HomeMy WebLinkAboutStaff Report 106-08TO:
FROM:
City
City of Palo Alto
Manager’s Report
HONORABLE CITY COUNCIL 7
CITY MANAGER DEPARTMENT: ADMINISTRATIV~
SERVICES
DATE:
SUB3ECT:
JANUARY 14, 2008 CMR: 106:08
REVIEW OF ANNUAL STATUS REPORT ON DEVELOPERS’ FEES AND
ADOPTION OF RESOLUTION MAKING FINDINGS REGARDING
CONTINUING NEED FOR UNEXPENDED COMMUNITY CENTER
DEVELOPMENT FEES IN THE AMOUNTOF $3,150 AND LIBRARY
DEVELOPMENT FEES IN THE AMOUNT OF$1,190
RECOMMENDATION
Staff recommends that the City Council review and accept the Annual Repolnt on Developers’
Fees for the period ending June 30, 2007 (E.’xhibit A). In addition, staff reconmaends that the
City Council adopt the attached resolution (Exhibit B) regm’ding the continuing need for
unexpended funds in the Community Center Fund and the Librmies Fund
BACKGROUND
State law (Govermnent Code Section 66006) requires each local agency that imposes
development impact fees prepare an annual report providing specific information about those
fees. This requirement is part of the law commonly referred to as AB 1600. It codifie~ the legal
requirement that fees on new development must have the proper nexus to any project on which
they are imposed. In addition, AB 1600 imposes certain accounting and reporting requirements
with respect to the fees collected. The fees, for accounting purposes, must be segregated from
the general funds of the City and from other funds or accounts containing fees collected for other
improvements. Interest on each development fee fund or account must be credited to that fund
or account and used only for the purposes for which the fees were collected.
The law was alnended effective January 1, 1997 to require that, within 180 days after the close of
the fiscal year, the agency that collected the fees must make available to the public the following
information regarding each fund or account:
o A brief description of the type of fee in the fund.
o The amount of the fee.
o The beginning and ending balance for the fiscal 5’ear.
CMR:106:08 Page 1 of 4 ~
o The amount of fees collected and interest earned.
An identification of each public improvement on which fees were expended and
the anaount of the expenditm-e on each improvement, including the total
percentage of the cost of the public improvemem that was funded with fees.
An identification of an approximate date by which the construction of a public
improvement will commence, if the local agency determines that sufficient funds
have been collected to complete financing on an incomplete public improvement.
A description of each interfund transfer or loan made from the account or fund,
including the public improvement on which the loaned funds will be expended,
and in the case of an interfund loan, the date on which the loan will be repaid and
the rate of interest that the account or fund will receive on the loan.
The amount of may refunds made due to inability to expend fees within the
required time frame.
This report must also be reviewed by the City Council at a regularly scheduled public meeting
not less than 15 days after the information is made available to the public. In addition, notice of
the time and place of the meeting shall be mailed at least 15 days prior to the meeting to any
interested party who files a w~’itten request with the local agency for such a mailed notice.
The law also provides that, for the fifth fiscal year following the first deposit into the fund and
every five years thereafter, the local agency shall make findings with respect to any portion of
the fee remaining unexpended, whether committed or uncommitted. The finding must: identify
the purpose to which the fee is to be put; demonstrate a nexus between the fee and the purpose
for which it was originally charged; and identify all sources and amounts of funding anticipated
to complete financing of incomplete improvements along with the approximate dates on which
the anticipated funding is expected to be deposited into the fund.
If the agency no longer needs the funds for the purposes collected, or if the agency fails to make
required findings, or to perform certain administrative tasks prescribed by AB 1600, the agency
may be required to refund, on a prorated basis to ow-ners of the properties upon which the fees
for the improvement were imposed, the monies collected for that project and any interest earned
on those funds.
DISCUSSION
The City of Palo Alto development fees covered by AB 1600, and documented in Exhibit A,
include the following:
Stanford Research Park/El Camino Rea! traffic impact fees (PAMC Ch. 16.45): Fee for
new nonresidential development in the Stanford Research Park/El Camino Real Service
Commercial zone, to fund capacity improvements at eight intersections.
CMR:106:08 Page 2 of 4
San Antonio/West Bayshore Area traffic impact fees (PAMC Ch. 16.46): Fee for new
nonresidential development in the San Antonio/West Bayshore area to fund capacity
improvements at four intersections.
Housing impact fees imposed on commercial developments (PAMC Ch. 16.47: Fee on
commercial and industrial development to contribute to programs that increase the City’s
low income and moderate-income housing stock.
Parking in-lieu fees for University Avenue Parking District (PAMC Ch. 16.57): Fee on
new nonresidential development in the University Avenue Parking Assessment District in
lieu of providing required parking spaces.
Developer impact fees (PAMC Ch. 16.58): Fee on new residential and non-residential
housing developments to provide community facility funds for parks, community centers
and libraries.
o Residential housing in-lieu fees (PAMC Ch. 16.47): Fee on residential developments in-
lieu of providing required below-market rate units to low and moderate income
households.
Charleston-Arastradero Corridor pedestrian and bicyclist safety fees (PAMC Ch. 16.59):
Fee on new development and re-development within the Charleston-Arastradero Con’idor
to provide for pedestrian and bicyclist improvements.
o Parkland dedication fees (California Govermnent Code Section 66477): Fees or parkland
dedication imposed on new residemial and non-residential development.
o Water and sewer capacity fees (California Govermnent Code Section 66000): Fee on
developments adding load to water and sewer systems.
o Transportation impact fee (This fee became effective on August 17, 2007, and no fees
have been collected to date.)
Additionally, the San Antonio/West Bayshore Fund and Stanford Research Par ~kiE1 Camino Real
Fund contain development impact fees collected on or before June 30, 1999 that remain
unexpended. In fiscal year 2002-03 (CMR: 113:04) the City Council made the required findings
that there was a continued need for the San Antonio/West Bayshore funds for the San Antonio
On-Ramp Project. Council also found a continued need for the Stanford Research Par~k!E1
Camino funds for the major intersection improvements at the Page Mill/Hanover intersection,
which are scheduled for completion in 2010.
AB 1600 requires the City to make specified findings in the event any funds au’e not expended
within five fiscal years of collection. There were two categories of fees collected in the year
2002 which have not been spent and where the City has not previously made the required
CMR:106:08 Page 3 of 4
findings to assist in the findings of the proposed Mitchell Park Library and Community Center
facility. In accordance with AB 1600, such funds will be allocated to the proposed facility’s
additional capacity. (The proposed findings are contained in Exhibit B.)
RESOURCE IMPACT
If the Council does not make the findings contained in Exhibit B, the development fees described
therein will be required to be refunded. This would have a fiscal impact of $4,340.
POLICY I_ IPLICATION S
This report does not represent any change to existing City policies.
ENVIRONMENTAL ASSESSMENT
Presentation of this mmual report is not a project under the California Environmental Quality
Act; accordingly, no enviromnental assessment is required.
PREPARED BY:
DEPARTMENT HEAD APPROVAL:
ALLEN LEE
Senior Account~_~
Lalo Perez~ ~
Director, Administrative Services
CITY MANAGER APPROVAL:
HARRISON
Assistant City Manager
ATTACHMENT
Exhibit A: Amaual Report on Development Fees for Period Ending
June 30, 2007
Exhibit B: Resolution Adopting Findings with Respect to Unspent Impact Fees
cc: Home Builders Association
CMR:106:08 Page 4 of 4
Exhibit A
City of Palo Alto
Annual Report on Developers’ Fees
for Period Ending June 30, 2007
Purpose and Authority
for Collection
Amount of the Fee
Fund Balance July 1, 2006
~ctivity in 2006-07
Revenues
Fees Collected
Interest Earnings
Unrealized Gain/Loss Investments
Total Revenues
Expenditures
Other
Chadeston/Arastradero Corridor
Improvements
(PL-05002)
Total Expenditures
Ending Balance June 30, 2007
Net Funds Available
Traffic impact fees imposed on new
nonresidential development in the
Stanford Research Park/El Camino
Real CS zone to fund improvements
at eight identified intersections.
PAMC Ch. 16.45
$9.44 per square foot
$672,339
0
29,024
14,794
$43,818
0
0
$716,157
$716,157
USE OF FEES:
No expenditures have been made from
this fund in FY 2006-07. Fees are planned
to be used for Gunn High School entrance
near Foothil/Arastradero.
Traffic impact fees imposed on new
nonresidential development in the
San Antonio/VVest Bayshore Areas
to fund capacity improvements at
four identified intersections.
PAMC Ch. 16.46
$1.95 per square foot
$585,716
0
26,412
5,579
$31,991
$617,707
$617,707
USE OF FEES:
No expenditures have been made from this
fund in FY 2006-07. Fees are planned to be
used for specific traffic improvements in the
Charleston/San Antonio Road area, but have
been delayed by a related project to be
constructed by the State Department of
Transportation.
Page 1 of 6
Exhibit A
City of Palo Alto
Annual Report on Developers’ Fees
for Period Ending June 30, 2007
Purpose and Authority
for Collection
Amount of the Fee
Fees imposed on large commercial
and industrial development to
contribute to programs that increase
the City’s low income and moderate-
income housing stock.
PAMC Ch.16.47
$16.52 per square foot
Fees collected from non-residential
development within the University Ave.
Parking Assessment District in lieu of
providing the required number of
parking spaces.
PAMC Ch 16.57
$55,423 perspace
Fund Balance July 1, 2006
Activity in 2006-07
Revenues
Fees Collected
Interest Earnings
Unrealized Gain/Loss Investments
Transfer In from CDBG Fund
Total Revenues
Expenditures
Deposit for Ole’s parcel
Consultant Fees
Total Expenditures
$6,436,483
664,098
69,524
17,684
250,000
1,001,306
(500,000)
(55,460)
(555,460)
$80,269
3,618
698
4,316
Ending Balance June 30, 2007
Other Commitments/Appropriations
Encumbrances
Reserve for Notes Receivable include
$2,221,976 for Alma Single Room
Occupancy, $1,960,000 for Oak Court
Apartments, $480,000 for Eden Housing,
and $400,000 for Barker Hotel.
Net Funds Available
$6,882,329
(40,365)
(5,061,976)
$1,779,988
$84,585
$84,585
USE OF FEES:
$500,000 was deposited into escrow for
the purchase of Ole’s Car Repair. An
additional $55,460 was spent on
consultant services.
USE OF FEES:
No expenditure of funds have been made
from this fund in FY 2006-07.
Page 2 of 6
Exhibit A
City of Palo Alto
Annual Report on Developers’ Fees
for Period Ending June 30, 2007
Purpose and Authority
for Collection
Amount of the Fee
Fund Balance July 1, 2006
Activity in 2006-07
Revenues
Fees Collected
Interest Earnings
Unrealized Gain/Loss
Total Revenues
Operating Transfer to Capital Projects
Fund
Total Expenditures
Ending Balance June 30, 2007
Other Commitments/Appropriations
Reserve for Notes Receivable:
Net Funds Available
Fees imposed on new residential and
non-residential development approved
after Jan 28, 2002 for Parks.
PAMC Ch. 16.58
Residential: Single family
$8,878/residence (or $13,257/residence
larger than 3,000 sq ft); Multifamily
$5,81 l/unit (or $2,938/unit smaller than or
equal to 900 sq ft)
Nonresidential: Commercial/industrial
$3,770.00 per 1,000 sq ft; Hotel/Motel
$1,704.00 per 1,000 sq ft
$921,365
1,040,805
68,382
1,546
$1,110,733
(135,000)
(135,000)
$1,897,098
$1,897,098
Fees imposed on new residential and
non-residential development approved
after Jan 28, 2002 for Community Centers.
PAMC Ch. 16.58
Residential: Single family $2,3021residence
(or $3,445/residence larger than 3,000 sq ft);
Multifamily $1,514Iunit (or $764/unit smaller
than or equal to 900 sq ft)
Nonresidential: Commerciallindustrial
$2!3.00 per 1,000 sq ft; Hotel/Motel $96.00
per 1,000 sq ft
$295,436
247,890
19,899
(896)
$266,893
0~
$562,32S
$562,32~
USE OF FEES:
Budgeted transfers in the amount of
$60,000 was made from this fund to the
Capital Improvement Fund for
Stanford/Palo Alto Playing Fields and
$75,000 for Heritage Park Playground in
FY 2006-07.
USE OF FEES:
No expenditure of funds have been made
from this Fund in FY 2006-07
Page 3 of 6
Exhibit A
City of Palo Alto
Annual Report on Developers’ Fees
for Period Ending June 30, 2007
(INFORMATION ONLY)
Purpose and Authority
for Collection
Amount of the Fee
Fund Balance July 1, 2006
Activity in 2006-07
Revenues
Fees Collected
Webster Wood In-Lieu Payment
Sale of High St property
Interest Earnings
Unrealized Gain/Loss Investments
Total Revenues
Expenditures
Housing Program Expense
Total Expenditures
Ending Balance June 30, 2007
Other Commitments/Appropriations
Reserve for Notes Receivable include
$375,000 for 3053 Emerson, $1,151,174
for Oak Manor, $750,000 for Opportunity
Center, $756,819 for Sheridan Apts. and
$341,450 for Palo Alto Gardens.
Net Funds Available
Fees imposed on new residential and
non-residential development approved
after Jan 28, 2002 for Libraries.
PAMC Ch. !6.58
Residential: Single family $803/residence
(or $1,194/residence larger than 3,000 sq
ft); Multifamily $525/unit (or $263/unit
smaller than or equal to 900 sq ft)
Nonresidential: Commercial/industrial
$203.00 per 1,000 sq ft; Hotel/Motel
$85.00 per 1,000 sq ft
$114,268
91,368
7,644
449
$99,461
0
0
$213,729
$213,729
USE OF FEES:
No expenditure of funds have been made
from this Fund in FY 2006-07
Fees collected from residential
developments of three or more units in
lieu of providing the required below-
market rate unit(s) to low and moderate
income households.
PA Comprehensive Plan and
PAMC Chapter 18
Varies
$3,882,565
2,134,411
6,175
450,O00
63,243
(9,361
$2,644,468
(220,372)
(220,372)
$6,306,66t
(3,374,443
$2,932,218
USE OF FEES:
Expenditures in FY 2006-07 include
$135,000 to Palo Alto Housing Corp for BMR
fees, $52,889 for Oak manor Apts loan
forgiveness, and $25,434 for BMR
professional fees.
Page 4 of 6
Exhibit A
City of Palo Alto
Annual Report on Developers’ Fees
for Period Ending June 30, 2007
Purpose and Authority
for Collection
Fees or parkland dedication imposed
on new residential and non-residential
development
Govt Code Sec.66477 (Quimby Act)
Fees collected from new development and
re-development within the Charleston-
Arastradero Corridor to provide for pedest-
rian and bicyclist safety improvements.
PAMC Ch. 16.59
Amount of the Fee Varies Residential: $950 per unit; Commercial:
$0.28 per sq ft
Fund Balance July 1, 2006
Activity in 2006-07
Revenues
Fees Collected
Interest Earnings
Unrealized Gain/Loss Investments
Total Revenues
Expenditures
Total Expenditures
Ending Balance June 30, 2007
$0
39,240
147
(598)
$38,789
$38,789
$~
183,492
3,948
(1,1951
$186,245
$186,245
Net Funds Available $38,789
USE OF FEES:
No expenditure of funds have been made
from this Fund in FY 2006-07
$186,245
USE OF FEES:
No expenditure of funds have been made
from this Fund in FY 2006-07
Page 5 of 6
Exhibit A
City of Palo Alto
Annual Report on Developers’ Fees
for Period Ending June 30, 2007
(INFORMATION ONLY)
Purpose and Authority
for Collection
Capacity fees charged to developers that
are adding load to the water and sewer
systems effective July 1, 2005.
California Government Code Sect 66000
Amount of the Fee
Water Domestic: 5/8 in., 314 in. $1200, 1
in. $2,250, 1/12 in. $4,500, 2 in. $9,000, 3
in. by est. $30/FU ($66,750 at cap), 4 in.
by est. $30/FU ($176,333 at cap.), 6 in. by
est. $30/FU (339,667 at cap.) Water Fire
service: 4 in. $8,250, 6 in. $19,970, 8 in.
$36.300
Sewer: 4 in. $2,500 first 50 FU, $50/FU
additional, 6 in. by est. $50/FU, 8 in. by
est. $50/FU
FU is fixture unit
Activity in 2006-07
Capacity Fees Collected
Water
Wastewater Collection
Total
$542,618
212.850
$755,468
USE OF FEES:
The fees are used exclusively for water
and sewer system improvements
Page 6 of 6
RESOLUTION NO.
RESOLUTION OF THE COUNCIL OF THE CITY OF PALO
ALTO MAKING FINDINGS REGARDING CONTINUING
NEED FOR UNEXPENDED COMMUNITY CENTER
DEVELOPMENT FEES IN THE AMOUNT OF $3,150
LIBRARY DEVELOPMENT FEES IN THE AMOUNT OF
$1,190
WHEREAS, Government Code section 66001(d) requires the City to make
certain findings with respect to development fees collected which remain unexpended or
uncommitted five of more fiscal years after deposit of such fees; and
WHEREAS, as authorized under Chapter 16.58 of the Palo Alto Municipal Code,
the City has collected a development fee known as a "community center development
fee" for the purpose of funding development and improvement to community centers and
a fee known as a "library development fee" to fund development and improvements to
libraries; and
WHEREAS, the sum of $3,150 representing fees collected pursuant to Chapter
16.58 since January 1, 2002, together with accrued interest thereon, remains unexpended
five or more years after deposit of the fees ("unexpended community center development
fees"); and
WHEREAS, the sum of $1,190, representing fees collected pursuant to Chapter
16.58 since January 1, 2002, together with accrued interest thereon, remains unexpended
five or more years after deposit of the fees ("the unexpended library development fees");
and
WHEREAS, the City Council desires to make the findings required by law with
respect to such fees.
NOW, THEREFORE, the Council of the City of Palo Alto does RESOLVE as
follows:
SECTION 1. The Council makes the following findings:
Community Center Development Fees
1. The community center development fees were collected pursuant to Chapter
16.58 of the Palo Alto Municipal Code to be used solely for the purpose of funding
development and improvement to community centers.
2. The need for the improvements for which the community center development fees
were collected was identified in the Parks and Community Facilities Impact Fee Study
prepared by DMG-Maximus on September 18,2001.
080108jb 0130240 1
3. The Study identified specific improvements to be constructed with the
community center development fees.
4. The City anticipates spending the fees on the development of new facilities at the
current Mitchell Park Community Center site. While cost estimates for the new facilities
have not been fully developed, it is estimated that the portion of the development cost
attributable to additional capacity is likely in excess of $5,000,000. A funding plan has
not yet been finalized, but a combination of funding, including but not limited to,
community development fees, general funds and bond revenue (subject to voter approval)
is being contemplated.
5. The City anticipates that the funds identified in the above paragraph will be
deposited into the appropriate capital improvement account some time after November
2009.
6. Based on the foregoing, a continuing need for the unexpended community center
development fees has been demonstrated.
Library Development Fees
1. The library development fees were collected pursuant to Chapter 16.58 of the
Palo Alto Municipal Code to be used solely for the purpose of funding development and
improvements to libraries.
2. The need for the improvements for which the library development fees were
collected was identified in the Parks and Community Facilities Impact Fee Study
prepared by DMG-Maximus on September 18, 2001 ("Study").
3. The Study identified specific improvements to be constructed with the library
development fees. The Study concluded that given high land acquisition costs in the City
of Palo Alto, new library facilities were expected to be constructed as additions to
existing facilities or construction on existing library sites rather than as entirely new
facilities in different locations.
4. The City anticipates spending the fees on the development of new facilities at the
current Mitchell Park Library and Community Center site. While cost estimates for the
new facilities have not been fully developed, it is estimated that the portion of the
development cost attributable to additional capacity is likely in excess of $5,000,000. A
funding plan has not yet been finalized, but a combination of funding, including but not
limited to, library development fees, general funds and bond revenue (subject to voter
approval) is being contemplated.
5. The City anticipates that the funds identified in the above paragraph will be
deposited into the appropriate capital improvement account some time after November
2009.
080108jb0130240 2
6. Based on the foregoing, a continuing need for the library development fees has
been demonstrated.
SECTION 2.
Environmental
necessary.
INTRODUCED AND PASSED:
AYES:
NOES:
ABSENT:
ABSTENTIONS:
The Council finds that this is not a project under the California
Quality Act and, therefore, no environmental impact assessment is
ATTEST:APPROVED:
City Clerk Mayor
APPROVED AS TO FORM:
Senior Asst. City Attorney
City Manager
Director of Community Services
Director of Library Services
080108jb 0130240 3