CC 2020-11-24_08d Annual Adjustment of Development Impact FeesMEMORANDUM
TO: CITY COUNCIL
FROM: MICHAEL STEVENS, ADMINISTRATIVE SERVICES DIRECTOR
BY: NICOLE VALENTINE, ACCOUNTING MANAGER
SUBJECT: CONSIDERATION OF ANNUAL ADJUSTMENT OF DEVELOPMENT IMPACT
FEES
DATE: NOVEMBER 24, 2020
SUMMARY OF ACTION:
Adoption of a Resolution approving the annual adjustment of Development Impact Fees
consistent with the Engineering News Record (ENR) Construction Cost Index (CCI) to increase
fees by 1.54%.
IMPACT ON FINANCIAL AND PERSONNEL RESOURCES:
Adoption of the Resolution will increase the Development Impact Fees charged for new
development projects for most of 2021. The revenue generated from this increase is dependent
on the amount of new development in the community during the coming year.
RECOMMENDATION:
It is recommended the City Council adopt a Resolution approving the annual adjustment to the
City’s Development Impact Fees based on changes in the Engineering News Record (ENR)
Construction Cost Index (CCI).
BACKGROUND:
Section 3.36.040 of the Arroyo Grande Municipal Code states that the Development Impact fees
shall be adopted by resolution and shall be adjusted each year in accordance with the percentage
increase based on changes in the annual average Engineering News Record (ENR) Construction
Cost Index (CCI).
The following is a list of the Development Impact Fees that are included in the annual
adjustment:
Traffic Signalization Fee: This fee is restricted for funding the construction of traffic signal
systems, signing, and other traffic control devices.
Item 8.d. - Page 1
CITY COUNCIL
CONSIDERATION OF ANNUAL ADJUSTMENT OF DEVELOPMENT IMPACT FEES
NOVEMBER 24, 2020
PAGE 2
Transportation Facility Fee: This fee is paid to protect the public health, safety, and
welfare by maintaining the existing level of public services for existing and future
residents within the City.
Drainage Facility Fee: This fee is collected from developers to acquire and construct
drainage facilities with a designated drainage zone attributable to new development.
Water Neutralization Fee: This fee is to collected from developers to neutralize projected
water demand of development projects above historical usage amounts.
Fire Protection Fee: This fee is to be used for facilities to house fire fighting personnel
and equipment serving future development.
Police Facilities Fee: This fee is for funding for the expansion of police facilities.
Park Improvement Fee: This fee is to be used to improve parklands in order to maintain
4.0 acres of neighborhood and community parks per thousand residents.
Community Center Fee: The fee was enacted to ensure community center facilities are
maintained at 542 square feet per thousand population.
The previous rate increase of 1.98% was approved by Council on February 11, 2020, and
became effective on April 13, 2020. This annual adjustment is typically reviewed and adopted
by Council with the annual AB 1600 Development Impact Fee Status Report or following the
approval of the report. The rate increase becomes effective 60 days after City Council has
approved the adjustment pursuant to State law.
ANALYSIS OF ISSUES:
The calculation shown below provides documentation that a 1.54% increase in the ENR CCI
warrants an adjustment in the City’s Development Impact Fees.
The calculation adjusts the fees as follows:
Factor = 1 + Current Index – Base Index for Date of Adoption
Base Index for Date of Adoption
The calculation is as follows:
1.0154 = 1 + 11,455 – 11,281
11,281
The effective date of the new fees is January 25, 2021. The existing and proposed increased
fees are set forth in Exhibit A to the attached Resolution.
ALTERNATIVES:
The following alternatives are provided for City Council consideration:
1. Adopt the Resolution;
2. Do not adopt the Resolution and request further information; or
3. Provide direction to staff.
Item 8.d. - Page 2
CITY COUNCIL
CONSIDERATION OF ANNUAL ADJUSTMENT OF DEVELOPMENT IMPACT FEES
NOVEMBER 24, 2020
PAGE 3
ADVANTAGES:
By approving the recommended fees, the City will be able to recover the estimated cost of
providing infrastructure and services to new development.
DISADVANTAGES:
The only disadvantage identified in relation to this recommendation is an increased cost to new
development.
ENVIRONMENTAL REVIEW:
No environmental review is required for this item.
PUBLIC NOTIFICATION AND COMMENTS:
The Agenda was posted at City Hall and on the City’s website in accordance with Government
Code Section 54954.2.
Item 8.d. - Page 3
RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
ARROYO GRANDE ADJUSTING DEVELOPMENT IMPACT
FEES BY THE CHANGE IN THE ENGINEERING NEWS
RECORD CONSTRUCTION COST INDEX
WHEREAS, pursuant to Section 3.36.040 of the Arroyo Grande Municipal Code,
Development Impact Fees are to be adjusted annually by modifying the adopted value up
or down in conformance with the Engineering News Record Construction Cost Index.
WHEREAS, it is determined that an increase of 1.54% of the ENR CCI has been
calculated to warrant an adjustment to the City Sewer Connection Fees effective January
25, 2021.
NOW, THEREFORE BE IT RESOLVED that the City Council of the City of Arroyo Grande
hereby adopts the fees and fee schedules set forth in Exhibit “A” attached hereto and
incorporated herein by this reference. This Resolution shall take effect sixty (60) days
after its adoption, per Government Code Section 66017.
On motion of Council Member __________________ seconded by Council Member
__________________ and on the following roll call vote, to wit:
AYES:
NOES:
ABSENT:
the foregoing Resolution was passed and adopted this 24th day of November, 2020.
Item 8.d. - Page 4
RESOLUTION NO.
PAGE 2
_____________________________________
CAREN RAY RUSSOM, MAYOR
ATTEST:
KELLY WETMORE, CITY CLERK
APPROVED AS TO CONTENT:
_____________________________________
WHITNEY MCDONALD, CITY MANAGER
APPROVED AS TO FORM:
_____________________________________
TIMOTHY J. CARMEL, CITY ATTORNEY
Item 8.d. - Page 5
Definitions:
Development Types –Residential and commercial development divided into sub-
categories.
Units of Development – A standard measure of the cost to provide services. The
acre is the fundamental unit measure, which is divided into a smaller component,
the dwelling unit (DU).
Asset Cost Per Acre – The calculated cost to provide additional services/facilities
to new development.
Calls Per Unit – The number of yearly additional police calls generated by new
development.
Facility Cost Per Call – The cost per call to expand current police facilities to
accommodate new development.
Persons Per Unit – The number of persons expected to reside in the unit of
development.
Costs Per Capita – The cost of new or additions to the current community center,
on a per person basis, to maintain the current level of service of recreation facilities.
Impact Fee Per Unit – The fee to be levied per unit of development in order to
recover future cost of new or expanded facilities.
Fees:
A person seeking to construct a residential or non-residential development project shall pay
Development Impact Fees for fire protection, police facilities, traffic signalization, transportation
facilities, community centers, park improvements, and water facilities based upon the following
schedule:
To note the City has not collected any low income or very low income residential
dwelling unit Development Impact Fees in FY 2017-18, FY 2018-19 or FY 2019-20 for
low income and very low income residential dwelling units.
EXHIBIT A
Item 8.d. - Page 6
Exhibit A
Development Fee per Acres Fee
Type Units Acre Per Unit Per Unit
Residential - Estate Dwelling Unit 2,046.00$ 2.500 5,115.00$
Residential Rural Dwelling Unit 2,046.00$ 1.000 2,046.00$
Residential - Single-Family Dwelling Unit 2,046.00$ 1.000 2,046.00$
Low- income Dwelling Unit 511.00$ 1.000 511.00$
Very Low-income Dwelling Unit -1.000
Residential - Multi-Family Dwelling Unit 2,046.00$ 0.090 184.00$
Low- income Dwelling Unit 511.00$ 0.090 46.00$
Very Low-income Dwelling Unit -0.090
Residential Mobile Home Dwelling Unit 2,046.00$ 0.120 246.00$
Low- income Dwelling Unit 511.00$ 0.120 61.00$
Very Low-income Dwelling Unit -0.120
Commercial - General Thousand Square Feet 2,046.00$ 0.091 186.00$
Commercial - Service Thousand Square Feet 2,046.00$ 0.091 186.00$
Hotel/Motel Thousand Square Feet 2,046.00$ 0.050 102.00$
Professional Office Thousand Square Feet 2,046.00$ 0.077 158.00$
Industrial Thousand Square Feet 2,046.00$ 0.067 137.00$
Development Fee per Calls Fee
Type Units Call Per Unit Per Unit
Residential - Estate Dwelling Unit 171.00$ 0.250 43.00$
Residential Rural Dwelling Unit 171.00$ 0.250 43.00$
Residential - Single-Family Dwelling Unit 171.00$ 0.750 128.00$
Low- income Dwelling Unit 43.00$ 0.750 32.00$
Very Low-income Dwelling Unit -0.750
Residential - Multi-Family Dwelling Unit 171.00$ 1.320 226.00$
Low- income Dwelling Unit 43.00$ 1.320 57.00$
Very Low-income Dwelling Unit -1.320
Residential Mobile Home Dwelling Unit 171.00$ 0.750 128.00$
Low- income Dwelling Unit 43.00$ 0.750 32.00$
Very Low-income Dwelling Unit -0.750
Commercial - General Thousand Square Feet 171.00$ 3.909 668.00$
Commercial - Service Thousand Square Feet 171.00$ 2.273 389.00$
Hotel/Motel Thousand Square Feet 171.00$ 1.195 204.00$
Professional Office Thousand Square Feet 171.00$ 0.095 16.00$
Industrial Thousand Square Feet 171.00$ 0.045 8.00$
CITY OF ARROYO GRANDE
DEVELOPMENT IMPACT FEES
EFFECTIVE 01/25/2021
Fire Protection
Police Facilities
Item 8.d. - Page 7
Exhibit A
CITY OF ARROYO GRANDE
DEVELOPMENT IMPACT FEES
EFFECTIVE 01/25/2021
Development Fee per PeakTrips Fee
Type Units Trip Per Unit Per Unit
Residential - Estate Dwelling Unit 752.00$ 1.2 902.00$
Residential Rural Dwelling Unit 752.00$ 1.2 902.00$
Residential - Single-Family Dwelling Unit 752.00$ 1.0 752.00$
Low- income Dwelling Unit 188.00$ 1.0 188.00$
Very Low-income Dwelling Unit -1.0
Residential - Multi-Family Dwelling Unit 752.00$ 0.7 526.00$
Low- income Dwelling Unit 188.00$ 0.7 132.00$
Very Low-income Dwelling Unit -0.7
Residential Mobile Home Dwelling Unit 752.00$ 0.5 376.00$
Low- income Dwelling Unit 188.00$ 0.5 94.00$
Very Low-income Dwelling Unit -0.5
Commercial - General Thousand Square Feet 752.00$ 7.0 5,264.00$
Commercial - Service Thousand Square Feet 752.00$ 4.0 3,008.00$
Hotel/Motel Thousand Square Feet 752.00$ 1.8 1,354.00$
Professional Office Thousand Square Feet 752.00$ 2.8 2,106.00$
Industrial Thousand Square Feet 752.00$ 0.8 602.00$
Development Fee per PeakTrips Fee
Type Units Trip Per Unit Per Unit
Residential - Estate Dwelling Unit 2,053.00$ 1.2 2,464.00$
Residential Rural Dwelling Unit 2,053.00$ 1.2 2,464.00$
Residential - Single-Family Dwelling Unit 2,053.00$ 1.0 2,053.00$
Low- income Dwelling Unit 513.00$ 1.0 513.00$
Very Low-income Dwelling Unit -1.0
Residential - Multi-Family Dwelling Unit 2,053.00$ 0.7 1,437.00$
Low- income Dwelling Unit 513.00$ 0.7 359.00$
Very Low-income Dwelling Unit -0.7
Residential Mobile Home Dwelling Unit 2,053.00$ 0.5 1,027.00$
Low- income Dwelling Unit 513.00$ 0.5 257.00$
Very Low-income Dwelling Unit -0.5
Commercial - General Thousand Square Feet 2,053.00$ 7.0 14,371.00$
Commercial - Service Thousand Square Feet 2,053.00$ 4.0 8,212.00$
Hotel/Motel Thousand Square Feet 2,053.00$ 1.8 3,695.00$
Professional Office Thousand Square Feet 2,053.00$ 2.8 5,748.00$
Industrial Thousand Square Feet 2,053.00$ 0.8 1,642.00$
Traffic Signalization
Transportation Facilities
Item 8.d. - Page 8
Exhibit A
CITY OF ARROYO GRANDE
DEVELOPMENT IMPACT FEES
EFFECTIVE 01/25/2021
Development Fee per Persons Fee
Type Units Capita Per Unit Per Unit
Residential - Estate Dwelling Unit 56.00$ 2.7 151.00$
Residential Rural Dwelling Unit 56.00$ 2.7 151.00$
Residential - Single-Family Dwelling Unit 56.00$ 2.7 151.00$
Low- income Dwelling Unit 14.00$ 2.7 38.00$
Very Low-income Dwelling Unit -2.7
Residential - Multi-Family Dwelling Unit 56.00$ 2.0 112.00$
Low- income Dwelling Unit 14.00$ 2.0 28.00$
Very Low-income Dwelling Unit -2.0
Residential Mobile Home Dwelling Unit 56.00$ 1.5 84.00$
Low- income Dwelling Unit 14.00$ 1.5 21.00$
Very Low-income Dwelling Unit -1.5 -
Development Fee per Persons Fee
Type Units Capita Per Unit Per Unit
Residential - Estate Dwelling Unit 968.00$ 2.7 2,614.00$
Residential Rural Dwelling Unit 968.00$ 2.7 2,614.00$
Residential - Single-Family Dwelling Unit 968.00$ 2.7 2,614.00$
Low- income Dwelling Unit 242.00$ 2.7 653.00$
Very Low-income Dwelling Unit -2.7 -
Residential - Multi-Family Dwelling Unit 968.00$ 2.0 1,936.00$
Low- income Dwelling Unit 242.00$ 2.0 484.00$
Very Low-income Dwelling Unit -2.0
Residential Mobile Home Dwelling Unit 968.00$ 1.5 1,452.00$
Low- income Dwelling Unit 242.00$ 1.5 363.00$
Very Low-income Dwelling Unit -1.5 -
Meter Size Fee
5/8 inch - 3/4 inch 1,063.00$
1 inch 1,773.00$
1 1/2 inch 3,546.00$
2 inch 5,671.00$
3 inch 10,637.00$
4 inch 17,728.00$
6 inch 35,472.00$
8 inch 70,944.00$
Community Centers
Park Improvements
Water Facilities
Item 8.d. - Page 9
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Item 8.d. - Page 10