The Santa Fe Governing Body on Wednesday rejected prohibiting the use of Fee-in-Lieu for rental market rate housing development at the Midtown Development Project.
Under current Santa Fe rules, at least 15% of the units developed in the city must be affordable housing, at Midtown its 30%.
Fee-in-Lieu is a city policy that allows a developer to pay a fee for every affordable housing unit that is not developed. Those dollars are then used to help develop other affordable housing projects.
The matter has again lit a fire under the debate in Sante Fe over the great need for more affordable and workforce housing.
Bill supporters like Councilor Mike Garcia say since the city owns the land it can determine the lease or sale cost to developers and base it on how many affordable housing units they can afford to build.
But several organizations, the city’s own housing department and opponents on the Council including Mayor Alan Webber say prohibiting the fee will not guarantee an increase in affordable housing at Midtown and may instead be a deterrent.
“Our experts tell us that taking away the fee-in-lieu of looks like a good solution but in fact it’s counterproductive,” he said. “We tried it for ten years and it didn’t work. We stopped using an approach that didn’t work and began to see housing developed.”
In the end the body voted 5-4 to reject the bill.
After the vote, Mike Garcia said he was disappointed and that the city needs to start thinking out of the box to address its housing problem.
“If we keep doing the same thing over and over we’re going to get the same results,” he said. “This is an innovative way for us to hope for the best and hope for positive results. It’s a situation where if we don't get the positive results we hoped for we can go back to allowing folks to pay the fee-in-lieu and go back to square one. We missed a great opportunity.”
State Representative Tara Lujan told the Governing Body she was disappointed with the vote and also said the state may have to take the lead in getting more affordable housing built.
