Systems Development Charges (SDC's)
SDC's are assessed on new home construction to pay for the demand they add to the utility and service systems. These charges can amount to $6000 to $10,000 per unit and therefore affect a community’s ability to create affordable housing.
Action Options :
- Jurisdictions can consider deferments or waivers of SDC's for affordable housing.
- In Friday Harbor, Washington, water/sewer connection fees (currently $17,000/unit) are deferred for 15 years –at which time they pay the rate at the time of construction even though the rate will have gone up. (The Community Land Trust buys a 0% coupon to pay off the fee in the future, saving 50%). If home becomes market rate at any time then the fee is due immediately.
- The City of Bend offers different levels of waivers depending on what percentage of affordable housing (specifically defined) is being provided in any development.
- Jurisdictions could offer loans to cover the cost of SDC’s for affordable housing. Bend does.
- Accessory Dwelling Unit fees can be considered as different from a dwelling unit relative to SDC's.
- Eugene's EWEB has a program for local utility SDC subsidy.
- Waivers could be made on ADU's with energy upgrades.
- An ADU’s deferral for affordable housing could be for 5 years and then forgiven.
