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A city plan to overhaul development impact fees could help revive some of San Francisco's biggest stalled housing projects, including Tishman Speyer's (developer for Infinity) 725-unit 201 Folsom St., and the 292-unit second tower in Urban West Associates' One Rincon Hill.

The city's Office of Economic and Workforce Development is proposing a package of changes that would allow developers to pay impact fees after the building is completed, rather than before construction starts. It would also reduce affordable housing fees by a third, replacing that portion with a permanent 1 percent transfer fee that would generate long-term revenue for the Mayor's Office of Housing. The Planning Commission will consider the package of legislation next week.

The proposal would enable Tishman Speyer to start construction on 201 Folsom St. about a year from now - a full two years sooner than would be possible if the stimulus package does not pass, according to Tishman Speyer Managing Director Carl Shannon. By lowering costs, it reduces the gap between current prices and the point at which it makes sense to start building again, he said.

"We believe that if this program goes forward it will reduce the required appreciation of the projects by 6 percent, which means that it can start two years earlier than it would without a stimulus package," said Shannon. "This is a project that will employ 250 union workers a day for three years and have a total union payroll of $100 million. The benefit in terms of employment in San Francisco is dramatic - and that is only one project." San Francisco Business Times 1/15/2010