New Fees for Developers Downtown Could Double Revenue for Santa Monica

By Jason Islas
Staff Writer

August 28, 2012 -- Santa Monica could double its revenue from developers who build Downtown but opt not to build parking.

The Planning Commission will look at a plan Wednesday that would require developers to pay a $20,000 in-lieu fee if they choose not to build on-site parking in their developments.

Currently, the in-lieu fee, which was established in 1986, is $1.50 for every square foot of development and will expire on June 30, 2016.

“To date, the City collects approximately $600,000 annually from a total of 44 parcels,” staff wrote.

But the revised pricing scheme is projected to raise $36.1 million in the next 30 years, or $1,152,000 a year, according to a report by Nelson\Nygaard and AECOM Consultants.

With gridlock an increasing problem in Downtown Santa Monica, mitigating traffic has become a priority for the city.

The money, staff says, would go to create “a fund that would accumulate sufficient revenue to construct additional public parking, construct parking and circulation related improvements… and fund transportation demand management (TDM) programs that would manage parking demand in the Downtown district.”

The consultant’s report recommended that the revenue from the new in-lieu fee also go toward “increasing capacity by either leasing underutilized private parking spaces or building new public parking supply” as well as improving signage that would allow visitors to find available parking more easily.

But there are still outstanding questions that the Commission will have to address, such as whether or not to allow developers to satisfy 100 percent of their parking requirements through the in-lieu fee and whether or not the developers should have four years to pay their fees.

Also, the Commission will weigh in on whether $20,000 per space is enough.

According to the staff report, rebuilding Parking Structure 6 is costing the City approximately $53,775 per underground parking space and $31,603 for every above-ground space.

But, according to the consultant’s report, Downtown stakeholders warned that “anything above $20,000 to $30,000 per parking space would be excessive and would deter participation in the program.”