ADU SDC Reduction Program

The Program

City-assessed SDC charges will be reduced by 50% for new ADU building permits during the period of December 1, 2020, through June 30, 2027.  This includes fees for Transportation, Sanitary Sewer Collection, Stormwater, and Parks; it does not include Sanitary Sewer Treatment.  Note that building permit fees are not included in this program.  

The program applies to new ADU building permits only; existing ADUs do not qualify.

How do I qualify?

To qualify for ADU SDC fee reduction, the  property owner must agree to:

• Not use the ADU as a short-term rental (renting to overnight guests for fewer than 30 consecutive days) for a period of 10 years from the City’s acceptance of the application;
• Execute a Restrictive Covenant (view sample(PDF, 458KB)), record it with Jackson County at your expense, and file it with the City prior to issuance of permit; and
• Report rents annually to the City and certify that the ADU was not used as a short-term rental

What happens if I default or opt out?

If the property owner defaults or opts out, payment of the equivalent to the reduced SDC fees with accrued interest will be due in full.  If not paid within 60 days, a 9% interest charge will be applied effective at the end of the month in which the payment is due.

Additional Funding No Longer Available

Funding provided through the Housing Opportunity Fund (HOF) to pay the remaining 50% of SDC fees has been expended and is no longer available.

We have five permit-ready ADU plans available:

• Plan 1, Dogwood - 364 square foot(PDF, 254KB) Studio
• Plan 2, Magnolia - 660 square foot(PDF, 402KB) fully accessible 1 bedroom
• Plan 3, Beech - 660 square foot(PDF, 208KB) 1 bedroom
• Plan 4, Myrtle - 364 square foot(PDF, 308KB) (780 total) Studio over garage/workspace/storage
• Plan 5, Cascara - 896 square foot(PDF, 321KB) 2 bedroom

Use of these plans saves applicants the cost of the plan check fee as well as time and cost for design work.  If the applicant changes anything on the plans, additional plan review fees may apply.  Note that as with any other structure, ADUs built in certain parts of the City may require additional foundation design due to the presence of expansive soils. Ask the Building and Safety Department if you have any questions.

Participation in the permit-ready program does require submittal of an application and participants must agree not to use their ADU as short-term housing (AirBnB, VRBO, etc.) for a period of 10 years.

To request more information, email hcd@cityofmedford.org.  

An ADU SDC Reduction Request form and copy of the property deed with legal description must be submitted with your building permit application.  The form along with a sample covenant can be  downloaded from the City website(PDF, 458KB).

Frequently Asked Questions

What fees are included in the 50% reduction?

The city-assessed System Development Charge (SDC) fees include:

• Parks Residential SDC
• Sanitary Sewer Collection SDC
• Storm Drain SDC
• Street SDC

All other permit and inspection fees are not included in this program.

What about the remaining 50% of city-assessed SDC fees?

Additional funds were previously dedicated to pay for the remaining 50% of city-assessed SDC fees listed above along with the full amount of the Sanitary Sewer Treatment SDC fee.  This funding has expired and is no longer available. 

What is considered a short-term rental?

A short-term rental is fewer than 30 consecutive days.

Do I have to certify short-term rent compliance and report rent if the unit is not yet complete?

Yes.  Annual certification that the unit was not used as a short-term rental and reporting of rent is required even if the unit is not complete.  

What if I want to opt out of the program?

You can opt out of the program at any time by repayment of the equivalent to the reduced SDC fees with accrued interest.  A 9% interest charge will be applied.

Permit-Ready Plans?

There are five permit-ready ADU plans available.  A preview of each is provided on this webpage.  If you are interested in a plan, email hcd@cityofmedford.org for the full plan set.

Do I have to participate in the ADU SDC Reduction Program to use the permit-ready plans?

Yes.  To use the permit-ready ADU plans, you must participate in the ADU SDC Reduction program and agree to the 10-year restrictive covenant.