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HomeMy WebLinkAbout050897 CC Special Meeting AgendaIn compliance with the Americans with Disabilities Act, if you need special assistance to participate in this meeting, please contact the office of the City Clerk (909) 694-6444. Notification 48 hours prior to a meeting will enable the City to make reasonable arrangements to ensure accessibility to that meeting [28 CFR 35.102.35.104 ADA Title II] AGENDA TEMECULA CITY COUNCIL A SPECIAL MEETING CITY COUNCIL CHAMBERS 43200 BUSINESS PARK DRIVE MAY 8, 1997- 7:00 PM At approximately 9:45 PM, the City Council will determine which of the remaining agenda items can be considered and acted upon prior to 10:00 PM and may continue all other items on which additional time is required until a future meeting. All meetings are scheduled to end at 10:00 PM. CALL TO ORDER: Flag Salute: ROLL CALL: Mayor Patricia H. Birdsall presiding Councilmember Linderoans Ford, Linderoans, Roberts, Stone, Birdsall Next in Order: Ordinance: No. 97-08 Resolution: No, 97-41 PUBLIC COMMENTS A total of 30 minutes is provided so members of the public can address the Council on items that appear within the Consent Calendar or ones that are not listed on the agenda. Speakers are limited to two {2) minutes each. If you desire to speak to the Council on an item which is listed on the Consent Calendar or a matter not listed on the agenda, a pink "Request to Speak" form should be filled out and filed with the City Clerk. When you are called to speak, please come forward and state your name for the record. For all Public Hearing or Council Business matters on the agenda, a "Request to Speak" form must be filed with the City Clerk before the Council gets to that item. There is a five (5) minute time limit for individual speakers. R:~Agenda\050897 1 CITY COUNCIL REPORTS Reports by the members of the City Council on matters not on the agenda will be made at this time. A total, not to exceed, ten (10) minutes will be devoted to these reports. PUBLIC HEARINGS Any person may submit written comments to the City Council before a public hearing or may appear and be heard in support of or in opposition to the approval of the project(s) at the time of hearing. If you challenge any of the projects in court, you may be limited to raising only those issues you or someone else raised at the public hearing or in written correspondences delivered to the City Clerk at, or prior to, the public hearing. Develol~ment Impact Fees RECOMMENDATION: 1.1 Review the options provided for the adoption of Development Impact Fees to be effective in the City of Temecula, and select the appropriate option for which a resolution will be presented. 1.2 Read by title only and introduce an ordinance entitled: ORDINANCE NO. 97- AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TEMECULA AMENDING TITLE 15 OF THE TEMECULA MUNICIPAL CODE BY ADDING A NEW CHAPTER ENTITLED 'PUBLIC FACILITIES DEVELOPMENT IMPACT FEE" 1.3 Adopt a resolution entitled: RESOLUTION NO. 97- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ESTABLISHING THE CITY OF TEMECULA'S PUBLIC FACILITY DEVELOPMENT IMPACT FEES TO BE ADMINISTERED IN ACCORDANCE WITH ORDINANCE NO. 97- , AND ESTABLISHING THE CRITERIA AND FACTORS TO BE CONSIDERED IN NEGOTIATING FEE REDUCTIONS THROUGH DEVELOPMENT AGREEMENTS CITY MANAGER'S REPORT CITY ATTORNEY'S REPORT ADJOURNMFNT Next regular meeting: May 13, 1997, City Council Chambers, 43200 Business Park Drive, Temecula, California. R:~Agenda\050897 : 2 ITEM NO. I CITY OF TEMECULA AGENDA REPORT APPROVAT, CITY ATTORNEY DIR. OF FINANCE CITY MANAGER TO: FROM: DATE: SUBJECT: PREPARED BY: City Council City Manager May 8, 1997 Development Impact Fees Allie Kuhns, Senior Management Analyst RECOMMENDATION: That the City Council: Review the options provided for the adoption of Development Impact Fees to be effective in the City of Temecula, and select the appropriate option for which a resolution will be presented. 2. Read by title only and introduce an ordinance entitled: ORDINANCE NO. 97- AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TEMECULA AMENDING TITLE 15 OF THE TEMECULA MUNICIPAL CODE BY ADDING A NEW CHAPTER ENTITLED "PUBLIC FACILITIES DEVELOPMENT IMPACT FEE" 3. Adopt the following resolution pertaining to the DIF Ordinance: RESOLUTION NO. 97- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ESTABLISHING THE CITY OF TEMECULA'S PUBLIC FACILITY DEVELOPMENT IMPACT FEES TO BE ADMINISTERED IN ACCORDANCE WITH ORDINANCE NO. 97-__, AND ESTABLISHING THE CRITERIA AND FACTORS TO BE CONSIDERED IN NEGOTIATING FEE REDUCTIONS THROUGH DEVELOPMENT AGREEMENTS DISCUSSION: The purpose of this workshop is to continue the City Council's discussions concerning development impact fees (DIF), and to provide the development community with an opportunity to discuss DIF with the Council in a less formal forum than a regular Council Meeting. For the past year, Staff has been meeting with representatives from the development community to work towards the adoption of development impact fees (DIF) for the City of Temecula. These meetings culminated in a DIF workshop which was held on March 13, 1997, at which time proposed fees were presented to the development community. By the conclusion of this workshop, Staff and representatives from the development community had reached mutual ground concerning the DIF methodology, and Staff prepared to take the proposed fees to the public hearing stage. On April 8, 1997, a Public Hearing was conducted during the regular Council meeting to record public testimony concerning DIF. Attached is a summary of the issues raised during the Hearing, and Staff's responses to the issues. FISCAL IMPACT: According to the Development Impact Fee Study conducted by David M. Griffith & Associates, $210 million will be required to construct the City's capital improvements necessitated by new development. Any fees adopted at less than 100% of the DMG maximum calculated fees will result in the need to identify other funding sources for these improvements. Attachments: 1. Ordinance No. 97- 2. Resolution No. 97- 3. Issues Raised by Developers during the Public Hearing Held on April 8, 1997 ORDINANCE NO. 97- AN ORDINANCE OF THE CITY OF TEMECULA AM'ENDING TITL~ 1~ OF THE TEMECULA MUNICIPAL CODE BY ADDING A NEW CHAPTER ENTITLED "PUBLIC FACIIJTIES DEVlZJOPMlZ~NT IMPACT FEE" TIlE CITY COUNCIL OF ~ CITY OF TEMECULA DOES ORDAIN AS FOLLOWS: ~qection l. Title 15 (Buildings and Consu'uction) of the Temecula Municipal Code is hereby mended by adding thereto a new Chapter 1:5.06 to read as follows: "ChRpter 15.06 Public Facilities Development Inlpact Fee 15.06.010 Findings and Intent. A. The City Council finds that Temecula is a rapidly growing City. The City's population has the potential to grow from a current population of about 40,000 to over 200,000 at build out. This increase in population is reasonably expected to create a substantial increase in the demand placed upon public facilities. The City's existing public facilities will soon become inadequate to handle the projected population growth at existing levels of service. In order to serve the projected population growth, public facilities must be expanded. B. It is the intent of the City to require every person who develops land to mitigate the impacts of that development on the City's public facilities. The City will therefore require developers to pay a public facilities development impact fee that will be used to meet the demand for public facilities caused by development. The public facilities will be constructed in accordance with a capital improvement plan adopted by resolution of the City Council. C. The amount of the public facilities dev~opment impact fees collected pursuant to this Chapter shall be limited to the cost of public facilities attributable to new development. The amount of the public facilities development impact fees collected shall not include the cost of public facilities that serve existing development. 15.06.020 Residential Public Facilities Development Irrlpact Fee Required. A. Except as provided in Sections 15.06.040 and 15.06.050, a developer shall pay a public facilities development impact fee for each building which is part of a residential development, in an amount established by resolution of the City Council, upon final inspection for that building, or the date the certificate of occupancy is issued for that building, whichever occurs first; provided, howevex, that if a residential development contains more than one dwelling, the Director of Community Development may dettmnine whether the fees or charges shall be paid on a pro rata basis for each dwelling when it receives its final inspection or certificate of occupancy, whichever eccurs first; on a pro rata basis when a certain percentage of the dwellings have received their final inspection or certificate of occupancy, whichever occurs first; or on a lump-sum basis when the first dwelling in the development receives its final inspection or certificate of occupancy, whichever occurs first. If the required fee is not fully paid prior to issuance of a building permit for construction of any portion of the residential development encumbered thereby, the Director of Community Development may require the property owner, or lessee if the lessee's interest appears of record, as a condition of issuance of the building permit, to execute a contract to pay the fee or charge, or applicable portion thereof, within the time specified above. The contract shall be recorded with the Riverside County Recorder and shall constitute a lien for the payment of the fee. B. For purposes of this Section, "final inspection" or "certificate of occupancy, shall be defined as that term is defined in Government Code Section 66007, as amended. 15.06.030 Non-Residential Public Facilities Development Impact Fee Requirefl. A. Except as provided in Sections 15.06.040 and 15.06.050, a developer shall pay a public facilities development impact fee for each building in a non-residential development, in an amount established by resolution of the City Council, prior to issuance of a building permit for that building. B. Notwithstanding paragraph A of this Section, a building permit may be issued to a developer prior to payment of a pubfie facilities development fee, if the developer qualifies as a any nonprofit organization that is exempted from taxes by Section 501(c)(3) of the Internal Revenue Code of 1986. If, pursuant to this paragraph, the required fee is not fully paid prior to issuance of a building permit for construction of any portion of the non-residential development encumbered thereby, the Director of Community Development may require the property owner, or lessee if the lessee's interest appears of record, as a condition of issuance of the building permit, to execute a contract to pay the fee or charge, or applicable portion thereof, upon transfer of the non-residential development, or the applicable portion thereof, to a purchaser that does not qualify as a nonprofit organization that is exempted from taxes by Section 501(c)0) of the Internal Revenue Code of 1986. The contract shall be recorded with the Riverside County Recorder and shall constitute a lien for the payment of the fee. 69 2 15.06.040 Developer C. onstruction of Public Facilities Puts,ant to Capital Improvement Plan. A. A developer shall be entitled to a reduction in the mount of the public facilities development impact fee required by Sections 15.06.020 and 15.06.030, if the developer constructs public facilities pursuant to the City's Capital Improvement Plan. The public facilities development impact fee shall be reduced by the amount of engineering and construction costs that would be reasonably incurred by the City in building those same public facilities. The amount of the reduction in the public facilities development impact fee shall be subject to approval by the Director of Community Development prior to construction of the development. B. If a developer constructs public facilities pursuant to the City's Capital Improvement Plan, and if the City's engineering and construction costs to construct those same public facilities would have been more than the public facilities development impact fee assessed to that developer pursuant to Sections 15.06.020 and 15.06.030, then nothing in this Section shall prevent the City from entering into a reimbursement agreement with that developer, subject to the availability of funds. 15.06.050 Fee Reduction. A. Application for Fee Reduction 1. Any developer whose development is subject to the public facilities development impact fee required by this Chapter may apply to the Director of Community Development for a reduction in that fee based upon the demonstrable absence of a reasonable relationship between the impact of that development on the City's public facilities and either the amount of public facilities development impact fee charged, or the type of public facilities improvements to be constructed and purchased. The application shall be made in writing and fried with the Director of Community Development no later than ninety days after approval of the development. If no application for discretionary review is required for the development, then the application shall be made in writing and fried within ninety days after the City issues a building permit for the development. The application shall state in detail the factual basis for the request for reduction. Failure to file a timely application for reduction deprives the Director of jurisdiction to consider the application. The Director shall make a decision on the application for reduction within thirty calendar days after the application has been filed. Notice of the Director's decision shall be mailed to the applicant, postage paid. 2. Any developer whose development is subject to the public facilities development impact fee required by this Chapter, including a developer who, in connection with the development, has constructed or financed regional or regionally significant public facilities substantially similar to those facilities that are listed or otherwise identified in the City's Capital Improvement Plan, either through participation in a special district (e.g., a community facilities district or a special assessment district) or as a result of conditions of approval for the development, may apply to the Director of Community Development for a reduction in that fee. The application shall be made in writing and filed with the Director of Community Development no latex than ninety days after the effective date of this Section, or ninety days after the City issues a building permit for the development, whichever is later. The application shall state in detail the factual basis for the request for reduction. The City shall consider entering into an agreement, or modifying an existing agreement, with any developer applying for a reduction pursuant to this paragraph. B. Appeal from Director's Decision 1. Any decision of the Director of Community Development under Section 15.060.050. A may be appealed to the Planning Commission by filing an application for appeal with the Director of Community Development. The application must be fried within fifteen calendar days after notice of the Director's decision has been mailed to the applicant; provided, however, that if the fifteen days expire on a day when Temecula City Hall is not open for business, then the appeal period shall be extended to the next business day. 2. Failure to file a timely appeal application deprives the Planning Commission of jurisdiction to hear the appeal. 3. The Planning Commission shall consider the appeal at a public hearing to be held within forty-five calendar days after the appeal application is filed. C. Appo. al from Commission's Decision 1. The decision of the Planning Commission pursuant to Section 15.06.050.B may be appealed to the City Council by filing an application for appeal with the City Clerk. The application must be filed within fifteen calendar days after the Commission has made a final decision on the appeal; provided, however, that if the fifteen days expire on a day when Temecula City Hall is not open for business, then the appeal period shall be extended to the next business day. 2. Failure to file a timely appeal application deprives the City Council of jurisdiction to hear the appeal. 3. The City Council shall consider the appeal at a public hearing to be held within forty-five calendar days after the appeal application is filed. The decision of the City Council shall be final. D. lnvalidafion of Fee Reduction If a reduction is granted pursuant to this Section, any subsequent change in the design of the subject development which may impact its potential use, or any increase in the square footage of the development, shall invalidate the reduction. 69 4 E. Proeessiqg of Protest.~ The procedure set forth in this Section shall implement Government Code Section 66020, or its succeisor, and shall serve as the City's method for processing protests filed pursuant to that section. Prior to the effective date of the approval of the development, or, if no discretionary approval is required, prior to the issuance of a building permit, a developer that is subject to this Chapter shall sign a statement acknowledging the imposition of a public facilities development impact fee upon that developer's development. Such acknowledgment shall not be deemed a waiver of the developer's right to protest the imposition and to request a fee adjustment pursuant to this Section. 15.06.060 !lse of Funds. All public facilities development impact fees paid and collected pursuant to this Chapter shall be placed in one or more funds and used solely for the purpose of constructing, expanding, or rehabilitating the public facilities specified in the resolution estabhshing the fee and described in the City's Capital Improvement Plan. 15.06.070 Calculation of Fees. A developer subject to the public facilities development impact fee required by Sections 15.06.020 and 15.06.030 shall pay the amount of the fee in effect at the time that the fee becomes due. Furthermore, any fee imposed on a development which is protected by vested rights acquired through a vesting tentative subdivision map shall pay the amount of the fee in effect at the time the rights became vested plus any adjustment for inflation made between that date and the date the fee becomes due." fleetion ~. Developments for which a development entitlement application was deemed complete prior to the introduction of this Ordinance shall be exempt from the requirements of this Ordinance; provided, however, that this exemption shall not override any condition of approval for a project which specifically requires payment of fees for the purposes of mitigating impacts on public facilities. ,qeefion 3. Ordinance 659 of the County of Riverside establishing a Development Mitigation Fee for residential development as adopted by reference by the City of Temecula shall not apply to any development subject to the public facilities development impact fee required by this Ordinance. fleetion 4. If any section, subsection, sentence, clause, phrase or portion of this Ordinance is for any reason held to be invalid or unconstitutional by a decision of a court of competent jurisdiction, such decision shall not effect the validity of the remaining portions of the Ordinance. The City Council hereby declares that it would have adopted this Ordinance, and each section, subsection, sentence, clause, phrase, or portion thereof, irrespective of the fact that any 5 one of more sections, subsections, sentences, clauses, phrases or portions be declared invalid or unconstitutional. Neetion 5. The City Clerk shall certify to the passage and adoption of this ordinance and shall cause same to be published as required by law. PASSED, APPROVED ~ND ADOPTI~ by the City Council of the City of Temecula this __ day of , 1997. ATTEST: Patricia H. Birdsall, Mayor June S. Greek, CMC/AAE City Clerk [SEAL] 6 STATE OF CALIFORNIA) COUNTY OF RIVERSIDE)ss CITY OF TEMF.,CULA ) I, June S. Greek, City Clerk of the City of Temecula, do hereby certify that the foregoing Ordinance No. 9q- was duly introduced and placed upon its first reading at a regular meeting of the City Council on May 8, 1997 and that thereafter, said Ordinance was duly adopted at a meeting of the City Council of the City of Temecula on the day of , 1997, by the following roll call vote: COUNCIL~ERS: NOF_~: COUNCILI~MBF. RS; COUNCILNn:~MBERS: June S. Greek, CMC/AAE City Clerk 7 RESOLUTION NO. 9% A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ESTABLISHING AND IMPOSING A PUBLIC FACILITIES DEVI~LOPMENT IMPACT FEE AND ESTABLIgmNG GUID~ FOR ADJUSTING THE AMOUNT T!:!gZREOF THE CITY COUNCIL OF THE CITY OF TEMECULA HEREBY FINDS, RESOLVF_~, DECLARES, DETERMINES AND ORDERS AS FOLLOWS: gection 1. Short Title. This resolution may be referred to as the "Public Facilities Development Impact Fee Resolution" of the City of Temecula. gection 9.. p,,rl~ose. The purpose of this resolution is to establish the amount of the public facilities development impact fee and to establish certain standards for the administration of such fees. Section 3. Findings. The City Council, after review of the City of Temecula Development Impact Fee Study (the "DIF Study") dated January $, 1996 and prepared by David M. Griffith & Associates, Ltd., and after review of additional staff reports, and testimony and information received at a noticed public hearing on this matter, makes the following findings: A. Based upon the land uses permitted by the City's General Plan and growth trends of actual development within the City, the City anticipates that 54,422 dwelling units and 55.526 million square feet of non-residential development will be developed in the City between January 1, 1995 and build out. B. The DIF Study analyzes the demand expected to be generated by future development for street system, park and recreation, corporate, fire protection, and library facilities. Based on this analysis, the DIF Study contains estimated levels of service for street system, park and recreation, corporate, fire pwtection, and library facilities that are necessary to serve anticipated development within the City of Temecula through build out. C. Present and future sources of Federal, State, County and City revenues are insufficient to fund construction of the street system, park and recreation, corporate, fire protection, and library facilities needed to accommodate the demands of anticipated residential and non~residential development. D. The only fair and equitable method of securing adequate revenue necessary to fund the construction of these facilities is through a fee based on the extent to which new development genea-atea additional demand for street system, park and recreation, corporate, fire protection, and library facilities. The fee amounts established in this resolution pursuant to the requirements of Chapter 15.06 of the Temecula Municipal Code are based on the DIF Study. E. The purpose of the public facilities development impact fee will be to provide street system, park and recreation, corporate, file protection, and library facilities in an amount sufficient to meet the estimated demand created by residential and non-residential development constructed in the City through build out. F. The public facilities development impact fee will be used to finance the public facilities listed in the City's Capital Improvement Plan. G. There is a reasonable ~!ationship between the need for a public facilities development impact fee and the construction of residential and non-residential development projects because the construction of these development projects creates a demand for street system, park and recreation, corporate, fire protection, and library facilities to serve the needs of the residents and occupants of these development projects. Such facilities are necessary to facilitate ingress to and egress from each development project, to provide necessary amenities to the residents and occupants of each development project, and to protect the structures constructed as part of each development project. H. There is a reasonable relationship between the use of the public facilities development impact fee and the construction of residential and non-residential development projects because, as a result of the fees' use as described in subsection F, residents and occupants of such development projects will be served by the street system, park and recreation, corporate, fire protection, and library facilities that will be financed by the fees. I. There is a reasonable relationship between the amount of the public facilities development impact fee and the portion of the total cost of street system, park and recreation, corporate, fire protection, and library facilities attributed to each development project because the amount of the public facilities development impact fee was carefully calculated so that the estimated share of the total cost of the facilities assessed to a development project would equal the estimated share of the total demand for the facilities generated by that development project. The general methodology for apportioning the total cost of facilities, and the method for calculating the portion of the total cost of facilities attributed to each development project is described in the DIF Study, which is incorporated herein by reference. ~ection 4. Amo, nt of the P, hllc Facilities Development lrrtl~sct Fee. The public facilities development impact fee is hereby established and imposed in the amounts set forth in Exhibit A to this resolution. 2 Section 5. Inflation Adj,stment. Commencing on January 1, 1998, the fees as established and imposed by this resolution shall be adjusted on January 1 of each year based upon the Dodge Building Cost Index (the 'BCI") for the Los Angeics Metropolitan Area (BCI) unless the fees are otherwise adjusted as part of an update of the City's Capital Improvement Plan. The Director of Finance shall compute the percentage difference between the BCI on July 1 of each year and the BCI for the previous July 1. The Director of Finance shall then adjust by such percentage the fees established and imposed by this resolution. The adjusted amounts shall be rounded to the nearest dollar, and shall be submitted to the City Council for consideration at a public hearing. Upon adoption by the City Council, the adjusted amounts shall become effective on the following January 1. These amounts shall constitute the fees authorized by Chapter 15.06 of the Temecula Municipal Code and established and imposed by this resolution. Should the BCI be revised or discontinued, the Director of Finance shall use the revised index or a comparable index, as approved by the City Council, for determining fluctuations in the cost of development. Section 6. Fee Adjm~ments - G. idellnes. The City shall follow the following guidelines in considering reductions in the fee amount pursuant to Section 15.06.050.A.2 of the Temecula Municipal Code: A. Reductions shall be calculated and applied on a case by case basis; B. Reductions may not exceed the fee amount payable by the developer; C. Reductions for a specific fee component may not be applied against a different fee component (e.g., a reduction in the Traffic Signal component of the fee may not be applied to reduce the Street System Improvement component of the fee); and D. Reductions are not transferable. Section 7. Fee Adjustments - Factors. The City shall consider the following factors when determining the amount of a fee reduction pursuant to Section 15.06.050.A.2 of the Temecula Municipal Code: A. The cost of public facilities previously constructed or financed by the developer which were attributable to mitigating impacts of the proposed development; B. Positive economic impacts of proposed development (including enhanced tax revenues which may be used to finance public facilities to mitigate impacts of the proposed developmen0; and C. The demonstrable absence of a reasonable relationship between the impact of the proposed development on the City's public facilities and either the amount of DIF charged or the type of public facilities to be constructed. 3 ~gecfion 8. F_,ffecfive Date. The fees established pursuant to Section 4 of this Resolution shall become effective 60 days following the adoption of Ordinance No. 97-_. ,~-tlon 9. ~ever~hfilty. if any section, subsection, sentence, clause, phrase or portion of this resolution is for any reason held to be invalid or unconstitutional by a decision of a court of competent jurisdiction, such decision shall not effect the validity of the remaining portions of the resolution. The City Council hereby declares that it would have adopted this resolution, and each section, subsection, sentence, clause, phrase, or portion thereof, irrespective of the fact that any one of more sections, subsections, sentences, clauses, phras~ or portions be declared invalid or unconstitutional. this PASSED, APPROVi~.D AND ADOPTED by the City Council of the City of Temecula day of ,1997. Patricia H. Birdsall, Mayor ATrF_~T: June $. Greek, CMC/AAE City Clerk 133 4 STATE OF CALIFORNIA) COUNTY OF RIVERSIDE)ss CITY OF ~ULA ) I, June S. Greek, do hereby certify that the foregoing Resolution No. 97- adopted at a special meeting of the City Council of the City of Temecula on the , 1997, by the following roll call vote: was duly day of COUNCILMEMBERS: NOES: COUNCILMEMBERS: COUNCIL~MBERS: June S. Greek, CMC/AAE City Clerk 133 5 EXHIBIT A PUBLIC FACIIJTIES DEVELOPlV!'ENT IMPACT FEES Coml)onent Street System Improvements Type of I ~ntt Ilsev Residential (Detached) Residential (Attached) Office Retail Commercial Service Commercial Business Park Amount of Fee Per UniY $729 $511 $1,895 $5,830 $2,915 $1,384 Traffic Signals and Traffic Control Systems Residential (Detached) Residential (Attached) Office Retail Commercial Service Commercial Business Park $109 $77 $286 $878 $439 $209 Park and Recreation Improvements Residential (Detached) Residential (Attached) Office Retail Commercial Service Commercial Business Park $1,611 $1,209 $o $o $o $o Corporate Facilities Residential (Detached) Residential (Attached) Office Retail Commercial Service Commercial Business Park $222 $118 $98 $245 $137 $81 Fire Protection Facilities Residential (Detached) Residential (Attached) Office Retail Commercial Service Commercial Business Park $55 $42 $29 $46 $39 $33 .L/ Land use is determined based on the categories in the Land Use Element of the Temecula General Plan. 2/ Fees for residential development are calculated per dwelling unit. Fees for non-residential development are calculated per 1,000 square feet of gross building area. Component Libraries Type of !-and Use5~ Residential (Detached) Residential (Attached) Office Retail Commercial Service Commercial Business Park $0 Amount of Fee Per Units/ $208 $156 $0 $0 $0 IMPACT FEE PER TOTAl. nEVT*.TOPlVm~rr Residential (Detached) Residential (Attached) Office Retail Commercial Service Commercial Business Park $2,934 $2,114 $2,308 $6,999 $3,531 $1,707 2J Land use is determined based on the categories in the I. and Use Element of the Temecula General Plan. Fees for residential development are calculated per dwelling unit. Fees for non-residential development are calculated per 1,000 square feet of gross building area. 7 ISSUES RAISED BY DEVELOPERS DURING THE PUBLIC HEARING HELD ON APRIL 8, '1997 1. ISSUE: Developers want credits for regional improvements constructed by them, particularly assessment district-funded improvements. RESPONSE: DIF is intended for the construction of unfunded and unbuilt infrastructure, whose need is created by new development. Various assessment districts and community facilities districts were set up by the County to fund certain regional improvements within the City. In some cases, the total amount of the improvements may not be assessed against property owners on account of regional benefits to be received from the improvements (e.g., the City has previously agreed to use sales tax revenues to offset the tax liability of properties within CFD 88-12). A case-by-case review of each district would be required to determine if, and how much, developers paid for regional benefits. To allow the City to adjust for circumstances in which a developer may have paid more than his or her fair share of a regional improvement, the proposed ordinance and resolution have provisions in them which allow developers to apply and negotiate for a fee reduction based on the developers having constructed improvements of regional significance. These provisions were included at the request of the developers. 2. ISSUE: Assessment district-funded improvements should be included in the DIF inventory and the cost of such improvements spread among development throughout the City. RESPONSE: DIF is intended for the construction of unfunded and unbuilt infrastructure. As noted in the previous response, it is not appropriate to include already- financed improvements in the DIF inventory. 3. ISSUE: Some developers want the ordinance to authorize fee reductions through agreements with the City, others want a fee to be set at such a low level that Development Agreement's will not be necessary, while still others do not want to allow the amount of the fee to be set on an ad hoc basis by the City. RESPONSE: Developers have the authority by statute to request Development Agreements with the City, regardless of the level of the DIF. If a Development Agreement already exists and a developer wishes to amend it to reduce the fees, then the entire Development Agreement may be reopened for negotiations. The City Council has the discretion to set the fees at any level up to the amount justified in the DIF Study. While City the must fix the fee at a set amount, Staff R:\kuhnsa\dif\dif.mtg recommends that the City retain its authority to encourage development which provides an economic or other benefit to the City. This may best be done on a case-by-c. ase basis. 4. ISSUE: collected. There is confusion about the public facility deposits which the City has RESPONSE: Developers who have already paid public facility deposits in connection with existing development have generally agreed to pay a Fee, when adopted, to offset the City's cost in providing regional improvements to serve such development. Public facility deposits will be addressed after the fees are adopted, since there are distinctly separate issues to address in dealing with them. 5. ISSUE: Some developers want to finance and/or bond for the fees, while others adamantly stated "Don't mortgage the future." RESPONSE: The single most frequent complaint in the City of Temecula is the need for traffic improvements, both streets and signals. As one developer stated, the City is already in the "catch-up" mode due to the County's inattention to infrastructure in this area. The City's Capital Improvement Program (CIP) has over 100 million in infrastructure programmed to be built in the next five years. Construction of infrastructure and award of contracts is dependent on having cash in the bank. By financing fees or deferring them, the City will be at dsk to defer, potentially indefinitely, critical improvements due to a lack of funding. In addition, once a development is completed and the developer no longer requires the cooperation of the City, the City may have difficulty in enforcing the developer's obligation to pay the DIF. This difficulty in enforcing the developer's financial obligations will also arise if the developer, subsequent to developing the property, experiences financial difficulties. 6. ISSUE: The retail fee is exorbitant at $4.20, and should be capped at a maximum of $2 per square foot. RESPONSE: The $4.20 retail commercial fee recommended by Staff, which is a 40% reduction in the maximum amount set forth in the DIF Study, is based on Staff committing to pursue other funding sources. Any further reductions are solely at the discretion of the City Council. R:\kuhnsa\dif\dif.mtg 2 7. ISSUE: The City needs to pursue federal grants, because there is a lot of money waiting to be tapped into at the federal level. RESPONSE: Staff recognizes the potential for federal funding, and the City Manager is personally pursuing this funding source. 8. ISSUE: There is concern over traffic generation factors and assumptions used for fee distribution. A high percentage (over 90%) of the non-residential fee is for traffic improvements. This is too high, and should be spread more equitably over residential development because the fee disparity between residential (2% of total project costs) and non-residential (up to 10% of total project costs) is unfair. RESPONSE: Based on national and SANDAG statistics, which are consistent with the statistics used by other entities, traffic generation factors generally are higher for non-residential than for residential development. While the City Council may use City funds to subsidize DIF, the law prohibits the arbitrary redistribution of fees from non- residential to residential for the purpose of more evenly distributing fees across all development. 9. ISSUE: Several developers wanted the sphere of influence improvements to be removed from the DIF inventory. RESPONSE: Inclusion of the sphere of influence in the DIF Study area was a Staff decision based on recommendations from David M. Griffith & Associates (DMG), who performed the Study. The primary reason for including the Sphere is to facilitate the application of fees upon annexation of areas within the Sphere. A City-only/City-plus-Sphere comparison of the street improvement component of the fee showed only 2 to 7 percent increase in the fee for including the sphere of influence. Based on this small increase in the fee and the benefit of establishing a fee which applies to annexed territory, Staff recommends including the Sphere. NOTE: UNLESS THE FEES ARE ADOPTED AT 100% OF THE MAXIMUM AMOUNT FOR NON-RESIDENTIAL DEVELOPMENT, THE 7% DIFFERENCE IN FEE SHOULD NOT BE AN ISSUE. 10. ISSUE: Traffic generators do not recognize differences in types of non- residential development. RESPONSE: The Study was conducted using the four non-residential land uses provided for in the City's General Plan. For each category, DMG used a conservative R:\kuhnsa\dif\dif.mtg 3 low average of the uses within the category. Because the DIF may only be applied at the development stage, and not when a use is subsequently changed, the amount of the DIF must be based on the potential, rather than actual, use of the property, based on the City's General Plan. Otherwise, a developer could submit plans for a low-intensity non-residential use (e.g., manufacturing), and then change the use to another permitted non-residential use (e.g., retail). 11. ISSUE: Future development should not bear the burden of addressing existing needs; rather, the fees should be prorated for existing and future development impacts. RESPONSE: All of the improvements included in the DIF inventory are designed to address only future development impacts. The improvements were presented to the developers prior to their inclusion in the DIF inventory. The actual street improvement inventory was conducted at the request of the developers specifically to ensure that only new development impacts would be included in the Study. 12. ISSUE: There is no nexus in applying fees Citywide - that is, applying a fee to a developer in the southern end of the City for the construction of improvements in the northern end of the City. RESPONSE: The improvements to be financed through DIF are regional improvements, which have been determined to benefit all development within the City. 13. ISSUE: The proposed fees are too high, making rents for businesses too high. Fees need to be adopted at the lowest levels possible. RESPONSE: Staff recommends a 40 percent reduction in the non-residential fees from the maximum amounts set forth in the DIF Study to encourage development while not sacrificing the City's infrastructure. Staff acknowledges that fees, as well as land costs, utility hook-ups, etc., are ultimately passed on to the end user. Each of these costs increases rents, leases, and other operating costs for tenants. In the case of DIF, the final decision as to the level of fees to be adopted is at the discretion of the City Council. 14. ISSUE: Developers want the City to support speculative builders, specifically with a waiver of fees for the first one million square feet to be built. RESPONSE: Staff encourages development by speculative builders; however, waiving fees for the first one million square feet of industrial development will result in a reduction of approximately $1 million in DIF revenues for that type of R:\kuhnsa\dif\dif.mtg 4 development. This would substantially impair the City's ability to finance infrastructure improvements to support the speculative development. 15. ISSUE: Special consideration should be given to churches and other non- profit charitable service organizations. RESPONSE: The City Council has committed to reducing the fees for churches and other non-profit charitable service organizations. 16. ISSUE: Some developers want the City Council to take a vote to the citizens for taxes to pay for infrastructure. RESPONSE: At this time, Staff does not recommend imposing a tax as an alternative to charging DIF to developers. Obtaining voter approval of such a tax is speculative at best, and would require the City to invest a significant amount of time and money in conducting the election. 17. ISSUE: There are blatant errors in the methodology used in the spreadsheet attached to the Staff Report - it is not appropriate to add land costs which are calculated in square feet to building and other costs. RESPONSE: Both matrix comparison spreadsheets were included as attachments for the City Council at the request of the developers. These spreadsheets were not used in the DIF Study to determine the maximum DIF amount, and were included merely for informational purposes. The spreadsheet in question was provided by representatives of the development community, and was not calculated by Staff. 18. ISSUE: This issue of DIF should be referred back to Staff for more analysis. RESPONSE: Having worked through all major issues with the developers, DMG, and the City Attorney, including making changes to Study methodology, Staff is confident that the appropriate level of analysis has been completed to take the fees forward for adoption. Further delay in the adoption of the DIF will prolong the uncertainty in the development community regarding the Fees, thereby discouraging development in the City. R:\kuhnsa\dif\dif.mtg 5