(a) (1) Subject to paragraph (4), the executive board may establish, increase, or impose a commercial linkage fee, in an amount not to exceed ten dollars ($10) per square foot, within the San Francisco Bay area by enactment of a resolution, in accordance with the requirements of this article, that is in addition to any fee, as defined in Section 66000, that is levied by an underlying land use jurisdiction.

(2) The fee shall be adjusted on July 1 of each year, in accordance with the California Construction Cost Index. The annual adjustment may increase the fee to be greater than the ten-dollar ($10) maximum imposed by paragraph (1).

(3) The authority board shall ratify, by resolution, any commercial linkage fee or modification to a commercial linkage fee adopted by the executive board.

(4) The executive board shall not establish a commercial linkage fee pursuant to paragraph (1) until after the voters approve a parcel tax pursuant to Section 64610 or a general obligation bond pursuant to Section 64631.

(5) (A) The executive board may establish, increase, or impose a commercial linkage fee pursuant to this article by a resolution that provides for a fee assessed on commercial development projects within the San Francisco Bay area.

(B) A resolution establishing or revising the fee shall provide that the amount of the fee required to be paid shall be reduced by the amount that the applicant is required to pay, if any, for a commercial linkage fee for affordable housing imposed by the relevant underlying land use jurisdiction.

(b) Before establishing, increasing, or imposing a commercial linkage fee, the executive board shall prepare a regional jobs and housing nexus study in order to support the necessity and amount of the fee. The study, or separate study conducted before the establishment of a commercial linkage fee, shall examine the factors listed in paragraph (5) of subdivision (d), may consider other potential consequences, and shall take into consideration the potential impact of the fee on the creation of high-paying jobs for people without four-year degrees.

(c) Expenditures of proceeds from a commercial linkage fee shall be limited to affordable housing production, preservation, and tenant protection, as described in subparagraphs (A) and (B) of paragraph (2) of subdivision (b) of Section 64650.

(d) In any action to establish, increase, or impose a commercial linkage fee, the executive board shall do all of the following:

(1) Identify the purpose of the commercial linkage fee.

(2) Determine how there is a reasonable relationship between the fee’s use and the type of commercial development project on which the fee is imposed, based on the regional nexus study prepared pursuant to subdivision (b).

(3) Determine how there is a reasonable relationship between the need for housing and the type of commercial development project on which the fee is imposed, based on the regional nexus study prepared pursuant to subdivision (b).

(4) Determine how there is a reasonable relationship between the amount of the fee and the cost of the housing necessitated by the commercial development project that is attributable to the development on which the fee is imposed, based on the regional nexus study prepared pursuant to subdivision (b).

(5) (A) Adopt findings that, based upon the executive board’s analysis and the regional nexus study, the commercial linkage fee:

(i) Would concentrate jobs near transit.

(ii) Would not reduce commercial development and space for jobs, particularly in economically disadvantaged areas.

(iii) Would not exacerbate intraregional job-to-housing imbalances.

(iv) Would not disincentivize mixed-use development.

(B) The executive board shall provide analysis to support the findings and consider other potential consequences of the fee.

(e) The executive board and the authority shall suspend the imposition of a commercial linkage fee after two consecutive quarters of negative gross domestic product growth within the San Francisco Bay area. The fee may be reinstated after two consecutive quarters of positive gross domestic product growth within the San Francisco Bay area. The executive board and the authority board may reinstate the fee by resolution that states the condition in the previous sentence is met but shall not be subject to subdivisions (b), (c), or (d) of this section.

(Added by Stats. 2019, Ch. 598, Sec. 1. (AB 1487) Effective January 1, 2020.)