DATE:
January 16, 2024
TO:
Mayor and City Council Members
FROM:
Rachel Molina, City Manager
BY:
Casey Brooksher, Assistant City Manager
Keith Cheong, Senior Accountant
SUBJECT:
Fiscal Year 2022-2023 Annual Compliance Report for AB 1600 Development Impact Fees
RECOMMENDED ACTION
It is recommended that the City Council receive and file the AB 1600 report on development fee activity that occurred during Fiscal Year (FY) 2022-2023.
BACKGROUND
State of California Assembly Bill 1600 (AB 1600) – the Mitigation Fee Act (Government Code, Sections 66000 et seq.) sets forth the standards of governing fees charged to address the impacts of development. The City Council adopted and updated various development impact fees applicable to new development within the City. The purpose of development impact fees is to finance the design, construction, and acquisition of facilities and equipment necessary to accommodate future development.
ISSUES/ANALYSIS
Development impact fees are collected, segregated and placed in special funds or accounts which earn interest. Those funds are held for the facilities from which the fees are collected, in accordance with Government Code Section 66006. This report provides a summary of development fee activity and financial detail regarding each of the projects impacted during FY 2022-23 (July 1, 2022 through June 30, 2023). The summary of development fee activity and detail regarding each project is included as Attachment 1 to this report.
Annual Compliance Reporting for all Development Impact Fees Government Code Section 66006(b) sets forth that for each Development Impact Fee (DIF) the City shall, within 180 days after the last day of each fiscal year, make available to the public the following information:
A brief description of the type of fee in the account or fund.
The amount of the fee.
The beginning and ending balance of the account or fund.
The amount of the fees collected and interest earned.
An identification of each public improvement on which fees were expended and the amount of expenditures on each improvement, including the total percentage of the cost of the public improvement that was funded with fees.
An identification of an approximate date by which the construction of the public improvement will commence if the local agency determines that sufficient funds have been collected to complete financing on an incomplete public improvement.
A description of each interfund transfer or loan made from the account or fund, including the public improvement on which the transferred or loaned fees will be expended, and in the case of an interfund loan, the date on which the loan will be repaid and the rate of interest that the account or fund will receive on the loan.
The amount of refunds made due to sufficient funds being collected to complete financing on incomplete public improvements, and the amount of reallocation of funds made due to administrative costs of refunding unexpended revenues exceeding the amount to be refunded.
Stated below are the unaudited DIF Balances as of June 30, 2023.
Fund
Fund Balance as of 6/30/2023
Transportation Facilities
$7,210,093
Citywide Drainage Facilities
$5,681,952
A-04 Drainage Facilities
$823,569
Fire Facilities
$4,398,377
Police Facilities
$41,710
Public and City Hall Facilities
($3,035,399)1
Animal Control Facilities
$273,010
Records Storage Facilities
$128,179
Note:
1. Includes accumulated debt related to loan from the General Fund which was made in order to cover the shortfall in the required 87.25% contribution from Impact Fees. The General Fund loan amount will increase annually until Impact Fees are sufficient to make the full 87.25% contribution.
The attached report provides all the required elements and details regarding balance, fees collected, and project expenditures. The purpose of the applicable legal requirements under the Mitigation Fee Act, as it applies to findings and compliance reporting, is to provide the community with information as to the status and use of impact fees collected. Additionally, every five years, Government Code Section 66001(d) requires the City to identify the purpose for the continued collection of the fee and the anticipated amount of impact fees to be used towards future improvements. This five-year requirement was met with the Fiscal Years 2015-16 through 2020-21 report approved by the City Council in January 2022. The next five-year report requirement will be included with the Fiscal Year 2025-26 report.
The Fiscal Year 2022-2023 annual report presented meets the requirements per the Mitigation Fee Act.
In addition, per Section 66006(2), the City is required to review and accept the report not less than fifteen (15) days after the information has been made available to the public for review.
FISCAL IMPACT
There is no fiscal impact. This report provides a summary of transaction activity that has already occurred and expenditures on projects previously authorized by the City Council.
ALTERNATIVE(S)
Provide alternative direction to staff.
ATTACHMENTS
Attachment 1 – AB 1600 Report
City of Hesperia STAFF REPORT City of Hesperia STAFF REPORT City of Hesperia
STAFF REPORT
City of Hesperia
STAFF REPORT
Staff Report to the Mayor and City Council
Fiscal Year 2022-23 Annual Compliance Report for AB 1600 Development Impact Fees January 16, 2024