1 DECEMBER 2, 202 5
CITY OF COSTA MESA
77 FAIR DRIVE
COSTA MESA, CA 92626
City of Costa
Mesa
FY 2024-25
Development
Impact Fee
Report
ATTACHMENT 1
2 Table of Contents
City Council Directory ................................................................................................... 3
City Officials Directory .................................................................................................. 4
Introduction
Legal Requirements for Development Impact Fee Reporting ...................................... 5 Description of Development Impact Fees with corresponding Fee Schedules ............. 7
Development Impact Fee Report
Statement of Revenues, Expenditures and Changes in Fund Balance Summary ....... 9
Financial Summary Report and Capital Improvement Projects (CIP) Park Development Fees ............................................................................................. 10 Drainage Fees ........................................................................................................... 12 Traffic Impact Fees .................................................................................................... 13 Fire System Development Fees ................................................................................. 15 Cannabis Traffic Impact Fees .................................................................................... 16
Development Impact Project Identification
Park Development Projects ........................................................................................ 17 Drainage Projects ...................................................................................................... 18 Traffic Impact Projects ............................................................................................... 18 Fire System Development Projects ............................................................................ 18 Cannabis Traffic Impact Projects ............................................................................... 18
City Council Action and Studies
Review of the Citywide Traffic Impact Fee Program .................................................. 19 Update to the Park Impact Fees ................................................................................ 19
3 City Leadership
4 City Official Directory
City Manager’s Office
City Manager .............................................................. Lori Ann Farrell Harrison
Department Directors
City Attorney’s Office ............................................................... Kimberly Barlow Community Development Services .................................................... Carrie Tai Finance .......................................................................................... Carol Molina Information Technology ...................................................................... Steve Ely Parks and Community Services .................................................. . Brian Gruner Public Services ...................................................................... Raja Sethuraman
Public Safety
Fire and Rescue ......................................................................... Daniel Stefano Police ..................................................................................... Ronald Lawrence
5 Legal Requirements for Development Impact Fee Reporting
Legal Requirements for Development Impact Fee Reporting
California Government Code Section 66006 (b)
California Government Code Section 66006 (b) defines the specific reporting requirements for local agencies that impose AB 1600 DIFs on new development. Annually, for each separate fund established for the collection and expenditure of DIFs, the local agency shall, within 180 days of the close of the fiscal year, make available to the public the information shown below for the most recent fiscal year.
a) A brief description of the type of fee in the account or fund. b) The amount of the fee.
c) The beginning and ending balance of the account or fund. d) The amount of the fees collected and interest earned. e) An identification of each public improvement on which fees were expended and the amount of the expenditures on each improvement, including the total percentage of the cost of the public improvement that was funded with fees. f) An identification of an approximate date by which the construction of the public improvement will commence if the local agency determines that sufficient funds have been collected to complete financing on an incomplete public improvement, as identified in paragraph (2) of subdivision (a) of Section 66001, and the public improvement remains incomplete.
g) A description of each inter -fund transfer or loan made from the account or fund, including the public improvement on which the transferred or loaned fees will be expended, and, in the case of an inter-fund 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. h) The amount of refunds made pursuant to subdivision (e) of Section 66001 and any allocations pursuant to subdivision (f) of Section 66001.
California Government Code Section 66001
For all funds established for the collection and expenditure of DIFs, California Government Code Section 66001 (d) has additional requirements. For the fifth fiscal year following the first deposit into the fund and every five years thereafter, the local agency shall make all of the following findings with respect to that portion of the fund remaining unexpended, whether committed or uncommitted:
a) Identify the purpose to which the fee is to be put.
b) Demonstrate a reasonable relationship between the fee and purpose for which it is charged.
c) Identify all sources and amounts of funding anticipated to complete financing in incomplete improvements identified in paragraph (2) of subdivision (a). d) Designate the approximate dates on which the funding referred to in subparagraph (c) is expected to be deposited into the appropriate account or fund.
6 California Government Code Section 66002
The State of California Government Code Section 66002 states that:
a) Any local agency, which levies a fee subject to Section 66001, may adopt a capital improvement plan, which shall indicate the approximate location, size, time of availability, and estimates of cost for all facilities or improvements to be financed with the fees.
b) The capital improvement plan shall be adopted by, and shall be annually updated by, a resolution of the governing body of the local agency adopted at a noticed public hearing.
Notice of the hearing shall be given pursuant to Section 65090. In addition, mai led notice shall be given to any city or county, which may be significantly affected by the capital improvement plan. This notice shall be given no later than the date the local agency notices the public hearing pursuant to Section 65090. The information in the notice shall be not less than the information contained in the notice of public hearing and shall be given by first-class mail or personal delivery.
c) "Facility" or "improvement," as used in this section, means any of the following:
1. Public buildings, including schools and related facilities; provided that school facilities shall not be included if Senate Bill 97 of the 1987 -88 Regular Session is enacted and becomes effective on or before January 1, 1988.
2. Facilities for the storage, treatment, and distribution of nonagricultural water.
3. Facilities for the collection, treatment, reclamation, and disposal of sewage.
4. Facilities for the collection and disposal of storm waters and for flood control purposes.
5. Facilities for the generation of electricity and the distribution of gas and electricity.
6. Transportation and transit facilities, including but not limited to streets and supporting improvements, roads, overpasses, bridges, harbors, ports, airports, and related facilities.
7. Parks and recreation facilities.
8. Any other capital project identified in the capital facilities plan adopted.
7 Description of Development Impact Fees with Corresponding Fee Schedule
Park Development Impact Fees (Quimby Act Fees)
Fee Description: This fee provides funding for additional or improved park and/or recreation facility improvements for which the need is generated by new development within the City.
Fee Schedule: The table below indicates the applicable park development fee per unit that will be applied to new residential projects based on the net increase in residential units.
Development Fee per Unit
Single-family Dwelling Unit $13,572.00
Multi-family Dwelling Unit $13,829.00
Apartment Dwelling Unit $5,000.00
Drainage Impact Fees
Fee Description: This fee provides funding for additional construction and maintenance of the City's drainage system for which the need is generated by new development or redevelopment within the City.
Fee Schedule: The table below indicates the applicable drainage impact fee per acre that will be applied to new or redeveloped projects.
Development Type Fee per Acre
Low Density Residential Use $6,283.00
Medium Density Residential Use $7,539.00
High Density Residential Use $10,052.00
Commercial / Industrial Density Residential Use $11,309.00
Traffic Impact Fees
Fee Description: This fee provides funding for additional or improved traffic signal, operation, and infrastructure improvements for which the need is generated by new or expanding development within the City.
Fee Schedule: The citywide Traffic Impact Fee is assessed on the increased number of average daily trips generated by the proposed project. The City Council adopted a fee of $235 per daily trip on November 13, 2018. On November 17, 2020, the City Council voted to continue the Traffic Impact fees at $235 per daily trip. Additionally, Council voted to continue
8 with the Traffic Impact fees at $235 per daily in 2021 through 2023. On November 19, 2024, the City Council voted to decrease the Traffic Impact fees to $228 per daily trip.
Fire System Development Fees
Fee Description: This fee provides funding for additional fire protection facilities, equipment, and paramedic support for which the need is generated by future development within the North Costa Mesa area. This fee is only levied against five identified developments: Home Ranch, South Coast Plaza Town Center, South Coast Metro Center, and Sakioka Farms' Lots 1 and 2.
Fee Schedule: The fee is $0.29 per square foot of new commercial, industrial or residential development.
Cannabis Traffic Impact Fees
Fee Description: This fee provides funding for additional or improved traffic signal, operation, and infrastructure improvements within the City for which the need is generated by the cannabis retail establishments.
Fee Schedule: The citywide Cannabis Traffic Impact Fee is assessed on the increased number of average daily trips generated by the proposed project. The City Council adopted a fee of $235 per daily trip on November 13, 2018. On November 17, 2020, the City Council voted to continue the Traffic Impact fees at $235 per daily trip which is the same for the Cannabis Traffic Impact Fee. Additionally, Council voted to continue with the Traffic Impact fees at $235 per daily in 2021 through 2023. On November 19, 2024, the City Council voted to decrease the Traffic Impact fees to $228 per daily trip.
9 Statement of Revenues, Expenditures and Changes in Fund Balance
A summary of activities in each type of development impact fee for fiscal year ended June 30, 2025 is shown below:
Statement of Revenues, Expenditures and Changes in Fund Balance for the Fiscal Year Ended June 30, 2025*
Development Impact Fees
Description
Park
Development
Fees
Drainage
Fees
Traffic Impact
Fees
Fire System
Development
Fees
Cannabis
Traffic Impact
Fees
Revenue
Fees 262,786 150,933 554,731 18,753
Investment Earnings 104,336 109,517 207,685 16,967 27,021 Other
Revenue Total 367,122 260,450 762,416 16,967 45,774
Expense
Expenditures 678,009 266,580 1,584,597 0 0
Other
Transfers Out
Expense Total 678,009 266,580 1,584,597 0 0
Rev Over(Under) Exp (310,885) (6,129) (822,182) 16,967 45,774 Begin Fund Balance 2,331,723 2,159,858 4,580,203 349,836 545,919 End Fund Balance 2,020,837 2,153,729 3,758,021 366,803 591,693 *Unaudited actuals
10 Financial Summary Reporting and CIP
State law requires an identification of each public improvement on which fees were expended and the amount of expenditures on each improvement, including the total percentage of the costs of the public improvement that was funded with fees. A summary of improvements for each Development Impact Fee is provided.
PARK DEVELOPMENT FEES (QUIMBY ACT FEES)
Statement of Revenues, Expenditures and Changes in Fund Balance for the Last Five Years:
For the Fiscal Year Ended June 30
Description 2020 2021 2022 2023 2024 2025*
Revenue
Fees 1,049,018 766,372 1,278,941 158,327 142,598 262,786 Investment Earnings 223,901 8,022 (100,792) 33,194 103,834 104,336 Other 106,966
Revenue Total 1,272,919 881,359 1,178,149 191,520 246,433 367,122 Expense
Expenditures 1,589,954 1,753,155 2,214,169 934,235 787,431 678,009 Other
Transfers Out
Expense Total 1,589,954 1,753,155 2,214,169 934,235 787,431 678,009
Rev Over(Under) Exp (317,035) (871,796) (1,036,020) (742,714) (540,999) (310,885) Begin Fund Balance 5,840,286 5,523,251 4,651,456 3,615,436 2,872,722 2,331,723 End Fund Balance 5,523,251 4,651,456 3,615,436 2,872,722 2,331,723 2,020,837 *Unaudited actuals
11 Capital Improvement Projects (CIP) for the Last Five Years:
For the Fiscal Year Ended June 30
Capital Project 2020 2021 2022 2023 2024 2025*
208 - Park Development Fees
Tanagr Pk Plygrd Equip Repl 96,786 47,220
Wilson TeWinkle Park Bridge 18,630 4,273 109,118
Pk Security Lighting Repl 86,983 102,249 28,919 21,542 Jack Hammett Field Upgrade 3,300 8,796 1,532,681 204,580 106,056 Fairview Pk Master Plan 59,822 151,967 30,828
Fairview Pk Fence Sign Trail 5,136 762 110 20,756
Jordan Pk Playground Equip 96,384 77,371
TeWinkle Park Lakes Repairs 31,830 86,060 13,885
NCC - Library Development 1,282,483 1,427,452 225,904 Shalimar Park Improvements 6,940 14,942
Ketchum-Libolt Park Exp 6,940 12,867 12,300
Education Hubs Fairview Pk 5,185 3,172
208 - Park Development Fees
Fund Total 1,285,783 1,523,232 2,007,351 596,218 443,049
88,598
Funds held past the fifth year and first deposit
Not applicable at this time. All funds were expended within the five-year timeframe to fund park improvements and/or recreation facility improvements.
Construction Commencement Date for Incomplete Improvements Not applicable at this time.
Inter-fund Transfers and Loans
No loans were disbursed during this period.
Amount of Refunds
No refunds of any of these funds were made or required in during this period.
12 DRAINAGE FEES
Statement of Revenues, Expenditures and Changes in Fund Balance for the Last Five Years:
For the Fiscal Year Ended June 30
Description 2020 2021 2022 2023 2024 2025*
Revenue
Fees 898,498 433,328 348,736 76,516 81,806 150,933
Investment Earnings 78,484 2,100 (57,057) 22,712 86,162 109,517 Other 107,327
Revenue Total 976,982 435,428 291,679 206,555 167,968 260,450 Expense
Expenditures 194,127 593,405 145,850 273,825 183,061 266,580 Expense Total 194,127 593,405 145,850 273,825 183,061 266,580
Rev Over(Under) Exp 782,855 (157,977) 145,829 (67,270) (15,093) (6,129) Begin Fund Balance 1,471,513 2,254,368 2,096,392 2,242,221 2,174,951 2,159,858 End Fund Balance 2,254,368 2,096,392 2,242,221 2,174,951 2,159,858 2,153,729 *Unaudited actuals
Capital Improvement Projects (CIP) Expenditures for the Last Five Years:
For the Fiscal Year Ended June 30
Capital Project 2020 2021 2022 2023 2024 2025*
209 - Drainage Fees Fund
Catch Basin Inserts-Various 9,966 169,750 26,727 29,199 Citywide Storm Drain Impr 184,161 332,976 108,752 206,984 59,000 34,908 Westside Storm Drain Impr 10,370 66,841 89,625 106,671 Placentia Ave. Stormwater 125,000
NCC - Library Development 90,679
209 - Drainage Fees Fund Total 194,127 593,405 145,850 273,825 177,824 266,579
Funds held past the fifth year and first deposit
Not applicable at this time. All funds were expended or committed within the five -year timeframe to fund storm drain improvements.
Construction Commencement Date for Incomplete Improvements Not applicable at this time.
Inter-fund Transfers and Loans
No loans were disbursed during this period.
Amount of Refunds
No refunds of any of these funds were made or required in during this period.
13 TRAFFIC IMPACT FEES
Statement of Revenues, Expenditures and Changes in Fund Balance for the Last Five Years:
For the Fiscal Year Ended June 30
Description 2020 2021 2022 2023 2024 2025*
Revenue
Fees 259,298 1,212,500 437,943 601,330 39,292 554,731
Investment Earnings 174,806 (9,496) (143,170) 60,376 190,335 207,685 Other 1,855 7,167
Revenue Total 434,104 1,204,859 294,773 668,873 229,627 762,416 Expense
Expenditures 220,544 404,704 127,222 485,738 1,490,324 1,584,597 Other 75,000
Expense Total 295,544 404,704 127,222 485,738 1,490,324 1,584,597
Rev Over(Under) Exp 138,560 800,155 167,552 183,135 (1,260,697) (822,182) Begin Fund Balance 4,551,499 4,690,059 5,490,214 5,657,766 5,840,900 4,580,203 End Fund Balance 4,690,059 5,490,214 5,657,766 5,840,901 4,580,203 3,758,021 *Unaudited actuals
Capital Improvement Projects (CIP) Expenditures for the Last Five Years:
For the Fiscal Year Ended
Capital Projects 2020 2021 2022 2023 2024 2025*
214 - Traffic Impact Fees Fund
W 19th St Wallace Av Traf Sig 181,157
Bicycle Racks Citywide 35,032 8,299 28,187 3,427
Hyland/MacArthur Intersct Impr 23,224
Adams at Pinecreek Imp 3,831 25,056 1,248,255
East 17th St. Landscape Enhanc (2,611)
Fairview Traffic Signal Sync 10,457 174,575
Baker/Placntia/19th/Victr TSSP 15,373 138,620 68,810 23,049 Sunflower Traff Signal Sync 93,407
W 17th Design Newport Westside 48,992
Newport Blvd Wide 19th to 17th 43,751 5,731 31,491 52,280 Class II and III Bicycle Project 712 1,805 12,052 82,152 861,298 116,599 Merrimac Way Bicycle Facility 181,847 16,837
Adams Av Bicycle Facility Project 5,715 6,832 122,846 Bicycle/Pedestrian Infra Lamp 1,976 2,459 56,707
Randolph Prkg & Pedestrin Impr 25,792 124,208
West 18th & Wilson Crosswalks 9,325 15,359 372,750
Fairview Road Improvement Proj 17,900 3,850 13,714
214 - Traffic Impact Fees Fund Total 220,544 404,704 127,222 485,738 1,490,324 1,584,597
14 Funds held past the fifth year and first deposit
Traffic Impact Fee funds are being held passed the fifth year and first deposit. These funds are intended to fund additional or improved traffic signal, operation, and infrastructure improvements for which the need is generated by new or expanding development within the City.
Construction Commencement Date for Incomplete Improvements Not applicable at this time.
Inter-fund Transfers and Loans
No loans were disbursed during this period.
Amount of Refunds
No refunds of any of these funds were made or required in during this period.
15 FIRE SYSTEM DEVELOPMENT FEES
Statement of Revenues, Expenditures and Changes in Fund Balance for the Last Five Years:
For the Fiscal Year Ended June 30
Description 2020 2021 2022 2023 2024 2025*
Revenue
Fees 167,540
Investment Earnings 16,608 23 (8,300) 3,437 13,681 16,967 Other
Revenue Total 184,148 23 (8,300) 3,437 13,681 16,967
Expense
Expenditures
Transfers Out
Expense Total 0 0 0 0 0 0
Rev Over (Under) Exp 184,148 23 (8,300) 3,437 13,681 16,967 Begin Fund Balance 156,847 340,995 341,018 332,718 336,155 349,836 End Fund Balance 340,995 341,018 332,718 336,155 349,836 366,803 *Unaudited actuals
Capital Improvement Projects (CIP) Expenditures for the Last Five Years:
For the Fiscal Year Ended June 30
Capital Projects 2020 2021 2022 2023 2024 2025*
218 - Fire System Dev. Fees
218 - Fire System Dev. Fees
Fund Total 0 0 0 0 0 0
Funds held past the fifth year and first deposit
Fire System Development Fee funds are being held past the fifth year and first deposit. These funds are intended to fund additional fire protection facilities, equipment, and paramedic support for which the need is generated by future development within Costa Mesa.
Construction Commencement Date for Incomplete Improvements Not applicable at this time.
Inter-fund Transfers and Loans
No loans were disbursed during this period.
Amount of Refunds
No refunds of any of these funds were made or required in during this period.
16 CANNABIS TRAFFIC IMPACT FEES
Statement of Revenues, Expenditures and Changes in Fund Balance for the Last Five Years:
For the Fiscal Year Ended June 30
Description 2020 2021 2022 2023 2024 2025*
Revenue
Fees 432,659 91,309 18,754
Investment Earnings 2,778 19,174 27,021
Other
Revenue Total 0 0 0 435,436 110,483 45,774
Expense
Expenditures
Transfers Out
Expense Total 0 0 0 0 0 0
Rev Over(Under) Exp 435,436 110,483 45,774
Begin Fund Balance 0 435,436 545,919
End Fund Balance 0 0 0 435,436 545,919 591,693
*Unaudited actuals
Capital Improvement Projects (CIP) Expenditures for the Last Five Years:
For the Fiscal Year Ended June 30
Capital Projects 2020 2021 2022 2023 2024 2025*
None 0 0 0 0 0 0
Funds held past the fifth year and first deposit
These funds are intended to fund off-site transportation improvements City -wide. Financing is provided by fees charged to cannabis retail establishments.
Construction Commencement Date for Incomplete Improvements Not applicable at this time.
Inter-fund Transfers and Loans
No loans were disbursed during this period.
Amount of Refunds
No refunds of any of these funds were made or required in during this period.
17 Development Impact Fee Project Identification
The City's current, Fiscal Year 2025-26 Adopted Budget, which includes the Five-Year Capital Improvement Plan (CIP) FY 2025-26 – FY 2029-30 can be found on the City's website at:
https://www.costamesaca.gov/home/showpublisheddocument/61565/638978440985530000
Funding of Infrastructure
The FY 2025-26 – FY 2029-30 CIP identifies all funding sources and amounts for individual projects through FY 202 9-30. The CIP is updated annually to reflect the current City's infrastructure needs. As a CIP is identified, the project is evaluated to determine the portion of the project that will service existing residents and businesses versus new development.
Once the determination of use is made, the percentage of use attributed to new development is then funded by the appropriate development fee based on the type of project. The percentage of use associated with existing residents or businesses are funded fro m other appropriate sources. Estimated construction start dates for projects are adjusted, as needed, to reflect the needs of the community.
ONGOING/NEW CAPTIAL IMPROVEMENT PROJECTS
Park Development Fees
Projects by Fund FY 2025-26 – FY 2029-30
208 - Park Development Fees Fund
700021 - Wilson TeWinkle Park Bridge Rep 67,981
700027 - TeWinkle Skate Park Expansion 100,000
700080 - Pk Security Lighting Replacement 11,789
700115 - Jack Hammett Field Upgrade 203,207
700129 - Shalimar Park Improvements 228,118
700133 - Canyon Pk Invntr Mgmt Restore 60,000
700134 - Fairview Pk Fence Sign Trail 273,236
700135 - Fairview Pk Master Plan Update 146,948
700137 - TeWinkle Park Lakes Repairs 700
700139 - Ketchum-Libolt Park Expansion 17892
700142 - Brentwood Park Improvements 400,000
700149 - Educational hubs @ Fairview Pk 81,642
208 - Park Development Fees Fund Total 1,591,513
18 Drainage Fees
Projects by Fund FY 2025-26 – FY 2029-30
209 - Drainage Fees Fund
550008 - Citywide Catch Basin Inserts and Water Quality Improvement 151,189 550011 - Citywide Storm Drain Improvements 460,546
550022 - Westside Storm Drain Improvements 1,326,494
209 - Drainage Fees Fund Total 1,938,229
Traffic Impact Fees
Projects by Fund FY 2025-26 – FY 2029-30
214 - Traffic Impact Fees Fund
300148 - Citywide Bicycle Rack Improvements 175,053
300174 - Adams at Pinecreek Improvements 160,311
300181 - Fairview Road Improvement Project 1,489,535
300187 - Fairview Road Improvement - Fair to Adams 120,000 370010 - Mesa del Mar Multi-Model Access 100,000
370039 - Baker/Placentia/19th/Victoria Traffic Signal Synchronization 7,265 450010 - Class II, III, and IV Bicycle Projects 125,383 450014 - Adams Avenue Bicycle Facility Project 817,154
450015 - Bicycle/Pedestrian Infrastructure Improvements 538,857 450016 - Mesa/Santa Ana Bicycle Facility Improvements 100,000 450017 - MV/Peterson Place Class II Bicycle 100,000
214 - Traffic Impact Fees Fund Total 3,733,558
Fire System Development Fees
No current projects to report.
Cannabis Traffic Impact Fees
Projects by Fund FY 2025-26 – FY 2029-30
240 – Cannabis Traffic Impact Fees Fund
450015 – Bicycle Pedestrian Infra Improvements 300,000
240 – Cannabis Traffic Impact Fees Fund Total 300,000
19 City Council Action and Studies
The following attachments are Development Impact Fees related recent and prior Council Reviews (Traffic Impact Fees and Park Development Fees).