Economic & Planning Systems, Inc.
Draft Memorandum
To: Thai-Chau Le, Planning Manager, City of Foster City From: Jason Moody, Luke Foelsch, and Kaavya Chhatrapati; Economic & Planning Systems, Inc.
Subject: Fiscal Impact Analysis of the Gilead Campus Expansion Project; EPS #251057
Date: March 4, 2026
This memo evaluates the fiscal impacts of Gilead Sciences’ (Applicant) proposed redevelopment of three parcels in Foster City into an expanded research and development (R&D) campus (Project). The analysis focuses on annual General Fund revenues and expenditures generated by the proposed development compared to the current assessed value and fiscal contribution of the existing buildings on the site. The report is organized into the Key Findings, followed by the Project Description, the Fiscal Impact Analysis, and the One-Time Revenues section. Supporting data tables are included in Appendix A.
Key Findings
1. At full buildout of Phase II, the Project is expected to generate $1.7 million more each year for Foster City’s General Fund than the site brings in today, as summarized in Table 1. At full buildout, the proposed Project is anticipated to generate an annual net fiscal surplus (revenues minus expenditures) of approximately $2.1 million (2026$).
This compares to an estimated annual net fiscal surplus of the existing use of approximately $357,000, resulting in an annual surplus net of the existing use (net fiscal impact of the proposed Project minus the existing net fiscal impact of the site) of about $1.7 million at full buildout (see Page 19 for detailed impact). The Project is expected to generate substantially more General Fund revenues than the incremental public service costs it creates, thereby creating surplus revenues that the city may use to support services citywide. In summary, at full buildout, the Project is estimated to generate an estimated $2.1 million annual net General Fund surplus (revenues – costs), compared to the estimated $357,000 annual surplus the site is generating today, meaning the Project is anticipated to generate an additional $1.7 million compared to current conditions.
Fiscal Impact Analysis of the Gilead Campus Expansion Project;
Table 1 Summary of Fiscal Impact Estimates
2. Property tax is the largest General Fund revenue source associated with the project.
At Phase I buildout, the Project site is estimated to add approximately $240 million in assessed value through redevelopment of two out of the three parcels, with one parcel assessed at $49 million remaining as-is, resulting in a total Phase I assessed value of $289 million. The remaining parcel will be redeveloped under Phase II, increasing its assessed value from $49 million to an estimated $720 million, bringing the total site’s assessed value to $960 million at full buildout of Phase II. Because the Foster City General Fund receives about 23 percent of the one percent ad valorem property tax rate charged to the site, the increase in assessed value drives the corresponding increases in annual General Fund property tax revenue. At full buildout, the Project is estimated to generate about $2.2 million per year in General Fund property tax revenue and approximately $170,000 annually in property tax in-lieu of vehicle license fees (see Page 11). Under existing conditions, assessed value is roughly $146 million, resulting in significantly lower levels of property-tax-related revenue. The new assessed value created by the Project therefore provides a substantial increase in ongoing General Fund revenues for the city.
3. Public Safety costs represent the largest share of the City’s anticipated additional General Fund expenditures associated with the project. At full buildout, the Project is estimated to generate $331,000 in annual General Fund expenditures (see Table 7 for full summary of annual expenditures by Department). Police services are estimated at approximately $124,000 per year and Fire services at approximately $76,000 per year.
Together, these two categories account for about $200,000 (about 60 percent) of the total $331,000 in projected annual General Fund expenditures attributable to the site.
Annual Annual Annual
Estimated General Fund General Fund General Fund Net Impact on Revenues and Expenditures Reve nues Expenditures General Fund Existing Site $357,000 $0 $357,000
Phase I Buildout
Proposed $717,000 ($61,000) $656,000
Net of Existing1 $359,000 ($61,000) $298,000
Phase II Buildout
Proposed $2,402,000 ($331,000) $2,071,000
Net of Existing1 $2,044,000 ($331,000) $1,713,000
10 Years Post-Buildout (2026$)
Proposed $2,204,000 ($346,000) $1,859,000
Net of Existing1 $1,877,000 ($346,000) $1,532,000
Source: Economic & Planning Systems
*values shown are rounded to nearest thousand - values may not sum due to [1] Net of Existing values subtract Existing Site values from Proposed values.
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The remaining expenditures, which include General Government, Financial Services, Parks and Recreation, Community Development, Public Works, and Library Services, make up the balance of the annual General Fund cost. Although total expenditures would increase with the proposed Project as compared to the existing site, the associated increase in property-tax-related revenues is substantially larger, resulting in a strong net fiscal surplus to the city.
4. In addition to the annual fiscal impacts, the project is estimated to generate over $20 million in one-time impact fee revenue for the City at full buildout. Based on the City’s current Development Impact Fee schedule, the Project is projected to generate approximately $2.8 million in one-time impact fees for Phase I 1 and an additional $19.1
million for Phase II, for a total of about $21.9 million (see Page 21-22). One-time construction sales tax will likely also apply (though the exact amount will depend on a variety of factors, including whether the construction contractors establish a job-site sub-permit) and is estimated at an overall total of $1.7 million at buildout of Phase II.
Additional one-time charges may apply that are not included in this calculation (such as plan check fees, permit fees, etc.), so the final amount collected by the city is expected to exceed the figures shown here.
5. Ten years post-buildout, the Project is estimated to remain a stable positive net fiscal generator for the City, even after adjusting for inflation. Despite a modest erosion in inflation-adjusted property tax revenue over time (due to the two percent annual cap in assessed value growth from Prop. 13, a level that is likely to lag inflation), the Project is estimated to produce $1.9 million annually in net fiscal benefit to the City a decade after buildout, compared to $2.1 million at buildout.
1 This estimate assumes Phase I will build to its maximum entitled amount (200,000 square feet). If Phase I is built to the amount contemplated in the current plans (174,785 square feet), the Phase I one-time fee estimate would be closer to $1.8 million.
Fiscal Impact Analysis of the Gilead Campus Expansion Project;
Site Context and Citywide Demographics
The Project site is located in Foster City on three parcels, totaling 11.9 acres, east of Chess Drive and west of Highway 92. All parcels are owned by Gilead and currently contain 12 vacant one- and two-story commercial / light industrial buildings (totaling about 190,000 square feet) and a surface parking lot. Foster City is in San Mateo County and has approximately 33,000 residents and just over 20,000 jobs, as shown in Table 2.
Table 2 Foster City Citywi de Demographic Assumptions
Proposed R&D Project
The proposed development program is split into two phases. Phase I includes the demolition of the existing buildings on two of the three parcels (containing 120,000 of the total 190,000 existing square feet) and the construction of 200,000 square feet of new R&D uses on one parcel and a surface parking lot on the other. 2 As shown in Table 3, this
new development is estimated to generate about $240 million in new assessed value and employ about 150 new employees.
Phase II involves the redevelopment of the third parcel and the parking lot constructed in Phase I for the construction of 600,000 additional square feet of R&D space (bringing the total new R&D space to 800,000 square feet) and the construction of a new multi-story parking structure. This second phase of development is estimated to add about $720 million in assessed value to the site and employ an additional 670 employees, bringing the 2 Note: the Applicant’s proposed use permit for Phase I contemplates 174,785 square feet of development under Phase I however their proposed zoning would allow for up to 200,000 square feet of development. This analysis assumes the full 200,000 square foot envelope that would be allowed under the proposed zoning.
Citywide
Item Total Source
Population 32,658 Depart ment of Finance 2025
All Jobs 21,423 LEHD Employment Statistics 2022
Primary Jobs1 20,115 LEHD Employment Statistics 2022
Service Population 40,990 Appendix Table A-1
Source: DOF; Census ACS; LEHD; Economic & Planning Systems [1] A Primary Job is defined by the Census as the highest paying job for an individual worker for the year. Therefore, an individual with two jobs is only counted once under the Primary Jobs total, while the All Jobs value shown above would capture both jobs.
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total cumulative assessed value of new development to $960 million and the total cumulative new employees to 820 (as shown in Table 3). When the service population equivalency is applied to the employee count (as derived in Appendix Table A-1), the new development is anticipated to increase City service population by the equivalent of 340 people.
Table 3 Gilead Campus Expansion Proposed Development and Assumptions
The assumed employee count at buildout (820 workers) is based on high-level, early planning estimates provided by the Project Applicant. This number of workers, as compared to the anticipated building size of 800,000 square feet, results in an average employee density of just under 1,000 square feet per employee. When compared to industry average assumptions for R&D uses, and EPS experience regarding similar projects, this number appears high, i.e., typical density assumptions for R&D uses are Phase I Phase II Full
Item Formula Only Only Buildout
New Office/R&D Sq. Ft. a 200,000 600,000 800,000
New Parking Structure Sq. Ft.1 b 0 242,900 242,900
Total New Square Feet c= a + b 200,000 842,900 1,042,900 Site Parameters and Value
Office/R&D
Gross Sq. Ft. (GSF) d 200,000 600,000 800,000
Value per Sq. Ft.2 e $1,200 $1,200 $1,200
Total Value f = d * e $240,000,000 $720,000,000 $960,000,000 Parking Structure
Gross Building Area (GBA) g 0 242,900 242,900
Est. Assessed Value per Sq. Ft.3 h $100 $100 $100
New Assessed Value i = g * h $0 $24,290,000 $24,290,000 Site Parameters and Value
Estimated Employees4 j 151 669 820
Service Population5 = j * 41.4% 63 277 340
[2] Based on preliminary estimates from Applicant, EPS research on nearby sale comps confirms the reasonability of this estimate.
[4] Based on preliminary estimates from Applicant.
Source: Gilead; CoStar Group; CBRE; Marshall & Swift; Economic & Planning Systems [5] Appendix Table A-1 demonstrates the calculation of the Service Population equivalency. [1] Estimated size based on 694 proposed parking stalls per the June 16th, 2025 Foster City Staff Report, assumed at 350 square feet per stall.
[3] Based on construction cost estimate for podium parking structure provided by Marshall & Swift CoreLogic Cost Estimator.
Fiscal Impact Analysis of the Gilead Campus Expansion Project;
generally lower than what is assumed here (meaning the estimated total employee count would be greater than 820).
While any given project will have its own set of unique circumstances, a typical range normally assumed for R&D uses is between about 400 and 750 square feet per employee (which would result in an estimated 1,067-2,000 new employees). This analysis continues with the employee count estimates provided by the Applicant, but EPS performed a sensitivity scenario based on an employee density of 400 square feet per employee, which translates to 2,000 new employees. The overall impact of increased on-site employment is to slightly reduce the net fiscal impact of the project, as described in more detail in subsequent sections of this report.
Existing Development
The existing site parameters are shown in Table 4 below. As shown, there are currently 12 buildings totaling about 192,000 square feet with a total assessed value of about $146 million. As all buildings are currently vacant, there are no employees attributed to the existing site and therefore no city service population either.
Table 4 Gilead Campus Existing Development and Assumptions
Building Square Service
Address APN Count Existing Use Feet Employees 1 Population2 1155 Chess Drive 094-010-100 2 R & D Office 40,654 0 0 $36,558,455 1185 Chess Drive 094-010-500 4 R & D Office 67,971 0 0 $49,092,783 1165 Chess Drive 094-010-510 6 R & D Office 82,882 0 0 $60,582,585 Total 12 191,507 0 0 $146,233,823
[1] According to June 16, 2025 Foster City Community Development Department memo to Mayor and Council and confirmation by the Applicant, all 12 existing buildings are vacant. [3] Assessed Value Information for APNs 094-010-100, 094-010-500, and 094-010-510 for FY2025 per County of San Mateo Treasurer-Tax Collector.
[2] Multiplies employee number by Service Population equivalent of 41.4% per Table A-1 (rounded to nearest whole number).
Source: County of San Mateo Treasurer-Tax Collector; CoStar Group; Economic & Planning Systems Assessed
Value3
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Fiscal Impact Analysis
The fiscal impact analysis compares the potential additional costs incurred by the City’s General Fund from providing public services to the proposed campus expansion with the additional public revenues generated by the new development. The analysis indicates whether the Project can be expected to have a positive or negative overall fiscal effect at buildout.
It should be noted that fiscal results (annual surpluses or deficits) are simply indicators of fiscal performance; fiscal results do not mean that the City will automatically have surplus revenues or deficits because cities must have a balanced budget each year. Persistent shortfalls shown in a fiscal analysis may indicate the need to reduce service levels or obtain additional revenues; persistent surpluses will provide resources to reduce liabilities or improve service levels.
The impacts of the proposed Project are considered upon completion of construction and full stabilization at the culmination of each Phase (Phase I and Phase II) with estimates provided in constant dollar terms. The analysis is based on a number of sources, including the City’s Fiscal Year 2025-26 Final Budget, information on the development program and home sale prices provided by the Applicant via the City, public data sources such as the Census, the Department of Finance, and the Bureau of Labor Statistics, along with EPS’ prior work experience in Foster City and similar jurisdictions.
Assumptions and Methodology
This section describes the methodology and key assumptions used in calculating the fiscal impacts of the proposed Gilead Campus Expansion Project on Foster City’s General Fund.
For each revenue and expenditure line item, EPS used the most appropriate forecasting methodology based on the data and information available and industry best practices.
Service Population
“Service Population” is a concept that allows the impacts of both residents and employees to be estimated, acknowledging that employees who work but do not live in the city do not require city services to the same degree as residents. Foster City’s service population is shown in Table 2 and is calculated using U.S. Census and California Department of Finance data. The calculation accounts for commute patterns by considering the proportion of employees who commute into the city and the proportion of residents who commute out of the city, and applies weighting based on an estimate of the proportion of time these cohorts spend within Foster City with access to municipal services. Because employees have access to City services primarily during work hours, their impact is weighted using an employee-to-resident equivalency factor of 41.4 percent, the detailed calculations for which can be found in Appendix Table A-1.
Fiscal Impact Analysis of the Gilead Campus Expansion Project;
Fixed vs. Variable Expenditures
In calculating the estimates of General Fund expenditures attributable to the project, a variable percentage factor has been applied. Most city departments operate with some fixed amount of overhead that does not vary as the city’s service population grows or contracts. For example, even as the city grows, the city only requires one City Manager or one City Clerk.
This variable percentage factor is applied to departmental expenditures to represent the proportion of costs that are assumed to vary and therefore scale with increases in service population. Expenditures assumed to be fixed include overhead costs, director-level salaries, and other costs that do not scale with service population and therefore would be unaffected by new development such as the Project.
Case Study
A case study approach is used to calculate those revenues that can be estimated using assumptions specific to the proposed development program. Items estimated using a case study approach in this analysis include property tax, property tax in-lieu of VLF, and sales tax.
Average Revenue/Expenditure per Service Population
This approach estimates average revenues and expenditures per member of Foster City’s service population and applies those factors to the Project’s projected service population.
Revenues and expenditures are derived from the City of Foster City Final Budget Fiscal Year 2025-26. Appendix Table A-1 provides the calculation of the citywide service population and the weighting methodology used to distinguish the impacts of residents and employees, as explained previously in the Service Population subsection. This calculation results in a service population equivalency factor of 41.4 percent, meaning if the City spends an average of $100 to provide municipal services to each resident, then it would only spend an average of $41.40 to provide those same services to an employee due to the fact that employees spend less of their time (on average) in the City with access to/demand for these services. This percentage is based on Census LEHD data for commuting patterns of Foster City residents and employees, and attempts to capture the difference in time spent in the City. Applying this 41.4 percent factor to the City’s total employee count (20,115 primary jobs * 41.4% equivalency = 8,332 service population attributed to employees) and adding the resident population (32,658 residents) results in an estimated citywide service population of 40,990.
Not Impacted
Some budget items are not estimated because certain City revenues and expenditures are not directly impacted by new development associated with this project, such as Transient Occupancy Tax, Business License Tax,
3 and Interest Income, among others.
3 In November 2024, Foster City voters approved Measure V, which updated the City’s business license tax to a gross receipts structure. Since the applicant has indicated that their proposed R&D redevelopment will not generate commercial sales (which is what a gross receipts structure is based on), business license tax revenues are not anticipated to be impacted by the proposed Project.
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General Fund Revenue Estimates
This section describes the methodology and assumptions used for each revenue item estimated in this analysis. Several General Fund revenue items are not forecasted because they are not expected to be impacted by the Project. Table 5 displays a summary of Foster City’s General Fund revenue items based on the City of Foster City Final Budget Fiscal Year 2025-26, with details on how each impacted revenue item is estimated. The remainder of this section explains how the Project’s estimated revenue impacts are derived.
Table 5 General Fund Revenue Summary
FY 2025-26
General Fund
Description Revenues*
Property Tax $36,356,666 22.68% of 1% of base assessed value2 Property Tax In-Lieu of VLF $2,680,715
Excess ERAF $3,600,000 - not impacted
Sales Tax $3,992,179 0.95% of estimated taxable sales
Transient Occupanc
y Tax $4,600,000 - not impacted
Business License Tax1 $4,100,000 - not impacted
Other Taxes (Transfer) $304,900 - not impacted
Franchise Taxes $1,377,700 $33. 61 per service population Permits $2,721,093 $32.48 per service population3
Interest Income $1,7 13,900 - not impacted
Rentals – Cit y/EMID $1,030,686 - not impacted
Rentals – Parks & Recreation $54 9,121 $13.40 per service population Other (Fines, etc.) $579,835 $14.15 per service population Intergovernmental $144,200 - not impacted
Recreation Service Charges $1,781,431 $43.46 per service population CDD & Others Service Charges $566,739 $13.83 per service population Total Revenues $66,099,165
[3] Based on information received from City, $1.4M of permit revenue is generated from one-time development projects and therefore is not included in the per service population estimate. The $32.48 value shown is based on the per-service population amount of the remaining permit revenue of $1.3M ($2.7M - $1.4M) which is assumed to scale based on population change.
Source: City of Foster City Final Budget Fiscal Year 2025-26; Economic & Planning Systems Impact Estimating Factors
Case Study Approach
* 2025-26 General Fund Budget values per City of Foster City Final Budget Fiscal Year 2025-26. [1] The applicant has confirmed the proposed project, as biotechnology R&D, is not related to commercial sales and thus would not impact business license tax revenues. [2] Tax Distribution to the Estero Municipal Improvement District for Tax Rate Area 010-003 for Fiscal Year 2025-2026 per the San Mateo County Controller's Office. Value was provided pre- ERAF shift, 22.68% value shown is post-ERAF shift based on proportions from FY2022 as applied to most recent FY pre-ERAF value.
Fiscal Impact Analysis of the Gilead Campus Expansion Project;
Property Tax
Property taxes are based on the assessed value of land and improvements, such as new development. The Project comprises 200,000 square feet of new R&D under Phase I with an additional 600,000 square feet of R&D as well as an estimated 240,000-square foot parking structure under Phase II. The estimated assessed value at project completion (full buildout of Phase II) is $960 million based on anticipated price points provided by the Applicant (see Appendix Table A-2) and confirmed to be reasonable by EPS through research of market comparables and industry experience. Note that the existing assessed value of each parcel is overridden by the new development’s assessed value when a parcel is redeveloped.
San Mateo County collects property tax based on 1.0 percent of the assessed value, and Foster City receives 22.68 percent
4 of the County’s property tax base from property
located in Tax Rate Area 010-003. The property tax revenue the City is expected to receive is therefore equal to about $655,000 annually at buildout of Phase I, increasing by $1.6 million at buildout of Phase II for a total combined annual property tax revenue estimate of $2.2 million. See Appendix Table A-3 for details on this calculation.
Property Tax In-Lieu of Vehicle License Fees
In 2004, the State of California revised the method for allocating Vehicle License Fee (VLF) revenues to cities by replacing the VLF with an equivalent amount of property tax. The VLF in-lieu amount received by each jurisdiction now grows in proportion to changes in its assessed value. Because the Project substantially increases the City’s assessed valuation, it also increases the City’s annual in-lieu VLF revenues. In recent years, San Mateo County has experienced annual shortfalls in these revenues from the State, resulting in cities (including Foster City) not receiving their full share of VLF revenues. This analysis presents VLF revenues as they are calculated by the State and represents the full amount of revenues that should accrue to the City (given the estimated uplift in citywide assessed value) without assuming any shortfalls in reimbursement from the State.
At full buildout, the Project is estimated to generate approximately $168,800 per year in property tax in-lieu of VLF revenue, as shown in Appendix Table A-3. Under existing conditions, the site is estimated to contribute about $25,700 annually. The increase in assessed value produced by the Project therefore results in a meaningful increase in the City’s VLF in-lieu revenues.
4 This percentage represents the tax distribution to the Estero Municipal Improvement District (EMID) for Tax Rate Area (TRA) 010-003, which is the TRA for the Project site. For the purposes of this analysis, the distinction between the City and EMID is unnecessary and they are treated as one entity.
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Sales Tax
Sales tax revenues associated with the Project are based on taxable retail spending generated by employees working on the site. Because the Project consists entirely of non- residential development, the analysis relies on a standard non-residential methodology for estimating worker-generated taxable sales. Based on data from the International Council of Shopping Centers, adjusted to 2026 dollars using the Consumer Price Index, workers are estimated to spend approximately $50 per week on taxable retail purchases. This assumption represents average weekly taxable spending done by employees either during the workday or as part of their commute at certain retailers such as foodservice establishments (lunch spending), general merchandise stores (such as Costco), and health and personal care stores (such as CVS), among others.
Applying the above spending level to the number of employees in each development phase and assuming 48 working weeks per year, total annual worker taxable spending is estimated at about $362,400 in Phase I and an additional $1.6 million in Phase II, for a total of $2.0 million at full buildout. Foster City is expected to capture 25 percent of this spending based on the nature and availability of retail around the site, and after applying the City’s effective sales tax rate of 0.95 percent, the Project is estimated to generate approximately $4,700 in annual General Fund sales tax revenue at full buildout, as shown in Appendix Table A-4.
Other General Fund Revenues
The Project also contributes to the City’s General Fund through several additional revenue categories that are tied to the service population generated by the new development.
These revenues are calculated using the City’s per-service population revenue factors and are applied to the number of new employees generated by the Project. As shown in Appendix Table A-5, these other General Fund revenue estimates total approximately $51,300 per year at full buildout of the Project. The below sections describe in more detail the revenue items that make up Other General Fund revenues.
Franchise Taxes
The city collects franchise tax revenues from utilities operating within Foster City, and these revenues increase as the service population grows. Appendix Table A-5 shows that franchise taxes are estimated at $33.61 per service population. Applying this factor to the Project’s service population results in estimated annual franchise tax revenues of approximately $11,400 at full buildout. As the existing site is currently vacant and therefore has no service population tied to it, there are no franchise tax revenues attributed to the existing development.
Rentals
Rental revenues from Parks & Recreation are estimated in this analysis as they represent the city’s receipts from facility rentals, which are assumed to increase proportionally with increases in City service population. Appendix Table A-5 applies a rate of $13.40 per Fiscal Impact Analysis of the Gilead Campus Expansion Project;
service population, resulting in estimated annual rental revenues of about $4,500 at full buildout. As the existing site is currently vacant and therefore has no service population tied to it, there are no rental revenues attributed to the existing development.
Permits, Service Charges, and Other Revenues
Permits, Other Revenues (Fines, etc.), and Service Charges are the remaining Other General Fund revenue items assumed to scale proportionally based on increases in the City’s service population. Appendix Table A-5 shows that permit revenues are estimated at $32.48 per service population, other revenues (such as fines) are estimated at $14.15 per service population, and Service Charges at $57.29 per service population. Applying these factors to the Project’s service population results in an estimated combined total annual revenue for these three items of approximately $6,500 dollars at Phase I and an additional $28,800 dollars at Phase II, for a total of $35,300 dollars at full buildout. As the existing site is currently vacant and therefore has no service population tied to it, the existing development is assumed to not generate any of these revenue items.
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General Fund Expenditure Estimates
This section describes the methodology and key assumptions for calculating various General Fund expenditure items. All Departments consist of both fixed and variable costs.
While fixed costs are independent of new development, variable costs are assumed to increase based on new growth in the City. Only variable costs are used to project the General Fund expenditures in this analysis. The approach is presented in Table 6. The application of these per service population expenditures to the Project is shown in Appendix Table A-6.
A variable percentage is applied to each Department’s budgeted General Fund expenditures to derive the annual variable expense, which is then divided by the citywide service population to produce a per-service population General Fund expenditure for each City Department. Following Table 6 below, this section describes the Departmental expenditure items in further detail, grouped by departments with similar percent variable assumptions.
Table 6 Foster City General Fund Expenditure Summary
Percent Annua l VariableP e r S e r vice Pop.
Item Variable1
Expense GF Expenditures2
General Government3
$6,544,293 15% $981,644 $23.95
Financial Services $1,893,929 15% $284,089 $6.93
Parks & Recreation $11,630,139 75% $8,722,604 $212.80
Police $20,006,457 75% $15,004,843 $366.06
Fire4
$13,527,093 67% $9,123,834 $222.59
Community Development $4, 715,722 30% $1,414,717 $34.51 Public Works $5,654,550 75% $4,240,913 $103.46
Library Services $607,560 25% $151,890 $3.71
Property Tax Administration $305,500
0% $0 $0.00
Total General Fund Expenditures $64,885,243 $39,924,533 $974.00 Source: City of Foster City Final Budget Fiscal Year 2025-26; Economic & Planning Systems FY 2025/26 GF
Expenditures*
[4] Percent variable assumed to be equal to the portion of the San Mateo Consolidated Fire Department's General Fund budget allocated to Personnel minus the SMC Fire Legacy Costs for pension liability, workers' compensation, and retiree medical for retirees and former employees from the City's fire operations that have transferred to SMC Fire.
[3] The General Government category consists of the Council/Board, City/District Manager, Communications/City Clerk, City Attorney, and Administrative Services Departmental expenditures. *2025-26 Requested General Fund Appropriations per City of Foster City Final Budget Fiscal Year 2025-26. [2] Divides annual variable expense by total Citywide Service Population of 40,990 from Table 2. [1] EPS assumptions; align with industry standards.
Fiscal Impact Analysis of the Gilead Campus Expansion Project;
Administrative Government Functions (15 Percent Variable Expenditures)
There are six City departments that generally serve administrative government functions and as such are attributed a 15 percent variable assumption. These departments include Council/Board, City/District Manager, Communications/City Clerk, City Attorney, Administrative Services (all of which are grouped into the “General Government” category in Table 6), and Financial Services. Based on EPS’s research in similar jurisdictions, new development typically affects administrative and legislative government costs by only a fraction of these departments’ operating budgets. As a result, EPS assumes that 15 percent of the cost of these services is variable and will be affected by new development. The combined per-service population expenditure by these departments is estimated at $30.88, which results in an estimated total annual administrative government expenditure of about $10,000 at full buildout of the Project.
Community Development and Library Functions (25-30 Percent Variable Expenditures)
The Library Services department is attributed a 25 percent variable assumption and the Community Development department a 30 percent variable assumption. While new development at the scale of the Project typically affects these costs by a fraction of the operating budget, these departments provide more public-facing services than the Administrative Government functions and therefore are attributed a higher variable percentage of between 25 and 30 percent. The combined per-service population expenditure by these departments is estimated at $38.22, which results in an estimated total annual administrative government expenditure of about $13,000 at full buildout of the Project.
Fire Protection Functions (67 Percent Variable Expenditures) Foster City is part of a Joint Powers Agreement (JPA) with San Mateo and Belmont for fire services as part of the San Mateo Consolidated Fire Department (SMCFD) and is responsible for 20 percent of shared SMCFD expenditures. The JPA stipulates that each member agency has the authority to deliver fire protection services within their respective jurisdictions. Therefore, it is assumed that as service population grows in Foster City, the provision of fire services within its jurisdiction will also increase to maintain existing service standards, and as such this expenditure item is included in this analysis.
EPS assumes a 67 percent variable assumption for General Fund Fire expenditures. The SMCFD 2025-26 Adopted Budget indicates that personnel services represent 86 percent of total SMCFD General Fund expenditures, and it is assumed the remaining 14 percent represents fixed costs that would not scale based on population increases. Foster City’s General Fund expenditures on Fire consist of 78 percent for Services, Supplies, and Internal Services. The remaining 22 percent represents Fire Legacy Costs and are also assumed to not scale based on population. EPS multiplies the 86 percent variable SMCFD Economic & Planning Systems, Inc.
expenditures by the 78 percent variable Foster City expenditures to arrive at the 67 overall variable percent used in this analysis.
This results in an annual variable General Fund Fire expenditure of about $9.1 million, which equates to $222.59 per City service population. As applied to the Project, this results in an estimated $14,000 annual fire expenditure at buildout of Phase I, increasing by $62,000 with Phase II for a total annual expenditure of $76,000 at full Project buildout.
Police, Parks, and Public Works Services (75 Percent Variable Expenditures)
The Police, Parks & Recreation, and Public Works functions are assumed to scale most closely with changes in service population and are given a variable expenditure assumption of 75 percent.
Foster City’s Police Department provides all police services to the City, the Parks and Recreation Department oversees parks and recreation facilities and programming, and the Public Works Department manages all aspects of city streets and stormwater/wastewater/water infrastructure, among other things. These functions are assumed to scale more closely with increases in service population than the previous categories, as increases in City service population will increase police calls for service, participation in programming and usage of City parks and recreation facilities (and required maintenance), and usage of public works infrastructure, thereby increasing Departmental expenditures. A 75 percent variable factor is applied to account for existing overhead costs, resulting in a $212.80 per service population expenditure for Parks and Recreation, $366.06 for Police, and $103.46 for Public Works, for a combined total of $682.32 per-service population expenditure for these three departments. As applied to the Project, this results in an estimated $42,000 annual expenditure at buildout of Phase I, increasing by $189,000 with Phase II for a total annual expenditure of $231,000 at full Project buildout.
Fiscal Impact Analysis of the Gilead Campus Expansion Project;
Net Fiscal Impact on General Fund
Based on the assumptions and analysis described above, the Project is expected to generate a positive net fiscal impact on Foster City’s General Fund relative to the existing site. The annual net fiscal impact (annual revenues – annual costs) associated with the proposed Gilead Campus Expansion is estimated at approximately $656,000 after completion of Phase I, increasing to $2.1 million at buildout of Phase II, as summarized in Table 7. When compared to the estimated net fiscal impact of the existing site of a positive $357,000 annually, the “net-net” fiscal impact of the proposed Project (net fiscal impact of the proposed Project minus the existing net fiscal impact of the site) is estimated at about $300,000 at buildout of Phase I and $1.7M at buildout of Phase II.
Actual fiscal impacts may vary due to the actual timing of Project buildout and changes in economic and budgetary conditions.
Ten-Year Post Buildout Fiscal Impact
Also included in Table 7 is an estimate for the annual fiscal impact ten years from completion of Phase II of the Project. The values shown in these columns are derived in Appendix Tables A-7A and A-7B.
EPS chose to present this ten-year impact as an annual value rather than a cumulative value because a cumulative approach would not reflect the realities of how General Fund budgets operate – the revenues generated by this Project would not be set aside to accumulate but rather be integrated into the General Fund and used in setting future budgets, so presenting a cumulative value over the ten years after Project buildout would misrepresent the impacts.
Presenting the annual impacts in ten years’ time indicates whether the anticipated inflation/escalation of City costs over this time frame outpaces the assessed value growth (capped at two percent due to Proposition 13), which could potentially erode the net fiscal impact over time.
Appendix Table A-7A shows the estimated annual fiscal impact of the proposed Project in each of the ten years following Phase II Buildout. A general annual inflation rate of three percent is applied to all revenue items with the exception of Property Tax and Property Tax In-Lieu of VLF, which are assumed to increase by two percent annually due to Proposition 13, as mentioned previously. Cost items are escalated by 3.5 percent annually, an amount which is based on the compound annual growth rate of projected General Fund expenditures listed in Foster City’s Five Year Financial Plan FY 2025-26 to FY 2029-2030.
These escalation rates are applied cumulatively each year shown, then each value is deflated by the General Inflation rate of three percent to present everything in 2026 dollar values. This approach highlights the slight decrease (in real terms) of the assessed value- based revenues over time and the slight increase (in real terms) of the expenditure items.
That being said, the total estimated annual net fiscal impact decreases in real terms by only a marginal amount over the course of these ten years, from $2.1 million to $1.9 million, Economic & Planning Systems, Inc.
indicating that the proposed Project is anticipated to remain a fiscal benefit to the City ten years after full buildout.
Appendix Table A-7B applies the same escalators and methodology as described above to the Existing Site impact, i.e., the annual net fiscal impact over ten years assuming the proposed Project is not constructed. Since there is no service population tied to the existing site there are no expenditures tied to the site, and the only revenue items are Property Tax and Property Tax In-Lieu of VLF. Since assessed value is capped to a two percent increase every year, and this analysis assumes a three percent annual inflation rate, the revenues of the existing site will slowly decline over time as inflation outpaces the capped growth in assessed value. As shown, estimated annual net fiscal impact of the existing site (in 2026 dollar terms) is anticipated to decrease from $357,000 to $327,000 over the course of a decade.
Fiscal Impact Analysis of the Gilead Campus Expansion Project;
Table 7 Annual General Fund Fiscal Impact Detail
Existing Table
Annual General Fund Impacts Site Proposed Net 1 Proposed Net 1 Proposed Net 1 Reference2 General Fund Revenues
Property Tax $332,000 $656, 000 $324,000 $2,177,000 $1, 845,000 $1,994,000 $1,690,000 Table A-3 Property Tax In-Lieu of VLF $26,000 $51,000 $25,000 $169,00 0 $143,000 $155,000 $131,000 Table A-3 Sales Tax $0 $1,000 $1,000 $ 5,000 $5,000 $5,000 $5,000 Table A-4 Franchise Fees $0 $2,000 $2,000 $11,000 $11,000 $11,000 $11,000 Table A-5 Permits $0 $2,000 $2,000 $11,000 $11,000 $11,000 $11,000 Table A-5 Rentals $0 $1,000 $1,000 $ 5,000 $5,000 $5,000 $5,000 Table A-5 Other (Fines, etc.) $0 $1,000 $1,000 $5,000 $5,000 $5,000 $5,000 Table A-5 Service Charges $0 $4,000 $4,000 $19,000 $19,000 $19,000 $19,000 Table A-5 Total Revenues $357,000 $717,000 $359,000 $2,402,000 $2,044,000 $2,204,000 $1,877,000 General Fund Expenditures
General Government $0 $1,000 $1,000 $8,000 $8,000 $9,000 $9,000 Table A-6 Financial Services $0 $0 $0 $2,000 $2,000 $2,000 $2,000 Table A-6 Parks & Recreation $0 $13,000 $13, 000 $72,000 $72,000 $76,000 $76,000 Table A-6 Police $0 $23,000 $23,000 $124 ,000 $124,000 $130,000 $130,000 Table A-6 Fire $0 $14,000 $14,000 $76,000 $76,000 $79,000 $79,000 Table A-6 Community Development $0 $2,000 $ 2,000 $12,000 $12,000 $12,000 $12,000 Table A-6 Public Works $0 $6,000 $6,000 $35,000 $35,000 $37,000 $37,000 Table A-6 Library Services $0 $0 $0 $1,000 $1,000 $1,000 $1,000 Table A-6 Property Tax Administration $0 $0 $0 $0 $0 $0 $0 Table A-6 Total Expenditures $0 $61, 000 $61,000 $331,000 $331,000 $346,000 $346,000 Annual Net Impact on General Fund $357,000 $656,000 $298,000 $2,071,000 $1,713,000 $1,859, 000 $1,532,000 Source: Economic & Planning Systems
[2] Table References indicate which table the rounded results originate from for the Phase I and II Buildout values. 10-Year Post-Buildout values originate from Tables A-7A and A-7B.
[1] Net values subtract Existing Site values from Proposed values. *Values shown are rounded to the nearest thousand. Totals may not sum due to rounding.
Buildout Buildout Post-Buildout (2026$)
Phase I Buildout Phase II 10 Years
Economic & Planning Systems, Inc.
Sensitivity Analysis: Impact of Increased Employees
As stated previously, the estimated employee count of 820 workers at full buildout of the Project compared to the 800,000 square feet of R&D space results in an average employee density of about 975 square feet per employee. This estimate is slightly higher than would be expected under a generic R&D employee density assumption, which would usually fall within the range of 400-750 square feet per employee. To estimate the lower bound of this range, EPS ran a sensitivity of the fiscal impact analysis wherein the employee density was reduced to 400 square feet per employee, resulting in an estimated 500 employees under Phase I (compared to the original 151) with an additional 1,500 under Phase II (compared to the original 669), for a total employee count at Full Buildout of 2,000 (compared to the original 820).
As Table 8 shows, even if the ultimate employee count at full buildout of the Project is more than double what the base analysis assumes (2,000 as opposed to 820), the estimated net fiscal impact is still substantially positive. The net fiscal impact at full buildout is estimated at $1.7 million per year under the original assumptions, and this number is estimated to reduce to $1.3 million if the project results in 2,000 on-site employees. This is due to the fact that each additional employee only increases estimated service costs by about $400 per year, so adding an additional 800 employees is only anticipated to increase costs by about $475,000 annually.
With a fiscal surplus of $1.7 million under base assumptions, the City can reasonably expect the fiscal impact of this Project to remain positive even if the number of employees at the site is ultimately much higher than currently anticipated.
Table 8 Employee Count Sensitivity Results
Estimated General Fund
Revenues and Expenditures Proposed Net 1 Proposed Net 1 Original Results (820 New Employees at Buildout)
Annual General Fund Revenues $717,000 $359,000 $2,402,000 $2,044,000 Annual General Fund Expenditures $61,000 $61,000 $331,000 $331,000 Annual Net Impact on General Fund $656,000 $298, 000 $2,071,000 $1,713,000 Sensitivity Results (2,000 New Employees at Buildout)
Annual General Fund Revenues $740,000 $383,000 $2,482,000 $2,125,000 Annual General Fund Expenditures $202,000 $202,000 $807,000 $807,000 Annual Net Impact on General Fund $539,000 $181, 000 $1,675,000 $1,318,000 Source: Economic & Planning Systems
*values shown are rounded to nearest thousand - values may not sum due to rounding. [1] Net values subtract Existing Site values from Proposed values.
Phase I Phase II
Buildout Buildout
Fiscal Impact Analysis of the Gilead Campus Expansion Project;
Major One-Time City Revenues
One-Time Construction Sales Tax Revenue
New development projects are required to pay sales and use tax for certain items utilized in construction based on a complex set of rules and criteria determined by the California Department of Tax and Fee Administration (CDTFA). EPS has produced an estimate of potential one-time construction sales tax revenue that the City may receive from the proposed Project based on a number of assumptions. This calculation is shown in Appendix Table A-8 for Phase I, Phase II, and the combined Project total.
In order to estimate potential construction sales tax revenues, it is necessary to estimate the total costs of taxable materials necessary for construction. EPS begins with the estimated assessed value of the Project and assumes 55 percent of this value consists of hard costs (with the remaining 45 percent consisting of between 12-15 percent developer profit and the remaining comprised of soft/other costs such as architecture, engineering, marketing, etc.). An estimate of the construction cost for the parking garage is also added and is based on values retrieved from Marshall & Swift CoreLogic Cost Estimator. The total estimated construction hard cost is therefore estimated at $132 million for Phase I and an additional $420 million for Phase II, for a total of $552 million.
The estimated construction cost is split into labor (35 percent) and materials (65 percent) based on EPS industry experience in typical development cost splits. Since labor costs are not relevant to sales tax calculation, only the materials portion is carried forward. A point- of-sale assumption of 50 percent is then applied to the materials portion of construction costs. The point-of-sale assumption is incorporated to account for the fact that only certain groups of items will be taxable in Foster City. The portion of items that will be locally taxable depends on whether the contractor submits a job-site sub-permit with the California Department of Tax & Fee Administration (CDTFA), the total amount of taxable goods within non-master contracts that exceed $5 million, the origin of the taxable goods, and the particular breakdown of fixtures and materials, among other things. As these details are not known at this time, it is assumed that half of all non-labor hard costs will be taxable in Foster City. After this point-of-sale assumption is applied, the estimate of construction costs that are taxable by Foster City is $43 million in Phase I and $137 million in Phase II, for a total overall cost of $179 million. Applying the 0.95 percent local sales tax results in an estimated $408,000 in Foster City sales tax revenues during Phase I and an additional $1.3 million in Phase II for total estimated cumulative sales tax revenues to Foster City of $1.7 million.
Economic & Planning Systems, Inc.
City Fee Revenues
There are a number of fees that new developments are required to pay in Foster City. This analysis estimates only those major fees that are readily calculable based on the information EPS has regarding the proposed Project. The fees estimated for the proposed Project include the Affordable Housing Commercial Linkage Fee, the Parks Facilities Impact Fee, the Public Safety Impact Fee, and the Transportation Impact Fee. The Project will also be required to pay various plan check, permitting, and other one-time fees that are not included in this analysis.
Appendix Table A-9 shows the selected fee revenue estimates for the proposed Project for Phase I, Phase II, and the combined total. As shown, the Project is estimated to generate about $2.75 million in revenue from the four included fees at completion of Phase I and an additional $19.14 million at completion of Phase II for a total of $21.89 million in one-time revenue from these four impact fees.
Note that these estimates assume that the Developer constructs up to the maximum allowable amount (200,000 square feet in Phase I and 600,000 square feet in Phase II).
Current project plans indicate a proposed Phase I development of only 174,785 square feet. If Phase I is ultimately built out at this reduced size, the estimated one-time impact fee revenues from Phase I would be reduced from $2.75 million to $1.84 million.
Appendix Tables
Appendix Table A-1
Service Population Factors based on Resident to Employee Equivalencies Foster City Gilead Expansion Fiscal Impact Analysis; EPS #251057 Item # %
Employment Status of Foster City Residents1 Formula: a = b * 32,658 b1 c= b * c Not in Labor Force 15,597 47.8% 100% 47.8%
Employed in the City3 1,340 4.1% 50% 2.1%
Employed Outside of the City 15,721 48.1% 67% 32.3%
Total Residents 32,658 100.0% 82.1%
Residence Status of Foster City Employees1 Formula: a = b * 20,115 b1 c= b * c Live in the City3 1,340 6.7% 50% 3.3%
Live Outside the City 18,775 93.3% 33% 30.7%
Total Primary Jobs 20,115 100.0% 34.0%
Employee to Resident Equivalency Factor
4 (34.% / 82.1%) = 41.4%
Service Population Calculation
Amount Attributable to Residents (@ 100%) 32,658 79.7%
Amount Attributable to Employees (@ 41.4%) 8,332 20.3%
Total Service Population 40,990 100.0%
Sources: LEHD OnTheMap 2022, Department of Finance, and Economic & Planning Systems, Inc. [3] The number of residents who are employed in the City and the number of employees in the City who are residents are the same, representing the same group of unique individuals. This group is reflected both in the Total Residents and the Total Jobs to demonstrate the composition of the totals, with their weighting split evenly between the resident and employee groups.
[4] Equals wei
ghted average of residents divided by weighted average of employees.
Existing Weight2 Weighted
Average
[1] Distribution and total primary jobs based on data from U.S. Census (OnTheMap 2022). Total residents based on 2025 estimates provided by DOF in Table E-5.
[2] Represents EPS estimate of how various types of residents and employees relate to each other in terms of demand for City Services.
23 Appendix Table A-2
Estimated Assessed Values
Foster City Gilead Expansion Fiscal Impact Analysis; EPS #251057 Existing
Parcel Number Development Phase I Only Phase II Only Full Buildout New Assessed Value (AV)
2 094-010-100 $0 $0 $720,000,000 $720,000,000
094-010-500 $0 $0 $0 $0
094-010-510 $0
$240,000,000 $0 $240,000,000
Total New AV $0 $240,000,000 $720,000,000 $960,000,000
Remaining AV of Existing Development
094-010-100 $36,558,455 $0 $0 $0
094-010-500 $49,092,783 $49,092,783 $0 $0
094-010-510 $60,582,585
$0 $0 $0
Total Existing AV $146,233,823 $49,092,783 $0 $0
Total Assessed Value $146, 233,823 $289,092,783 $720, 000,000 $960,000,000 Source: Economic & Planning Systems
New Development1
[2] Assessed Value data per Table 3 and Table 4.
[1] Phase II will consist of 600,000 square feet of new development across parcels 094-010-100 and 094-010-510. It is currently unknown what the ultimate distribution of square footage will be between the two parcels. For the purposes of this analysis, the full 600,000 square feet is assumed to be built on one parcel. 24 Appendix Table A-3
Property Tax Revenue Estimate
Foster City Gilead Expansion Fiscal Impact Analysis; EPS #251057 Existing
Item
Formula Phase I Only Phase II Only Full Buildout Development Property Tax
Total Assessed Value1 a $289,092,783 $720,000,000 $960,000,000 $146,233,823 Ad Valorem 1.0% Property Tax b = a * 1.0% $2,890,928 $7,200,00 0 $9,600,000 $1,462,338 Foster City Annual
General Fund Property Tax Revenue2 c = b * 22.68% $655,546 $1,632,670 $2,176,893 $331,599 Property Tax In-Lieu of VLF
Existing Citywide Property Tax In-Lieu of VLF2 d = $2,680,715 Citywide Taxable Assessed Value3 e = $15,246,606,182
Percentage of Citywide Assessed Value f = a / e 1.90% 4.72% 6.30% 0.96% Foster City Annual General Fund
Property Tax In-Lieu of VLF4 = d * f $50,829 $126,593 $168,791 $25,711 New Development
Source: San Mateo County Assessor-County Clerk-Recorder; Economic & Planning Systems [1] See Appendix Table A-2.
[2] See Table 5.
[3] 2025 Citywide Local Secured Roll per San Mateo County Assessor-County Clerk-Recorder. [4] This estimate is based on the actual amount of VLF revenues that should accrue to the City based on the estimated increase in citywide assessed value. This does not account for any State shortfalls in reimbursements that may occur. 25 Appendix Table A-4
General Fund Annual Sales Tax Revenue Estimate
Foster City Gilead Expansion Fiscal Impact Analysis; EPS #251057 Existing
Item Phase I Only Phase II Only Full Buildout Development Worker-Generated Retail Sales
Employees 151 669 820 0
Weekly Taxable Retail
Spending per Worker1 $50 $7,550 $33,450 $41,000 $0
Annual Worker Taxable Spending 48 working weeks per year $362,400 $1,605,600 $1,968,000 $0 Total Citywide Captured
Worker-Generated Retail Sales 25% of Retail Expenditures2 $90,600 $401,400 $492,000 $0 Total Retail Sales Tax Revenue
from Employee Spending 0.95% of Taxable Sales3 $861 $3,813 $4,674 $0 Source: International Council of Shopping Centers; Bureau of Labor Statistics; and Economic & Planning Systems [2] EPS assumption.
[3] See Table 5.
Assumptions /
Estimating Factors
Tables 3 and 4
[1] Limited suburban employee spending (rounded) from ICSC survey data adjusted for inflation using the Consumer Price Index (CPI).
Assumes a 5-day work week.
New Development
26 Appendix Table A-5
Other General Fund Revenues
Foster City Gilead Expansion Fiscal Impact Analysis; EPS #251057 Existing
Revenue Source Phase I Only Phase II Only Full Buildout Development Franchise Taxes $33.61 per serv ice pop. $2,102 $9,314 $11,416 $0 Permits $32.48 per service pop. $2,032 $9,001 $11,032 $0 Rentals $13.40 per service pop. $838 $3,712 $4,550 $0
Other
(Fines, etc.) $14.15 per service pop. $885 $3,920 $4,805 $0 Service Charges $57.29 per service pop. $3,583 $15,875 $19,458 $0 Total Annual Other Revenues $9,440 $41,822 $51,262 $0
Source: Economic & Planning Systems
New DevelopmentAssumptions /
Estimating Factors1
[1] See Table 5 for revenue estimates and Tables 3 and 4 for project service population. 27 Appendix Table A-6
Annual General Fund Expenditures
Foster City Gilead Expansion Fiscal Impact Analysis; EPS #251057 Expenditure Existing
Item Phase I Only Phase II Only Full Buildout Development General Government $23.95 per se rvice pop. $1,498 $6,637 $8,134 $0 Financial Services $6.93 per service pop. $434 $1,921 $2,354 $0 Parks & Recreation $212.80 per se rvice pop. $13,310 $58,970 $72,280 $0 Police $366.06 per service pop. $22,896 $101,442 $124,339 $0 Fire $222.59 per service pop. $13,922 $61,683 $75,605 $0 Community Development $34.51 per service pop. $2,159 $9,564 $11,723 $0 Public Works $103.46 per service pop. $6,471 $28,671 $35,143 $0 Library Services $3.71
per service pop. $232 $1,027 $1,259 $0
Total Annual Expenditures $974.00 per service pop. $60,922 $269,915 $330,837 $0 Source: Economic & Planning Systems
Expenditure Estimation
Factors1
[1] See Table 6 for cost estimates and Tables 3 and 4 for project service population.
New Development
28 Appendix Table A-7a
10 Year Impact - Proposed Project
Foster City Gilead Expansion Fiscal Impact Analysis; EPS #251057 (Buildout)
Item Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Assumptions (Annual Change)
General Inflation Rate1 3.0%
City Cost Inflator2 3.5%
Property Assessed Value Increase 2.0%
General Fund Revenues
Property Tax $2,176,900 $2,155,800 $2,134,800 $ 2,114,100 $2,093,600 $2,073,300 $2,0 53,100 $2,033,200 $2,013,400 $1,993,900 Property Tax In-Lieu of VLF $168,800 $167,200 $165,500 $16 3,900 $162,300 $160,800 $159, 200 $157,600 $156,100 $154,600 Sales Tax $4,700 $4,700 $4,700 $4,700 $4, 700 $4,700 $4,700 $4,700 $4,700 $4,700 Franchise Fees $11,400 $11,400 $11,400 $11,4 00 $11,400 $11,400 $11,400 $11,400 $11,400 $11,400 Permits $11,000 $11,000 $11,000 $11,000 $11,000 $11,000 $11,000 $11,000 $11,000 $11,000 Rentals $4,600 $4,600 $4,600 $4,600 $4, 600 $4,600 $4,600 $4,600 $4,600 $4,600 Other
(Fines, etc.) $4,800 $4,800 $4,800 $4,800 $4,800 $4 ,800 $4,800 $4,800 $4,800 $4,800 Service Charges $19,500 $19,500 $19,500 $19,500 $19,500 $19,500 $19,500 $19,500 $19,500 $19,500 Total Revenues $2,401,600 $2,378,800 $2,356,300 $2,334,000 $2,311,800 $2,289,900 $2,268,300 $2,246,800 $2,225,500 $2,204,400 General Fund Expenditures
General Government $8,100 $8,200 $8,200 $8 ,300 $8,300 $8,300 $8,400 $8,400 $8,500 $8,500 Financial Services $2,400 $2,400 $2,400 $2 ,400 $2,400 $2,400 $2,400 $2,400 $2,400 $2,500 Parks & Recreation $72,300 $72,600 $73,000 $73, 400 $73,700 $74,100 $74,400 $74,800 $75,200 $75,500 Police $124,300 $124,900 $125,600 $126,200 $126,800 $127,400 $128,000 $128,700 $129,300 $129,900 Fire $75,600 $76,000 $76,300 $76,700 $77,100 $77,500 $77,900 $78,200 $78,600 $79,000 Communit
y Development $11,700 $11,800 $11,800 $11,90 0 $12,000 $12,000 $12,100 $12,100 $12,200 $12,300 Public Works $35,100 $35,300 $35,500 $35,70 0 $35,800 $36,000 $36,200 $36,400 $36,500 $36,700 Library Services $1,300 $1,300 $1,300 $1,300 $1,300 $1,300 $1,300 $1,300 $1,300 $1,300 Property Tax Administration $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Total Expenditures $330,800 $332,500 $334,100 $335,700 $337,400 $339,000 $340,700 $342,400 $344,100 $345,800 Total Net Impact $2,070,800 $2,046,400 $2,022,200 $1,998,200 $1,974,500 $1,950,900 $1,927,500 $1,904,400 $1,881,400 $1,858,700 Source: Economic & Planning Systems
[1] Revenue Items (except Property Tax and Property Tax In-Lieu of VLF) increase annually by the General Inflation Rate. All values shown (revenues and expenditures) are deflated annually by the general inflation rate to maintain constant 2026$ presentation of values. [2] Expenditures increase annually by the city cost inflator. Assumed to escalate at 3.5% annually based on the compound annual growth rate of General Fund expenditures listed in Foster City's Five Year Financial Plan FY 2025-26 to FY 2029-2030 from Page 32 of City of Foster City Final Budget Fiscal Year 2025-26. *Values shown are rounded to the nearest hundred and expressed in 2026 dollars. 29 Appendix Table A-7b
10 Year Impact - Existing Development
Foster Cit
y Gilead Expansion Fiscal Impact Analysis; EPS #251057
Item Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Assumptions (Annual Change)
General Inflation Rate1 3.0%
City Cost Inflator2 3.5%
Property Assessed Value Increase 2.0%
General Fund Revenues
Property Tax $331,600 $328,400 $325,200 $322,000 $318,900 $315,800 $312,700 $309,700 $306,700 $303,700 Property Tax In-Lieu of VLF $25,700 $25,500 $25,200 $2 5,000 $24,700 $24,500 $24, 200 $24,000 $23,800 $23,600 S a l e s T a x $ 0$ 0$ 0$ 0$ 0$ 0$ 0$ 0$ 0$ 0
Franchise Fees $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
P e r m i t s $ 0$ 0$ 0$ 0$ 0$ 0$ 0$ 0$ 0$ 0
R e n t a l s $ 0$ 0$ 0$ 0$ 0$ 0$ 0$ 0$ 0$ 0
Other
(Fines, etc.) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Service Charges $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Revenues $357,300 $353,800 $350,400 $347,000 $343,600 $340,300 $337,000 $333,700 $330,500 $327,300 General Fund Expenditures1
General Government $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Financial Services $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
P a r k s & R e c r e a t i o n $ 0$ 0$ 0$ 0$ 0$ 0$ 0$ 0$ 0$ 0 Police $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Fire $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Communit
y D e v e l o p m e n t $ 0$ 0$ 0$ 0$ 0$ 0$ 0$ 0$ 0$ 0
P u b l i c W o r k s $ 0$ 0$ 0$ 0$ 0$ 0$ 0$ 0$ 0$ 0
Librar
y Services $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Property Tax Administration $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Total Expenditures $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Net Impact $357,300 $353,800 $350,400 $347,000 $343,600 $340,300 $337,000 $333,700 $330,500 $327,300 Source: Economic & Planning Systems
[1] Revenue Items (except Property Tax and Property Tax In-Lieu of VLF) increase annually by the General Inflation Rate. All values shown (revenues and expenditures) are deflated annually by the general inflation rate to maintain constant 2026$ presentation of values. *Values shown are rounded to the nearest hundred and expressed in 2026 dollars. [2] Expenditures increase annually by the city cost inflator. Assumed to escalate at 3.5% annually based on the compound annual growth rate of General Fund expenditures listed in Foster City's Five Year Financial Plan FY 2025-26 to FY 2029-2030 from Page 32 of City of Foster City Final Budget Fiscal Year 2025-26. 30 Appendix Table A-8
Estimate of One-Time Construction Sales Tax
Foster City Gilead Expansion Fiscal Impact Analysis; EPS #251057 Overall
Taxable Sales
Formula Phase I Only Phase II Only Total
Assessed Value (AV) of R&D Development a $240,000,000 $720,000,000 $960,000,000 Estimated Construction Hard Cost of R&D 55% of AV 1 b = a * 55% $132,000,000 $396, 000,000 $528,000,000 Estimated Construction Hard Cost of Parking Garage2 c $0 $24,290,000 $24,290,000 Estimated Total Construction Hard Costs d = b + c $132,000,000 $420,290 ,000 $552,290,000 Labor 35% of Hard Costs e = d * 35% $46,200,000 $147,101, 500 $193,301,500 Materials 65% of Hard Costs f = d * 65% $85,800,000 $273,188 ,500 $358,988,500 Point-of-Sale Assumption3 50% of Materials g = f * 50% $42,900,000 $136,594 ,250 $179,494,250 Estimated Construction Sales Tax Revenue 0.95% Sales Tax = g * 0.95% $407,550 $1,297,645 $1,705,195 Source: Marshall & Swift CoreLogic; Economic & Planning Systems [3] A point-of-sale assumption is incorporated to account for the fact that only certain groups of items will be taxable in Foster City. The portion of items that will be locally taxable depends on whether the contractor submits a job-site sub-permit with the CDTFA, the total amount of taxable goods within non-master contracts that exceed $5 million, the origin of taxable goods, and the particular breakdown of fixtures and materials, among other things. As these details are not known at this time, it is assumed that half of all non-labor hard costs will be taxable in Foster City. [2] Applicant proposes a 694-space parking structure. EPS assumes 350 gross square feet per space and applies a $100 per gross square foot construction cost estimate based on Marshall & Swift CoreLogic Cost Estimator results for a podium parking structure. [1] Assumes $1,200 per square foot is equal to market value, deducts land value, assumes between a 12-15% developer profit, and the remaining value is further split into 25% for soft/other costs and 75% for hard costs (such that soft/other costs represent one third of hard costs). Resulting hard cost equates to about $650 per square foot.
Assumptions
Table A-2
See Footnote 2
31 Appendix Table A-9
Estimate of One-Time Impact Fees
Foster City Gilead Expansion Fiscal Impact Analysis; EPS #251057 Overall
Item Phase I Only Phase II Only Total
Existing Developed Square Feet 123,536 67,971 191,507
Square Feet
(Sq. Ft.) of New Development2 200,000 600,000 800,000
Net New Square Feet 76,464 532,029 608,493
Affordable Housing Commercial Linkage Fee $30.78 per Net New Sq. Ft. $2,353,562 $16,375,853 $18,729,415 Parks Facilities Impact Fee $3.60 pe r Net New Sq. Ft. $275,270 $1,915,304 $2,190,575 Public Safety Impact Fee $0.38 pe r Net New Sq. Ft. $29,056 $202,171 $231,227 Transportation Impact Fee $1.22 per Net New Sq. Ft. $93,286 $649,075 $742,361 Total Impact Fees $2,751,175 $19,142, 403 $21,893,578
Fee Rate1
[1] City of Foster City/Estero Municipal Improvement District Master Fees & Service Charges Schedule Fiscal Year 2025-26 for industrial uses; Linkage Fee schedule specifies R&D uses are treated as industrial for purposes of fee administration so that assumption is utilized for all impact fee categories listed here.
Source: City of Foster City/Estero Municipal Improvement District Master Fees & Service Charges Schedule Fiscal Year 2025-26; Economic & Planning Systems [2] It is assumed that the Project will be built to its fully-entitled Phase I amount (200,000 square feet). The Developer's current plans indicate a Phase I total of only 174,785 square feet, which would reduce the estimated Phase I impact fee total to about $1.8 million. 32