in a fee of$26,318) RECOMMENDATION A) With respect to the Design Review and Conditional Use Permit applications, staff recommends the Council: 1. Find that the proposed project complies with the California Environmental Quality Act (CEQA) Guidelines Section 15183 and requires no further environmental analysis; 2. Adopt the draft resolution, Attachment 1, upholding the Commission's approval, modifying the approved plans, of Case Nos. P19-0128 and P19-0129, subject to the Conditions of Approval in Exhibit A of Attachment 1, including if determined appropriate, a modified request for community amenities/benefits; and B) With respect to the request for reduction of Affordable Housing Fees, staff recommends the Council: 1. Adopt the attached resolution, Attachment 2, approving a reduction to the Affordable Housing Fee for P19-0128/P19-0129, reflecting the staff recommended Option 5, to reduce the fee by 0 percent for the office and 97.3 percent for the new storage area, to remain in alignment with more industry- standard assumptions for employee generation in storage projects. FISCAL IMPACT No fiscal impacts to the City or public services are anticipated with approval of the project. Approval of the Affordable Housing Fee reduction also does not have a direct fiscal cost (i.e., does not in and of itself generate costs to the City), it would, however, reduce the total Affordable Housing Fees the City would otherwise collect for the Public Storage project. The estimated Affordable Housing Fee required for this project is $2,156,893 which (in the Option 5 recommended by staff) is proposed to be reduced to Page 2 of 18