HomeMy WebLinkAboutAttachment 8 - Fiscal Impact AnalysisWest Ming Specific Plan
Response to Comments
on the Draft Environmental Impact Report
Michael Brandman Associates
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Attachment 8: Fiscal Impact Analysis
FISCAL IMPACT ANALYSIS
FOR THE
WEST MING SPECIFIC PLAN
Prepared By:
Fiscal Impact Analysis
November 22, 2006 West Ming Project
Table of Contents
Page
Purpose of Fiscal Impact Analysis.................................................................................................................1
FIA Summary and Conclusions......................................................................................................................1
Summary................................................................................................................................................1
Project Land Use....................................................................................................................................1
General Sources of Information and Methodology Used in FIA...................................................................1
Projected Fiscal Revenues..............................................................................................................................2
Property Tax...............................................................................................................................................2
Property Transfer Tax................................................................................................................................2
Sales and Use Tax......................................................................................................................................2
On-Site Retail Sales Tax........................................................................................................................2
Off-Site Retail Sales Tax........................................................................................................................3
Motor Vehicle In Lieu Tax (“VLF”)..........................................................................................................3
VLF Backfill to Property Taxes.................................................................................................................3
Licenses, Permits, and Franchises..............................................................................................................3
Court Fines and Asset Forfeitures..............................................................................................................3
Utility Franchise Tax..................................................................................................................................4
Business Licenses Tax................................................................................................................................4
Fire Charges...............................................................................................................................................4
Police Charges............................................................................................................................................4
Recreation Fees..........................................................................................................................................4
Projected Fiscal Costs....................................................................................................................................5
Police..........................................................................................................................................................5
Fire.............................................................................................................................................................5
Streets.........................................................................................................................................................5
Public Works..............................................................................................................................................5
Recreation and Parks..................................................................................................................................5
Development Services................................................................................................................................5
Economic and Community Development...................................................................................................6
General Government Costs.........................................................................................................................6
Exhibit A – Fiscal Impact Analysis at Buildout – Constant Dollars
Exhibit B – Ongoing Fiscal Impact – Constant Dollars
Fiscal Impact Analysis
November 22, 2006 West Ming Project
P:\MA\JonesB\Bolthouse\West Ming FIA Summary, 11-22-06 Final.DOC - 1 -
Purpose of Fiscal Impact Analysis
Development Planning & Financing Group has prepared this Fiscal Impact Analysis
(“FIA”) to determine the estimated fiscal impacts on the City of Bakersfield (“City”) in
connection with the proposed development of the West Ming Specific Plan (“Project”).
The reader should be aware that the FIA contains estimates or projections of the Project’s
future revenue and cost impact on the City and actual fiscal results may vary from
estimates because events and circumstances can occur in a manner different than
described in the FIA.
FIA Summary and Conclusions
Summary
The FIA examines the financial impact the Project will have on the City’s general fund
(“General Fund”). The Project will generate additional income for the General Fund
primarily through increased property taxes, sales taxes, and franchise taxes while
increasing the need for City services such as police, fire, public works, recreation, and
park services. The impacts are summarized below:
Total Ongoing Revenue $10,576,253
Total Ongoing Cost $10,070,243
Total Ongoing Surplus $506,009
The Project’s impact on the General Fund will change over time, but the Project as
projected in the FIA does not result in a deficit to the General Fund, as shown in Exhibit
A and Exhibit B. The FIA does not consider the impact of potential revenues and/or
reduced General Fund costs due to a Project Homeowner’s Association, City Landscape
Maintenance District, or Community Facilities District which could serve to increase the
ongoing surplus.
Project Land Use
The proposed Project is anticipated to include 7,450 residential units, ranging from high
density apartments to low density custom homes. The Project also includes
approximately 322 acres of non-residential land uses, of which 44 acres is
office/commercial, 30 acres is retail, and 247 acres is light industrial. Reducing the
residential unit count to 6,500 would result in a total ongoing surplus of $492,665.
General Sources of Information and Methodology Used in FIA
Information used in preparing the FIA was obtained from the following sources: (1) the
City of Bakersfield Budget FY 2006-07(“Budget”), (2) Castle & Cooke, Inc. (land use
information), (3) the California Department of Finance (population information), and (4)
the California Employment Development Department (employment information).
Fiscal Impact Analysis
November 22, 2006 West Ming Project
P:\MA\JonesB\Bolthouse\West Ming FIA Summary, 11-22-06 Final.DOC - 2 -
The methodology used to determine the allocable revenue and cost impacts to the City as
a result of the Project’s development was a combination of case studies and per
capita/employee analysis. The per capita/employee impacts were determined by applying
the appropriate per capita, per employee and per capita and employee factors (“Factors”)
to the Project land use assumptions. The Factors were calculated using the Budget. Cost
and revenue factors are projected in constant 2006 dollars (i.e. not adjusted for inflation).
The FIA uses the following assumptions:
City of Bakersfield
Residential Population (a) 311,824
Residents Per Household (a) 3.014
Employment (b) 136,700
Resident Equivalent Population (c) 380,174
Share of the Basic Tax (d) 22.23%
(a) Per the California Department of Finance as of October 1, 2006
(b) Per the California Employment Development Department, January 1, 2006.
(c) Equal to population + weighted employment. Employment was weighted by 50% to account for the estimated less frequent use of
City public services by employees than residents.
(d) Per Kern County Auditor/Controller.
Projected Fiscal Revenues
Property Tax
The FIA assumes that the City will receive 22.23% of the 1% ad valorem property taxes
assessed to property owners within the Project. The Project is within Tax Rate Area 001-
343 (27.84% share of ad valorem taxes) and Tax Rate Area 061-001 (22.23% share of ad
valorem taxes). For purposes of this analysis the entire Project is assumed to be located
within Tax Rate Area 061-001. The City will receive $8,238,174 per year in property
taxes at buildout.
Property Transfer Tax
The City receives the property transfer tax as new or existing property is sold and
ownership is transferred. According to the Kern County Recorder, property transfer tax
is collected upon the sale of property at a rate of $1.10 per $1,000 of valuation. The
City’s portion of the tax is $0.55 per $1,000 of value transferred since half of the transfer
tax goes to the City and half of the tax goes to the State. The FIA assumes a residential
and non-residential turnover rate of 13.33% of total assessed value per year.
Sales and Use Tax
On-Site Retail Sales Tax
The FIA assumes that the City will receive sale tax revenues from taxable purchases
made within the Project. The FIA assumes that retail land use will generate $172 of
taxable sales per building square foot per year. Office/commercial and light industrial
Fiscal Impact Analysis
November 22, 2006 West Ming Project
P:\MA\JonesB\Bolthouse\West Ming FIA Summary, 11-22-06 Final.DOC - 3 -
land uses are not assumed to generate sales tax revenue. Applying this methodology, the
City would receive approximately $427,203 in annual on-site sales tax revenue at
buildout.
Off-Site Retail Sales Tax
The City will receive sales tax revenue from taxable purchases made by new residents
within the City but outside the Project area. The FIA assumes that each household’s
income is equivalent to three times its mortgage payment, 34% of household income is
spent on retail taxable expenditures, and 50% of retail taxable expenditures are captured
in the City. After calculating total Project retail taxable expenditures captured in the
City, the FIA assumes the City receives sales tax revenue of 1% of taxable sales.
Applying this methodology, the City would receive approximately $730,773 in annual
off-site sales tax revenue at buildout.
Motor Vehicle In Lieu Tax (“VLF”)
Based on the Budget, the City receives $20.35 per capita in VLF before the Triple Flip
transfers the funds to Property Taxes.
VLF Backfill to Property Taxes
Due to the “Triple Flip,” the State takes the City’s VLF and backfills the City with the
same amount in property taxes. As such, the VLF is accounted for in the Property Tax
calculation.
Licenses, Permits, and Franchises
The City receives a portion of fines and forfeitures allocated from applicable enforcement
agencies. Based on the Budget, the City would receive $1.77 per equivalent resident in
fines and forfeitures.
Court Fines and Asset Forfeitures
The City receives a portion of fines and forfeitures allocated from applicable enforcement
agencies. Based on the Budget, the City would receive $1.85 per equivalent resident in
fines and forfeitures.
Fiscal Impact Analysis
November 22, 2006 West Ming Project
P:\MA\JonesB\Bolthouse\West Ming FIA Summary, 11-22-06 Final.DOC - 4 -
Utility Franchise Tax
The City receives utility franchise tax revenue from utility franchises which service the
local area and the Project. Based on the Budget, the City expects to receive
approximately $11.30 per equivalent resident in utility franchise tax revenue.
Business Licenses Tax
The City receives a business license tax from businesses which service the local area and
the Project. The project residents will ultimately require new businesses to serve the
additional demand. Based on the Budget, the City expects to receive approximately
$9.74 per equivalent resident in business license revenue.
Fire Charges
Based on the Budget, the City anticipates receiving $2.19 per capita and $14.99 per
employee in fire charges. The analysis assumes 25% of fire charges are related to
residential land use and 75% are attributed to non-residential land use.
Police Charges
The City earns revenue from various police and related service charges including special
police services, DUI responses, police records fees, police disorderly gathering fees,
fingerprinting charges, animal shelter fees, and booking fees. Based on the Budget, the
City anticipates receiving $1.81 per equivalent resident in police and related service
charges.
Recreation Fees
The City charges and collects fees associated with services provided in connection with
youth programs, senior citizens programs, family programs, special City events, sports
and cultural events, and performing arts events. Based on the Budget, the City
anticipates receiving $2.03 per capita in parks and recreation revenue.
Fiscal Impact Analysis
November 22, 2006 West Ming Project
P:\MA\JonesB\Bolthouse\West Ming FIA Summary, 11-22-06 Final.DOC - 5 -
Projected Fiscal Costs
Police
The Budget includes approximately $65 million in police costs, or $153,999 per sworn
officer. The FIA assumes the project will require 36 additional officers, or 1.3 officers
per thousand residents and employees. Therefore, the Project will add $5,543,959 in
police costs at buildout.
Fire
The Budget includes approximately $30 million in fire costs, or $158,703 per firefighter.
Assuming nine firefighters per station, each fire station costs approximately $1.4 million
annually. Each station can serve approximately 5.7 square miles with 1,920 parcels per
square mile, meaning it costs $130.51 per parcel to provide fire service. Therefore, the
Project will add $1,098,232 in fire costs at buildout.
Streets
The Budget includes approximately $6.4 million in street maintenance costs, or $52,957
per square mile. Assuming 1,920 parcels per square mile, it costs $27.58 per parcel to
provide street maintenance service. Therefore, the Project will add $232,092 in street
maintenance costs at buildout.
Public Works
Based on the Budget, the City anticipates spending $1.61 per equivalent resident in
Public Works administration, $8.97 per equivalent resident in Public Works engineering,
and $18.67 per equivalent resident in Public Works general services. Therefore, the
Project will add $810,831 in Public Works costs at buildout.
Recreation and Parks
Based on the Budget, the City anticipates spending $3.85 per resident in Recreation and
Parks administration, $38.58 per resident in parks maintenance, and $10.64 per
equivalent resident in recreation services. Therefore, the Project will add $1,191,701 in
Recreation and Parks costs at buildout.
Development Services
The FIA assumes that after buildout the Project will result in a 25% marginal increase in
Development Services Costs. Therefore, the Project will add $64,247 in Development
Services costs at buildout.
Fiscal Impact Analysis
November 22, 2006 West Ming Project
P:\MA\JonesB\Bolthouse\West Ming FIA Summary, 11-22-06 Final.DOC - 6 -
Economic and Community Development
Based on the Budget, the City anticipates spending $2.03 per equivalent resident in
community development costs. Therefore, the Project will add $56,309 in Economic and
Community Development costs at buildout.
General Government Costs
General government costs are used to establish and maintain legislative, executive,
financial, and non-departmental positions within the government. In the FIA, these costs
are calculated as a percent of direct general fund costs. The FIA assumes a 50% marginal
increase as general government costs do not have a 1:1 relationship with population
growth. Based on the Budget, general government costs are anticipated to be 11.9% of
direct General Fund costs.
Exhibit A
Statement 1
West Ming Specific Plan
Summary of Fiscal Impact Analysis At Buildout - Constant Dollars
November 22, 2006
Per% of
REVENUESTotalUnitTotal
Gross Secured & Unsecured Property Taxes8,238,174$ 1,106$ 77.9%
Property Transfer Tax241,758 32 2.3%
Sales and Use Tax1,157,975 155 10.9%
Proposition 172 - Half Cent Sales Tax30,879 4 0.3%
Motor Vehicle In-Lieu Tax (VLF)- - 0.0%
Licenses, Permits and Franchises 48,949 7 0.5%
Court Fines and Asset Forfeitures51,341 7 0.5%
Utility Franchise Tax313,223 42 3.0%
Business Licenses Tax270,038 36 2.6%
Fire Charges128,233 17 1.2%
Police Charges50,101 7 0.5%
Recreation Fees45,582 6 0.4%
Total Ongoing Revenues10,576,253$ 1,420$ 100.0%
COSTS
Police Services5,543,959$ 744$ 55.1%
Fire Protection1,098,232 147 10.9%
Streets232,092 31 2.3%
Public Works810,831 109 8.1%
Water Resources- - 0.0%
Recreation and Parks1,191,701 160 11.8%
Development Services64,247 9 0.6%
Economic and Community Development56,309 8 0.6%
Subtotal 8,997,371$ 1,208$ 89.3%
General Government1,072,872 144 10.7%
Total Ongoing Costs10,070,243$ 1,352$ 100%
FISCAL IMPACT
Ongoing Surplus/(Deficit)506,009$ 68$
Revenue/Cost Ratio1.05
P:\MA\JonesB\Bolthouse\FIA West Ming 06_07 budget 11.21.06Exhibit A, Page 1 of 3
Exhibit B
West Ming Specific Plan
Ongoing Fiscal Impact - Constant DollarsNovember 22, 2006
2007-08
2008-09
2009-10
2010-11
2011-12
2012-13
2013-14
2014-15
REVENUESGross Secured & Unsecured Property Taxes-$ 247,303$ 712,406$ 1,260,988$ 1,907,148$ 2,552,363$ 3,197,577$ 3,842,792$
Property Transfer Tax
-
7,461 21,452 37,876 57,010 75,629 94,249 112,869
Sales and Use Tax
-
24,856 71,465 126,177 185,929 310,882 435,835 560,788
Proposition 172 - Half Cent Sales Tax- 663 1,906 3,365 4,958 8,290 11,622 14,954
Motor Vehicle In-Lieu Tax (VLF)- - - - - - - -
Licenses, Permits and Franchises - 1,117 3,331 6,157 10,245 14,032 17,819 21,605
Court Fines and Asset Forfeitures- 1,172 3,494 6,458 10,745 14,717 18,689 22,661
Utility Franchise Tax
-
7,151 21,316 39,396 65,556 89,789 114,021 138,253
Business Licenses Tax
-
6,165 18,377 33,965 56,518 77,409 98,301 119,192
Fire Charges
-
1,387 4,134 7,641 15,503 27,174 38,846 50,517
Police Charges
-
1,144 3,410 6,302 10,486 14,362 18,238 22,114
Recreation Fees
-
1,285 3,830 7,079 11,337 14,586 17,835 21,084
Total
-
$ 299,703$ 865,120$ 1,535,403$ 2,335,436$ 3,199,234$ 4,063,032$ 4,926,830$
COSTS
FactorFactorDuring Buildout
After Buildout
Police Services
153,999
$ 153,999$
-
$ 153,999$ 307,998$ 769,994$ 1,231,991$ 1,539,989$ 2,001,985$ 2,463,982$
Fire Protection
-
27,408 81,701 151,003 249,670 330,718 411,767 492,815
Streets
-
5,792 17,266 31,912 52,763 69,892 87,020 104,148
Public Works
29.25
29.25
-
18,511 55,179 101,985 169,704 232,433 295,163 357,892
Water Resources
-
-
-
- - - - - - -
Recreation and Parks
53.07
53.07
-
33,592 100,135 185,074 296,406 381,344 466,283 551,222
Development Services
9.27
2.32
-
5,867 17,489 32,323 53,786 73,668 93,550 113,431
Economic and Community Development
2.03
2.03
-
1,285 3,832 7,082 11,785 16,141 20,498 24,854
Subtotal
-
$ 246,453$ 583,599$ 1,279,373$ 2,066,105$ 2,644,186$ 3,376,265$ 4,108,344$
General Government (See FIA Report, Page 6)11.92%-$ 29,388$ 69,590$ 152,556$ 246,368$ 315,300$ 402,596$ 489,891$
Total Ongoing Costs
-
$ 275,841$ 653,189$ 1,431,929$ 2,312,474$ 2,959,486$ 3,778,860$ 4,598,235$
FISCAL IMPACTOngoing Surplus/(Deficit)
-
$ 23,862$ 211,931$ 103,474$ 22,962$ 239,748$ 284,172$ 328,595$
Surplus/(Deficit) per Unit
-
$ 114$ 339$ 89$ 12$ 101$ 97$ 95$
Revenue/Cost Ratio
-
1.087 1.324 1.07 1.01 1.08 1.08 1.07
See FIA Report, Page 6See FIA Report, Page 5
P:\MA\JonesB\Bolthouse\FIA West Ming 06_07 budget 11.21.06
Exhibit B, Page 2 of 3
Exhibit B
West Ming Specific Plan
Ongoing Fiscal Impact - Constant DollarsNovember 22, 2006
REVENUESGross Secured & Unsecured Property TaxesProperty Transfer TaxSales and Use TaxProposition 172 - Half Cent Sales TaxMotor Vehicle In-Lieu Tax (VLF)Licenses, Permits and Franchises Court Fines and Asset ForfeituresUtility Franchise TaxBusiness Licenses TaxFire ChargesPolice ChargesRecreation FeesTotalCOSTS
FactorFactorDuring Buildout
After Buildout
Police Services
153,999
$ 153,999$
Fire ProtectionStreetsPublic Works
29.25
29.25
Water Resources
-
-
Recreation and Parks
53.07
53.07
Development Services
9.27
2.32
Economic and Community Development
2.03
2.03
Subtotal
General Government (See FIA Report, Page 6)11.92%Total Ongoing CostsFISCAL IMPACTOngoing Surplus/(Deficit)Surplus/(Deficit) per UnitRevenue/Cost Ratio
See FIA Report, Page 6See FIA Report, Page 5
2015-16
2016-17
2017-18
2018-19
2019-20
2020-21
2021-22
2022-23
2023-24
4,488,006
$ 5,210,831$ 5,879,135$ 6,507,629$ 7,136,124$ 7,609,880$ 7,897,756$ 8,113,285$ 8,238,174$
131,489
152,220 171,474 190,295 209,116 223,238 231,741 238,074 241,758
685,741
815,733 946,446 1,001,297 1,056,148 1,096,281 1,124,606 1,145,703 1,157,975
18,286
21,753 25,239 26,701 28,164 29,234 29,989 30,552 30,879
-
- - - - - - - -
25,392
30,250 34,244 38,037 41,829 44,921 46,719 48,156 48,949
26,633
31,728 35,918 39,895 43,873 47,116 49,002 50,509 51,341
162,485
193,566 219,130 243,396 267,663 287,446 298,956 308,149 313,223
140,083
166,879 188,918 209,839 230,760 247,816 257,738 265,664 270,038
62,188
76,582 90,020 101,698 113,376 123,234 125,466 127,249 128,233
25,990
30,962 35,051 38,932 42,814 45,978 47,819 49,290 50,101
24,333
28,591 31,840 35,095 38,350 40,950 43,018 44,670 45,582
5,790,628
$ 6,759,094$ 7,657,415$ 8,432,815$ 9,208,216$ 9,796,094$ 10,152,811$ 10,421,301$ 10,576,253$
2,925,979
$ 3,387,975$ 3,849,972$ 4,311,968$ 4,773,965$ 5,081,963$ 5,235,962$ 5,389,960$ 5,543,959$
573,863
680,361 765,485 848,621 931,758 999,434 1,043,547 1,078,785 1,098,232
121,276
143,783 161,772 179,342 196,911 211,213 220,536 227,983 232,092
420,622
501,080 567,256 630,073 692,891 744,105 773,898 797,698 810,831
-
- - - - - - - -
636,160
747,492 832,431 917,530 1,002,628 1,070,611 1,124,678 1,167,867 1,191,701
133,313
158,814 179,788 199,697 219,607 58,960 61,320 63,206 64,247
29,210
34,798 39,393 43,756 48,118 51,675 53,744 55,397 56,309
4,840,423
$ 5,654,303$ 6,396,097$ 7,130,987$ 7,865,878$ 8,217,960$ 8,513,684$ 8,780,896$ 8,997,371$
577,186
$ 674,235$ 762,689$ 850,319$ 937,950$ 979,933$ 1,015,196$ 1,047,059$ 1,072,872$
5,417,609
$ 6,328,538$ 7,158,786$ 7,981,307$ 8,803,828$ 9,197,894$ 9,528,881$ 9,827,955$ 10,070,243$
373,019
$ 430,556$ 498,629$ 451,508$ 404,388$ 598,200$ 623,930$ 593,346$ 506,009$
94
$ 92$ 96$ 79$ 65$ 89$ 89$ 81$ 68$
1.07
1.07 1.07 1.06 1.05 1.07 1.07 1.06 1.05
P:\MA\JonesB\Bolthouse\FIA West Ming 06_07 budget 11.21.06
Exhibit B, Page 3 of 3