CITY OF FAIRFIELD
RESOLUTION NO. 2025-146
ESTABLISHING AN INCLUSIONARY HOUSING IN-LIEU FEE SCHEDULE PURSUANT TO CHAPTER 5F (INCLUSIONARY HOUSING) OF THE CITY OF FAIRFIELD MUNICIPAL CODE
WHEREAS, the State of California has found that local governments have a responsibility to use the powers vested in them to facilitate the development of housing and to make adequate provision for the housing needs of all economic segments of the community (Government Code Section 65580(d)); and
WHEREAS, Fairfield Municipal Code (FMC) Chapter 5F provides the City of Fairfield’s (City) inclusionary housing program, which requires developers of residential projects of 10 or more units to provide a certain percentage of housing units affordable to very-low, low, or moderate income households within the residential development; and
WHEREAS, State law requires jurisdictions with inclusionary housing programs to provide alternative means of compliance. A common form of alternative compliance is the option to pay an inclusionary housing in-lieu fee. In-lieu fees are paid by developers to the jurisdiction and may be used to support the development of new affordable housing units and the rehabilitation and improvement of existing affordable housing units, among other options; and
WHEREAS, FMC Chapter 5F provides that developers may pay an in -lieu fee as an alternative to building inclusionary units on-site; and
WHEREAS, Economic & Planning Systems, Inc. (EPS), an economic consulting firm retained by the City, prepared an “Inclusionary Housing and In-Lieu Fee Feasibility Analysis Report” dated April 18, 2025 (Fee Study); and
WHEREAS, as part of the Fee Study, EPS estimated the associated “affordability gap” or subsidy required to develop affordable inclusionary hou sing units. The affordability gap analysis compares the cost of developing affordable units to their value under income -based pricing restrictions. Where the development cost exceeds the unit value, there is an affordability gap that must be subsidized to support affordable unit development. The affordability gap is then applied to the inclusionary requirements for market -rate housing development to derive an equivalent supportable in-lieu fee; and
WHEREAS, as a policy decision, jurisdictions may choose to charge in-lieu fees that are less than the estimated cost of providing affordable housing. The Fee Study accordingly recommends adoption of fees at 50 % of the equivalent level, as presented in Exhibit A; and
WHEREAS, in-lieu fees shall be deposited in the City’s housing trust fund for use by the City to facilitate the provision of affordable housing in the City; and RES. NO. 2025-146
WHEREAS, in excess of state law requirements for the adoption of in -lieu fees, notice was provided to any persons or organizations who had requested notice at least fourteen days prior to the adoption of this Resolution, in accordance with Government Code Section 66019; and
WHEREAS, in excess of state law requirements for the adoption of in-lieu fees, at data was made available to the public indicating the amount of cost, or estimated cost, required to provide the affordable housing for which the fee is being levied and the revenue sources anticipated to provide the affordable housing at least 10 days p rior to the adoption of this Resolution, in accordance with Government Code Section 66019; and
WHEREAS, in excess of state law requirements for the adoption of in -lieu fees, notice of the hearing on the proposed fees was published twice in a newspaper of general circulation in the manner set forth in Government Code Section 6062a, in accordance with Government Code Sections 66004 and 66018; and
WHEREAS, on July 1, 2025, 2025, the City Council held a public hearing and conducted a first reading of Ordinance No. 2025-05 establishing the authority for imposing and charging an in-lieu fee. The Ordinance states that the council shall set the amount of the in -lieu fee by resolution.
The council is expected to conduct a second reading of the Ordinance on July 15, 2025; and
WHEREAS, on July 1, 2025, 2025, the council conducted a duly noticed public hearing concerning the amount of the in-lieu fee adopted herein; and
WHEREAS, evidence, both written and oral, was duly presented to and considered by the council of the City of Fairfield at the aforesaid public hearing; and
WHEREAS, after close of the public hearing, the council considered all public comments received both before and during the public hearing, the presentation by City staff, the staff report, the recommendations, and all other pertinent documents and associated actions regarding the proposed fee update; and
WHEREAS, the council reviewed and considered the inclusionary housing in -lieu Fee Study and related fee schedule in accordance with the provisions of the California Environmental Quality Act (CEQA), as amended, and the CEQA Guidelines promulgated thereunder. The council finds that the inclusionary housing in-lieu fee schedule resolution is not a “project” as defined by the California Environmental Quality Act (CEQA) pursuant to Section 15378(b)(4) of the CEQA Guidelines. The adoption of an in-lieu fee is the creation of a government funding mechanism and a fiscal activity that does not involve any commitment to a specific project that may result in a potentially significant physical impact on the environment. The council further finds that it may be seen with certainty that there is no possibility that the inclusionary housing in -lieu fee schedule resolution will have a RES. NO. 2025-146
significant effect on the environment, pursuant to CEQA Guidelines Section 15061(b)(3). Were the City to utilize the in -lieu fee revenue to construct any affordable units, CEQA review would be conducted prior to the authorization of such a project.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF FAIRFIELD HEREBY RESOLVES AS FOLLOWS:
1. Recitals: The facts set forth in the Recitals, above, are true and correct.
2. Findings:
a. The findings of the Fee Study have been considered and are hereby incorporated into this Resolution by reference.
b. The purpose of the in -lieu fee is to provide new development an alternative means of compliance to building inclusionary units on-site under the City’s inclusionary housing program.
c. The in-lieu fees collected pursuant to this Resolution shall be used to finance only affordable housing as described in Ordinance No. 2025-
05. d. The in-lieu fees set forth in this Resolution shall be adjusted annually based on the Engineering News-Record Construction Cost Index for San Francisco, or its equivalent, to ensure that the fees continue to reflect the costs of construction.
e. The in-lieu fees and the affordable housing to be financed with the fees are consistent with the City’s General Plan.
3. In-Lieu Fee: The council hereby adopts the in-lieu fee schedule as described in Exhibit A, based upon the analysis provided in the EPS Fee Study.
4. Effective Date: This Resolution shall take effect upon adoption, provided that the fees as herein established shall not be imposed by the City until 60 days from the date of the second reading of Ordinance No. 2025-05, establishing the authority for imposing and charging the in-lieu fee.
5. Judicial Challenge: Any judicial action proceeding to appeal, review, set aside, void, or annul this Resolution shall be brought within 120 days of its adoption.
6. Certification: The City Clerk shall certify the adoption of this Resolution.
RES. NO. 2025-146
PASSED AND ADOPTED this 1st day of July 2025, by the following vote:
AYES: MEMBERS: MOY/BERTANI/CARR/PANDURO/SANDHU/TONNESEN/WILLIAMS NOES: MEMBERS: _________________________________________________ ABSENT: MEMBERS: _________________________________________________ ABSTAIN: MEMBERS: _________________________________________________
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MAYOR
ATTEST:
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CITY CLERK