HomeMy WebLinkAboutStaff Report 6295
City of Palo Alto (ID # 6295)
City Council Staff Report
Report Type: Consent Calendar Meeting Date: 1/25/2016
City of Palo Alto Page 1
Summary Title: Annual Status Report Development Impact Fees FY15
Title: Review and Acceptance of Annual Status Report on Development
Impact Fees for Fiscal Year 2015
From: City Manager
Lead Department: Administrative Services
Recommendation
Staff recommends that Council review and accept the Annual Report on Development Impact
Fees for the year ended June 30, 2015 (Attachment A).
Background
State law (Government Code Section 66006) requires that 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 codifies 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.
Government Code Section 66006 contains comprehensive annual reporting requirements for
development impact fees. This statute requires 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:
Brief description of the type of fee in the fund.
Amount of the fee.
Beginning and ending balance in the fund.
City of Palo Alto Page 2
Amount of fees collected and interest earned.
Identification of each public improvement on which fees were expended and the
amount of the expenditure on each improvement, including the total percentage
of the cost of the public improvement that was funded with fees.
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.
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.
Amount of any 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 written request with the local agency for such a mailed notice. An
early packet consisting of Exhibit A only was made available to the public and included in the
packet for the December 7, 2015 meeting of the City Council.
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 to property owners a prorated portion of the monies
collected for that project and any interest earned on those funds.
The City Auditor’s office recently conducted an audit of the City’s Parking in-lieu fund.
City of Palo Alto Page 3
Discussion
The City of Palo Alto development fees covered by AB 1600, and documented in Attachment A,
include the established fees noted below, as well as two new fees for Public Safety Facilities
and General Government Facilities that were approved by Council in May 2014. In addition,
though not technically a fee covered by AB 1600, the City is reporting its Public Art fee for
informational purposes only.
Stanford Research Park/El Camino Real 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.
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.
Commercial housing in-lieu (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.
University Avenue Parking in-lieu (PAMC Ch. 16.57): Fee on new non-residential
development in the University Avenue Parking Assessment District in lieu of providing
required parking spaces.
Parks, Community Centers, and Libraries impact fees (PAMC Ch. 16.58): Fee on new
residential and non-residential development to provide community facility funds for
parks, community centers, libraries, public safety, and general government.
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.
Parkland dedication fees (Quimby Act) (California Government Code Section 66477): Fee
or parkland dedication imposed on new residential and non-residential development.
Charleston-Arastradero Corridor pedestrian and bicyclist safety fees (PAMC Ch. 16.59):
Fee on new development and re-development within the Charleston-Arastradero
Corridor to provide for pedestrian and bicyclist improvements.
Public Safety facilities (PAMC Ch. 16.58): Fee on residential and non-residential
development to fund police and fire facilities, including fire apparatus and vehicles.
General Government facilities (PAMC Ch. 16.58): Fee on residential and non-residential
development to fund facilities associated with municipal administration.
City of Palo Alto Page 4
Citywide Transportation impact fee (PAMC Ch 16.59): Fee on development in all parts
of the City to fund transportation projects and programs to reduce congestion.
Public Art fees (PAMC 16.61): Fee on public art for private developments.
Water and sewer capacity fees (California Government Code Section 66000): Fee on
developments adding load to water and sewer systems.
AB 1600 requires the City to make specified findings in the event any funds are not expended
within five fiscal years of collection and every five years thereafter. While there are several
funds containing collected fees that have not been expended in five years, the required
statutory carryover findings have already been made for those funds and no further findings
are required.
RESOURCE IMPACT
Council approved the required findings with respect to unexpended fees in fiscal years 2012
and 2013. There were no required findings for either fiscal year 2014 or fiscal year 2015. The
next finding date will be fiscal year 2017, and the unexpended balances for each fee type are
noted at the bottom of each section in Attachment A.
Attachments:
Attachment A: Developer Fees (XLS)
Attachment A
City of Palo Alto
Annual Report on Development Impact Fees
for Period Ending June 30, 2015
Stanford Research Park/San Antonio/West
FUND El Camino Fund Bayshore Fund
Purpose and Authority Traffic impact fees imposed on new Traffic impact fees imposed on new
for Collection nonresidential development in the nonresidential development in the
Stanford Research Park/El Camino San Antonio/West Bayshore Areas
Real CS zone to fund improvements to fund capacity improvements at
at eight identified intersections.four identified intersections.
PAMC Ch. 16.45 PAMC Ch. 16.46
Amount of the Fee $11.64 per square foot $2.40 per square foot
Fund Balance July 1, 2014 $3,492,212 $848,819
Activity in 2014-15
Revenues
Fees Collected 616,173 0
Interest Earnings 73,552 16,769
Unrealized Gain/Loss Investments (4,692)(361)
--------------------------------------------------------------------------------------------------------------------
Total Revenues $685,033 $16,408
Expenditures
Inter-agency expenses 0
Transfer to Gas Tax Fund (994,217)0
--------------------------------------------------------------------------------------------------------------------
Total Expenditures (994,217)0
--------------------------------------------------------------------------------------------------------------------
Ending Balance June 30, 2015 $3,183,028 $865,227
Other Commitments/AppropriationsReserve for unrealized gain on
investments (19,599)(5,037)--------------------------------------------------------------------------------------------------------------------
Net Funds Available $3,163,429 $860,190
Unexpended balance at next finding
date (FY 2017-18)$2,343,008 $823,819
USE OF FEES:USE OF FEES:
Expenditures of funds have been made in
Fiscal Year 2015 for $994K transfer to
Gas Tax Fund. During the FY 2008-09,
the City transferred out $994k from Gas
Tax Fund to this fund for various street
related costs. However, the transfer were
not used for street related expenses, as
result per SCO recommendation $994K
was returned to Gas Tax Fund.
No expenditures have been made from this
fund in Fiscal Year 2015.
Page 1 of 10 1/5/2016
Attachment A
City of Palo Alto
Annual Report on Development Impact Fees
for Period Ending June 30, 2015
Commercial Housing University Avenue Parking
FUND In-Lieu Fund In-Lieu Fund
Purpose and Authority Fees imposed on large commercial Fees collected from non-residential
for Collection and industrial development to development within the University Ave.
contribute to programs that increase Parking Assessment District in lieu of
the City's low income and moderate-providing the required number of
income housing stock.parking spaces.
PAMC Ch.16.47 PAMC Ch 16.57
Amount of the Fee $19.31 per square foot $63,848 per space
Fund Balance July 1, 2014 $12,538,778 $1,970,372
Activity in 2014-15
Revenues
Fees Collected 2,297,126 2,890,950
Interest Earnings 171,150 90,052
Unrealized Gain/Loss Investments 10,053 11,685
--------------------------------------------------------------------------------------------------------------------
Total Revenues 2,478,329 2,992,687
Expenditures
Transfer to Residential Housing In- Lieu
Fund (375,000)0
--------------------------------------------------------------------------------------------------------------------
Total Expenditures (375,000)0
--------------------------------------------------------------------------------------------------------------------
Ending Balance June 30, 2015 $14,642,107 $4,963,059
Other Commitments/Appropriations
Reserve for Notes Receivable
include:$1,290,000 for 2811 Alma, and
$3,645,010 for 801 Alma.(4,935,010)
Reserve for Buena Vista (7,700,000)
Reserve for unrealized gain on
investments (49,863)(20,457)
--------------------------------------------------------------------------------------------------------------------
Net Funds Available $1,957,234 $4,942,602
Unexpended balance at next finding
date (FY 2017-18)4,667,286 $652,080
USE OF FEES:USE OF FEES:
Expenditures of funds have been made in
Fiscal Year 2015 for $375K. This is
transfer to Residential Housing In-Lieu
Fund for rehabilitation and preservation of
affordable housing units at 110-130 El
Dorado. This will be repaid on June 30,
2016 including interest.
No expenditure of funds have been made
from this fund in Fiscal Year 2015.
Page 2 of 10 1/5/2016
Attachment A
City of Palo Alto
Annual Report on Development Impact Fees
for Period Ending June 30, 2015
Residential & Non-Residential Housing Residential & Non-Residential Housing
Community Facilities Community Facilities
FUND Parks Community Centers
Purpose and Authority Fees imposed on new residential and Fees imposed on new residential and
for Collection non-residential development approved non-residential development approved
after Jan 28, 2002 for Parks. after Jan 28, 2002 for Community Centers.
PAMC Ch. 16.58 PAMC Ch. 16.58
Amount of the Fee
Residential: Single family
$11,180/residence (or $16,695/residence
larger than 3,000 sq ft); Multi-family
$7,318/unit (or $3,700/unit smaller than or
equal to 900 sq ft)
Residential: Single family $2,898/residence
(or $4,439/residence larger than 3,000 sq ft);
Multi-family $1,907/unit (or $963/unit smaller
than or equal to 900 sq ft)
Nonresidential: Commercial/industrial
$4,748 per 1,000 sq ft; Hotel/Motel $2,147
per 1,000 sq ft
Nonresidential: Commercial/industrial $268
per 1,000 sq ft; Hotel/Motel $121 per 1,000
sq ft
Fund Balance July 1, 2014 $2,929,569 $5,009,861
Activity in 2014-15
Revenues
Fees Collected 830,387 117,161
Interest Earnings 64,721 99,910
Unrealized Gain/Loss 5,398 (4,344)
--------------------------------------------------------------------------------------------------------------------
Total Revenues $900,506 $212,727
--------------------------------------------------------------------------------------------------------------------
Total Expenditures 0 0
--------------------------------------------------------------------------------------------------------------------
Ending Balance June 30, 2015 $3,830,075 $5,222,588
Other Commitments/Appropriations
Reserve for unrealized gain on investments (19,905)(30,068)--------------------------------------------------------------------------------------------------------------------
Net Funds Available $3,810,170 $5,192,520
Unexpended balance at next finding
date (FY 2016-17)446,005 $843,809
USE OF FEES:USE OF FEES:
No expenditure of funds have been made
from this Fund in Fiscal Year 2015.
No expenditure of funds have been made
from this Fund in Fiscal Year 2015.
Page 3 of 10 1/5/2016
Attachment A
City of Palo Alto
Annual Report on Development Impact Fees
for Period Ending June 30, 2015
Residential & Non-Residential Housing Residential Housing
Community Facilities In-Lieu Fund
FUND Libraries
Purpose and Authority Fees imposed on new residential and Fees collected from residential
for Collection non-residential development approved developments of three or more units in
after Jan 28, 2002 for Libraries. lieu of providing the required below-
market rate unit(s) to low and moderate
PAMC Ch. 16.58 income households.
PA Comprehensive Plan and
PAMC Chapter 18
Amount of the Fee
Residential: Single family
$1,012/residence (or $1,507/residence
larger than 3,000 sq ft); Multi-family
$604/unit (or $332/unit smaller than or
equal to 900 sq ft)Varies
Nonresidential: Commercial/industrial
$255 per 1,000 sq ft; Hotel/Motel $107 per
1,000 sq ft
Fund Balance July 1, 2014 $730,991 $13,909,337
Activity in 2014-15
Revenues
Fees Collected 58,007 19,800
Sterling Litigation Settlement 3,851,759
Webster Wood In-Lieu Payment 5,175
Interest Earnings 14,909 203,752
Unrealized Gain/Loss Investments (211)12,663
Transfer from Commercial Housing In-
Lieu Fund 375,000
--------------------------------------------------------------------------------------------------------------------
Total Revenues $72,705 $4,468,149
Expenditures
Legal (278,326)
Housing Program Expense (347,070)
Principal Retired (131,126)
--------------------------------------------------------------------------------------------------------------------
Total Expenditures 0 (756,522)
--------------------------------------------------------------------------------------------------------------------
Ending Balance June 30, 2015 $803,697 $17,620,964
Other Commitments/Appropriations
Reserve for Reappropriations (1,975,000)
Reserve for Encumbrances (363,645)
Reserve for Buena Vista (6,800,000)
Reserve for unrealized gain on
investments (4,512)(46,400)
Reserve for Notes Receivable include
$375,000 for 3053 Emerson, $3,804,850
for Tree House Apts, $203,093 for Oak
Manor, $756,819 for Sheridan Apts., and
$2,674,986 for 801 Alma (7,814,748)
--------------------------------------------------------------------------------------------------------------------
Net Funds Available $799,185 $621,171
Page 4 of 10 1/5/2016
Attachment A
City of Palo Alto
Annual Report on Development Impact Fees
for Period Ending June 30, 2015
Unexpended balance at next finding
date (FY 2016-17-Residential & Non
Residential Housing Communities
Facilities Libraries, FY2017-18-
Residential Housing In-Lieu)$541,529 2,734,967
USE OF FEES:USE OF FEES:
No expenditure of funds have been made
from this Fund in Fiscal Year 2015.
Expenditures in Fiscal Year 2015 include
$147K to Palo Alto Housing Corp for BMR
fees, $131K for Oak Manor Apts. loan
forgiveness, $279K for legal fees, and
$200K financial contribution to Housing Trust
Silicon Valley.
Page 5 of 10 1/5/2016
Attachment A
City of Palo Alto
Annual Report on Development Impact Fees
for Period Ending June 30, 2015
Parkland Dedication Charleston-Arastradero Corridor
Pedestrian and Bicyclist Safety
FUND
Purpose and Authority Fees on parkland dedication imposed Fees collected from new development and
for Collection on new residential and non-residential re-development within the Charleston-
development Arastradero Corridor to provide for pedest-
rian and bicyclist safety improvements.
Govt Code Sec.66477 (Quimby Act) PAMC Ch. 16.60
Amount of the Fee Varies Residential: $1,225 per unit; Commercial:
$0.36 per sq ft
Fund Balance July 1, 2014 $2,427,163 $249,804
Activity in 2014-15
Revenues
Fees Collected 78,214 1,168
Interest Earnings 48,088 4,942
Unrealized Gain/Loss (310)(1,224)
--------------------------------------------------------------------------------------------------------------------
Total Revenues $125,992 $4,886
--------------------------------------------------------------------------------------------------------------------
Total Expenditures 0 0
--------------------------------------------------------------------------------------------------------------------
Ending Balance June 30, 2015 $2,553,155 $254,690
Other Commitments/ReappropriationsReserve for unrealized gain on
investments (14,534)(1,475)
--------------------------------------------------------------------------------------------------------------------
Net Funds Available $2,538,621 $253,215
Unexpended balance at next finding
date (FY 2016-17-Parkland Dedication,
FY2017-18-Charleston)$757,744 $138,989
USE OF FEES:USE OF FEES:
No expenditure of funds have been made
from this Fund in Fiscal Year 2015.
No expenditure of funds have been made
from this Fund in Fiscal Year 2015.
Page 6 of 10 1/5/2016
Attachment A
City of Palo Alto
Annual Report on Development Impact Fees
for Period Ending June 30, 2015
New Public Safety Facilities General Government Facilities
FUND
Purpose and Authority
Fees imposed on residential and non-
residential development to fund police
and fire facilities (including fire apparatus
and vehicles)
Fees imposed on residential and non-
residential development to fund facilities
associated with municipal administration
for Collection PAMC Ch. 16.58 PAMC Ch. 16.58
Amount of the Fee Residential: Single family $996 per unit;
Multi-family $797 per unit
Residential: Single family $1,225 per unit;
Multi-family $1004 per unit
Nonresidential: Commercial $557 per
1,000 sq ft. or fraction thereof; Industrial
$186 per 1,000 sq. ft. or fraction thereof;
Hotel/Motel $743 per 1,000 sq ft or
fraction thereof
Nonresidential: Commercial $702 per 1,000
sq ft. or fraction thereof; Industrial $234 per
1,000 sq. ft. or fraction thereof; Hotel/Motel
$937 per 1,000 sq ft or fraction thereof
Fund Balance July 1, 2014 $0 $0
Activity in 2014-15
Revenues
Fees Collected 1,594 2,008
Interest Earnings 2 3
--------------------------------------------------------------------------------------------------------------------
Total Revenues $1,596 $2,011
--------------------------------------------------------------------------------------------------------------------
Total Expenditures 0 0
--------------------------------------------------------------------------------------------------------------------
Ending Balance June 30, 2015 $1,596 $2,011
Other Commitments/Reappropriations
--------------------------------------------------------------------------------------------------------------------
Net Funds Available $1,596 $2,011
Unexpended balance at next finding
date FY 2019-20 $1,596 $2,011
USE OF FEES:USE OF FEES:
No expenditure of funds have been made
from this Fund in Fiscal Year 2015.
No expenditure of funds have been made
from this Fund in Fiscal Year 2015.
Page 7 of 10 1/5/2016
Attachment A
City of Palo Alto
Annual Report on Development Impact Fees
for Period Ending June 30, 2015
Citywide Transportation
FUND
Purpose and Authority for Collection
Transportation impact fees imposed on
new development in all parts of the City to
fund congestion reduction projects.
PAMC Ch. 16.59
Amount of the Fee $3,354 per net new PM peak hour trip
Fund Balance July 1, 2014 $3,882,010
Activity in 2014-15
Revenues
Fees Collected 405,120
Interest Earnings 62,759
Unrealized Gain/Loss Investments (4,311)--------------------------------------------------------
Total Revenues $463,568
Expenditures
Operating Transfer to CIP (1,885,183)
--------------------------------------------------------
Total Expenditures (1,885,183)--------------------------------------------------------
Ending Balance June 30, 2015 $2,460,395
Other Commitments/Reappropriations
Reserve for unrealized gain on
investments (18,630)--------------------------------------------------------
Net Funds Available $2,441,765
Unexpended balance at next finding
date (FY 2017-18)$1,216,124
USE OF FEES:
Expenditures have been made in Fiscal
Year 2015 for $372K to PL-15001
(Embarcadero Corridor), $308K to PL-
14000 (El Camino / Churchhill), $841K to
PL-05030 (Traffic Signal and ITS
upgrades, and $364K to PL-11003 (Palo
Alto Traffic Signal)
Page 8 of 10 1/5/2016
Attachment A
City of Palo Alto
Annual Report on Development Impact Fees
for Period Ending June 30, 2015
(INFORMATION ONLY)
Public Art Fund
FUND
Purpose and Authority for Collection
Fees imposed on new commercial
develoments (including mixed use
projects), including new construction,
remodels, additions and reconstruction
that (i) have a floor area of 10,000 square
feet or more, and (ii) have a construction
value of $200,000, or more, exclusive of
costs for architecture, design, engineering,
and required studies; and all new
residential projects of five or more units to
fund public art for private developments.
PAMC Ch. 16.61
Amount of the Fee
1% of first $100 million construction
valuation and .9% of construction
valuation for valuation in excess of $100
million
Fund Balance July 1, 2014 $56,176
Activity in 2014-15
Revenues
Fees Collected 110,485
Interest Earnings 5,707
Unrealized Gain/Loss Investments 1,208
Operating Transfer from General Fund 96,123
--------------------------------------------------------
Total Revenues $213,523
Expenditures
Salaries and benefits (114,815)
Supplies and materials (168)
--------------------------------------------------------
Total Expenditures (114,983)
--------------------------------------------------------
Ending Balance June 30, 2015 $154,716
Reserve for unrealized gain on
investments (1,546)
--------------------------------------------------------
Net Funds Available $153,170
This fund is not subject to AB1600
requirements and is listed only for
information purposesPage 9 of 10 1/5/2016
Attachment A
City of Palo Alto
Annual Report on Development Impact Fees
for Period Ending June 30, 2015
(INFORMATION ONLY)
FUND Water and Wastewater Collection
Purpose and Authority Capacity fees charged to developers that
for Collection 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., 3/4 in. $5,000, 1
in. $9,400, 1 1/2 in. $18,850, 2 in. by est.
$125/FU, 3 in. by est. $125/FU , 4 in. by
est. $125/FU , 6 in. by est. $125/FU
Water Fire Service: 2 in. $750, 4 in.
$9,000, 6 in. $22,530, 8 in. $43,080, 10in.
$69,510
Sewer: 4 in. $10,500 first 50 FU, $210/FU
additional, 6 in. by est. $210/FU, 8 in. by
est. $210/FU
FU is fixture unit
Activity in 2014-15
Capacity Fees Collected
Water $1,132,095
Wastewater Collection 647,640
Total $1,779,735
USE OF FEES:
The fees are used exclusively for water
and sewer system improvements
Page 10 of 10 1/5/2016