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OEWD Integrated Production Distribution and Repair (IPDR) Registration Program

The link to begin the registration process can be found at the bottom of this page. Please read carefully through the following information before you proceed.

Introduction:
The Office of Economic and Workforce Development (OEWD)’s Integrated Production Distribution and Repair (IPDR) Registration Program is a system through which building owners with IPDR tenants who employ a specified number of “Disadvantaged Workers” in San Francisco’s Eastern Neighborhoods PDR and UMU zoning districts can qualify for up to a 50% fee development impact waiver for any new permitted IPDR use by completing an annual IPDR registration process for five continuous years. Additionally, the IPDR Registration Program can also provide substantial tax credits to assist IPDR tenant businesses if they simultaneously apply for the California State and Local Enterprise programs. Here you will find instructions on the IPDR Registration process, as well as information on valuable tax incentives for businesses within the PDR and UMU zoning districts. Please review the information carefully. If you have questions, contact OEWD at (415) 554-6969.

Background:
The IPDR Fee Discount Program was created as part of the Eastern Neighborhoods Plan (comprised of the East SOMA, the Mission, Showplace Square/Potrero Hill, and the Central Waterfront) that amended the City Administrative and Planning Codes. The changes were adopted by the Board of Supervisors and signed by the Mayor, and became effective on January 19, 2009. For a more comprehensive overview of the Eastern Neighborhoods Community key definitions, planning efforts, and resulting legislation, click here.

Development Impact Fees for IPDR:

New floor area added to an existing building or in a newly completed structure and occupied by IPDR uses would be required to pay the City’s full Transit Impact Development (TIDF), Jobs-Housing Linkage, and Eastern Neighborhoods Development Impact fees. These fees are adjusted annually by the City. As of August 1, 2009 the fees were as follows:

• TIDF: $10.94 per gross square foot.
• Jobs-Housing Linkage Fee: $15.69 per gross square foot.
• Eastern Neighborhoods Development Impact Fee: $6.00 - $14.00 per square foot, depending on the amount of height the parcel received as part of the Eastern Neighborhoods Plan.

Existing IPDR-like uses that are “legitimizing” as IPDR under the City’s Eastern Neighborhoods Amnesty Program would pay a single fee of $6.00 per gross square foot.

The Planning Department and OEWD are working to clarify what portion of the above development impact fees would apply in cases where a building owner is applying for a conversion of existing floor area from a non-IPDR use to IPDR. It is the intent of OEWD that impact fees should only apply in cases where a proposed change to IPDR results in an increased intensity of use compared to prior existing use. In these circumstances, the project should only pay impact fees commensurate with the marginal increase in use.

IPDR Development Impact Fee Discounts:
Building owners are required to pay 50% of IPDR Development Impact Fees up front. If after five years from the issuance of a permit to be an IPDR use, 35% of employees working in any registered IPDR space qualify as “Discount-eligible Workers” (“Disadvantaged Workers” as defined by the California State Enterprise Zone Hiring Tax Credit who ALSO live within the City and County of San Francisco) the remaining 50% of Development Impact Fees otherwise due will be waived. Reduced waivers are eligible for disadvantaged workers levels between 10% - 35%. If none of the hiring goals are met, the remaining 50% of fees will be due at the end of the 5-year period.

Requirements of the Program:
Building owners and IPDR tenants must follow initial registration and annual update instructions carefully in order to take advantage of the IPDR Fee Discount Program which can qualify individual property owners for a complete waiver or significant reductions of any “Outstanding Discount-Program impact fees” otherwise due to the Planning Department upon the fifth year anniversary of a permitted IPDR use. Please note that an annual update is required for four consecutive years after the initial registration year, making the entire process five years long.

It is emphasized that if annual updating requirements to OEWD are not met, the right to a waiver of the remaining development impact fees after 5 years is forfeited. As summarized from Sec 10E.68 of the Admin Code:

A) The owner if any property subject to an Integrated IPDR Notice of Special Restrictions (NSR) recorded pursuant to the Planning Code Section 328 is required to register any Integrated IPDR occupant or tenant business with OEWD’s Integrated IPDR Registration Program, as well as to submit annual updates to OEWD on an annual basis for five years.
B) Upon successful registration of a new building with IPDR tenants, OEWD will provide each building owner a dated receipt acknowledging initial registration or annual update. This receipt shall be referred to as an “Integrated IPDR Registration Record” for purposes of this Section and Planning Code Section 328. If the building owner fails to register for an Integrated IPDR Registration Record as of December 31 of the subject year, OEWD is prohibited from issuing a receipt for that year.
C) Property owners who cannot provide sufficient evidence in the form of Integrated PRD Registration Records to demonstrate to the Planning Department that current and former occupants of any IPDR space have satisfied the initial registration and annual reporting requirements outlined in this Section will not be eligible for any waivers or reductions of Outstanding Discount Program Fees as set forth in the Planning Code Section 328.
D) It is important to emphasize that any owner of an IPDR space seeking a full or partial fee waiver at the fifth year anniversary of the initial registration must make annual updates by December 31 or lose the privilege of a fee waiver.

Benefits of the Program:
While the Integrated IPDR Fee Discount Program benefits building owners by providing a waiver of up to 50% of the Development Impact Fees otherwise owed upon receiving a use permit for new or converted IPDR space waivers, IPDR business tenants can also greatly benefit if they use the employee data from the registration process to apply for the California State Enterprise Zone Hiring Tax Credit and the Local Enterprise Zone payroll tax credit. As part of the registration process, IPDR tenants are asked to evaluate their employees and disclose how many qualify as “Disadvantaged Workers” under the California State Enterprise Zone Hiring Tax Credit designations. OEWD strongly encourages IPDR tenants to complete the process and apply for CA Enterprise Zone Hiring Tax Credit Vouchers. This can lead to more than $36,000 in hiring tax credits for each qualified employee hired over five years as follows: In the first year, a business can claim 50% of an employee’s qualified wages. 40% can be claimed in the second year, 30% in the third year, 20% in the fourth year and 10% in the fifth year. There is a maximum wage allowance of 150% of the current minimum wage rate.

All businesses in the Eastern Neighborhoods are located within both the State and Local Enterprise Zones (EZ) and are encouraged to take advantage of the valuable tax incentives available through both of these programs. If you have any questions about the Enterprise Zone please contact the Enterprise Zone Manager at 554-6130.

Logistics of the Online Registration Process:
The registration process is administered through online forms (link to the form is below). It is the building owner’s responsibility to collect all the necessary information from their tenants and complete all the forms. All initial registrations and annual updates are due on December 31 of the subject year. Late information will not be accepted. OEWD will process the information received and distribute IPDR Registration Records to the building owner by January 31 of the following subject year. We will also retain a copy of the Registration Record in our files.

Print out copies of this packet and distribute to your IPDR tenants.

Click here to begin the registration process.

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