Pasadena Municipal Code Ch. 4.32 Construction Tax

This chapter shall be known as the "construction tax ordinance."

(Ord. 5081 § 1, 1972)

A. Every building, swimming pool or similar permit issued by the planning and community development department shall be subject to a construction tax at the rate of 1.5% of the value of the structures included in said permits, or as may be subsequently adjusted by permit modifications.

B. No tax shall be levied or collected on plumbing, heating and air conditioning, electrical, automatic fire-extinguishing system, demolition or grading permits, nor on building permits issued in connection with the "New Year's Day ordinance."

(Ord. 6272 § 1, 1988; Ord. 5260 § 1, 1976; Ord. 5236 § 1, 1975; Ord. 5214 § 1, 1975; Ord. 5143 § 1, 1974; Ord. 5112 § 1, 1973; Ord. 5081 § 2, 1972)

(Ord. No. 7364, § 10, 5-18-2020)

The tax shall be collected at the time of issuance of the permit, and no permit shall be deemed issued until the tax is paid.

(Ord. 5081 § 3, 1972)

Any claim for refund of the tax collected pursuant to this chapter shall be processed in like manner to refunds of permit fees provided for in the Pasadena Building Code.

(Ord. 5081 § 4, 1972)

A. Any residential housing unit which is affordable to persons of very low, low or moderate income as defined in Section 17.80.020(A) is exempt or partially exempt from payment of the tax required by this chapter, according to the schedule provided each year on the resolution of fees, taxes and charges adopted by the board. Such schedule shall reflect the formula approved by the board on November 21, 1991, and may be amended from time to time by the board.

B. The city council, by resolution, may authorize an exemption from the payment of plan check and building permit fees for projects meeting the following criteria:

1. A project sponsored by an organization having nonprofit status under Section 501(c)(3) of the Internal Revenue Code, which project will rehabilitate housing occupied by low-income (or very low-income) senior citizen homeowners, or low-income (or very low-income) or handicapped homeowners. The terms "low-income" and "very low-income" shall have the meanings specified in Section 17.12.129(A) of the Pasadena Municipal Code;

2. A single-family residential remodeling project not exceeding 250 square feet, or, in the event of remodeling projects or improvements which do not result in an expansion of the square footage of the residence, less than $20,000.00 in valuation;

3. A reroofing project valued at $5,000.00 or less for a single-family residence;

4. A seismic retrofit project for a single-family residence.

C. Any construction project with the "Research and Development-Office" or "Research and Development-Non-Office" land use designation as defined in Chapter 17 of the Pasadena Municipal Code. The director shall determine whether a full or partial waiver will be granted and shall base his/her decision on his/her determination as to what portion of the construction project is being built to specifically accommodate "Research and Development" uses.

D. Hotels or motels converted to residences which are rented or sold to persons and families of low or moderate income (as defined in Health and Safety Code Section 50093) pursuant to a Hotel Conversion Permit are exempt from the payment of the tax required by this chapter.

E. Wood-framed multiple-family buildings which are retrofitted pursuant to Chapter 14.08 are exempt from the payment of the tax required by this chapter.

F. Accessory Dwelling Units ("ADU") and Junior Accessory Dwelling Units ("JADU") that are entered into an affordability covenant or landlord agreement for ADUs in accordance with the city's Inclusionary Housing Regulations and in a form approved by the city attorney, or ADUs that utilize an ADU Standard Plan pre-reviewed by the City and are eligible for ADU Standard Plan processing, are exempt from the payment of the tax required by this chapter. ADUs that are 900 square feet or less (including JADUs) shall receive a 25% reduction of the tax required by this chapter.

(Ord. No. 7450, § 3, 7-14-2025; Ord. No. 7345, § 2, 5-20-2019; Ord. No. 7333, § 3, 10-15-2018; Ord. 6884 § 1, 2002; Ord. 6748 § 2, 1998; Ord. 6629 § 1, 1995; Ord. 6480 § 1, 1992; Ord. 6472 § 1, 1992)

Section 14.80.050 of the Pasadena Municipal Code provides that a developer who voluntarily enters into a first source hiring agreement pursuant to that section and fulfills the requirements under that agreement is eligible to receive a rebate of the tax required by this chapter. Pursuant to Section 14.80.050, the rebate shall be based on a formula established by resolution of the city council.

(Ord. 6995 § 3, 2004)