(a) Requirements. Developers of high intensity industrial development are required to mitigate the demand for affordable housing created by the development. For purposes of this section, "high intensity industrial development" is defined as all development projects in industrial zoning districts which require a use permit to exceed specified threshold floor area ratios, as set forth in Table 19.32.020 of this code. Housing mitigation fees paid pursuant to this section shall be placed in the city's housing fund and shall be used to support the provision of affordable housing within the city, including, but not limited to, funding the creation or acquisition of new units, providing assistance to potential home buyers, and assisting with the maintenance and rehabilitation of existing units.

(b) Housing Mitigation Fee. A housing mitigation fee is hereby imposed on all developers of high intensity industrial development projects that result in the creation of new floor area.

(c) Calculation of Housing Mitigation Fee. The housing mitigation fee shall be imposed on a per-square foot basis for all new gross floor area which exceeds the amounts specified in Table 19.32.020. The fee amount shall be calculated as follows: (Gross square footage of entire project minus the square footage allowed in Table 19.32.020) X (Applicable Fee) = Housing Mitigation Payment. In calculating the floor area, the following uses/facilities may be subtracted from the gross square footage:

(1) Recreational facilities such as gyms, showers, indoor pools, locker rooms;

(2) Cafeterias;

(3) Architectural design features not utilized for occupancy or storage.

(4) Atria;

(5) Auditoriums or other special presentation rooms not easily converted to work area;

(6) Childcare facilities;

(7) Hazardous materials storage.

(d) The amount of the fee shall be as set forth in the city's master fee resolution.

(e) In calculating the payment due, the director of community development shall use the fee in effect by resolution of the city council at the time of the issuance of the building permit. The housing mitigation payment must be paid prior to issuance of the first grading or building permit for a project. A developer may pay all or a portion of the fee owed at any time prior to issuance of the building permit, at the rate in effect at the time payment is made. Any grading or building permit issued prior to payment shall be null and void. For phased projects, the amount due shall be paid on a pro rata basis across the entire square footage of the approved development, and each portion shall be paid prior to the issuance of any grading or building permit for each phase.

(f) As an alternative to payment of the housing mitigation fee, a developer may submit a request to mitigate the impacts of such development through the construction of residential units on an appropriate housing site, the dedication of land or provision of other resources. Such requests may be granted by the director of community development if it is determined that such alternative will further affordable housing opportunities in the city to an equal or greater extent than payment of the housing mitigation fee.

(g) An adjustment, reduction or waiver of the fee required by this section may be granted at the time the use permit is issued under the following circumstances:

(1) Upon the remodeling of a building to add square footage, the appropriate housing mitigation fee shall be paid only on the additional square footage.

(2) If the development project is in whole or part a replacement for space previously on the site, but vacated or demolished in the twelve (12) months prior to the filing of the application for a use permit for the new construction or remodel, credit shall be given for the space vacated or demolished at the rate applicable to the prior use of the space.

(3) If, upon evaluation of facts presented by the developer, the director of community development finds that there is an absence of any reasonable relationship or nexus between the impact of the development and the need for housing, the project shall be eligible for a conditional waiver of the fees. The burden of proof shall be on the applicant. If a waiver is granted, a "Notice of Conditional Waiver of Housing Mitigation Fee" shall be recorded in the Santa Clara County Office of the Recorder. If a subsequent change in the use or structure of the building occurs which triggers the need for housing, the waiver granted shall be deemed revoked, and housing mitigation payment shall be calculated and due at that time.

This section is enacted to supplement and to assist in the interpretation and administration of Table 19.32.020.