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Last month I wrote about how Boulder was weighing an ordinance that would raise the city’s affordable housing linkage fee on new commercial development from $12 per square foot–a fee just 16 months old and the second highest in the country–to $25, $30, or $35 per square foot. Last week, by a 6-3 vote, city council voted to raise that fee to $30. The $30 fee falls short of the country’s highest, Palo Alto’s $35. But because of the difference in the price of land in Boulder versus Palo Alto, on a percentage basis, Boulder’s new $30 fee will be much greater than Palo Alto’s fee.

Importantly, the city council also approved a “tiered system” for the fee. For example, developers of office space will pay the full $30 per square foot, while hospital space and warehouse space will pay $20 and $10 per square foot, respectively.

Only time will tell whether the new $30 fee will accomplish the city’s goal to spur residential development over commercial development without detriment to the city’s affordable housing fund.

The vote will be made official on May 1.

Photo of Kyle R. Blackmer Kyle R. Blackmer

Kyle Blackmer represents clients in a variety of real estate and real estate finance transactions. He currently focuses on representing lenders on loans involving all types of real estate, including multi-family housing, mixed-use, office, charter schools and retail.