HomeMy WebLinkAbout07/07/09_CC_AGENDA_PACKET_SPECIAL
NOTICE OF SPECIAL MEETING
♦ AND •
BAKERSFIELD CITY COUNCIL
SPECIAL MEETING AGENDA
JULY 7, 2009
Council Chambers, City Hall, 1501 Truxtun Avenue
SPECIAL MEETING- 12:00 p.m.
1. ROLL CALL
2. PUBLIC STATEMENTS
3. DEFERRED BUSINESS
a. Metropolitan Bakersfield Regional Transportation Impact Fee, Phase IV:
1. Resolution adopting the 2008-2035 Regional Transportation Facilities List
Phase IV, fee schedule and nexus report.
Staff recommends adoption of resolution.
4. ADJOURNMENT
Respectfully submitted,
Alan Tandy
City Manager
07/01/09 8Xam
A
OF
ADMINISTRATIVE REPORT
LIF
MEETING DATE: July 7, 2009 AGENDA SECTION: Deferred Business
ITEM: 3. a.
TO: Honorable Mayor and City Council APPROVED
FROM: Alan Tandy, City Manager DEPARTMENT HEAD
DATE: June 29, 2009 CITY ATTORNEY
CITY MANAGER
SUBJECT: Metropolitan Bakersfield Regional Transportation Impact Fee, Phase I ( I Wards)
1. Resolution Adopting the 2008-2035 Regional Transportation Facilities List
Phase IV, Fee Schedule, and Nexus Report.
RECOMMENDATION: Staff recommends adoption of the Resolution.
BACKGROUND: On June 4, 2009 and again on June 16, 2009, the Planning and Development
Committee of the City Council met to consider comments on the Phase IV Transportation Impact
Fee, and to make a recommendation to the City Council. The Committee recommends:
1) The adoption of the Transportation Impact Fee Resolution, and;
2) The adoption of the amendment to Council Resolution No. 118-05 temporarily
suspending Council policy to allow for the discretionary extension of vesting rights for
maps with recorded phases whose initial year would expire before December 31, 2009.
The suspension of this policy would extend vesting rights for 324 lots within the City of
Bakersfield.
At the City Council meeting of June 24, 2009, new information came forward indicating that only
about 70 lots would qualify for the map, thus seemingly making this part of the proposal
insignificant. Staff prepared responses to 55 questions from the Home Builders Association,
including several that were posed at the June 4, 2009 Planning and Development Committee
meeting, and a lengthy list that was included in their letter dated June 10, 2009 to the Committee
(copy attached), as well as a Public Records Act request. The documents referenced in the HBA
letter and PRA are on file and available in the City Clerk's office.
In early 2006, following a period of unprecedented growth, the City of Bakersfield and the
County of Kern began the process of developing the Phase IV Metropolitan Bakersfield Regional
Transportation Impact Fee (RTIF). This process began with retaining outside consultants to
facilitate the update of the Kern Council of Governments (KernCOG) Traffic Model and the
development of a Facilities List which was based on a transportation system designed to support
development out to the new horizon year of 2035. The need for this update was due to the fact
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that previous phases of the RTIF were constructed with a horizon year of 2020 and assumptions
that are now obsolete.
As this update took place, City and County staff engaged public stakeholders throughout the
entire process to seek input and to keep them informed as to the status of the development of
the Phase IV RTIF. Members of the development community were involved in the update of the
KernCOG model and participated in numerous stakeholder meetings. In total, the City and
County have held over 20 meetings, including Council Workshops, Public Stakeholder Meetings,
Planning and Development Committee Meetings, and City Council and Board of Supervisors
meetings.
On September 17, 2008, the City Council held a Public Hearing to consider the Phase IV RTIF,
which was subsequently adopted by the City Council on October 8, 2008. However, since the
RTIF is jointly adopted by both the City and the County, the fee does not go into effect for the
City until 60 days following the joint adoption. Following the October 8th action by the City
Council, the Phase IV RTIF was sent to the County Board of Supervisors for consideration.
Since that time, City and County staff have met extensively with the Home Builders Association of
Kern County and worked with them on a detailed review of the Phase IV RTIF Facilities List. This
effort has resulted in some modifications to the Facilities List and the corresponding fees. On May
19, 2009, the Kern County Board of Supervisors voted to approve and adopt the revised Phase IV
RTIF. A summary of the major changes to the Facilities List is as follows:
• Changed unit cost of AC from $70/ton to $60/ton - affected the cost of all arterial
segments;
• Refined 7th Standard Road;
• Reduced SR 99 by 30% to reflect through trips;
• Reduced SR 58 by 15% to reflect through trips;
• Revised TRIP, per Parsons, including the Westside Parkway and West Beltway;
• Added Snow Road interchange;
• Removed some roads south of Taft Highway;
• Adjusted Snow Road and Jewetta to reflect current conditions; and
• Added improvements on Coffee at Rosedale, Truxtun and Stockdale.
Throughout the public meeting process, City and County staff have continuously reviewed the
assumptions, equations, and any and all other background data in response to comments from
the public, including representatives from the home builders and the commercial builders. The
commercial rates received a very intensive review of all of the factors in the basic fee equation,
resulting in a slighter lower rate than had originally been proposed. The Facilities List received a
particularly thorough assessment of many of the line items through multiple discussions with Roger
McIntosh of McIntosh and Associates. Although Mr. McIntosh and staff do not agree on some
items, his analysis did result in some changes and reductions to the list, with a commensurate
lowering of the facilities total.
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Overall, the total amount for the Facilities List changed from $2,017,115,510 to $1,933,587,852 - a
difference of $83,527,658. The Non-Core Single Family Residential fee changed from $13,595
(beyond the initial "economic recovery year" originally proposed by the City Council) to $12,870
- a difference of $725 per SFR.
A comparison of the City adopted Phase IV RTIF and the County adopted revised Phase IV RTIF is
attached. This comparison also shows the current Phase III fee in both the City and the County.
Also attached is a detailed chronology of the various meetings that have been held over the
past two-plus years in which the RTIF has been discussed. In addition, staff has provided
information, which is attached, regarding the number of vested lots that remain, and would not
be subject to the Phase IV increase until their existing vesting rights expire.
Staff feels it is important to note that the subject of transportation - both the actual facilities and
the costs and funding of them - is always evolving. Every day brings change to line item costs.
Every week brings new information on funding. Every year brings change to growth assumptions.
What we have right now is the best "snap shot in time" that we have ever had for this program.
On a side note, we as a City and as a County must meet certain requirements in order to receive
Federal funding for our road projects. One of these requirements is the Regional Transportation
Plan (RTP). The RTP is a 20-year plan for our region's transportation needs and network that
KernCOG is required to prepare. Recently, this plan has been required to show all transportation
funding sources for a "constrained" projects list. This Phase IV RTIF is a very large component of
this projects list. Without it, it is possible that all federal transportation funding to the City and
County could be imperiled.
Staff recommends the City Council approve the Phase IV Transportation Impact Fee. The
extensive work done by City, County and Kern COG staff and their consultants over the past two
and a half years has resulted in the most complete and up-to-date traffic impact fee program
that we have ever achieved.
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Running Total Vested Lots as of 6/29/2009
Number of Recorded Number of Recorded
Lots that lots that Number of Lots that lots that Number of
have have lost Lots have have lost Lots
Date expired vesting remaining Date expired vesting remaining
6/30/2009 33551 6/30/2009 33551
12/31/2009 3539 166 29846 12/31/2009 0 166 33385
12/31/2010 14867 20 14959 12/31/2010 265 20 33100
12/31/2011 13433 0 1526 12/31/2011 0 0 33100
12/31/2012 1199 0 327 12/31/2012 888 0 32212
12/31/2013 327 0 0 12/31/2013 1082 0 31130
12/31/2014 4957 26173
Note: No extensions were assumed, 12/31/2015 12200 13973
no new maps were assumed approved, 12/31/2016 10159 3814
and no more map were assumed to have 12/31/2017 3814 0
recorded after 6/29/2009
Note: All extensions were assumed,
no new maps were assumed approved,
and no more map were assumed to have
recorded after 6/29/2009
IOOA000.--~
S A K E R S F I E L D
OFFICE OF THE CITY MANAGER
MEMORANDUM
July 2, 2009
TO: Honorable Mayor and City Counci
FROM: Alan Tandy, City Manager
SUBJECT: Transportation Impact Fee Collection
At the regular Council meeting of June 24, 2009, a hearing took place on the proposed
Phase IV Metropolitan Bakersfield Regional Transportation Impact Fee (RTIF). The City
Council closed the hearing and voted to delay action until a Special Meeting at noon
on July 7, 2009. Research was requested from staff on various ways to either delay fee
collection or to "ease" it in some way. The results of the research follow:
SCIP Program
Statewide Community Infrastructure Program ("SCIP") is a financing program offered
through California Communities@ joint powers authority that enables developers to pay
most impact fees and finance public improvements through an acquisition agreement
that qualify under the 1913/1915 Bond Act (excluding school fees) via tax-exempt bond
issuance proceeds. The SCIP program has assisted communities and developers
throughout California to finance over $134.8 million in impact fees since 2003.
This highly versatile program has been molded to the needs of each local agency
participant of SCIP. As most local agencies require developers to pay impact fees prior
to obtaining a permit, SCIP can be used to directly prepay these fees or, alternatively,
to reimburse the developer after fee payment. The program can be used to enable
developers to pay for, or be reimbursed for, all eligible impact fees or for a single
impact fee. Moreover, the program may alleviate the need for a fee deferral program
by providing the local agency with necessary funds and eliminating the risk of
nonpayment by the developer.
The City of Bakersfield became a member of SCIP in 2008 at the request of a local
developer. Staff recommends using the existing SCIP program to assist those
developers who wish to finance fees or public infrastructure requirements related to
their development projects.
Honorable Mayor and City Council
Transportation Impact Fees
July 2, 2009
Page 2
Mello Roos Financing
Mello-Roos is the common name for the Community Facilities District Act, enacted by
the State Legislature in 1982. The name comes from its co-authors, Senator Henry Mello
of the Monterey area and Los Angeles assemblyman Mike Roos. Mello-Roos enabled
"Community Facilities Districts" (CFDs) to be established by local government agencies
as a means of obtaining funding for community projects of a regional nature.
A Mello-Roos District is an area where a special property tax on real estate, in addition
to the normal property tax, is imposed on those property owners within a Community
Facilities District. These districts seek public financing through the sale of bonds for the
purpose of financing public improvements and services. These services may include
streets, water, sewage and drainage, electricity, infrastructure, schools, parks and
police protection to newly developing areas. The tax paid is used to make the
payments of principal and interest on the bonds.
Formation of these special districts is a lengthy and complicated process. The costs of
formation include attorney fees, underwriter fees, assessment engineering studies,
appraisal costs and special consultant fees. The City has to contract with each of these
specialty companies and manage the formation process from beginning to end. There
are also continuing disclosure costs and annual administration fees, all of which add up
to significant overhead costs. Considering the number of districts (or annexations to the
district) that would be required to accomplish the continual financing of fees as
development occurred, the costs associated with such an endeavor would be.
economically infeasible. Staff does not recommend the City be directly involved in
using this method to help developers finance impact fees.
City Financing of Sewer Fees
The Bakersfield Municipal Code provides a mechanism for the City to finance sewer
connection fees and / or sewer construction costs for individual property owners who
demonstrate economic hardship regarding their ability to pay such costs in a lump sum.
Each individual financing is brought before the City Council for approval, which allows
the City to place a lien on the individual property and collect a special assessment for
up to five ( 5 ) years through the County property tax collection process.
This process is a special accommodation for individual property owners and is normally
associated with existing neighborhoods that have recently annexed in to the City. Staff
does not recommend this process be used to help developers finance impact fees.
These types of liens have no special priority and thus could be subject to high
delinquency rates if they were applied to tracts of homes that may or may not be sold
in a timely manner.
Honorable Mayor and City Council
Transportation Impact Fees
July 2, 2009
Page 3
School Fee Collection
Section 17620 b. of the Education Code states that a city or county may not issue a
building permit for any construction absent certification by the appropriate school
district that the fee has been paid (or exempted). The City cannot defer the payment
of these fees to final inspection (school district may be allowed to under agreement
subject to legal verification).
Based on staff's quick survey, many cities do not collect school fees but instead, require
that the applicant bring in proof of payment from the school district.
BACKGROUND FOR OUR CURRENT PROCESS
In a cooperative effort with the KCSOS, the City Council's Urban Development
Committee with Report No. 6-87 agreed to collect the fee as the most convenient
process for the public, school districts and the City. Fees go into a holding account and
are dispersed monthly to the KCSOS. Pursuant to said agreement, a $10 fee per
building permit is deducted from the account for the City's administrative costs.
Section 17620 a.5. of the Education Code allows up to 3% of the fees collected in that
fiscal year to be retained by the school district, city, or county, as appropriate, for the
reimbursement of the administrative costs incurred in the collection of those fees. This
maximum is for all combined agency administrative costs. KCSOS currently collects
$0.5% and is considering increasing it to 1% (they have charged as high as 2% in the
past).
It is clear that the current administrative fee collected by the City to administer the
collection of school fees on behalf of the KCSOS is insufficient. Staff will review this issue
and work with the KCSOS to revise this fee to a more appropriate level.
Community-wide Assessment Distrlct
These districts are used to finance infrastructure improvements and are not applicable
to this situation (this is really what the SCIP Program is for). In addition, the City of
Bakersfield has stopped creating these districts due to the high rate of delinquencies
and foreclosures. Staff does not believe this is a realistic tool to finance development
related fees.
Collection at Time of Certificate of Occupancy
City's can collect traffic impact and other development fees at final inspection
(Certificate of Occupancy). However, it is not commonly done (see Development Fee
Collection Survey Attached). Communities surveyed stated that the process is more
labor intensive for tracking, especially for those that do not have a computerized
permit system and have limited staff resources. Additionally, with the recent economic
downturn, many homes were left unfinished so there was no final inspection and
therefore, no fee payment made. Other comments that were made included what
Honorable Mayor and City Council
Transportation Impact Fees
July 2, 2009
Page 4
happens if a home is accidently "finaled" without the fees being paid; potential for
complaints by new home owners being delayed to move in if they or their builder
cannot pay; if the fee is paid by check and it is returned for lack of funds, this lengthens
time to obtain payment (i.e. collection process, property lien).
Prior staff research also shows that several communities, which normally require fee
collection at the Building Permit stage, have developed "Fee Deferral Programs."
These programs include a wide range of options associated with fee deferral designed
to safeguard against non-payment of deferred fees. These safeguards include:
• Application process to approve the fee deferral;
• Paying a portion of fees at permit;
• Requiring any deferred fees to be paid at the rate in effect at the time of
payment;
• Requiring security for deferred fees such as a lien on the subject property,
surety bond, or an irrevocable letter of credit;
• Fee deferral for a fixed time period with penalties for non-payment; and
• Requirements that an applicant not have any foreclosures on any of their
properties in recent past; applicant hasn't filed for bankruptcy in recent past;
and applicant has no unsatisfied Civil judgments.
Conclusion
Staff does not recommend deferral of the fees until the Certificate of Occupancy. We
believe it will lead to instances of failures to collect. Furthermore, many of the
safeguards discussed above make this type of program less palatable to those paying
the fees due to the necessary level of security that would be necessitated to ensure
future payment.
It is staffs view that the SCIP program, discussed above, is an existing mechanism
specifically designed to provide . builders the ability to finance a portion of or the
entirety of the RTIF fee (and any other impact fee for that matter). Utilizing this program
can drastically limit the carrying costs builders are concerned with by providing up front
financing for fee payment. Utilization of the SCIP program would also remove the need
for fees to be deferred. Builders would be able to recoup the costs associated with
SCIP financing over a defined period of time as property assessments which don't
impact the initial purchase price of a home, increasing a builder's ability to compete in
the current hosing market.
Development Fee Collection Survey
Cities/Counties Development Fees School Fees
(time collected - traffic, sewer, etc.) (agency collection )
Anaheim Building Permit Issuance School District
Clovis Building Permit Issuance School District
(exceptions allowed per department)
Merced Building Permit Issuance School District
Stockton Building Permit Issuance School District
Kern County Building Permit Issuance County Building Dept.
(exceptions allowed per department)
Building Permit Issuance City Building Dept.
t
Costa Mesa (exceptions allowed per department) g p
El Segundo Building Permit Issuance School District
Lancaster Building Permit Issuance School District
Sacramento County Building Permit Issuance School District
Ontario Building Permit Issuance School District
Santa Ana Building Permit Issuance School District
Visalia Building Permit Issuance School District