In May 2025 The Pasadena City Council approved a proposal significantly reduce or waive several fees associated with building Accessory Dwelling Units (ADUs). This fee reduction and waiver was part of a broader push to encourage affordable housing and multigenerational living in the city limits of Pasadena.
Under this reduction, the city amended its Fiscal Year 2025 General Fee Schedule to reduce plan check and permit fees for many ADU projects and directed the city attorney to draft an ordinance—within 60 days—that would exempt qualifying ADUs from construction taxes and Residential Impact Fees (RIFs). Subsequently, in July 2025, the construction tax was reduced by 25% for ADUs that are 900 square feet or smaller and will be waived entirely forADUs that enter into an affordability covenant or landlord agreement in accordance with the City's Inclusionary Housing Regulations or that utilize a pre-reviewed ADU Standard Plan. Additionally, the Residential Impact Fee was waived going forward for ADUs that are 900 square feet or fewer.
The changes undertaken were aimed at addressing high permitting and impact fees that were exceeding regional averages. Pasadena was charging $16,900 for a 1,000-square-foot ADU—well above the regional average of $9,400.
Plan check fees were reduced by 50% for ADUs that use one of the city’s pre-approved standard plans or that are governed by affordability covenants, such as those rented to Section 8 tenants or family members.
Permit fees for smaller ADUs (under 900 square feet) received a 25% reduction on construction taxes, general plan maintenance fees, and technology fees. Those same fees are now fully waived for standard-plan ADUs and affordable units.
Residential impact fees were waived entirely for ADUs governed by a Housing Agreement, and the exemption threshold would be expanded from 750 to 900 square feet, benefiting the majority of ADUs built in Pasadena.
Refundable construction and demolition (C&D) deposits were reduced to a $1,000 flat rate, decreasing upfront costs for homeowners.
These reductions followed from a March 18 recommendation by the Economic Development and Technology Committee, which urged the Council to adopt a more accessible and affordable ADU permitting framework.
The Council’s analysis shows that since 2021, Pasadena has approved or completed 559 ADUs, with an average size of 600 square feet. About 90% of ADUs built in the city are under 900 square feet, meaning most projects would benefit from the new fee structure.
