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Menlo Park is charging a homeowner who’s adding a housing unit to his property about $127,000 in park fees, even after state housing officials warned the city that it may not be allowed to do so when it comes to certain types of small developments.
The dispute centers on Senate Bill 9, a 2022 law intended to boost housing by allowing homeowners to split single-family lots and build up to four units without discretionary review. The California Department of Housing and Community Development informed Menlo Park in 2024 that the city cannot apply so-called Quimby Act park fees to these lot splits because they fund off-site improvements, which SB 9 generally prohibits as a condition of approval.
But Menlo Park officials have maintained that Quimby Act fees are still allowed under state law.
The fees are affecting Palo Alto developer Mircea Voskerician, who applied to split a single-family lot at 12 Maywood Lane into two parcels. While Menlo Park approved the subdivision, the city is requiring him to pay a $127,400 park fee before finalizing the project.
Voskerician said he has filed a complaint with the state housing department and warned the city of possible legal action, arguing that Menlo Park is improperly applying fees to projects that are meant to be streamlined under SB 9.
“It was never the intent of SB 9. They are playing games with me. They are playing games with the state. And they are taking advantage because the state will not go after them,” Voskerician said.
Voskerician said he emailed Menlo Park’s city manager, City Council and staff asking for justification for the fee but did not receive a response after 30 days and a follow-up message.
“This is not how a city operates. A city is dedicated to its people. It’s dedicated to the residents. It’s dedicated to the law. And they must answer the question to the public,” Voskerician said. “They could have said: ‘Here’s our response,’ ‘here’s our stance.’ In my personal opinion, it just kind of answers the question of how ignorant they are — you cannot be ignorant and silent when people are asking why you are charging fees.”
The city did not address its rationale for charging Quimby Act fees on lot splits when responding to questions from The Almanac about this story.
How the fee works
The fees stem from the Quimby Act, a 1965 state law that allows cities to require residential subdivision developers to dedicate land for parks or pay a fee in lieu of providing parkland. The goal is to ensure that growing communities have adequate open space and recreational areas.
“The logic is (of the Quimby Act) when you’re creating land or creating housing on a property, or whatever else you would construct, they want to make sure that there is some amount of public parkland that is preserved,” said attorney Jack Farrell of the pro-development law group YIMBY Law.
In Menlo Park, the city requires the developer to pay or dedicate 5 acres of park and recreation land per 1,000 additional residents. In the case of one additional single-family home, the city assumes 2.59 people will live there and therefore requires the developer to pay the “fair market value” per acre of 0.013 acres of land (566 square feet).
The city sets a fair market value of $9.8 million per acre, which means a single-family home requires a fee payment of $127,400.
While the fee is determined based on the value of acquiring land, the city does not have to spend it on buying land. The city is allowed to spend the fees on any park or recreational purposes. For fiscal year 2024-25, the city collected $411,600 in in-lieu park fees and used it, plus previously collected fee revenues, to pay for building part of the Belle Haven Community Campus and improvements at Willow Oaks Park.
Conflict with state law
In 2022, a new state law created by SB 9 required cities to allow homeowners to split a single-family lot into two lots and allow up to two units on each lot, in an effort to increase housing availability in the state. Cities are required to approve eligible projects without discretionary review.
However, to be eligible, the applicant for a lot split must agree they intend to occupy one of the lots for at least three years.
As part of that streamlined process, the law generally prohibits cities from requiring off-site improvements as a condition of approval.
The California Department of Housing and Community Development (HCD) sent Menlo Park a letter in 2024 informing the city it could not charge Quimby Act fees for SB 9 subdivisions. According to HCD, the city can not charge Quimby Act fees since those are used for off-site improvements.
City Attorney Nira Doherty’s response to HCD said that SB 9 allows the city to charge fees under any other law and that Quimby Act fees don’t count as off-site improvements.
“The argument from the city feels a little strained,” Farrell said. “The logic of SB 9 is to make special exceptions for very small projects. It’s a ministerial tool for only two to four units. The idea of leaving extra land aside when you’re making a small project, it’s not a massive subdivision. It makes a little less sense.”
Farrell added that most SB 9 applications are by small developers or homeowners, instead of corporations, which typically are involved in larger subdivisions.
Regardless of legality, Jeremy Levine with the Housing Leadership Coalition of San Mateo County says lot splits can help create housing for families.
“Lot splits are an important strategy to create new family-friendly housing opportunities in neighborhoods that have historically restricted it,” he said in an email. “A $127,000 fee per home is a perverse penalty against the future families who will one day live there.”
“To the extent the city charges parks fees on lot splits, it needs to think about not just its legal wiggle room but also its housing needs,” Levine added.
While cities were initially concerned that SB 9 would eliminate single-family zoning, few projects have actually been approved in Midpeninsula cities.
Potential legal risks
According to Farrell, the city could face legal penalties for prohibiting these types of developments.
Under Assembly Bill 712, Farrell explained, cities that take actions in violation of housing laws after receiving a warning from the state housing department or the attorney general’s office can face fines of $50,000 or more if a developer prevails in court.
It is unclear whether the state’s 2024 letter to Menlo Park would trigger those penalties.
The state housing department did not respond to requests for comment.
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