HomeMy WebLinkAboutMinutes - June 21, 1991236
SPECIAL CITY COUNCIL MEETING
CARNEGIE FORUM
FRIDAY, JUNE 21, 1991
7:00 A.M.
The meeting was called to order by Mayor Hinchman at 7:00 a.m.
Roll was recorded by the City Clerk as follows:
Present: Council Members - Pennino, Pinkerton, Sieglock,
Snider and Hinchman (Mayor)
Absent: Council Members - None
Also Present: City Manager Peterson, City Attorney McNatt,
Public Works Director Ronsko, Finance
Director Holm, Fire Chief Hughes, Parks and
Recreation Director Williamson, and City
Clerk Reimche
DEVELOPMENT IMPACT
CC -46 City Manager Peterson introduced the agenda subject
CC -56 "Development Impact Fees". Public Works Director presented
the following responses to questions that were raised at
the May 28, 1991 Development Impact Fee public hearing.
1. What is the "Value" of existing Parks and Recreation
Department in $/Acre for the existing City compared to the
new fees (Terry Piazza)?
Since the "existing standard" as defined is the same as
that used for calculating the fee, the "value" would be the
same if replacement value of existing facilities was used.
The estimate for future park facilities took into account
the existing inventory shown in Table 9-2 on Page 80 of the
study. Thus, the new park facilities are comparable to
existing facilities. Explicitly answering the question
would require a more detailed inventory and additional
estimates; both requiring significant staff time and
consultant expense.
2. Sewer RAE schedule appears inconsistent with Design
Standards and Water RAE (Steve Pechin).
The Design Standards while based on the various Master
Plans, were written to cover the design of facilities
within a development project. The impact fee study
relied on city-wide flow data taken directly from the
engineering consultants who worked on the General Plan.
The unit flow factors are not necessarily the same and are
more conservative in the Design Standards; thus, comparing
1
Continued June 21, 1991
3.
4.
237
the RAE schedule to the Design Standards will not provide
consistent results.
However, in reviewing this issue, the consultant found
discrepancies in both the Water and Sewer RAE schedules.
The schedules have been recalculated as follows:
Category Water RAE Sewer RAE
Residential
Low Dens ty
1.00
1.00
Medium Density
1.96*
1.96*
High Density
3.49*
3.49*
East Side
1.00
1.00
PR -LD
1.00
1.00
PR -MD
1.96*
1.96*
PR -HD
3.49*
3.49*
Commercial
Neig bor ood
0.64
0.94
(was
1.25)
General
0.64
0.94
(was
1.25)
Downtown
0.64
0.94
(was
1.25)
Office
0.64
0.94
(was
1.25)
Industrial
Light
0.26 (was 0.92)
0.42
(was
0.33)
Heavy
0.26 (was 0.92)
0.42
(was
0.33)
*Original figure was rounded to nearest 0.1; used nearest
0.01 to be consistent with other categories
Storm Drain RAE schedule appears inconsistent with Design
Standards and Water and Sewer RAE's (Steve Pechin).
The storm drain relative factors are the same as those
presently in effect. They were determined by the City in
1988 as part of the update of the Master Storm Drain System
Master Plan and Fee Program. An analysis was done on the
total cost of providing trunk lines, basins and pumping
facilities for residential versus commercial development.
The Design Standards only address runoff calculations.
While it could be argued that a more refined breakdown is
possible (for example, commercial versus industrial), the
cost difference would be less the difference implied by the
Design Standards which is only 13%.
Incidentally, the storm drain fees need to be recalculated
due to land use changes in the adopted General Plan and the
omission of two existing storm drain reimbursement
agreements that are to be paid out of the impact fee fund.
How does additional water system revenue from metering
affect the fee program (Steve Pechin)?
2
238 Continued June 21, 1991
Presumably, water rates will be set to cover maintenance,
replacements and contributions to general fund and no new
capital facilities. Of course, actual water rates are set
by the City Council. To the extent water conservation from
metering reduces the need for additional wells, future
updates of the General Plan and the Water Master Plan would
reduce the number of new wells needed. Then the fee could
go down.
5. What is the effect of removing Lodi Lake from the
calculation on existing park standard (Steve Pechin)?
The lake itself accounts for 35 acres of the 101 acres of
Lodi Lake Park included in the existing standard.
Eliminating acreage from the existing standard and reducing
the new park acreage to match the existing standard will
reduce the fee. The exact reduction amount will depend on
the results of the cash flow analysis. Based on the
average cost of new parks, Table 1 (see Exhibit A attached)
presents the approximate effect of reducing the acreages as
shown.
6. Question using $100,000 per acre as value for land
acquisition (Steve Pechin, Dennis Bennett, Jeff Kirst,
Council).
Based on comments from other developers, staff feels the
$100,000 figure is reasonable considering the City will
have to have appraisals done and pay prevailing market
rates at the time of purchase. This action will occur
nearer to development time, thus land will be more
expensive than land purchased years ago on speculation.
7. In computing the area of existing community buildings, were
leased facilities included and how does it effect the
program; is there a list of the existing facilities (Steve
Pechin, Jeff Kirst)?
The facilities used in determining the existing standard
are:
Hutchins Street Square Cafeteria
6,400
SF
Camp Hutchins Room
6,000
SF
Hutchins Street Square North Complex
19,600
SF
Hutchins Street Square Pool Area
5,400
SF
Hutchins Street Square Fine Arts Building
8,700
SF
Recreation Annex, North Stockton Street
3,500
SF*
Kofu Park Building
1,800
SF
Lee Jones Building (@ Legion Park)
900
SF
Grape Festival Pavilion**
32,000
SF*
Grape Festival Chablis Hall
9,600
SF*
Recreation Office Meeting Room
900
SF
TOTAL
94,800 S
Continued June 21, 1991
(use of indoor school facilities not included)
*Leased
**Pavilion only available 5-1/2 months/year
239'`
This square footage was used in determining the amount and
cost of new community buildings (44,100 SF @ $100/SF =
$4,410,000). Reducing this square footage has a similar
effect on the fee as reducing park acreage, although the
amounts are smaller. See Table 1 (Exhibit A attached) for
some approximate alternatives.
8. Were revenues from renting/leasing community buildings
included in the program (Steve Pechin)?
No, City policy in setting rental rates is to attempt to
recover operating expenses only.
9. Police RAE's the land use is not as important a factor as
the area of town (Steve Pechin).
Possibly, but this is not accounted for in the methodology
and it would probably not be legal to do so.
10. Residential impact fee comparison - Tracy is going down,
Galt's figure is only for certain parts of town and include
Mello -Roos figures, also the comparisons are distorted,
misleading and inaccurate (Dennis Bennett).
Tracy's storm drain fee has been reduced from $5,204 to
$4,564; however, many of the other categories have gone
up. The total of $23,116 shown in the comparison is now
$23,661. We have also been informed that a suit is being
filed over Tracy's fees.
Based on correspondence from Bennett and Compton, the
City's comparison is accurate except in two categories:
Water - Depending on the area being developed, the fee is
$950 instead of $1,800.
NE Area - These fees were established to reduce the
Mello -Roos bond payments. They are used for capital
facilities including the types of facilities in Lodi's
proposed program, and in our mind fit the definition of an
impact fee.
Their letter.provided the following fee examples:
1,331 SF home in NE area: $12,623.64
1,250 SF home not in NE area: $ 8,763.20
The City comparison showed $12,677 for a 2,000 SF home.
Given the wide variation in fee programs and situations, we
4
240 Continued June 21, 1991
feel the comparison is sufficiently accurate for the
purpose intended.
The fee comparisons were not intended to be precise. Doing
so would require a specific project design in a specific
area for each city. The proposed City of Lodi fees are
based on providing the facilities listed for the General
Plan service area. The City Council may, as a matter of
policy, reduce the fees in order to be "competitive".
However, this will transfer the burden to the General Fund
and/or Utility Funds. As discussed at the public hearing,
arbitrarily adjusting the fees opens the City to legal
challenge. Reducing the fees can be done by:
1. Lowering the service standard and
eliminating projects - This would uniformly
reduce the fee in each land use category for
the reduced standard fee category (i.e.,
Police, Fire, etc.).
2. Reduce the fee per RAE in any or all of the
fee categories - This would require
subsidies from other City funds in order to
maintain the service standard or would mean
deferring or eliminating projects, in effect
reducing the level of service.
3. Directly subsidize land use categories (such
as low income housing) by paying all or a
portion of the fee out of the General Fund
or other City funds.
11. Fee collection at Final Map versus Building Permit stage
(Dennis Bennett).
Later collection will increase fees and create much more
administrative burden, i.e., billing and tracking every
parcel versus one map. Changing to collecting all fees at
building permit would mean recalculating to a square
footage basis for commercial/industrial and presumably per
dwelling unit for residential. We could split with some
categories at map and others at building permit. We
already collect storm drain fees at map stage.
12. Parks standard distorted especially considering Lodi Lake
and School acreage, need more analysis (Dennis Bennett).
The standard is a policy decision; the data is there for
Council to decide. The first Parks project is a new Parks
Master Plan which will more precisely define the nature of
the new parks, improvements to be included, etc. Staff
suggests that is the time to do more analysis and fine-tune
the fee program.
Continued June 21, 1991
V24-
School acreage was not included in the existing standard
nor included in future additions since the City has no
control over either situation.
13. Need more analysis on General City Facilities Fees (Dennis
Bennett).
Again, this is a policy decision on the Council's part as
to what projects should be paid out of fees versus the
general fund or simply deleted. All the City Facilities
included are needed to accommodate growth.
14. Effect on house price of borrowing money to pay fees at
Final Map stage (Dennis Bennett).
The impact fees for a single-family subdivision at 5 lots
per acre total $7,634 per lot. At 15% interest for 18
months, the additional cost to be passed on the home buyer
is approximately $1,700 plus whatever the developer and
builder mark up their costs. These numbers are comparable
to a realtor's fee on a $150,000 sale ($9,000 @ 6%).
This is over-estimated however, since it includes the time
spent building the house. In collecting at building permit
stage, there is still 6 months' or so interest while the
house is being built. In collecting at that later stage,
the fee will have to be approximately 4% higher to account
for the loss of interest revenue in the fee program. These
two factors would reduce the additional amount
approximately $800 plus markup. We also would assume that
with the growth management program, we will not see
excessive numbers of lots mapped so there should be a
shorter time between map filing and home construction.
15. Lodi's proposed Park standard is 3.4 acres per 1,000
persons served. What is the parks standard for other
agencies (Council)?
Stockton - 3 acres per 1,000 residents (considering
commercial/industrial impact)
Davis - standard is area/distance based
Tracy - 3.5 acres per 1,000 residents
Manteca - 5 acres per 1,000 residents
Woodland (draft) - 3.2 acres per 1,000 persons served plus
additional standards for facilities and regional parks
16. Relationship/methodology between Commercial land use and
Police, Fire and General City Facilities and sales tax
revenue (William Mitchell).
Al
242 Continued June 21, 1991
r
No credit was offered for potential sales tax revenue.
These sources don't even pay for Police, Fire, and Parks
and Recreation operations, let alone new capital facilities.
17. Difference/relationship between commercial fees (especially
streets) based on per acre basis versus per 1,000 SF of
building area (William Mitchell).
The basic decision to use General Plan land use categories
to keep the fee program simple and to collect at map stage
means that acreage must be used since specific project
plans are not available then. This also evens out small
differences in land use and is much simpler to administer
(fewer arguments over trip rates -or specific types of land
use nor worrying about minor changes in land use). Given
this, there will always be at least 50% of the projects who
feel they are below the average and should get a fee
reduction. That could be done, but only if we charge the
other 50% a higher fee.
18. Why have parallel water mains on certain streets (Council)?
This is done on major streets and provides better service
to what are usually large parcels needing many fire
services. It reduces the need to cross the major street
repeatedly which is expensive since such crossings are
usually bored rather than open cut.
19. Police "existing persons served" is 80,207 per Table 7-1.
This seems high (Council).
The number includes an accounting of residents and
employees based on the various General Plan documents. It
is consistently used in the existing land use and project
land use, although it is recalculated separately for each
fee category.
20. The additional number of firefighters appears to be more
than that needed for the new station. Is it "top heavy"
(Council)?
The projects/equipment shown on Table 8-1 are per the Fire
Long Range Plan which includes:
- A 4 -person "quint" (combined truck/engine) at the new
Station 4, which includes 1 captain (mid -management)
- Adding a firefighter to the east side truck company
- Adding 2 fire inspectors
- Adding 1 public education specialist
- Adding 1 hazardous materials specialist
7
Continued June 21, 1991
_ All are firefighting personnel. This is a total of 23
positions for which equipment costs only are included.
21. We are collecting fees for a fire station that will not be
built for a few years (Council).
The collection of fees for future projects is in compliance
with State law given that we have a long-range Capital
Improvements Program.
22. Parks and Recreation, Page 78, Paragraph 2 says 770 SF is
the existing building standard (Council).
That is a typographical error; the correct figure is 1,800
SF.
23. If a service club or private donation builds a park
improvements, what happens to the fee (Council)?
When a project included in the fee program is funded from
another source, the cost estimate would be changed at the
next fee program update along with any other changes and/or
cost increases; thus the total fee would be adjusted
accordingly.
24. Why don't we reimburse the City for the cost of land
already purchased (Council)?
That could be done. However, then the land could not be
counted as part of the existing standard. For example, the
semi -developed portion of Pixley Park (C -Basin) was counted
in the existing standard. It could be removed from the
standard and included in new parks. In some specific cases
(such as the rest of C -Basin), the undeveloped land was
purchased with impact fee (Master Storm Drain) funds so it
would not be appropriate to "buy" it again. In other
cases, such as the 13 -acre Lodi Lake Park expansion, the
land was acquired many years ago (more than 10) and it
would be difficult to determine the purchase terms and
conditions. In the case of streets where we included
recent widening projects, the cost of land (Right -of -Way
acquisition) was included. We would include some allowance
for park land already owned if Council so desires and City
provides specific direction. This would of course increase
the fee. An example is shown in Table 1.
25. Why is the level of service standard for City Hall being
increased per Page 91, Table 10-1 (Council)?
The analysis for City Hall reflects that fact that the
existing building is overcrowded, thus the total cost of
the project cannot be placed on new development. The term
"level of service standard" in this case is misleading
since it is a statement of existing conditions, not a
244 Continued June 21, 1991
desired level of space allocation. The future total is
based on the present plans for the expansion of the
building and matches the projections of City Hall personnel
increases throughout the life of the General Plan.
Additional Discussion
Although there were no specific questions, the issue of
"affordable housing" was discussed. This issue involves
much more than just impact fees and includes land prices,
construction costs, interest charges, profit margins and
"the Market". However, the following discussion just
addresses impact fees.
Certainly anything that increases expenses to developers
and builders has the potential of increasing the final sale
price. The issue of "who ultimately pays" is not clear and
depends on many local factors. According to the latest
information staff received at a recent seminar on impact
fees, there have been very few rigorous studies that
attempt to answer this question. These few indicate that
while there is an increase, it is "trivial" when compared
against increases due to other factors.
This seminar included some discussion on the "impact" of
impact fees. Ten suggestions on offsetting their impact
are attached as Exhibit A. Given the City's 2% Growth
Management Plan, some of these suggestions are not
possible. Note that No. 7 suggests fees be charged as
early as possible in the approval process. Numbers 9 and
10 and similar alternatives would require a much more
active role by the City in the area of housing programs.
Such programs could be handled by other public agencies on
a contract basis, by a consultant, or by new City staff.
Recommendation/Action
At this point, staff needs Council direction on how to
proceed with the Development Impact Fee Program in order to
complete the enabling ordinance and implementing
resolution. The draft fees as presented need to be
recalculated anyway because of the changes. Also, the
calculations started with revenue and expenses in fiscal
year 1990/91. Obviously, the program will not start then.
We do wish to proceed as quickly as possible; the City
cannot collect any of its county -wide 1/2t sales tax
(Measure K) allocations until we have a traffic fee in
place.
Council decisions are needed on the following issues that
have been raised which will also affect the fee calculation:
1. RAE Schedules - In addition to the water and
sewer changes, if the Council has
2
Continued June 21, 1991
questions/concerns on
as Parks and
commercial/industrial
should be resolved.
245
other schedules (such
Recreation and
land use), these
2. Projects/Standards - A decision should be
made on the project list and standards used,
especially in Parks and Recreation where the
most questions were raised; also the land
value figure should be agreed upon.
3. Fee Collection - The issue of collecting at
Final Map versus Building Permit is
critical. In changing to building permit,
staff would recommend changing the
residential acre equivalent factors (RAE's)
to a dwelling unit and 1,000 SF
commercial/industrial basis.
Also presented for Council review was the following Revised
Draft (June 20, 1991) of the proposed 1991 Fee and Service
Charge Schedule.
10
24Ei
• CITY O F L O D I1991 Fee and
PUBLIC WORKS DEPARTMENT Service Charge Schedule
Development liiipi ct MIitllgat,an l=ees
RAE = Residential Acre Equivalent
Land Use Category Total Fee Water
per Acre RAE Fee/Acre
Sewer
RAE
Revised Draft -
6/20/91
Storm Drainage
Fee/Acre RAE Fee/Acre
Streets
RAE
Fee/Acre
Residential
Low Density
$39,160
1.00
$5,500
1.00
$1,080
1.00
$7,380
1.00
35,380
Medium Density
$59,820
1.96
$10,780
1.96
$2,120
1.00
$7,380
1.96
$10,540
High Density
$105,200
3.49
$19,200
3.49
$3,770
1.00
$7,380
3.05
$16,410
East Side Residential
$41,130
1.00
$5,500
1.00
$1,080
1.00
$7,380
1.00
$5,380
Planned Low Density
$39,160
1.00
$5,500
1.00
$1,080
1.00
$7,380
1.00
$5,380
Planned Med. Density
$59,820
1.96
$10,780
1.96
$2,120
1.00
$7,380
1.96
$10,540
Planned High Density
$105,200
3.49
$19,200
3.49
$3,770
1.00
$7,380
3.05
$16,410
Commercial
Neighborhood
$40,280
0.64
$3,520
0.94
$1,020
1.33
$9,820
1.90
$10,220
General
$48,270
0.64
$3,520
0.94
$1,020
1.33
$9,820
3.82
$20,550
Downtown
$40,280
0.64
$3,520
0.94
$1,020
1.33
$9,820
1.90
$10,220
Office
$53,530
0.64
$3,520
0.94
$1,020
1.33
$9,820
3.27
$17,590
Industrial
Light
$29,930
0.28
$1,430
0.42
$450
1.33
$9,820
2.00
$10,760
Heavy
$28,870
0.26
$1,430
0.42
$450
1.33
$9,820
1.27
$6,830
Police
Fre
Parke & Recreation
General City
RAE
Fee/Acre
RAE
Fee/Acre
RAE
Fee/Acre
RAE
Fee/Acr;
Residential
Low Density
1.00
$1,130
1.00
$510
1.00
$11,810
1.00
$ 6,370
Medium Density
1.77
$2,000
1.96
$1,000
1.43
$16,890
1.43
$9,110
High Density
4.72
$5,330
4.32
$2,200
2.80
$33,070
2.80
$17,840
East Side Residential
1.09
$1,230
1.10
$560
1.10
$12,990
1.10
$7,010
Planned Low Density
1.00
$1,130
1.00
$510
1.00
$11,810
1.00
$6,370
Planned Med. Density
1.77
$2,000
1.96
$1,000
1.43
$16,890
1.43
$9,110
Planned High Density
4.72
$5,330
4.32
$2,200
2.80
$33,070
2.80
$17,840
Commercial
Neighborhood
4.28
$4,840
2.77
$1,410
0.32
$3,780
0.89
$5,670
General
2.59
$2,930
1.93
$980
0.32
$3,780
0.89
$5,670
Downtown
4.28
$4,840
2.77
$1,410
0.32
$3,780
0.89
$5,670
Office
3.72
$4,200
2.46
$1,250
0.54
$6,380
1.53
$9,750
Industrial
Light
0.30
$340
0.64
$330
0.23
$2,720
0.64
$4,080
Heavy
0.19
$210
0.61
$310
0.33
$3,900
0.93
85,920
See Note 4.
Reference: LMC 5IS. 64.roa & Resolution 91 -root
Notes
I . This schedule is a summary only; refer to the reference cited for details of applicability and interpretations.
2. LMC = Lodi Municipal Code; PWD = Public Works Department
3. Fees must be paid before work is scheduled or applicable Map/Permit issued.
4. Special area assessments or charges required by reimbursement agreements are not included in this summary.
Approved: Jack L. Ronsko, Public Works Director Date
Page 4 of 4 May 1991 PWDFEE4.XLS
Continued June 21, 1991
Following a lengthy discussion, with questions being posed
by members of the Lodi City Council and members of the
audience, the City Council took the following actions:
a) On motion of Council Member Snider, Sieglock
second, the City Council determined that the
Parks Standards as described in the Fee
Study, including the acreage standard of 3.4
acres per 1,000 persons served, be adopted.
The motion carried by the following vote:
Ayes: Council Members - Pennino, Sieglock,
Snider and
Hinchman (Mayor)
Noes: Council Members - Pinkerton
Absent: Council Members - None
b)
On motion of Council Member Sieglock,
Hinchman second, the City Council
unanimously voted that the parks residential
acre equivalent factors described in the Fee
Study be approved and that a Parks and
Recreation Master Plan study be done.
c)
On motion of Mayor Hinchman, Sieglock
second, the City Council unanimously voted
that all of the projects shown in the Fee
Study be included in the Fee Program.
d)
On motion of Council Member Snider, Sieglock
second, the City Council unanimously voted
that the Fee Program provide for fees to be
collected at Final Subdivision Map or, when
not applicable, at Building Permit.
ADJOURNMENT The meeting was adjourned at 9:10 a.m.
AMR/imp
Attest:
A - 44ne"L
Alice �d. Reimcne
City Clerk
12
248,
Table 1 `—
APPROXIMATE PARKS AM RECREATION IMPACT FEE REVISIONS
"Existing" Future Cost of Fee Diff.
Standard Additions Future per RAE
Additions
Parks
With Lodi Lake 177.8 Ac 83.0 Ac $12,991,000* $11,810 --
Deduct Lake 35 Acres 142.8 Ac 66.7 Ac $10,440,000 (approx.) $10,210 41,600
Deduct 50% of Lake 35 Acres 160.3 Ac 74.8 Ac $11,710,000 (approx.) $11,000 -$ 810
Camunity Buildings
With All Facilities 94,800 SF 44,100 SF $ 4,410,000 $11,810 --
Deduct All Leased Facilities 49,700 SF 23,120 SF $ 2,312,000 (approx.) $10,490 -$1,320
Prorate Pavilion SF 77,470 SF 36,040 SF $ 3,604,000 (approx.) $11,310 -$ 500
Land Reimbursement
Lodi Lake 13 Acre Expansion -- -- $ 1,300,000 (approx.) $12,630 +$ 820
*Master Plan, Camunity Buildings, and miscellaneous projects subtotal $5,749,000 for $18,740,000 total program
MCC9101/TXTW.02M