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Honorable Pete Hoffmann Chair and Presiding Officer and Members of the County Council COUNTY COUNCIL Page 4 March 8, 2007 per employee, would be roughly $19,000. This means that the person getting plan approval fora 10,000 square foot warehouse on a one-acre lot, who we would assume to generate ten employees and provide 2.5 affordable housing credits, would have an in-lieu fee of $190,000 to satisfy the affordable housing requirement. This is a tremendous financial burden for a project like this. In South Hilo, the in-lieu fee would be roughly $6000 per employee, or $60,000 for aone-acre lot. In Puna, on the other hand, the in-lieu fee would be zero or close to zero because the median sales price for homes is not that different than the "120% of median" affordable price. While the in-lieu fee for non- industrial projects can be high too, those have other options. The proposed amendment I have drafted reduces the in-lieu fee requirement for an industrial project from being based on 25%, to 10%, of the difference between the median sales price of homes in a district and the 120% of median figure. This would reduce the fee to about $7600 per employee in North Kona, and $2400 per employee in South Hilo. There is also a slight wording change to sec. 11-6(c) to change the term "dwelling unit" to "housing credit", because the technically the applicant has to earn a "housing credit" rather than provide a dwelling unit. The specific amendments to implement the above are as follows: Amend section 11-4(d) to read as follows: "(d) Requirements for industrial uses. The industrial uses that must fulfill affordable housing requirements are any uses allowed as ofright in an ML or MG district, except for home improvement centers, and any uses that are also allowed as of right in a CG district. [Individual enterprises generating more than] Rezonings to ML MG or MCX with a potential to generate more than one hundred employees on a full-time equivalent basis must earn one affordable housing credit for every four full-time equivalent jobs created. At the time of rezoning the votential iob veneration shall be assumed to be ten full-time equivalent lobs ver acre to determine whether subsequent develoyment within the rezoned area must satisfy an affordable housing reauirement. At the time of elan ayyroval pursuant to sec 11-9(b~ the affordable housing requirement shall be based uvon ten full time equivalent iobs ver acre or one per 1 000 square feet of gross floor area whichever is greater yrovided that the administrator after consultation wtth the Manning director can reduce the number of iobs based on yroof that the actual number of iobs created will be lower and provided that in that case the affordable housing requirement shall be reassessed if the use is changed. The applicant may also satisfv the