1 Published 11/25/2025
City of Foster City/Estero Municipal Improvement District Annual and Five-Year Development Impact Fee and Capacity Fee Report Fiscal Year Ended June 30, 2025
The California Mitigation Fee Act (California Government Code Section 66000 et seq.) mandates procedures for administration of impact fee programs, including collection and accounting, reporting, and refunds. Regarding the reporting requirements, the Mitigation Fee Act requires annual reporting to provide information about each impact fee fund under Government Code Section 66006 (b), a separate reporting of five-year findings for any fee revenue that remains unexpended under Government Code Section 66001 (d), and capacity fee findings under 66013 (d).
Capacity Fee Findings
This capacity fee findings meets the City of Foster City and the Estero Municipal Improvement District’s (City/District) capacity fees reporting requirement. The City/District currently assesses two capacity fees: water connection fee and sewer connection fee.
Water Connection Fee
A Water Connection Fee is a type of capacity fee that public agencies may impose as a condition of development under the authority of California Government Code Section 66013. The purpose of the fee is to ensure that development pays its fair share of the costs associated with providing system capacity. The connection fee is charged at the time that building permit is issued, and it is based on the size of the service connection, which is a direct measure of the cost of the facilities and the capacity provided by those facilities. The fees collected will be used to pay for existing and future public facilities that provide water capacity, supply, and infrastructure to serve new connections.
The following table shows the revenues and expenditure activities of water connection fees and the capital projects funded by the fee.
Water Connection Fee
Meter Size Fees
¾ “ $12,504
1 “ $20,884
1 ½” $50,020
2 “ $66,654
3 “ $145,938
4 “ $262,613
6 “ $583,626
8 “ $1,000,433
Water Connection Fee Schedule
Fiscal Year 2024-2025
3 Published 11/25/2025
Revenues and Expenditures Schedule
For the Fiscal Years Ended June 30
Projects Funded by Water Connection Fee for the Fiscal Year Ended June 30, 2025 In FY 2024-2025, there were no interfund transfers, loans, or refunds made from the fund, and the unexpended fund balance of the water connection fee revenue is $217,282. In FY 2024-2025, the City did not complete any projects. The fund balance and continued collection of water connection fees will be utilized to fund projects related to the water system improvements and ongoing maintenance of existing facilities. The City/District has planned to continue funding the Water Main Condition Assessment Project (CIP 405-723) through Water Connection Fees in the FY 2025-2026 Capital Improvement Plan Budget.
Sewer Connection Fee
A Sewer Connection Fee is a type of capacity fee that public agencies may impose as a condition of development under the authority of California Government Code Section 66013. The purpose Fiscal Year Ended June 30, 2021 2022 2023 2024 2025
BEGINNING BALANCE $ - $ 678,698 $ 1,125,686 $ 1,206,901 $ 156,059 REVENUES:
Water Connection Fees 977,278 443,541 46,433 - 79,284 Interest Income 2,779 3,447 34,782 49,158 8,377 Total revenues 980,057 446,988 81,215 49,158 87,661 EXPENDITURES:
Capital Projects:
Two Natural Gas Powered Engines & Pumps
Replacement (CIP#651) - - - - - Water Distribution System Master Plan Study
(CIP#668) - - - - - Water System Improvements & Valve
Replacements (CIP#636) 159,287 - - - - Water Tank Improvements Project (CIP#660) 142,072 - - 1,100,000 Water Main Condition Assessment (CIP#723) 26,438 Total expenditures 301,359 - - 1,100,000 26,438 REVENUES OVER(UNDER) EXPENDITURES 678,698 446,988 81,215 (1,050,842) 61,223 ENDING BALANCE $ 678,698 $ 1,125,686 $ 1,206,901 $ 156,059 $ 217,282 Project No. Project Name
FY 2024-2025
Total Expenditure
(All Funding Sources)
FY2024-2025
Connection Fee
Expended
% of Expenditures
Funded with
Connection Fee
Project
Completed?
(Y/N)
405-723 Water Main Condition Assessment 26,438$ 26,438$ 100% N - in progress 3 Published 11/25/2025
of the fee is to recover an equitable share of costs for capacity in facilities needed to provide sewer services. New development connecting to the City of Foster City’s sewer system is charged at the time of the building permit is issued. The connection fee is based on the reasonable cost of capacity per service connection. The reasonable cost is derived based on the value of facilities that provide capacity for growth. The sewer connection fees are charged based on per Equivalent Dwelling Unit (EDU). The fees collected will be used by the City/District to pay for existing and future facilities that provide capacity to serve future connections.
The following table shows the revenues and expenditures activities of sewer connection fees and the capital projects funded by the fee.
Sewer Connection Fee
Revenues and Expenditures Schedule
For the Fiscal Years Ended June 30
Customer Class Fees Unit
Single Family $8,866 Per Dwelling Unit
Multi Family $5,541 Per Dwelling Unit
$8,866 Per Equivalent Dwelling Unit (as calculated below ) Med. Strength EDUs = est. gpd ÷ 200 x 1.00
High Strength EDUs = est. gpd ÷ 200 x 2.84
Commercial
Sewer/Wastewater Connection Fee Schedule
Fiscal Year 2024-2025
Low Strength EDUs = est. gpd ÷ 200 x 0.65
Fiscal Year Ended June 30, 2021 2022 2023 2024 2025
BEGINNING BALANCE $ - $ 147,971 $ 329,365 $ 347,530 $ 363,545 REVENUES:
Sewer Connection Fees 482,551 180,449 8,120 - 254,366 Interest Income 1,234 945 10,046 16,015 20,983 Total revenues 483,785 181,394 18,166 16,015 275,348 EXPENDITURES:
Capital Projects:
Sewer System Rehab-Force Main, Gravity
Mains & Manholes 2011/2012 (CIP#611) 146,590 - - - - Sanitary Sewer Lift Station Improvement
Project Phase 5 (CIP#626) 83,089 - - - - Lift Station 59 Effluent Line Improvements
(CIP#695) 49,773 - - - - Sanitary Sewer System Improvements
(CIP#696) 56,362 - - - - Total expenditures 335,814 - - - - REVENUES OVER(UNDER) EXPENDITURES 147,971 181,394 18,166 16,015 275,348 ENDING BALANCE $ 147,971 $ 329,365 $ 347,530 $ 363,545 $ 638,893 5 Published 11/25/2025
In FY 2024-2025, there were no projects funded by sewer connection fees, and there were no interfund transfers, loans or refunds made from the fund, and the unexpended fund balance of the sewer connection is $638,893. The fund balance and continued collection of sewer connection fees will be utilized to fund the projects related to the sewer system improvements and ongoing maintenance and operations of existing facilities. In FY 2024-2025, the City completed Sanitary Sewer System Improvements project (CIP#696). The City/District does not have any capital improvement projects to be funded through Sewer Connection Fee in FY 2025-2026. 4 Published 11/25/2025
Annual Findings
This annual development impact fee findings meets the City of Foster City and the Estero Municipal Improvement District’s (City/District) annual development impact fees reporting requirement. The City/District currently assesses four development impact fees: Affordable Housing Commercial Linkage Fee, Park Facilities Impact Fee, Public Safety Impact Fee, and Transportation Impact Fee.
Affordable Housing Commercial Linkage Fee
Affordable Housing Commercial Linkage Fee is the fee paid by developers of commercial development projects to mitigate the impact that such developments have on the demand for affordable housing in the City/District. The purpose of the affordable housing linkage fee is to enhance the public welfare by imposing a fee whereby developers of commercial development projects will mitigate the impacts of their projects on the need for affordable housing by contribution to the supply of housing for households with very low, low, and moderate incomes.
The affordable housing fund will provide benefits to the community from new commercial development in the form of affordable housing, thereby helping to meet the needs of all socio- economic elements of the community as provided in the housing element.
The following table shows the revenues and expenditures activities of commercial linkage fees.
Category Fee per Square Foot of Net New Gross Floor Area (effective starting 8/20/2022)
Office (including Medical Office) $30.78
Retail (including Restaurant and Services) $5.13
Industrial (including Research & Development) $30.78
Hotel (effective starting 8/20/2022) $10.26
Affordable Housing Commercial Linkage Fee (Nonresidential Development Projects) Schedule Fiscal Year 2024-2025
5 Published 11/25/2025
Affordable Housing Commercial Linkage Fee
Revenues and Expenditures Schedule
For the Fiscal Years Ended June 30
In FY 2023-2024, the City did not identify any incomplete housing programs that required additional reporting related to program timelines or status. In FY 2024-2025 there were no interfund transfers, loans, or refunds made from the fund, and the unexpended fund balance of the commercial linkage was $5,714,223. The fund balance and continued collection of commercial linkage fees will be used to provide housing to very low income, lower income, and moderate- income households in the City, consistent with the goals and policies contained in the City’s Housing Element and the purposes for which the fees were collected.
Park Facilities Impact Fee
The park facilities impact fee is a type of development fee that public agencies may impose as a condition of development under the authority of California Government Code Section 66000 et seq, the Mitigation Fee Act. The purpose of the fee is to fund the creation and improvement of park facilities, including, but not limited to, the planning, designing, developing, and improving of existing and newly acquired park facilities related to new development and ensure that new development pays for its share of park and recreational facilities.
Fiscal Year Ended June 30, 2021 2022 2023 2024 2025
BEGINNING BALANCE $ - $ 568,915 $ 571,506 $ 588,599 $ 5,467,174 REVENUES:
Commercial Linkage Fees 567,683 - - 4,789,410 - Interest Income 1,232 2,591 17,093 99,074 247,049 Total revenues 568,915 2,591 17,093 4,888,484 247,049 EXPENDITURES:
Housing Projects Expenditures - - - 9,909 - Total expenditures - - - 9,909 - REVENUES OVER(UNDER) EXPENDITURES 568,915 2,591 17,093 4,878,575 247,049 ENDING BALANCE $ 568,915 $ 571,506 $ 588,599 $ 5,467,174 $ 5,714,223 7 Published 11/25/2025
The following table shows the revenues and expenditures activities of parks facilities impact fee.
Park Facilities Impact Fee
Revenues and Expenditures Schedule
For the Fiscal Years Ended June 30
Projects Funded by Park Facilities Impact Fee for the Fiscal Year Ended June 30, 2025 In FY 2023-2024, the City did not identify any public improvement project funded by Park Facilities Impact Fee that required additional reporting relating to project timelines or status. In FY 2024– 2025, there were no interfund transfers, loans, or refunds made from the fund, and the unexpended fund balance of the park facilities impact fee was $20,134. The fund balance and Single Family Residential $15,314
Multifamily Residential $11,941
Office $6.40
Retail $2.41
Industrial $3.60
Hotel $2.19
Parks Facilities Impact Fee Schedule
Fiscal Year 2024-2025
(effective starting 8/20/2022)
Residential Development Projects (per unit)
Non-Residential Development Projects (per Sq. Ft.)
Fiscal Year Ended June 30, 2024 2025
BEGINNING BALANCE $ - $ 568,798 REVENUES:
Park Facilities Impact Fees 560,361 - Interest Income 8,437 11,636 Total revenues 568,798 11,636
EXPENDITURES:
Recreation Center Rebuild Project - 560,300 Total expenditures - 560,300 REVENUES OVER(UNDER) EXPENDITURES 568,798 (548,664) ENDING BALANCE $ 568,798 $ 20,134
Project
No. Project Name
FY 2024-2025
Total
Expenditure
(All Funding
Sources)
FY2024-2025
Impact Fee
Expended
% of Expenditures
Funded with Impact
Fee
Project
Completed?
(Y/N)
301-678 Recreation Center Rebuild Project $ 13,583,213 $ 560,300 4% N - in progress 8 Published 11/25/2025
continued collection of park facilities impact fees will be used to support projects that expand park capacity in Foster City, consistent with legal requirements. The City/District has programmed $467,000 in park facilities impact fees toward the Recreation Center Rebuild Project in the FY 2025–26 Capital Improvement Plan budget.
Public Safety Impact Fee
The public safety impact fee is a type of development fee that public agencies may impose as a condition of development under the authority of California Government Code Section 66000 et seq, the Mitigation Fee Act. The purpose of the fee is to fund public safety facilities by providing adequate levels of police and fire facility improvements, vehicles, and other equipment necessary for adequate police and fire service provision related to new development.
The following table shows the revenues and expenditures activities of public safety impact fee.
Public Safety Impact Fee
Revenues and Expenditures Schedule
For the Fiscal Years Ended June 30
Single Family Residential $1,635
Multifamily Residential $1,275
Office $1.16
Retail $0.65
Industrial $0.38
Hotel $0.23
Public Safety Impact Fee Schedule
Fiscal Year 2024-2025
(effective starting 8/20/2022)
Residential Development Projects (per unit)
Non-Residential Development Projects (per Sq. Ft.)
Fiscal Year Ended June 30, 2024 2025
BEGINNING BALANCE $ - $ 61,580 REVENUES:
Public Safety Impact Fees 60,666 - Interest Income 914 2,784 Total revenues 61,580 2,784
EXPENDITURES:
Public Safety Expenditures - - Total expenditures - - REVENUES OVER(UNDER) EXPENDITURES 61,580 2,784 ENDING BALANCE $ 61,580 $ 64,364
9 Published 11/25/2025
In FY 2023-2024, the City did not identify any project funded by Public Safety Impact Fee that required additional reporting relating to project timelines or status. In FY 2024-2025, there were no projects funded by public safety impact fees, and there were no interfund transfers, loans, or refunds made from the fund, and the unexpended fund balance of the public safety impact fee was $64,364. The fund balance and continued collection of public safety impact fee will be used to fund police capital facilities and equipment and vehicles necessary to accommodate growth.
The City/District has not programmed any projects to be funded through public safety impact fees.
Since the fees were collected starting FY 2023-2024, there is no requirement for five-year findings.
Transportation Impact Fee
The transportation impact fee is a type of development fee that public agencies may impose as a condition of development under the authority of California Government Code Section 66000 et seq, the Mitigation Fee Act. The purpose of the fee is to fund the planning, design, development, and construction of transportation facilities related to new development and ensure that new development pays for its fair share of transportation facilities.
The following table shows the revenues and expenditures activities of transportation impact fee.
Single Family Residential $2,178
Multifamily Residential $1,699
Office $3.71
Retail $2.06
Industrial $1.22
Hotel $0.73
Transportation Impact Fee Schedule
Fiscal Year 2024-2025
(effective starting 8/20/2022)
Residential Development Projects (per unit)
Non-Residential Development Projects (per Sq. Ft.)
11 Published 11/25/2025
Transportation Impact Fee
Revenues and Expenditures Schedule
For the Fiscal Years Ended June 30
In FY 2023-2024, the City did not identify any public improvement project funded by Transportation Impact Fee that required additional reporting relating to project timelines or status.
In FY 2024-2025, there were no projects funded by transportation impact fees, and there were no interfund transfers, loans, or refunds made from the fund, and the unexpended fund balance of the transportation impact fee was $201,558. The fund balance and continued collection of transportation impact fees will be used to fund transportation system capacity as allowed by law.
The City/District has identified a capital improvement project to be funded through transportation impact fees in the next five years.
Fiscal Year Ended June 30, 2024 2025
BEGINNING BALANCE $ - $ 192,840 REVENUES:
Transportation Impact Fees 189,980 - Interest Income 2,860 8,718 Total revenues 192,840 8,718
EXPENDITURES:
Transportation Expenditures - - Total expenditures - - REVENUES OVER(UNDER) EXPENDITURES 192,840 8,718 ENDING BALANCE $ 192,840 $ 201,558
10 Published 11/25/2025
Five-Year Findings
The following section satisfies Government Code Section 66001(d) by making findings every fifth year with respect to that portion of each impact fee account that remains unexpended, whether encumbered to a specific project or remaining unencumbered in an impact fee fund. As of June 30, 2025, all impact fees listed below have unexpended balances. Therefore, the City/District is reporting the following findings relating to each of the impact fees.
Affordable Housing Commercial Linkage Fee
The purpose of the affordable housing linkage fee is to enhance the public welfare by imposing a fee whereby developers of commercial development projects will mitigate the impacts of their projects on the need for affordable housing by contribution to the supply of housing for households with very low, low, and moderate incomes. There is a reasonable relationship between the amount of the fee and the purpose for which it is charged because the fee represents the City’s proportionate costs of mitigating the need of affordable housing caused by the new development and the fee revenues will be used for the purpose of mitigating the need of affordable housing caused by the new development. The affordable housing fund will provide benefits to the community from new commercial development in the form of affordable housing, thereby helping to meet the needs of all socio-economic elements of the community as provided in the housing element.
$5,714,233 from the Commercial Linkage Fee (Fund 137) is planned to be allocated to three (3) loan programs, two (2) grant programs, and Unit rehabilitation for supportive housing program over the next five (5) years to implement the Housing Element programs, including Below Market Rate (BMR) Multi-Family Rental Development Loan Program; Below Market Rate (BMR) Accessory Dwelling Unit Loan Program; Low-Income Homeowner Rehabilitation Loan Program; Nonprofit rehabilitation/maintenance assistance; and, emergency rent relief for below market rate tenants.
Program # Program Name
Estimated
transfer
date
% of Estimated
Expenditures
Funded with
Impact Fee
revenue
Estimated
Amount to be
Funded with
Impact Fee
Revenue
Estimated
Amount to
be Funded
by Other
Sources
H-A-5-e Developer Loan(s) FY 2025-26 100% $2,786,733 $0 H-D-4-b ADU Loans: FY 2025-26 100% $1,000,000 $0
H-B-2-a Rehabilitation Loans: FY 2025-26 100% $900,000 $0 H-B-2-b Nonprofit Repair Program FY 2025-26 100% $17,500 $0 N/A Emergency Rent Relief Program FY 2026-27 100% $10,000 $0 H-F-3-a Six City-Owned Units Transition
to Supportive Housing FY 2025-26 100% $1,000,000 $0
12 Published 11/25/2025
Park Facilities Impact Fee
The purpose of the fee is to fund the creation and improvement of Park Facilities, including, but not limited to, the planning, designing, developing, and improving of existing and newly acquired Park Facilities related to new development and ensure that new development pays for its share of park and recreational facilities. There is a reasonable relationship between the amount of the fee and the purpose for which it is charged because the fee represents the City’s proportionate costs of constructing and improving park facilities to serve the new development and the fee revenues will be used for the purpose of constructing and improving park facilities to serve the new development. The fees collected will be used to fund the costs associated with increased demand for community and neighborhood parks and recreational facilities related by the new development.
The City/District’s impact fee study reports identify a list of improvements for which the park facilities impact fees are to be used, as well as the portion of expenditure to be funded by impact fee revenues. Specific other sources and amounts of funding anticipated to be used are determined on a project-by-project basis and documented in the City/District’s annual budget adopted by the City Council/District Board. The estimated timing and cost of the project are shown in the table below. To the extent a specific project cannot be fully funded with park facilities impact fees revenue, the balance of the costs is expected to be funded with other revenue sources.
Development Fee Project Identification: Parks
Public Safety Impact Fee
The City is not required to make Five-Year Findings because the City has not collected the Public Safety Impact Fee for five years.
Transportation Impact Fee
Project
No. Project Name
Start Year
(Estimated Dates
if not started yet)
Total Estimated
Project Cost
% of Estimated
Expenditures
Funded with Impact
Fee Revenue
Estimated
Amount to be
Funded with
Impact Fee
Revenue
Estimated Amount
to be Funded with
General Fund, Grant,
Park-in-Lieu, and
Building
Maintenance Fund
301-678 Recreation Center Rebuild Project 2017/2018 61,501,770$ 2% 1,027,300$ 60,474,470$ 14 Published 11/25/2025
The purpose of the fee is to fund the planning, design, development, and construction of Transportation Facilities related to New Development and ensure that New Development pays for its fair share of Transportation Facilities.
There is a reasonable relationship between the amount of the fee and the purpose for which it is charged because the fee represents the City’s proportionate costs of constructing and developing streets and roads to mitigate the increased use due to the new development and the fee revenues will be used for the purpose of constructing and developing streets and roads to mitigate the increased use due to new development. The fees collected will be used to fund the costs associated with maintaining adequate street and transportation related to the new development.
The City/District’s impact fee study reports identify a list of improvements for which the transportation impact fees are to be used, as well as the portion of improvements to be funded by impact fee revenues. Some of the projects include new signalized intersections to improve traffic flow and reducing conflicts for vehicles, bicyclists, and pedestrians, upgraded signal infrastructure, and various pedestrian/bicycle safety improvements such as installing new bidirectional curb ramps, curb extensions, and crosswalk improvements.
Specific other sources and amounts of funding anticipated to be used to complete improvements are determined on a project-by-project basis and documented in the City’s annual Capital Improvement Plan adopted by the City Council/District Board. The estimated timing and cost of the project are shown in the table below. To the extent a specific project cannot be fully funded with transportation impact fee revenue, the balance of the costs is expected to be funded with other revenue sources.
Development Fee Project Identification: Transportation
Project
No. Project Name
Start Year
(Estimated Dates
if not started
yet)
Total Estimated
Project Cost
% of Estimated
Expenditures
Funded with Impact
Fee Revenue
Estimated Amount
to be Funded with
Impact Fee Revenue
Estimated Amount
to be Funded with
General Fund,
Internal Service
Fund, Measure A,
Measure M , and
Measure W
301-698 Transportation Safety Signalization
Upgrades
2020/2021 7,825,000 $ 6% 495,000 $ 7,330,000 $