Contents
Executive Summary .............................................................................................1 Introduction .........................................................................................................1 Growth Projections .............................................................................................1 Fiscal Impact ......................................................................................................1 Technical Analysis ...............................................................................................3 Method and Approach ........................................................................................3 Service Population .................................................................................................. 3 Revenues ............................................................................................................... 3 Expenditures ........................................................................................................... 4 Inputs & Baseline Data ........................................................................................... 4 Fiscal Impacts ....................................................................................................4 2045 Development Quantities ................................................................................ 5 Sources and Uses .................................................................................................. 7 Service Population .................................................................................................. 8 Assessed Property Value ....................................................................................... 9 Property Tax ......................................................................................................... 11 Property Transfer Tax ........................................................................................... 11 State Motor Vehicle License Fees (VLF) In-Lieu .................................................. 13 Sales Tax ............................................................................................................. 14 Transit Occupancy Tax (TOT) Revenues ............................................................. 14 Other Tax Revenues ............................................................................................. 15 Expenses ............................................................................................................. 15 Net Fiscal Impacts ................................................................................................ 16
Fiscal Impact Analysis | August 2024 City of Culver City | 1 Executive Summary
Introduction
This fiscal impact analysis presents a model of the effects of the Draft Culver City General Plan Update (General Plan) on the City’s General Fund accounts. The analysis examines the fiscal implications of land use and development patterns that are anticipated by changes to the General Plan. The model is based on the City’s existing fiscal policy and rates using the achieved revenues and actual expenditures from the most recently completed budget year (FY 22/23). The model tests the net effect of the General Plan, given anticipated development volumes , on ongoing operations costs for the City. Capital costs, such as those covered by impact fees , are not considered, nor are impacts on non -city costs for other districts including schools.
Growth Projections
The analysis is based on population, housing, employment and commercial space growth projections for 2045 that are included in the Program Environmental Impact Report (EIR) for the General Plan. The 2045 forecasts differ from the total amount of development capacity that is created by the General Plan and the entitlements that would stem from its application. The EIR states:
“The General Plan 2045 and analysis contained within this PEIR are based on certain assumptions pertaining to future growth through the horizon year 2045. This PEIR analyzes the 2045 growth projections based on an understanding of historic, current, and projected demographic and economic conditions in the Planning Area through 2045, rather than full buildout. The full buildout scenario would assume that every parcel would be developed with the maximum amount allowed under the General Plan 2045. Actual development that may occur by the horizon year is typically less than the theoretical maximum of development.”1
Fiscal Impact
Using the current fiscal policies and the growth projections in the EIR, the fiscal impact analysis suggests a net negative fiscal impact to the General Fund revenues of the City of Culver City. Table 1 illustrates the key finding of the analysis , which is that the annual operating budget would incur an approximately $11.9 Million deficit representing a little over 21% of total anticipated revenues. This deficit is expected as the General Plan anticipates adding population (who typically consume more services than the revenue that they generate) at a greater rate than adding non -residential uses (which typically generate more revenue than the services that they consume). These impacts are based on the net change in population, housing, employment and commercial space that is anticipated in the City in 2045.
1 Culver City General Plan 2045 and Zoning Code Update Project Draft Environmental Impact Report State Clearinghouse No. 2022030144, March 2024 P.2-18
2 | City of Culver City Fiscal Impact Analysis | August 2024
Figure 1: General Fund Net Fiscal Impact Summary
$0
$10,000,000
$20,000,000
$30,000,000
$40,000,000
$50,000,000
$60,000,000
$70,000,000
$80,000,000
Nominal Dollars
Revenues Expenditures
Table 1: General Fund Net Fiscal Impact Summary
Revenues $55,683,116
Expenditures $67,643,811
Net Impact -$11,960,695
Net Impact as % of Revenues -21.48%
Fiscal Impact Analysis | August 2024 City of Culver City | 3 Technical Analysis
Method and Approach
This section describes the methodology, and inputs used to structure the fiscal impact analysis. This analysis is designed to measure the fiscal impact of the 2045 General Plan Update (General Plan) on the City of Culver City’s General Fund based on the 2045 volumes expressed in the General Plan Program Environmental Impact Report (EIR).
Methodology
The fiscal impact analysis measures the impact of potential new development on the City’s General Fund.
The analysis estimates the annual General Fund revenues and expenditures that could be generated at 2045 development volumes expressed in the EIR. The f iscal model’s net annual surplus or deficit represents the difference between estimated annual General Fund revenues and expenditures based on anticipated development volumes. The percentage of net annual surplus or deficit to total annual revenues are calculated to determine positive, neutral, or negative fiscal impact.
Service Population
The analysis uses per capita revenue and expenditure estimates, which are based on the current and projected future service population. The service population includes the total resident population and those who work within the City’s boundaries. Employees in Culver City are expected to generate less demand for city services compared to residents. The service population calculation estimates the impacts of workers in Culver City to be 22.8% of a fulltime resident’s based on the number of hours spent in the community.
Revenue estimates vary based on the number of projected residents, employees or the service population as noted. Estimates of increases in expenses are based on the service population Revenues
Revenues allocated to the City General Fund under the fiscal analysis are estimated using methods identified below.
• Taxes including:
o Property Tax based on the assessed property value
o Sales Tax estimated taxable sales based on net new retail space o Transient Occupancy Tax (based on recent historic growth of hotel rooms) o Real Property Transfer Tax (assessed property value, property turnover) • Other revenue sources on a per employee, per resident or service population basis. 4 | City of Culver City Fiscal Impact Analysis | August 2024 Expenditures
Costs to the General Fund from each department or category are estimated on a per service population basis. As there may be fixed costs that are not variable for each function, a prorated approach allows for an evaluation of service levels relative to the projected change in population and employment.
The fiscal model doesn’t include programs that are funded independently of the General Fund (such as the bus line or waste management) , and the analysis excludes impacts to the school district or other special districts that are funded separately and are not operated directly by the City. Also, unlike the EIR, the impact model only considers operations costs and therefore does not includ e estimates of impact fee revenues, which are charged to mitigate the effects of development on public facilities (e.g., s treets, parks, storm drains, etc.).
Inputs & Baseline Data
The following inputs and baseline data have been applied throughout the fiscal model based on available data such as, City input, market analysis findings, and industry standards. • Key development volumes including the number of units, total nonresidential square footage, number of jobs rely on the 2045 volumes included in the EIR. • The General Fund FY 2022-23 budget provides the most completed actual costs and revenues and is used as the baseline for analysis.
• All outputs are reported in 2024 dollars.
• Revenue factors are existing fiscal policies and rates. • Revenues are based on per service population and remain stable through the analysis. • Tax rates will not change.
• There is no change in the share of City services provided on a fee-for-service basis (i.e., additional General Fund dollars are not used to subsidize or further subsidize City services). • All new infrastructure and facility costs required for future development will be covered by developers and property owners (e.g., development impact fees, CFDs, etc.).
The specific rates and quantities that are used in the analysis are described in the fiscal impact analysis section that follows.
Fiscal Impacts
A fiscal impact analysis measures the impact of potential new development on a municipal budget. New residential and commercial development bring new residents and businesses, which increases the need for more city services while generating additional taxe s and other revenues for the city. A development program has a positive fiscal impact on a city’s budget when the associated new development generates more revenue for the city than the cost of additional city services needed to support it.
The analysis does not include expenditures or revenues associated with other funds outside the General Fund, including enterprise funds such as the Culver City Bus Line or waste collection and sewage enterprise Fiscal Impact Analysis | August 2024 City of Culver City | 5 funds. Additionally, the analysis focuses on city service costs related to ongoing operations and maintenance and does not include capital costs for new infrastructure or facilities. 2045 Development Quantities
The fiscal impact analysis evaluates the projected levels of net new development as a static model, based on the buildout quantities provided by the City for the General Plan that are anticipated at the end of the study period in 2045. Although development trends in the next 21 years are unknown, the projected levels of development in the EIR are applied as a means of measuring the effects of potential net new development.
The 2045 buildout capacity represents the projected future development within the City’s boundaries. The buildout scenario accounts for new net residential, retail, office, and industrial space. The majority of new development will be infill development an d redevelopment. This fiscal analysis is independent of specific sites within the city.
A summary of the estimated total number of residents, jobs, housing units, and commercial square for the 2045 buildout scenario is provided in Table 2. The values on this table are based on the projections contained in the EIR. Note that the EIR only provides projection for total commercial space. For the purpose of this fiscal impact analysis, it was necessary to estimate the portion of this space that would be occupied by retail uses. The analysis anticipates the current proportion of commercial space in Culver City would continue. Table 3 shows the current distribution of commercial space by use type.
Table 3: Current Distribution of Commercial Space
Land Use Buildings Existing Rentable
Building Area Percent
Retail 464 4,428,813 33.6%
Office 423 8,758,249 66.4%
Total Commercial 1,266 13,187,062 100.0%
Industrial 202 2,054,818 Total 1,468 15,241,880 Source: Costar Group
Table 2: EIR Development Potential Projections
Land Use EIR Base GP 2045 Projections Net Change (GP 2045 - Existing) Population 40,800 62,400 21,600 people Jobs 68,040 84,300 16,260 jobs Households 17,000 28,310 11,310 households Residential 17,010 29,710 12,700 units Commercial* 28,624,900 31,956,900 3,332,000 square feet Industrial 1,881,100 2,245,900 364,800 square feet Institutional 3,076,600 3,076,600 - square feet *Commercial includes Studio uses.
Source: GP Draft PEIR and City of Culver City
6 | City of Culver City Fiscal Impact Analysis | August 2024 This analysis also desegregates the total residential development in the EIR by unit type in order to estimate the potential assessed valuation and contribution to other ad valorum based revenue sources including the City’s Real Property Transfer Tax. The EIR identifies a total of 12,700 net new dwelling units in Culver City in 2045. Due to the scarcity of available sites for new single family residential units, Culver City Staff estimated that approximately 0.05% of the total growth, or 64 units, would be single family with the rest developing as multi-family units. This is a departure from the existing building stock which according to the census is 71% single family detached or attached. This implies that 99.5% of new units (12,637) would be multi-family units. Currently, 44% of Culver City’s multifamily units are owner occupied condominiums. This represents a legacy of condominium development that has not occurred in California in recent decades. A recent report by the Turner Center for Housing Innovation at UC Berkley 1 identifies the factors behind this decline and estimates that 10% of new multi-family units built in California are condominiums.
It is also anticipated that the preponderance of these new units would be developed at market rate.
Currently 3.7% of Culver City's current housing inventory is below market rate (BMR). However, the city currently has 500 BMR units in its development pipe line. The estimate for future development is based on analysis provided by HR&A’s May 2024 Affordable Housing Funding Gap Analysis . In that report the consultant estimated that between 7 and 13% of new units in new units in Culver City would be BMR units.
The report was based on an expectation that the units would generally be at 80% of AMI. Using the midpoint of this forecast, this analysis uses an estimate of 10% of new units built out to 2045 would be BRM at 80% of AMI. All of the BMR units are expected to occur as part of multifamily developments. The BMR units were further disaggregated by estimating that 90% of would be rental and 10% would be for sale.
Table 4 summarizes the projected net new development for 2045 based on the quantities provided in the EIR.
1 Construction Defect Liability in California: How Reform Could Increase Affordable Homeownership Opportunities Turner Center for Housing Innovation. UC Berkley July 2024.
Table 4: Summary of 2045 Buildout
PEIR 2045 Total 2045 Change
Baseline 2045 Net
Residents 40,800 62,400 21,600
Jobs 68,040 84,300 16,260
Housing Units 16,839 29,286 12,700
Single-Family 8,435 8,499 64
Condominiums 772 1,909 1,137
Apartments 6,946 17,181 10,236
BMR Condominiums (2BD, @ 80% Average AMI) 69 170 126
BMR Apartments (2BD, @ 80% Average AMI) 617 1,527 1,137 Commercial Sf. 30,506,000 34,202,800 3,696,800
Retail 9,613,539 10,732,575 1,119,037
Office 19,011,361 21,224,325 2,212,963
Industrial 1,881,100 2,245,900 364,800
Fiscal Impact Analysis | August 2024 City of Culver City | 7 Sources and Uses
The General Fund is the City’s primary vehicle for funding and ongoing revenues and expenditures for general operations of the city government, which are not accounted for in other department funds. These are activities and services, such as public safety, recreation and parks, and a city administration that is financed primarily through tax-generated revenues.
The fiscal impact analysis relies on the City’s 2022 -2023 General Plan Budget Actuals, which reflect the recorded revenues and expenditures that occurred , and do not represent estimated budget projections.
Table 5 shows the revenues by source to the City’s General Fund, and Table 6 shows the expenditures to the General Fund by source.
Table 5: General Fund Actual Receipts FY 22/23 Revenues Revenues
Property Tax $14,723,868
Property Tax – Secured $6,592,918
Property Tax – Unsecured $8,130,950
Utility User Tax $16,524,880
Sales Tax (including Measure CC) $42,394,800
Sales Tax $25,248,159
Measure CC $17,146,641
Transient Occupancy Tax (TOT) $11,963,174
Franchise Tax $1,805,748
Business Tax $18,736,311
Real Property Transfer Tax $9,655,756
Licenses & Permits $4,010,256
Use of Money & Property $5,519,297
Other Revenue $908,533
Charges for Services $10,949,213
Intergovernmental (includes VLF) $8,055,497
Other Transfers $3,423,930
Fines & Forfeitures $5,290,389
Commercial and Industrial Development Tax
(Comm/Ind Dev Tax) $545,566
Cost Allocation Rec $6,365,092
Total General Fund* $160,872,310
Table 4: Summary of 2045 Buildout
PEIR 2045 Total 2045 Change
Baseline 2045 Net
Institutional 3,076,600 3,076,600 0
Source: GP Draft PEIR, Costar and City of Culver City
8 | City of Culver City Fiscal Impact Analysis | August 2024 Table 6: General Fund FY 22/23 Actual Expenditures
Expenditures
Administration $3,778,800
City Attorney $2,129,319
Finance $6,270,598
Planning & Development $111,343
Community Development $10,133,254
Parks Recreation & Community Services $9,953,493
Police $50,330,046
Fire $30,959,964
Public Works $14,996,165
Non-Departmental $13,925,429
Human Resources $2,252,778
Information Technology $5,389,798
Housing & Human Services Department $288,312
Total Expenditures* $150,519,299
Net Annual Surplus/(Deficit) $10,353,011
Net Annual Surplus/(Deficit) as % of Total Revenue 6.4% * Rounded to nearest dollar
Towards the end of FY 22/23, Culver City restructured its departmental organization. The Community Development department was separated with Planning and Development, and Housing and Human Services became stand-alone departments, and Economic Development was moved to the City Manager’s Office. For FY 22/23, most of the expenditures related to these units are accounted for under Community Development. Starting in FY 23/24, the costs were fully separated. The previous structure was retained in this analysis.
Note that moving forward Culver City expect s significant changes to its budget in terms of revenues and expenses. The City recently changed its rates for business license fees and it is anticipated to collect over $30 million in fees for FY 23/24. This represents an approximate increase of 6 6% over the $18.7 million collected in FY 22/23. In January of 2023, Culver City declared a Homelessness Emergency. In FY 23/24, approximately $17 million General Fund dollars were added to the Housing and Human Services budget to fund homeless services in the city. These expenditures more than offset the revenue increase from the updated business license tax rates. Culver City’s Financial Forecast predicts a $5-6 million structural deficit annually over the next 10 years.
Service Population
The analysis uses per capita revenue and expenditure estimates, which are based on the current and projected future service population. The service population includes the total resident population and those who work within the City’s boundaries. Employees in Culver City generate fewer demands for city services compared to residents largely due to the amount of time they spend in the city. T he service population Fiscal Impact Analysis | August 2024 City of Culver City | 9 calculation estimates the impacts of workers in Culver City to be 28.8% of residents. Table 7 shows the net service population increase and the total projected for 2045.
Assessed Property Value
In the analysis, property value estimates are used to calculate future property tax revenue estimates. Table 8 shows the factors for estimating assessed property values. Estimated values for apartment units and retail, office, and industrial square footage were created using a capitalized rent value approach, the key inputs are shown in Table 8. Estimates for the assessed property value of net new residential units and commercial square feet are shown in Table 9 and Table 10.
Table 8: Capitalized Rent Values
Annual
Rent per SF
Capitalization
Rate Vacancy Operating
Expenses
Less
Operating
Expenses
Less
Vacancy
Capitalized
Value
Residential
Apartments
(2BD) $42.84 4.50% 5.1% 32.5% $13.92 $2.20 $594
BMR
Apartments
(2BD) (80%
AMI)
$34.27 4.50% 5.1% 32.5% $11.14 $1.76 $475
Commercial
Retail $56.05 5.40% 5.3% 12.5% $7.01 $2.97 $853
Office $47.19 6.80% 16.0% 12.5% $5.90 $7.55 $496
Industrial $37.79 5.00% 4.9% 12.5% $4.72 $1.85 $624
Source: NAR Commercial Real Estate Metro Market Report, Los Angeles-Long Beach-Anaheim, 2024 Q1
Table 7: Net Service Population
Baseline Net New 2045 Buildout
Residents 40,800 21,600 62,400
Employees
Total Jobs 68,040 16,260 84,300
Employee Factor 22.8% 22.8% 22.8%
Employee Estimate 15,513 3,707 19,220
Net Service Population 56,313 25,307 81,620
Service Increase % 45% 145%
10 | City of Culver City Fiscal Impact Analysis | August 2024 Table 9: Assessed Value Inputs
Estimated Value Vacancy Occupancy
Rate
Holding
Period
(years)
Turnover
Rate
Residential
Single Family (3BD) $1,800,000 per unit 5.1% 94.9% 15 3.7% Condominiums (2BD) $960,000 per unit 5.1% 94.9% 15 3.7% Apartments (2BD)1 $623,319 per unit 5.1% 94.9% 15 1.5%
BMR Condominiums (2BD,
@ 80% Average AMI) $406,667 per unit 5.1% 94.9% 15 3.7% BMR Apartments (2BD, @
80% Average AMI) $498,655 per unit 5.1% 94.9% 15 0.0%
Commercial
Retail $853 per sq. ft. 5.3% 94.7% 15 1.5%
Office $496 per sq. ft. 16.0% 84.0% 15 1.5%
Industrial $624 per sq. ft. 4.9% 95.1% 15 1.5%
1 Based on average apartment size of 1,050.
Source: Zillow, 2022; Redfin, 2022; Loopnet, 2022
*=((0.8 * LAC AMI tables (2022)) * .3)/cap rate
LAC (80% AMI, 2 BR) $76,250
Table 10: Assessed Value Estimates
Baseline Net New
Residential
Single Family (3BD) $5,518,026,909 $114,300,000
Condominiums (2BD) $269,261,396 $1,091,793,600
Apartments (2BD) $1,573,459,810 $6,380,020,960
BMR Condominiums (2BD, @ 80% Average AMI) $10,138,855 $51,388,433 BMR Apartments (2BD, @ 80% Average AMI) $111,890,475 $567,112,974 Residential Total $7,482,777,445 $8,204,615,967
Commercial
Retail $2,980,976,910 $954,758,217
Office $3,428,395,600 $1,098,059,116
Industrial $426,775,521 $227,727,892
Commercial Total $6,836,148,031 $2,280,545,224
Total Assessed Value $14,318,925,476 $10,485,161,191
Fiscal Impact Analysis | August 2024 City of Culver City | 11 Property Tax
The key factors used to estimate property tax revenues are shown in Table 1 1. Under California’s Proposition 13, the base property tax rate is 1% of the assessed property value. Culver City receives
10.43% of the 1% base property tax revenue. The anticipated property tax revenues for the net new development based on these rates at the level of development anticipated by the EIR for 2045 are shown below.
Table 11: Property Tax
Baseline
Property Tax Rate 1%
City Rate 10.43%
Source: City of Culver City, Annual Comprehensive Financial Report FY 22-23
Table 12: Net New Property Tax Revenues
Net New
Residential
Single Family (3BD) $119,215
Condominiums (2BD) $1,138,741
Apartments (2BD) $6,654,362
BMR Condominiums (2BD, @ 80% Average AMI) $53,598
BMR Apartments (2BD, @ 80% Average AMI) $591,499
Residential Total $8,557,414
Commercial
Retail $1,145,276
Office $237,520
Industrial $2,378,609
Commercial Total $3,761,405
Total Property Tax Revenues $12,318,819
Property Transfer Tax
The City collects property transfer tax when real properties change ownership. Table 1 3 shows the rate of residential transfers per year based on US Census data on length of residence in Culver City. The annual transfer rate was calculated at 3.7% for residential properties, 1.5 % for apartments, commercial and industrial properties. Using the collections from the last complete year when the tax was collected, the City receives 2.33% across transfer. Table 14 shows the estimated annual revenue from property transfer tax based on projected 2045 volumes.
12 | City of Culver City Fiscal Impact Analysis | August 2024 Table 13: Residential Property Turnover Rates
Estimate
Total Population in Occupied Units 17,691
Year Moved into Unit
2021 to 2022 715
2018 to 2020 3,138
2010 to 2017 5,934
2000 to 2009 3,357
Total moved 2000 to 2022 13,144
Years in period 20
Average annual turnover 657
Annual Turnover Rate 3.71%
Source: ACS, 2020
Table 14 Property Transfer Tax
Property Transfer Tax
Baseline
Property Transfer Tax Rate 2.33%
Annual Transfer Rate (Turnover)
Residential 3.7%
Commercial 1.5%
Industrial 1.5%
Source: 2022 ACS and LWC
Property Transfer Rates
Rate Baseline Share
0.45% on amounts of $1,499,999 or less 0.05% 20%
1.5% on amounts from $1,500,000 to $2,999,999 1.50% 25%
3.0% on amounts from $3,000,000 to $9,999,999 3.00% 25%
4.0% on amounts $10,000,000 and above. 4.00% 30%
Total 100%
Property Transfer Tax Revenues 2045 Buildout
Net New
Residential
Single Family (3BD) $99,104
Condominiums (2BD) $946,644
Apartments (2BD) $2,233,645
Residential Total $3,279,393
Commercial
Retail $334,261
Fiscal Impact Analysis | August 2024 City of Culver City | 13 Table 14 Property Transfer Tax
Net New
Office $384,430
Industrial $79,728
Commercial Total $798,419
Total Property Tax Revenues $4,077,812
State Motor Vehicle License Fees (VLF) In-Lieu
Beginning in 2004, the State of California changed its approach for allocating vehicle license fees (VLF) to local jurisdictions by substituting VLF fees with property tax revenues. The City records revenue generated from VLF under the “Intergovernmental” line item under the Culver City Adopted Budget for FY 202 2-23.
Table 15 shows the factors used to calculate the VLR property rate that are used to estimate future in-lieu VLF values.
Table 15: State Motor Vehicle License Fees (VLF) In-Lieu Property Tax In-Lieu of VLF
Total Estimated Citywide Assessed Value (FY 2022-23) $15,561,988,828 Citywide VLF Property Tax In-lieu Revenue (FY 2022-23) $7,227,479 VLF Property Tax In-lieu Per $1,000 in Assessed Value $0.4644 Source: City of Culver City, Annual Comprehensive Financial Report FY 22-23, p. 259
Property Tax In-Lieu of VLF Revenues 2045 Buildout
Net New
Residential
Single Family (3BD) 53,085
Condominiums (2BD) 507,063
Apartments (2BD) 2,963,083
BMR Condominiums (2BD, 80% AMI/Moderate) 23,866
BMR Apartments (2BD, 80% AMI Moderate) 263,385
Residential Total 3,810,483
Commercial
Retail 443,420
Office 509,973
Industrial 105,764
Commercial Total 1,059,157
Total Property Tax In Lieu of VLF Revenue 4,869,640
14 | City of Culver City Fiscal Impact Analysis | August 2024 Sales Tax
The City receives 1% (also known as Bradley Burns portion) of the sales tax collected from retail sales generated within the city. The City receives an additional 0.5% of sales tax revenues from the local Measure CC. Additionally, City voters initially approved Measure C in the November 2012 election at a 0.25%t rate which had a sunset in 2023, and in March 2020, voters extended the 0.5% t rate to sunset in 2033. This analysis anticipates that the additional sales tax rates would be reauthorized to 2045. Estimated sales tax revenues are based on net new retail square footage. Culver City is a net sales tax importer, meaning that the retailers in the city attract spending from beyond the community and at a higher rate than the County average on a per capital basis. Table 1 6 provides key factors for estimating sales tax revenues based on the 2045 development projections in the EIR.
Table 16: Sales Tax Revenues
Rate Net New
Sales Tax (local share) 1.00%
Sales Tax Measure C Rate 0.25%
Sales Tax Measure CC Rate 0.5%
Total City Rate 1.75%
Baseline Retail SF 9,613,539
Total Taxable Sales (CY 2023) $1,990,450,355
Retail Taxable Sales Per SF $207.05
Retail SF 1,119,037
Total Taxable Sales $231,692,707
Total General Fund Revenues $4,054,622
Transit Occupancy Tax (TOT) Revenues
Transit occupancy taxes (TOT) are levied on hospitality businesses such as hotels and motels that offer occupancy to the public for less than 28 days. There are 19 hotels and motels in the City with a total of 1,552 rooms. Since 2014, there have been 183 n ew hotel rooms developed across two properties. Using this rate of growth, it can be anticipated that Culver City would add an additional 384 hotel rooms by 2045.
Table 17 projects the TOT estimated for 2045 using the current rate of TOT received per room.
Table 17: Transient Occupancy Tax
Existing Number of Hotel Rooms 1,552
Baseline TOT Revenues $11,963,174
TOT per Hotel Room $7,708
New Hotel Rooms per 10 years 183
New Hotel Rooms 2045 384
Total Hotel Rooms 2045 1,936
Net New TOT 2,962,273
2045 Total TOT 14,925,447
Fiscal Impact Analysis | August 2024 City of Culver City | 15 Other Tax Revenues
Additional tax revenues are calculated per capita based on the service population except for three other revenue sources: 1) business license tax revenues and 2) licenses and permits revenues which were estimated based on employment, and 3) franchise tax revenues which were estimated based solely on residents. Table 18 shows the key factors used to calculate the additional tax revenues based on current rates as expressed in the City’s FY 22/23 budget.
Expenses
Net new expenditures to the City’s General Fund were calculated on a per capita basis. The per capita rate was established by dividing expenditures occurring to the City’s General Fund (2022-2023 Budget Actuals) by the estimated 2045 service population. Future net new expenditures were determined by multiplying the per capita costs by the current service population. Table 1 9 shows the estimated per capita rate s for expenditures to the General Fund.
Table 19: Expenditure Rates
FY 2022/23 Expenditures Estimated Rate
Administration $3,778,800 $67.10
City Attorney $2,129,319 $37.81
Finance $6,270,598 $111.35
Planning & Development $111,343 $1.98
Community Development $10,133,254 $179.94
Parks Recreation & Community Services $9,953,493 $176.75 Police $50,330,046 $893.75
Fire $30,959,964 $549.78
Table 18: Additional Revenue Source Calculations
FY 2022-2023 Revenues Rate Basis Rate
Licenses & Permits $4,010,256 Per Employee $58.94
Utility User Tax $16,524,880 Per Service Population $293.45 Franchise Tax $1,805,748 Per Resident $44.26
Commercial and Industrial
Development Tax $545,566 Per Service Population $9.69
Business Tax $18,736,311 Per Employee $275.37
Use of Money & Property $5,519,297 Per Service Population $98.01 Other Revenue $908,533 Per Service Population $16.13
Charges for Services $10,949,213 Per Service Population $194.43 Intergovernmental
(includes VLF) $8,055,497 Per Service Population $143.05 Other Transfers $3,423,930 Per Service Population $60.80 Fines & Forfeitures $5,290,389 Per Service Population $93.95 Cost Allocation Rec $6,365,092 Per Service Population $113.03 16 | City of Culver City Fiscal Impact Analysis | August 2024 Table 19: Expenditure Rates
FY 2022/23 Expenditures Estimated Rate
Public Works $14,996,165 $266.30
Non-Departmental $13,925,429 $247.29
Human Resources $2,252,778 $40.00
Information Technology $5,389,798 $95.71
Housing & Human Services Department $288,312 $5.12
Rate Basis: Per Service Population
Net Fiscal Impacts
Tables 20 and 2 1 summarize the total new revenues and expenses associated with the projected development volumes indicated in the EIR for the General Plan in 2045. The net fiscal impact is estimated to be negative on an annual recuring basis using existing rates of revenue and current service levels. The key finding of the analysis is that annual operating budget would incur an approximately $11.9 Million deficit representing a little over 21% of total anticipated revenues. These impacts are based on the net change in population, housing, employment and commercial space in the City by 2045.
Table 20: General Fund Net New Revenues 2045
Net New
Property Tax $12,318,819
Utility User Tax $7,426,329
Franchise Tax $955,984
Fines & Forfeitures $2,377,516
Commercial and Industrial Development Tax
(Comm/Ind Dev Tax) $245,179
Cost Allocation Rec $2,860,491
Real Property Transfer Tax $4,077,812
Intergovernmental (includes VLF) $3,620,164
Sales Tax (including Measure CC) $4,054,622
Transient Occupancy Tax (TOT) $2,962,273
Business Tax $4,477,549
Licenses & Permits $958,359
Use of Money & Property $2,480,388
Other Revenue $408,297
Charges for Services $4,920,608
Other Transfers $1,538,724
Total Revenues $55,683,116
Fiscal Impact Analysis | August 2024 City of Culver City | 17 Table 21: General Fund Net New Expenditures 2045
Net New
Administration $1,698,204
City Attorney $956,922
Finance $2,818,025
Planning & Development $50,038
Community Development $4,553,914
Parks Recreation & Community Services $4,473,129
Police $22,618,469
Fire $13,913,498
Public Works $6,739,320
Non-Departmental $6,258,128
Human Resources $1,012,405
Information Technology $2,422,191
Housing & Human Services Department $129,568
Total Expenditures $67,643,811
Net Annual Surplus/(Deficit) -$11,960,695
Net Annual Surplus/(Deficit) as % of Total Revenue -21.48%