Inclusionary Housing & Commercial Linkage

The City has prepared a draft Inclusionary Housing Ordinance to support the production of affordable housing and implement Program B 2.1.1 of Vallejo’s 6th Cycle Housing Element.

Inclusionary housing ordinances typically require new residential development to include a percentage of affordable units or pay an in-lieu fee to support affordable housing elsewhere in the community. The draft ordinance is informed by feasibility analysis prepared by Economic & Planning Systems, Inc. and public study sessions with the City Council and Planning Commission held on July 7, 2025, and November 24, 2025.

The City is also evaluating a Commercial Linkage Fee, which would address the relationship between new commercial development and the demand for affordable housing generated by employment growth. A draft Commercial Linkage Fee ordinance is anticipated to be prepared and released for public review following consideration and potential adoption of the Inclusionary Housing Ordinance.

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PROJECT STATUS

On September 9, 2026, the Planning Commission voted unanimously to recommend adoption of the proposed Inclusionary Housing Ordinance with revisions lowering the applicability threshold from 20 to 10 residential units and establishing affordable housing requirements of four percent for rental projects, seven percent for ownership projects containing 10 to 100 units, and ten percent for ownership projects containing more than 100 units. The Commission also directed staff to provide annual reports on the ordinance’s effectiveness and recommended an updated feasibility analysis approximately two years after enactment.

On October 27, 2026, the City Council considered the proposed ordinance and directed staff to revise it to reflect the Commission’s recommended applicability threshold and affordability requirements. Council also directed that the ordinance take effect 90 days after final passage, rather than the originally proposed 180 days.

The revised ordinance is scheduled to return to the City Council for second reading and adoption on November 10, 2026. If adopted, staff will return with a resolution establishing the in-lieu fee schedule before the ordinance takes effect.

Staff Contact
Hector Rojas, Long Range Planning Manager
(707) 553-7283
[email protected]

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