La Verne City Council
April 20, 2026

Agenda Packet - April 20, 2026
4 2. PR-1/5 planned residential, one detached dwelling unit/five acres;

3. PR-1D planned residential, one detached dwelling unit/acre;

4. PR-2D planned residential, two detached dwelling units/acre;

5. PR-3D planned residential, three detached dwelling units/acre;

6. PR-4.5D planned residential, four and one-half detached dwelling units/acre;

7. PR-5D planned residential, five detached dwelling units/acre;

8. PR-6A planned residential, six attached dwelling units/acre;

9. PR-7A planned residential, seven attached dwelling units/acre;

10. PR-7.5A planned residential, seven and one-half attached dwelling units/acre;

11. PR-8A planned residential, eight attached dwelling units/acre;

12. PR-10A planned residential, ten attached dwelling units/acre;

13. PR-15A planned residential, fifteen attached dwelling units/acre;

14. C-P-D commercial-professional mixed development, where residential has been allowed by Section 18.120.060.

B. An accessory dwelling unit may only be constructed on a lot which contains an existing or proposed single-family or multifamily dwelling.

C. Accessory dwelling units shall not count in determining density or lot coverage and are considered a residential use consistent with the existing general plan and zoning designation for the lot.
§ 18.120.045 Location/Number.

A. Location.

1. Accessory dwelling units shall be located only on lots with an existing or proposed single-family or multifamily dwelling. Junior accessory dwelling units shall be located only on lots in a single-family zone.

2. Accessory dwelling units may be interior conversions, attached or detached and may be located in an attached or detached garage or in an existing accessory structure.

3. Attached and detached accessory dwelling units shall be located behind the rear building line of the primary residence in a single-family zone. However, this requirement shall not apply if the accessory dwelling unit is being converted from a legally existing accessory structure, including a garage, or constructed in the exact

Agenda Packet - April 20, 2026
5 same location and to the exact same dimensions as a legal, previously existing accessory structure.

B. Number.Only one accessory dwelling unit or one junior accessory dwelling unit shall be allowed on a residentially zoned lot, unless otherwise permitted in accordance with Section 18.120.060 below.
§ 18.120.050 Development standards/requirements— Accessory dwelling units.

A. Type of Building. An attached or detached accessory dwelling unit shall be a permanent structure on a permanent foundation with permanent provisions for living, sleeping, food preparation, sanitation, and bathing. A manufactured home as defined in California Health and Safety Code Section 18007 shall qualify.

B. Height. The height of an attached or detached accessory dwelling unit shall not exceed the following limits.

1. A detached accessory dwelling unit shall not exceed a maximum height of eighteen feet if the accessory dwelling unit is on a lot with an existing or proposed single-family or multifamily dwelling unit if located within one-half mile walking distance of a major transit stop or a high-quality transit corridor as those terms are defined in Public Resources Code Section 21155. An additional two feet in height shall be allowed to accommodate a roof pitch on the accessory dwelling unit that is aligned with the roof pitch of the primary dwelling unit.

2. A detached accessory dwelling unit on a lot with an existing or proposed multifamily, multistory dwelling shall not exceed eighteen feet.

3. An attached accessory dwelling unit shall have a maximum height of twenty-five feet, or the height allowed for the primary dwelling, whichever is lower.

4. An accessory dwelling unit may be built on top of a detached garage; provided that the garage is maintained for parking and the total height of the structure does not exceed twenty-five feet. If an accessory dwelling unit is built pursuant to this provision, a declaration shall be recorded that the garage must be maintained for parking.

5. In all other cases not described in subsections 1-4, the maximum height for an accessory dwelling unit shall be sixteen feet.

6. No accessory dwelling unit shall exceed two stories.

C. Size.

1. The maximum size of an attached or detached accessory dwelling unit is eight hundred fifty square feet if it has zero or one bedrooms, and one thousand square feet if it has two or more bedrooms.

Agenda Packet - April 20, 2026
6 2. The minimum square footage for an attached or detached accessory dwelling unit shall not be less than the size allowed for an efficiency unit as defined in Health and Safety Code Section 17958.1.

3. Notwithstanding any other provision of this section, development standards shall be waived to allow an applicant to build an eight hundred square foot accessory dwelling unit provided that the height requirements do not exceed those set forth in subsection C above with at least four-foot side and rear yard setbacks.

4. Junior accessory dwelling units shall not exceed 500 square feet.

D. Setbacks.

1. Attached and detached accessory dwelling units shall be located behind the rear building line of the primary residence.

2. An accessory dwelling unit, including a unit constructed above a permitted garage, shall have rear and side yard setbacks of at least four feet.

3. The setback requirements in subsections E.1 and E.2 above shall not apply if the accessory dwelling unit is being converted from an approved accessory structure, including a garage, or being constructed in the same location and to the same dimensions as an approved existing accessory structure, including a garage.

4. Accessory dwelling units shall be required to comply with the requirements of the California Building Standards Code as set forth in Chapter 15.04 of this code, including relating to the distance between buildings. Notwithstanding the above, the construction of an ADU shall not constitute a Group R occupancy change unless the building official makes a written finding based on substantial evidence in the record that the construction of the ADU could have a specific, adverse impact on public health and safety.

5. Detached accessory dwelling units shall be a minimum of ten feet from other buildings on the same property.

6. No portion of an accessory dwelling unit may encroach into any public or private easement such as a utility easement unless the easement holder has provided written permission to construct the accessory dwelling unit in the manner proposed. To establish a rebuttable presumption of compliance with this requirement, the applicant may provide a written declaration under penalty of perjury affirming compliance with this requirement. The declaration shall be in a form acceptable to the city attorney.

E. Lot Coverage. The lot coverage standards of the underlying zoning district or specific plan area where the unit is located shall control.

F. Outdoor Living. For accessory dwelling units in single-family zones, there must be outdoor living spaces that meet the following requirements:

Agenda Packet - April 20, 2026
7 1. Each unit shall have a separate usable outdoor living area of four hundred square feet, with fifteen feet minimum in any direction.

2. Outdoor living areas shall be landscaped.

3. Outdoor living areas do not include parking areas, driveways, or front and rear yard setback areas of the primary residence.

G. Parking.

1. Parking shall be required at the rate of one space for each accessory dwelling unit that is at least one bedroom. No parking spaces shall be required for an accessory dwelling unit created within an existing livable space.

2. Parking spaces may be provided through tandem parking on an existing driveway provided that such parking does not encroach into the public sidewalk.

3. Parking spaces for accessory dwelling units may be provided in paved portions of setback areas provided that the amount of paving does not exceed the total amount of paving and hardscaped areas that are otherwise allowed by this title.

4. When a garage, carport, uncovered parking space, or covered parking structure is demolished or converted in conjunction with the construction of an accessory dwelling unit, such parking spaces need not be replaced.

5. Tandem parking and parking in setback areas shall not be allowed if the community development director makes specific findings that such parking is not feasible based upon specific site or regional topographical, or fire and life safety conditions.

6. Notwithstanding any other provision of this subsection, no parking shall be required for the accessory dwelling unit if any of the following conditions apply:
a. The accessory dwelling unit is located within one-half mile walking distance of public transit;
b. The accessory dwelling unit is located within an architecturally and historically significant historic district or the property is subject to the Mills Act; c. The accessory dwelling unit is part of a proposed or existing primary residence or an accessory structure;
d. When on-street parking permits are required, but not offered to the occupant of the accessory dwelling unit;
e. When there is a car share vehicle located within one block of the accessory dwelling unit; or
f. When a permit application for an accessory dwelling unit is submitted with a permit application to create a new single-family or multifamily dwelling

Agenda Packet - April 20, 2026
8 on the same lot provided that the accessory dwelling unit or the parcel satisfies any other criteria listed in this subsection H.6.
g. If a parking space is not required, then the owner shall be required to disclose that fact in any rental agreement.

H. Design.

1. The accessory dwelling unit shall be of the exact same architectural style, including roof design, windows, doors, wall treatment materials, and color as the primary unit.

2. The accessory dwelling unit shall have a separate entrance from the primary dwelling unit.

3. The accessory dwelling unit shall not alter the appearance of the primary single-family dwelling unit.

I. Fire sprinklers shall only be required in any accessory dwelling unit if they were required in the primary unit. The construction of an accessory dwelling unit shall not trigger a requirement for fire sprinklers to be installed in the existing primary dwelling.

J. Utilities— Connections, Fees and Capacity Charges.

1. Attached/Interior Accessory Dwelling Units.
a. The unit shall be connected to utilities, but a separate utility connection shall not be required unless the accessory dwelling unit is being constructed in connection with a proposed residential dwelling.
b. For an accessory dwelling unit contained within a proposed or existing single-family dwelling meeting the requirements of Section 18.20.060.A, the city shall not impose a connection fee or capacity charge, unless the unit is being constructed with a new single-family dwelling. For all other accessory dwelling units, the city shall charge a connection fee or capacity charge that is proportionate to the burden of the proposed accessory dwelling unit based on the size of the unit or number of plumbing fixtures.
c. No connection fees or capacity charges shall be imposed on a homeowner applying for a permit for a previously unpermitted junior or accessory dwelling units built before January 1, 2020, except when the utility infrastructure is required to comply with Health and Safety Code Section 17920.3 and authorized by Government Code Section 66324(e).

2. Detached Accessory Dwelling Units. The unit shall be connected to utilities, but a direct connection between the utility at the unit shall not be required unless the accessory dwelling unit is being constructed in connection with a proposed residential dwelling.

Agenda Packet - April 20, 2026
9 3. No connection fee or capacity charge shall be imposed on a homeowner applying for a permit for a previously unpermitted junior or accessory dwelling units built before January 1, 2020, except when the utility infrastructure is required to comply with Health and Safety Code section 17920.3 and authorized by Government Code section 66324(e).

K. Impact Fees.

1. No impact fee shall be imposed on any accessory dwelling unit less than seven hundred fifty square feet in size.

2. For accessory dwelling units seven hundred fifty square feet or greater, impact fees shall be charged proportionately in relation to the square footage of the primary dwelling.

3. All applicable public service and recreation impact fees shall be paid prior to occupancy in accordance with Government Code Section 66000 et seq. and 66012 et seq.

4. No impact fees shall be imposed on a homeowner applying for a permit for a previously unpermitted junior or accessory dwelling units built before January 1, 2020, except when the utility infrastructure is required to comply with Health and Safety Code section 17920.3 and authorized by Government Code section 66324(e).

L. Historic Properties. If a primary structure is subject to a Mills Act contract with the City, construction shall comply with the contract’s standards, including design conformance with the Secretary of Interior Standards. Additionally, the Mills Act contract shall be amended to authorize the accessory dwelling unit on the site.

M. Square Footage. All references to square footage in this Chapter are based on the square footage of interior livable space.
§ 18.120.060 Mandatory approvals.

Notwithstanding any other provision of this chapter, the city shall ministerially approve an application for any combination of the following:

A. One accessory dwelling unit and one junior accessory dwelling unit per lot within the existing or proposed space of a single-family dwelling or accessory structure.

1. An expansion of up to one hundred fifty square feet shall be allowed in an accessory structure solely for the purposes of accommodating ingress and egress.

2. The junior or accessory dwelling unit shall have exterior access separate from the existing or proposed single-family dwelling.

3. The side and rear setbacks shall be sufficient for fire and safety.

4. If the unit is a junior accessory dwelling unit, it shall comply with the requirements of Sections 18.120.070 and 18.120.080 below.

Agenda Packet - April 20, 2026
10 B. One detached accessory dwelling unit that does not exceed four-foot side and rear yard setbacks on a lot with an existing or proposed single-family dwelling, provided that the unit shall not be more than eight hundred square feet and shall not exceed the height specified in Section 18.120.050.B.1, C.2, , or sixteen feet in any other case.

C. On a lot with a multifamily dwelling structure, up to twenty-five percent of the existing multifamily dwelling units, but no less than one unit, shall be allowed within the portions of the existing structure that are not used as livable space, including, but not limited to, storage rooms, boiler rooms, passageways, attics, basements, or garages, provided that each unit complies with state building standards for dwellings.

D. On a lot with an existing multifamily dwelling structure, up to eight detached units, but in no event more than the number of existing units on the lot, , provided that they meet the height requirements of Section 18.120.050.B.1 through C.3, above, or not exceed sixteen feet in all other cases, and have at least four-foot side and rear yard setbacks.

E. On a lot with a proposed multifamily dwelling, up to two detached units, provided that they meet the height requirements of Section 18.120.050B.1, C.2, or not exceed sixteen feet in any other case, and have at least four-foot side and rear yard setbacks.

F. The junior and accessory dwelling units authorized under this section may not be combined with any other junior or accessory dwelling unit otherwise authorized by this Chapter.

G. A permit application may not be denied due to the need to correct a nonconforming zoning condition.

H. Fire sprinklers shall only be required in a junior or accessory dwelling unit if they were required in the primary unit. The construction of a junior or accessory dwelling unit shall not trigger a requirement for fire sprinklers to be installed in the existing primary dwelling.

I. Rentals of a junior or accessory dwelling unit created pursuant to this section shall be for a minimum of thirty-one days.
§ 18.120.070 Junior accessory dwelling units.

A. One junior accessory dwelling unit shall be allowed on each lot in the single- family residential zone within an existing or proposed single-family dwelling, including an attached garage. A junior accessory dwelling unit shall be allowed in conjunction with an accessory dwelling unit as specified in Section 18.120.060.

B. The junior accessory dwelling unit shall contain at least an efficiency kitchen which includes cooking appliances and a food preparation counter and storage cabinets that are of reasonable size in relation to the junior accessory dwelling unit.

Agenda Packet - April 20, 2026
11 C. The junior accessory dwelling unit shall have a separate entrance from the primary residence.

D. The junior accessory dwelling unit may, but is not required to, include separate sanitation facilities.

1. If separate sanitation facilities are not provided, the junior accessory dwelling unit shall share sanitation facilities with the single-family residence and must have an interior entry to the main living area of the single-family residence.

2. If sanitation facilities are shared, the owner must reside in either the primary unit or the junior accessory dwelling unit, unless the owner is another governmental agency, land trust, or housing organization.

E. Fire sprinklers shall not be required in a junior accessory dwelling unit if they are not required for the primary dwelling and the construction of a junior accessory dwelling unit shall not trigger a requirement for sprinklers to be installed in the existing primary unit.

F. No additional parking shall be required for a junior accessory dwelling unit.

G. A junior accessory dwelling unit shall be required to comply with applicable building standards.

H. The owner of property on which a junior accessory dwelling unit is constructed shall abide by the following and record a deed restriction which shall run with the land and shall provide for the following:

1. A prohibition on the sale of the junior accessory dwelling unit separate from the sale of the single-family residence;

2. A prohibition from enlarging the junior accessory dwelling unit beyond five hundred square feet;

3. A prohibition from renting the property for less than thirty-one consecutive, calendar days;

4. A statement that the deed restrictions may be enforced against future purchasers; and

5. A copy of the deed restriction shall be filed with the community development department after recordation.

I. For the purposes of any fire or life protection ordinance or regulation, or for providing service for water, sewer, or power, including a connection fee, a junior accessory dwelling unit shall not be considered to be a separate or new dwelling unit.

Agenda Packet - April 20, 2026
12 § 18.120.080 Regulations.

A. Sales.

1. Accessory dwelling units shall not be sold separately from the primary unit unless the sale is to a qualified nonprofit corporation in accordance with the provisions of Government Code Section 66341.

2. Junior accessory dwelling units shall not be sold separately from the primary unit.

B. Rental. All junior and accessory dwelling units may be rented separate from the primary rented and shall be rented for a minimum of thirty-one days.

C. Owner/Occupancy.

1. The city shall not enforce any owner/occupancy requirement previously imposed on an accessory dwelling unit.

2. No accessory dwelling unit shall be subject to an owner-occupancy requirement.

3. Junior accessory dwelling units shall only have an owner/occupancy requirement as specified in section 18.120.070.D.

D. This chapter shall in no way validate any existing illegal accessory dwelling unit nor shall it change a legal nonconforming unit to a conforming unit.

E. Unpermitted Accessory Dwelling Units.

1. An application for an accessory dwelling unit to convert an illegal and/or nonconforming accessory dwelling unit to a legal conforming accessory dwelling unit shall be subject to the same standards and requirements as for a newly proposed unit.

2. Notwithstanding subsection E.1 above, the city shall not deny a permit for an unpermitted accessory dwelling unit or junior accessory dwelling unit constructed before January 1, 2020 on the grounds that it is in violation of the California Building Standards (Health and Safety Code Section 17960 et seq.) or that it does not comply with this chapter unless the city makes a finding that correcting the violation is necessary to comply with the standards specified in Health and Safety Code section 17920.3 or if the building is deemed substandard pursuant to Health and Safety Code section 17920.3.

3. The city shall inform the applicant that before submitting an application for a permit, the homeowner may obtain a confidential third-party code inspection from a licensed contractor to determine the unit’s existing condition or potential scope of building improvements before submitting an application for a permit.

4. Upon receiving an application to permit a previously unpermitted ADU or JADU constructed before January 1, 2020, an inspector from the city may inspect the

Agenda Packet - April 20, 2026
13 unit for compliance with health and safety standards and provide recommendations to comply with such standards in order to obtain a permit. The city shall not penalize an applicant for having the unpermitted ADU or JADU and shall approve necessary permits to correct noncompliance with health and safety standards.

F. Guesthouses that were previously approved and which have a valid building permit on file shall not be affected by this chapter. However, an application to convert a guesthouse to an accessory dwelling unit shall be subject to this chapter.

G Enforcement. Until January 1, 2030, the city shall issue a statement with a notice to correct a violation of any building standard relating to an accessory dwelling unit that provides substantially as follows:

You have been issued an order to correct violations or abate nuisances relating to your accessory dwelling unit. If you believe that this correction or abatement is not necessary to protect public health and safety, you may file an application with the Community Development Department. If the City determines that enforcement is not required to protect the health and safety, enforcement shall be delayed for a period of five years from the date of the original notice.

H. Accessory dwelling units and junior accessory dwelling units shall be required to obtain a separate address for the unit from the department of building and safety.

I. When an accessory dwelling unit is being proposed with a new primary dwelling unit, the city shall not issue a certificate of occupancy for an accessory dwelling unit before it issues a certificate of occupancy for the primary dwelling unit.

SECTION 3. CEQA. This Ordinance is exempt from CEQA pursuant to Public Resources Code section 21080.17 which provides CEQA does not apply to the adoption of an ordinance to implement ADU law.

SECTION 4. Effective Date. This Ordinance shall take effect on the 31st day after passage.

SECTION 5. Severability. If any section, subsection, subdivision, paragraph, sentence, clause or phrase of this ordinance, or any part thereof is for any reason held to be unconstitutional, such decision shall not affect the validity of the remaining portion of this ordinance or any part thereof. The City Council hereby declares that it would have passed each section, subsection, subdivision, paragraph, sentence, clause or phrase thereof, irrespective of the fact that any one or more section, subsection, subdivision, paragraph, sentence, clause, or phrase be declared unconstitutional.

SECTION 6. Certification. The Deputy City Clerk shall certify the passage of this ordinance and shall cause the same to be entered in the book of original ordinances of said City; shall make a minute passage and adoption thereof in the records of the meeting at which time the same is passed and adopted; and shall, within fifteen (15) days after the passage and adoption thereof, cause the same to be processed as required by law.

Agenda Packet - April 20, 2026
14 SECTION 7. Transmission to HCD. The Deputy City Clerk shall send a copy of this Ordinance to the Department of Housing and Community Development as required by State law.

PASSED, APPROVED AND ADOPTED this _____day of __________, 2026, by the City Council at La Verne, California.
______________________________________
Mayor Tim Hepburn
_______________________________
Debra Fritz, CMC Deputy City Clerk

CERTIFICATION
I hereby certify that the foregoing Ordinance 26-XXX was duly and regularly adopted by the City Council of the City of La Verne at a meeting thereof held on the ____ day of ____________, 2026, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
____________________________________
Debra Fritz, CMC Deputy City Clerk

Agenda Packet - April 20, 2026
City of La Verne,City Council
Agenda Report

DATE: April 20, 2026
TO: Honorable Mayor and City Council
FROM: Ken Domer, City Manager
SUBJECT: MASTER LICENSE AGREEMENT FOR SMALL CELL WIRELESS FACILITIES IN THE PUBLIC RIGHT-OF-WAY.

SUMMARY
Under state law, and subject to City approval, telecommunication companies have certain authorities to install wireless facilities, also known as small cells, in the public right-of-way. One of the City's requirements is that wireless service providers enter into a Master License Agreement (Agreement) with the City prior to installing any facilities. The City Attorney's office has approved a template Agreement and this action seeks approval of the Agreement as well as authorization for the City Manager to execute Agreements and issue individual pole licenses subject to the terms and conditions within the Agreement in order to provide greater access and connectivity to cellular technology.

RECOMMENDATION
That the City Council approve the Master License Agreement for small cell wireless facilities within the public right-of-way and delegate authority to the City Manager to execute Master License Agreements and individual pole license agreements subject to the terms and conditions of the City Council approved Master License Agreement.

DISCUSSION
Over the past decade, regulation of small cell wireless facilities has evolved significantly at both the federal and state levels to facilitate deployment of next-generation telecommunications infrastructure. The Federal Communications Commission (FCC) has adopted a series of orders, including the 2018 Declaratory Ruling and Third Report and Order, which established “shot clocks” for local review of wireless applications and limited the scope of local discretion over aesthetic and land use considerations. In California, these federal standards are complemented by state laws which further streamline permitting for wireless facilities. As such, these state and federal regulations require expediting the deployment of small cell infrastructure, typically installed on existing utility poles or streetlights, to support increasing demand for wireless data, improved network reliability, and increased coverage area.

Cities, in response, have adopted Master License Agreements (MLAs) with telecommunications providers. An MLA establishes standardized terms and conditions governing the placement, operation, and maintenance of small cell facilities within the public right-of-way or on City- owned infrastructure. This approach provides administrative efficiency by avoiding the need to negotiate individual agreements for each installation, while ensuring consistency in design standards, insurance requirements, indemnification provisions, and compliance with applicable laws. For the City, an MLA also provides clarity and predictability in managing its public assets,

Agenda Packet - April 20, 2026
Master License Agreement for Small Cell Wireless Facilities In the Public Right-of-Way., Page 2

while for providers, it offers a streamlined and transparent framework for deployment. Importantly, it provides upfront understanding to a wireless provider for city requirements while ensuring the city meets its expedited processing requirements.

Under a typical MLA framework, once an agreement is in place, a telecommunications company seeking to install a small cell facility submits an application for a site-specific pole license. This application is reviewed ministerially for compliance with the MLA, applicable design and concealment standards, and any objective criteria established in the City’s municipal code or administrative regulations. As mentioned above, the review process is subject to federally mandated timelines, generally 60 days for collocation on existing structures and 90 days for new poles. Upon approval, the City issues a pole license or encroachment permit authorizing installation at the specific location, subject to ongoing compliance with the terms of the MLA.

Federal law places important limitations on the fees that local agencies may charge for small cell facilities. Under FCC regulations, fees must be limited to a reasonable approximation of the City’s actual and direct costs and must be non-discriminatory. The FCC has established presumptively reasonable fee levels, including application fees (generally up to $500 for a single application covering up to five sites) and annual recurring fees for use of public right-of- way infrastructure. It is proposed that our per pole license will be $275 per pole per year.

The term of individual pole agreements is for an initial term of ten (10) years followed by three (3), five (5) year extensions. This reduces the administrative burden to City staff for processing a lesser term. Non-renewal or termination of a license is subject to the agreement.

Adoption of a Master License Agreement positions the City to proactively manage small cell deployment while complying with applicable legal requirements. By establishing clear standards and a predictable approval process, the City can facilitate timely installation of wireless infrastructure, reduce administrative burden, and ensure that facilities are deployed in a manner that is compatible with community aesthetics and public safety. Ultimately, this framework supports improved wireless coverage and capacity throughout the City, benefiting residents, businesses, and public safety communications systems.

This item delegates to the City Manager the authority to enter into Master License Agreements with carriers desiring to install small cell wireless facilities in the City, under the terms and conditions approved by the City Council. As subject to the Master License Agreement, the City Manager is also delegated authority to enter into individual pole license agreements and to work with carriers to ensure upgraded service and broadband connectivity in all parts of La Verne.

FISCAL ANALYSIS
For each application which is for one to five facilities, a Licensee will pay a one-time fee of $500.00, with an additional $131.93 per facility beyond five. Additionally, the Licensee will annually compensate City for the use of each Municipal Facility (pole or location) that is the subject of a Pole License Agreement in the amount of $275.00 each, subject to an annual 3% escalator. Funds shall be deposited into the General Fund. Other than routine staff time spent on processing the application and working with a carrier for siting of facilities, no expenditures of funds are anticipated by the approval of this Master License Agreement.

ENVIRONMENTAL ANALYSIS

Agenda Packet - April 20, 2026
Master License Agreement for Small Cell Wireless Facilities In the Public Right-of-Way., Page 3

The project is exempt from review under the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines Class 1, Section 15301, Existing Facilities; Class 3, Section 15303, New Construction or Conversion of Small Structures, and the City's environmental guidelines.

LEGAL REVIEW
The City Attorney has approved the Master License Agreement.

ATTACHMENTS

1. Master License Agreement MLA Small Cell Wireless Facilities FINAL 041126

Agenda Packet - April 20, 2026

1 MASTER LICENSE AGREEMENT FOR

WIRELESS FACILITIES ON CITY STREETLIGHT POLES IN THE RIGHT OF WAY

This Master License Agreement for Wireless Facilities on City Poles (the “Agreement”) is entered into this ____ day of ______________, 2026, by and between the City of La Verne (“City”) and _________________________, a ___________ limited partnership (“Licensee”) with principal offices at __________________________________________________ (individually, a “Party” and collectively referred to as the “Parties”). The effective date of this Agreement is _______ (the “Effective Date”).

RECITALS
WHEREAS, City owns as its personal property a number of existing Streetlight Poles within the public right-of-way that are potentially suitable for installing wireless communications facilities within the City’s jurisdiction and has a duty under California law to derive appropriate value from the City’s property assets for the public good; and

WHEREAS, Licensee desires to install, maintain and operate wireless communications facilities in the public right-of-way by attaching to existing Streetlight Poles and Licensee is willing to compensate the City for the right to use the City’s Streetlight Poles for wireless communications purposes; and

WHEREAS, the City desires to authorize Licensee’s request to access individual City owned Streetlight Poles based on a comprehensive and uniform Agreement according to the terms and conditions set forth in this Agreement, and pursuant to all the applicable permits issued by the City to protect public health and safety; and

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are acknowledged, the parties agree to the following covenants, terms, and conditions:

Section 1. Definitions. The following definitions shall apply generally to the provisions of this agreement:

Agent. “Agent” means an agent, employee, officer contractor, subcontractor, and representative of a party in relation to this Agreement.

City. “City” means the City of La Verne, a Municipal Corporation.

City Property. “City Property” means the Right-of-Way, Municipal Facilities, and all real and personal property owned by the City.

Commencement Date. The “Commencement Date” for each Pole License Agreement shall be upon expiration of ninety days (90) after the date that the particular Pole License Agreement governing the License Area is executed by both parties or the date that all applicable permits and approvals are approved by the City with respect to a Licensee Facility, whichever occurs first.

Agenda Packet - April 20, 2026

2 CPUC. “CPUC” means the California Public Utilities Commission.

Fee. “Fee” means any assessment, license, charge, fee, imposition, tax, or levy of general application to entities doing business in the City lawfully imposed by any governmental body (excluding utility users’ tax, franchise fees, communications tax, or similar tax or fee.) Invitee. “Invitee” means the client, customer, invitee, guest, tenant, subtenant, licensee, authorized assignee and authorized sublicensee of a Party in relation to the area where Licensee’s Facilities are located.

Laws. “Laws” means any and all statutes, constitutions, ordinances, resolutions, regulations, judicial decisions, rules, tariffs, administrative orders, certificates, orders, or other requirements of the City or other governmental agency having jurisdiction over the Parties to this Agreement.

Licensed Area. “Licensed Area” means each Municipal Facility for which City grants a license to Licensee for placement of Licensee’s Facilities pursuant to this Agreement. The Licensed Areas shall more specifically be described in the Pole License Agreements.

Licensee’s Facilities, Licensee Facilities or Licensee’s Facility. “Licensee’s Facilities”, “Licensee Facilities” or “Licensee’s Facility” means the facilities and equipment controlled by Licensee to provide wireless telecommunications service, including but not limited to Wireless Telecommunications Facilities, antennas, cables, wires, lines, waveguides, poles, conductors and related hardware installed pursuant to a Pole License Agreement.

Licensee. “Licensee” means ________________________________, a _________ limited partnership _____________________, organized and existing under the laws of the State of _____________, and its lawful successors, assigns and transferees.

Municipal Facility or Municipal Facilities. “Municipal Facility” or collectively “Municipal Facilities” means City-owned Streetlight Poles, lighting fixtures, electroliers, or comparable facilities located within the Public Way.

Network. “Network” or collectively “Networks” means one or more of the carrier agnostic wireless networks operated by Licensee to serve its wireless carrier customers in the City.

Pole License Agreement. “Pole License Agreement” means an agreement executed by the Parties in substantially similar form as Exhibit “A” for each Municipal Facility licensed to Licensee. The Pole License Agreement form may be modified in the future pursuant to an amendment to this Agreement and executed by the Parties. The Pole License Agreement may have special clauses specific to that individual Licensed Area. In the event of a discrepancy or inconsistency between the terms and conditions of a particular Pole License Agreement and this Agreement, the terms and conditions of the Pole License Agreement shall govern and control.

Public Way, Right-of-Way, or Public Rights-of-Way. “Public Way,” “Right-of-Way,” or “Public Rights-of-Way” means the space in, upon, above, along, across; under and over the public streets, roads, lanes, courts, ways, alleys, boulevards, and places, including all public utility easements and public service easements as the same now or may hereafter exist, that are under the jurisdiction of the City. This term shall not include any other City Property or any property owned by any

Agenda Packet - April 20, 2026

3 person or entity (e.g. county, state, or federal rights-of-way) other than the City, except as provided by applicable Laws or pursuant to an agreement between the City and any such person or entity.

Services. “Services” means the services provided through the Network by Licensee to its wireless carrier customers pursuant to one or more tariffs filed with and regulated by the CPUC.

Streetlight Pole. “Streetlight Pole” means any, standard-design concrete, fiberglass, or metal pole that has a mast arm for electrolier support and is used for streetlighting purposes.

Wireless Telecommunications Facility. “Wireless Telecommunications Facility” means equipment installed for the purpose of providing wireless transmission of voice, data, images, or other information including, but not limited to, cellular telephone service, personal communications services, and paging services, consisting of equipment and network components such as towers, utility poles, transmitters, base stations, and emergency power systems. It includes, but is not limited to, antennas and/or other types of equipment for the wireless transmission or receipt of such signals, telecommunications towers or similar structures supporting such equipment, equipment cabinets, pedestals, meters, tunnels, vaults, splice boxes, surface location markers, related transmission equipment, equipment buildings, parking areas, and other accessory development.

Section 2. Licensed Area. This Agreement sets forth the basic terms and conditions upon which each Licensed Area is licensed to Licensee. Upon agreement between the Parties with respect to the particular terms and location of a Licensed Area, the Parties shall execute a completed Pole License Agreement in substantially similar form as Exhibit “A”. Subject to the terms and conditions contained herein and in the Pole License Agreement relating to a particular Licensed Area, for the limited purpose of constructing, installing, operating and maintaining Licensee’s Facilities, City hereby licenses to Licensee the Licensed Areas. Each Pole License Agreement shall include access to and from the Licensed Area, and to and from the closest public Right-of-Way and on and over the land of which the Licensed Area are a part and access to appropriate utilities. Each Pole License Agreement shall act as a separate and independent agreement for each Licensed Area, the express intent of the Parties being to use this Agreement to facilitate each of the independent transactions. It is understood that the Licensee’s right and license to place the Licensee’s Facilities is non-exclusive, but that upon execution of the Pole License Agreement, the Licensed Area licensed therein shall be exclusive for Licensee’s Facilities for a specific area or space at the Municipal Facility, subject to the terms and conditions of this Agreement and the particular Pole License Agreement. Further, Licensee’s license and rights granted under this Agreement and the particular Pole License Agreement are irrevocable until the expiration or sooner termination of this Agreement and/or the Pole License Agreement. a. Licensee Obtains Utilities. Licensee shall obtain its own utility services at its own cost from the applicable utility company. Licensee shall be responsible to secure its own utility services and shall not be permitted to use or submeter from any utility service provided to the City on any Streetlight Pole.
b. Electrical Costs. Licensee shall be solely responsible for all costs and expenses associated with obtaining and maintaining a suitable and compatible electrical supply sufficient to power and operate Licensee’s Facilities. Licensee shall also be solely responsible for all costs,

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4 expenses and payments of any and all electrical utility charges by the applicable utility company based upon its usage of electricity and applicable tariffs. City shall under no circumstances be responsible for reimbursing, contributing, or paying any costs to any utility company or Licensee for the costs and expenses associated with any modification of or any use of electricity under this Agreement. Licensee Facilities shall not draw compatible electricity from a Municipal Facility until such time as Licensee has secured all required electrical approvals and the electricity charging/payment agreement with the electrical utility company is in place.

Section 3. Term. This Agreement shall commence upon execution by both Parties and shall govern and be incorporated into each Pole License Agreement entered into on or after the Effective Date of this Agreement until such time that City and Licensee enter into a new agreement or the expiration of 10 years, whichever occurs first, with automatic renewal for three successive five-year renewal terms, unless earlier terminated by either Party in writing at least 90 days before the end of the initial term or any renewal term. In the event the Parties enter into a new agreement, each then existing Pole License Agreement governed by this Agreement shall continue to be governed by this Agreement and this Agreement shall remain in effect until the expiration or earlier termination of each Pole License Agreement it governs. Each new Pole License Agreement entered into on or after the effective date of the new agreement shall be governed by the new agreement.

The initial term of each Pole License Agreement shall be 10 years from the Commencement Date of that License Agreement and will automatically renew for three successive five-year renewal terms, on the same terms and conditions as the initial term. This Agreement and the Pole License Agreements shall automatically renew at the expiration of the initial term or any renewal term thereof unless Licensee provides City written notice of non-renewal at least ninety (90) days prior to the expiration of the initial term or the then applicable renewal term, as the case may be.

Section 4. Permitting and Location of Wireless Telecommunications Facilities. a. Construction of Licensee’s Facilities. City agrees to permit Licensee to construct Licensee’s Facilities within the Licensed Area subject to the terms of this Agreement and the Pole License Agreement and further subject to City’s reasonable, time, place, and manner restrictions in accordance with applicable Laws.
b. Height and location of equipment. Notwithstanding any other provision in this Agreement to the contrary, in no event may any Wireless Telecommunication Facility antenna or supporting Wireless Telecommunication Facility equipment placed on a Streetlight Pole be placed less than eight feet (8’) above the ground, and this Agreement does not authorize the placement of any equipment or other item in violation of any applicable Laws, including but not limited to the Americans with Disabilities Act.
c. City Planning Permits Required. In addition to the City permitting process, Licensee agrees to seek any and all additional local, state and federal approvals that may be required for its deployments. For example, Licensee shall have a City Business License and shall obtain any necessary zoning-related approvals. Notwithstanding the foregoing, nothing in this Agreement constitutes any warranty, guarantee, or promise in regards to any land use decision or governmental approval by the City or any government agency having jurisdiction.

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5 Section 5. Scope of Agreement. This Agreement shall be interpreted consistent with the following laws and regulations (a) California Government Code Sections 50030, 65964, and 65850.6; (b) California Public Utility Code and the Telecommunications Act of 1996 including but not limited to those rights set forth in Section 253(c); (c) Section 6409 of the Middle Class Tax Relief and Job Creation Act of 2012 (H.R. 3630, P.L. 112-96); and the Federal Communication Commission Declaratory Ruling and Third Report and Order (FCC 18-133) (“FCC 2018 Order”).

a. Limitations on License. Nothing herein creates a real property interest or creates a landlord-tenant relationship. Licensee cannot avail itself of rights afforded to tenants under the laws of the State of California.
b. No Warranty. City makes no warranty or representation whatsoever, whether express or implied, regarding the suitability of any Licensed Area for Licensee’s use. Licensee shall inspect Licensed Area and accept the same “AS IS.” Licensee agrees that neither the City nor its agents have made, and the City expressly disclaims any representations or warranties whatsoever, whether express or implied, with respect to the physical, structural or environmental condition of a Licensed Area or the present or future suitability of the Licensed Area for the permitted use. City is under no obligation to perform any work or provide any materials to prepare the Licensed Area for Licensee.

Section 6. Compensation.
a. Compensation for Use of City Infrastructure. For each application which is for one to five facilities, Licensee shall pay a one-time fee of Five Hundred Dollars ($500.00) (with an additional $131.93 per facility beyond five). Licensee shall annually compensate City for the use of each Municipal Facility or comparable facility that is the subject of a Pole License Agreement in the amount of Two Hundred Seventy-Five Dollars ($275.00) each (collectively the “Annual Compensation”).
b. Payment Terms and Audit. Licensee shall make first payments within sixty (60) days following the Commencement Dates of any Pole License Agreement. First payments shall be prorated from the applicable Commencement Date through the next occurring June 30 based upon a 365-day year. Thereafter, the Annual Compensation for all Pole License Agreements shall be paid on or before June 30th of each successive year during the Pole License Agreement. c. Annual Compensation Adjustment. The Annual Compensation will be annually increased (compounded) each calendar year by 3%.
d. One-time Adjustment From Cost Study. In addition, the City may adjust the compensation pursuant to a cost study which has been reviewed, adopted and approved by City’s council one time during the initial term and before each renewal term of this Agreement. After the revised Annual Compensation is final as described in the preceding sentence, City shall provide notice to Licensee of the Annual Compensation in accordance with the notice requirements of this Agreement. The Annual Compensation under this Agreement will adjust to the revised compensation rate starting with the first payment due following adoption of the cost study. City shall deliver to Licensee a copy of City’s cost study no less than sixty (60) days before the cost study is presented to City’s council for adoption or approval. Licensee reserves the right to review

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6 and/or challenge the cost study before a competent regulatory agency or court even after the effective date of such cost study. In the event Licensee successfully challenges the cost study, the Annual Compensation shall adjust back to the compensation rate in effect immediately prior to the cost study and City shall provide Licensee a refund for any Annual Compensation payments made by Licensee above the adjusted compensation rate during the pendency of such cost study challenge.
e. Delinquent Payment. Payments not received within ten (10) days after the due dates as specified above shall accrue interest at a rate of five and one-half percent (5.5%) per annum from the due date. In addition, a late fee in the amount of ten percent (10%) of the amount due shall be imposed if a payment is not received within thirty (30) days after the due date.

Notwithstanding the provisions of this subparagraph, failure to make payments pursuant to the terms provided herein shall constitute a material default of the terms of the Agreement, subject to the terms stated in Section 33, “Termination.” Licensee assumes all risk of loss and responsibility for delinquent payments.

Section 7. Assignment or Transfer of Authorization. Except as allowed by subsection (a) of this Section 7, Licensee shall not sell or transfer its operation, or directly or indirectly assign or delegate any of its interests or rights, and obligations under this Agreement to a third party without the express written consent of the City. The City shall not unreasonably withhold condition, or delay its consent under this Section.
a. The transfer of the rights and obligations of Licensee to a parent, subsidiary, or other affiliate of Licensee or to any successor in interest or entity acquiring more than fifty percent (50%) of Licensee’s stock or assets (collectively “Exempted Transfers”) shall not be deemed an assignment for the purposes of this Agreement and therefore shall not require the consent of the City, provided that Licensee reasonably demonstrates to the City’s City Manager or his or her designee the following criteria (collectively the “Exempted Transfer Criteria”): (i) such transferee has a net worth of at least Ten Million Dollars ($10,000,000); and (ii) any such transferee assumes all of Licensee’s obligations hereunder.
b. Licensee shall give at least forty-five (45) days’ prior written notice (the “Exempted Transfer Notice”) to the City of any such proposed Exempted Transfer along with reasonable evidence substantiating that the Exempted Transfer Criteria will be satisfied. c. If the City approves an assignment for which City’s consent is required, each assignee shall assume all obligations of Licensee under this Agreement and will remain liable jointly and severally with Licensee for all obligations to be performed by Licensee until and unless the assignee signs a written agreement, in a form reasonably acceptable to the City, to unconditionally assume all Licensee’s obligations under this Agreement and any Pole License Agreement issued hereunder. No assignment will be binding on the City unless Licensee or the assignee delivers to the City evidence reasonably satisfactory to the City that the assignee has obtained all required regulatory approvals necessary to install, maintain and operate the Licensee’s Facilities and any other associated improvements or personal property, and a copy of the assignment agreement (or other document reasonably satisfactory to the City in the event of a permitted assignment). However, the failure or refusal of an assignee to execute such instrument of assumption will not release such assignee from its liability as set forth in this Section. Except

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7 for an Exempted Transfer, Licensee shall reimburse the City within thirty (30) days after Licensee’s receipt of City’s demand and reasonable supporting documentation for any actual and reasonable costs that the City incurs in connection with any proposed assignment, including the costs of investigating the acceptability of the proposed assignee and legal costs incurred in connection with considering any requested consent. The City agrees that its right to reimbursement under this Section during the Term shall not exceed $4,000 for each such request.

Section 8. Responsibility of Licensee/Maintenance. The Licensee, on the Licensee’s own behalf and on behalf of any successor or assign(s), hereby assumes all responsibility, financial or otherwise, for the permitted use of the Public Rights-of-Way property, City Municipal Facilities, Licensed Area, and the planning, design, installation, construction, maintenance, repair, operation and complete and proper removal of Licensee’s Facilities. The uses granted herein shall be undertaken without risk or liability whatsoever on the part of the City. All construction, installation, removal, repair and maintenance work shall be performed by Licensee and at Licensee’s sole cost and expense in accordance with applicable Laws, using generally accepted construction standards. If the City approves a replacement Streetlight Pole, Licensee shall transfer all right, title and interest in such replacement Streetlight Pole to the City at the time Licensee completes the construction, and such replacement Streetlight Pole will become City property and remain City property should Licensee vacate or abandon such License Area.

Licensee shall ensure that Licensee’s Facilities are maintained in a clean and safe condition, in good repair and free of any defects, reasonable wear and tear excepted. Licensee shall employ reasonable care at all times in the installation and maintenance of Licensee’s Facilities and Licensee shall use commonly accepted methods and/or devices to reduce the likelihood of damage, injury or nuisance to the public. The construction, operation, and maintenance of Licensee’s Facilities shall be performed by experienced and properly trained, and if required, licensed maintenance and construction personnel.

Licensee shall not remove, damage or in any manner alter any City Property without prior written consent from the City and any other City agencies with jurisdiction over the subject City Property. The City may, to the extent consistent with applicable Laws, withhold its consent in its reasonable discretion, and may reasonably condition its consent in each instance based on the scope and nature of the proposed alterations. Licensee shall immediately notify the City upon Licensee’s discovery thereof if any removal, damage or other alteration occurs to a City Property for any reason and through any cause.

Licensee may use the Licensed Area solely for the construction, installation, operation, replacement, removal, maintenance and repair (“Operations”) of the Licensee’s Facilities for the purpose of providing the Services. All Operations shall be conducted by Licensee in a lawful manner and in compliance with all applicable Federal Communication Commission requirements.

Licensee shall, at its sole expense, comply with (and obtain and maintain such licenses, permits or other governmental approvals necessary to comply with) all Laws applicable to its Operations or use of the Licensed Area; provided, however, any changes to such orders or regulations shall not apply retroactively unless required by applicable Laws. Licensee’s Facilities and Operations shall not interfere with the operations of City, the traveling public, or any other uses existing on the Commencement Date of a Pole License Agreement with respect to any Licensed Area. If Licensee is unable to obtain and maintain such licenses, permits, or approvals, Licensee shall so notify City

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8 and the particular Pole License Agreement shall be subject to the termination provisions pursuant to Section 33 “Termination.”
Section 9. Public Works Operations. Except as provided otherwise in this Agreement, the City and its Agents have the right to access the Licensed Area at any time without notice for any purpose. The City will not be liable in any manner whatsoever, and Licensee expressly waives any claims for inconvenience, disturbance, lost business, nuisance or other damages that may arise from the City’s or its Agents’ access the Licensed Area, which includes any equipment removed in an emergency or other exigent circumstances pursuant to Section 9(c) (Emergencies), except to the extent that the damage arises from the gross negligence or willful misconduct of the City or its Agents.
a. Repairs, Maintenance and Alterations to Streetlight Poles. The City retains the right to and will: (1) maintain and repair City Property, Right-of-Way, and Streetlight Poles, as needed, in its sole and absolute discretion, for its street light operations and other municipal functions; and (2) correct any immediately hazardous condition. Except as provided in Section 33, “Termination,” and excluding conditions that arise from the City’s or its Agents’ gross negligence or willful misconduct, neither any City work on any City Property nor any condition of any City Property will: (a) entitle Licensee to any damages; (b) excuse or reduce any obligation by Licensee to make any payments or perform any covenant under this Agreement; or (c) constitute or be construed as a constructive termination of this Agreement.
b. Repairs, Maintenance and Alterations to the Licensed Area. The City may, at any time, alter, add to, repair, remove from and/or improve the Licensed Area in whole or in part for any operational purpose, which includes without limitation maintenance and improvements in connection with street light services and compliance with applicable Laws; provided (1) the City provides advance notice to Licensee’s Network Maintenance Center at 1-800-264-6620 or 1-800- 621-2622 as soon as reasonably practicable; (2) the City allows Licensee’s representative to observe the City’s work; and (3) the City takes reasonable steps not to disrupt Licensee’s ordinary operations on the area where Licensee’s Facilities are located. The provisions in this Section 9 (b) will not be construed to allow Licensee’s ordinary operations to impede or delay the City’s authority and ability to make changes to the area where Licensee’s Facilities are located, that are necessary to maintain street light services.
c. Emergencies. In emergencies or other exigent circumstances which imminently threaten public health and safety, the City’s work will take precedence over Licensee’s operations, which includes without limitation any equipment maintained or operated on the Licensed Area, and the City may access the Licensed Area in whole or in part as the City deems necessary, in its sole and absolute discretion, and in accordance with this Section 9(c), whether the City has notified Licensee of such emergency or such other exigent circumstance, or not. When safe and practicable, the City will notify Licensee of any emergency or such other exigent circumstance that requires the City to repair City Property including removing or replacing any Streetlight Pole and will allow Licensee to remove its equipment before the City repairs, removes or replaces City Property; provided, however, the City will remove the equipment from a Streetlight Pole when, in the City’s sole and absolute discretion, it would (1) be unsafe or not practicable to wait for Licensee to perform the work; (2) cause significant delay; or (3) otherwise threaten or compromise public safety or public services. The City will remove any equipment with reasonable care and store the

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9 equipment for retrieval by Licensee and the City will provide notice as soon as reasonably practicable after such emergency, but in no event later than 24 hours after the emergency occurs.

Licensee shall have the right to reinstall such removed equipment or equivalent equipment at Licensee’s sole expense on the repaired or replaced Streetlight Pole. The City’s removal of Licensee’s equipment in emergencies will not be deemed to be a forcible or unlawful entry onto the Licensed Area or any interference with Licensee’s contractual privilege to use the Licensed Area where Licensee’s Facilities are located.
d. Spare Facilities. For every ten (10) Municipal Facilities in use by Licensee, Licensee shall provide Licensor one (1) replacement spare Streetlight Pole for storage by Licensor up to a maximum of three (3) replacement spare Streetlight Poles (the “Spare Facilities”) which shall be dedicated exclusively for replacement of Municipal Facilities which support Licensee’s Facilities. Licensor shall return all unused Spare Facilities to Licensee within sixty (60) days of the expiration or earlier termination of this Agreement.

Section 10. Relocation/Removal . City, in its sole and absolute discretion, may require Licensee to remove and/or relocate all or any portion of Licensee’s Facilities from a Licensed Area. Licensee shall at City’s direction remove and/or relocate such Licensee’s Facility at Licensee’s sole cost and expense, whenever City reasonably determines that the removal and/or relocation is needed for any of the following purposes: (a) if required for the construction, completion, repair, relocation or maintenance of a City project; (b) where Licensee’s Facility interferes with or adversely affects the proper operation of City owned Streetlight Poles, traffic signals, communications, or other Municipal Facilities or City Property; or (c) to protect or preserve the public health or safety. In any such case, City shall use its best efforts to provide Licensee a reasonably equivalent alternate location to install Licensee’s Facility. Except in an emergency, the City shall give at least ninety (90) days’ prior written notice pursuant to Section 32 (Notices) describing where the work is to be performed and/or where removal is required.

Notwithstanding the foregoing, should the public health safety or welfare require that the City undertake immediate maintenance, repair or other action, Licensee shall take the measures required under this Section 10 within seventy-two (72) hours after receiving notice from the City to Licensee’s Network Maintenance Center at 1-800-264-6620 or 1-800-621-2622. If Licensee fails to remove or relocate any Licensee’s Facility as requested by the City within the time period specified above, or in the event of an emergency requiring immediate removal without notice, as outlined in Section 9 of this Agreement, City may remove and/or relocate Licensee’s Facility at Licensee’s sole cost and expense, without further notice to Licensee. Alternatively, upon Licensee’s request, City may approve the abandonment of Licensee’s Facilities in place. Upon approval, Licensee shall execute, acknowledge and deliver any necessary documents to transfer ownership of the Licensee’s Facilities to City and City shall take possession of such Licensee’s Facilities in their then “as is” condition without any representation or warranty by Licensee of their merchantability or fitness for any particular purpose
Section 11. Change in Equipment . If Licensee proposes to install equipment, which is different in any way from the specifications or design configurations originally approved by the City, then Licensee shall first obtain the approval for the use and installation of the equipment from the City. In addition to any other submittal requirements, at City’s request, Licensee shall provide load calculations for all equipment it intends to install in the Public Rights-of-Way, notwithstanding original installation or by way of equipment type changes. To the extent

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10 permissible by applicable Laws, the City may approve or disapprove of the use of the different equipment from the original specifications and such approval shall not be unreasonably withheld by the City. Notwithstanding the foregoing, but with prior written notice to the City describing and depicting the change(s), Licensee shall not be required to obtain a Building Permit for modifications within a Licensed Area, so long as the modification to the equipment involves only substitution of internal components, will be in compliance with applicable Laws (such as radiofrequency emission standards), does not result in any change to the external appearance, does not increase the dimensions or weight of the equipment, and does not cause any external impacts, such as additional electrical load or interference. Licensee shall abide by all applicable rules with respect to work within the Public Way and obtain all applicable permits/consent for any Public Way or road closure necessary in connection with such modification or replacement of a Licensee Facility.

Section 12. Repair of Facility. Licensee shall repair or re-finish, after providing the City notice, at Licensee’s sole cost and expense any surface or other portion of the Public Rights-of- Way, City Property, or Municipal Facilities that are disturbed or damaged during the construction, installation, maintenance, or operation of Licensee’s Facilities. Without limiting any other available remedies, if Licensee fails to repair or refinish such damage, City may in its sole and absolute discretion, but without any obligation to do so, repair or refinish the disturbance or damage and Licensee shall reimburse City all actual and reasonable costs and expenses incurred in the repair or refinishing of such property.

Licensee agrees to give the City notice of the need for any repair to any surface or other portion of the Public Rights-of-Way property, City Property, or Municipal Facilities promptly after Licensee discovers any damage from any cause. Licensee’s agreement to provide notice is not an assumption of liability for any life-threatening or hazardous conditions unless caused by the acts, omissions or negligence of Licensee or its Agents or Invitees.

Section 13. Licensee to Bear All Costs. The Licensee, or any successor or authorized assign, shall bear all costs incurred in connection with the planning, design, installation, construction, maintenance, repair, operation, modification, disconnection, relocation and removal of the Licensee Facilities. The Licensee shall be responsible and shall bear the cost of any movement to, damage to or repair of Licensee’s Facilities due to repair, maintenance and/or failure/collapse of any existing gas, water and sewer lines or any other improvements or works approximate to Licensee’s Facilities, except to the extent caused by City or its Agents. Licensee agrees to bear this cost regardless of whether or not such damage may be directly or indirectly attributable to the installation, operation, maintenance, repair or upgrade work on the Licensee’s Facilities, unless the damage results from the negligence or willful misconduct of the City, its officers, agents, contractors or employees. These costs include electrical utility charges to the applicable utility company based upon the Licensee Facilities usage of electricity and applicable tariffs.

Section 14. Compliance with Laws. Licensee agrees to comply with all Laws applicable to Licensee’s use of the Licensee Facilities in the Public Way and on Municipal Facilities. City agrees to comply with all Laws relating to City’s ownership and use of the Municipal Facilities and any improvements in the Public Way or on the Municipal Facility.

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11 Section 15. Licensee to Submit Acceptable Plans. Prior to the Commencement Date and prior to execution of a Pole License Agreement and to construction and installation of Licensee’s Facilities, Licensee shall, at its sole cost and expense, prepare and submit, together with payment of all related lawful fees, any and all reasonable plans and specifications required by the City, which shall include detailed maps showing the planned construction, the size and the location and number, and any other details regarding the placement of appurtenant equipment to be located in the Public Rights-of-Way and on City Municipal Facilities or existing third-party infrastructure.

The City Planning Department and Public Works Department shall be authorized to review the plans and specifications and to impose such requirements as are necessary to protect the public health and safety and to minimize any negative impact on aesthetics in the case of the above- ground improvements. The City Planning Department and Public Works Department shall be authorized to require an alternate location for the Licensee’s Facilities on Streetlight Poles or comparable facilities to avoid conflict with public safety as well as other permitted uses in or future public needs of the Public Rights-of-Way identified in this Agreement. Licensee shall, at its sole cost and expense, submit traffic control plans for City approval. The City reserves the right to inspect the installation and maintenance of Licensee’s Facilities at any time during the term of this Agreement and subsequent term extensions if applicable, Licensee shall pay all lawful plan check, inspection and other related fees prior to the issuance of any permit for the installation and construction of Licensee’s Facilities. All work within the Public Rights-of-Way and Municipal Facilities or existing third-party infrastructure shall be performed in strict compliance with plans and permits approved by the City Planning Department and Public Works Department.

Section 16. Licensee to Secure Approval and Permits. Licensee agrees that Licensee’s ability to use the Public Rights-of-Way and Municipal Facilities and any third-party infrastructure for the purposes contemplated by this Agreement is dependent upon Licensee obtaining and maintaining all of the certificates, permits and other approvals which may be required by other federal, state or local authorities and any easements which are required from any third parties. City shall cooperate with Licensee in its efforts to obtain such approvals and/or easements, as may be required for Licensees Facilities as approved in the permits.

Section 17. As Built Drawings to be Provided. The Licensee shall provide as-built drawings, in any format reasonably acceptable to the City, detailing the location of Licensee’s Facilities installed pursuant to this Agreement within sixty (60) days after Licensee’s Facilities are installed.

Section 18. Liability Insurance. During the Term of this Agreement. Licensee shall carry, maintain, and keep in full force and effect at Licensee’s sole expense insurance against claims for death or injuries to persons or damages to property that may arise out of or in connection with Licensee’s use of the Public Rights-of-Way and Municipal Facilities or the construction, operation, maintenance, repair of Licensee’s Facilities, or performance under this Agreement by Licensee, its agents, representatives, employees, contractors or volunteers. a. Insurance Types. Such insurance shall be of the types and in the amounts set forth in this Section below, unless the City Manager or City Risk Manager expressly approves in writing a lower amount, or approves a different type of insurance, upon prior written notice to, review and acceptance by Licensee.

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12 1. Commercial General Liability Insurance with coverage limits of One Million Dollars ($1,000,000) per occurrence for bodily injury and property damage and Two Million Dollars ($2,000,000) general aggregate including personal and advertising injury covering claims or incidents arising out of or resulting from Licensee’s performance under this Agreement.

2. Automobile Liability Insurance in the amount of $2,000,000 combined single limit each accident for bodily injury and property damage covering all owned, non-owned and hired vehicles used in connection with the performance of this Agreement.

3. Worker’s Compensation Insurance in compliance with statutory requirements of the California Labor Code and Employer’s Liability limits of $1,000,000 each accident for bodily injury/ disease-employee/ disease-policy limits.

Notwithstanding the forgoing, Licensee may, in its sole discretion, self-insure any of the required insurance under the same terms as required by this Agreement. In the event Licensee elects to self-insure its obligation under this Agreement, the following conditions apply:
(i) City shall promptly and no later than forty-five (45) days after notice thereof provide Licensee with written notice of any claim, demand, lawsuit, or the like for which it seeks coverage pursuant to this Section and provide Licensee with copies of any demands, notices, summonses, or legal papers received in connection with such claim, demand, lawsuit, or the like; (ii) City shall not settle any such claim, demand, lawsuit, or the like without the prior written consent of Licensee; and (iii) City shall fully cooperate with Licensee in the defense of the claim, demand, lawsuit, or the like.
b. Subcontractor Insurance. Licensee shall require each of its contractors or subcontractors while working hereunder, if any to maintain insurance coverage with reasonable and prudent limits. The insurance policies required under this Section shall be issued by an insurance carrier duly admitted and authorized to do business in the State of California and with an A.M. Best’s rating of at least “A-” (A minus).
c. Duty to Maintain Insurance. Licensee agrees that if it does not keep the aforesaid insurance in full force and effect City may immediately terminate this Agreement. d. Current Certificates of Insurance and Endorsements. At all times during the term of this Agreement, Licensee shall maintain on file with City’s Risk Manager certificates of insurance and relevant endorsements showing that the aforesaid policies are in full force and effect in the required amounts and including City as an additional insured as their interest may appear under this Agreement, except on the workers compensation policy. Licensee shall, prior to commencement of work under this Agreement, file with City’s Risk Manager such certificate(s) and endorsements. Licensee shall provide certificates of insurance as proof of insurance required herein expiring during the terms of this Agreement have been renewed or replaced with other policies providing at least the same coverage.
e. Required Endorsements. The Commercial General Liability and Automobile Insurance policies required herein shall include:

The City of La Verne, its officers, employees, and volunteers are additional insureds as their interest may appear under this Agreement. City’s additional insured status shall

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13 (i) be limited to bodily injury, property damage or personal and advertising injury caused, in whole or in part, by Licensee or its employees; (ii) not extend to claims for punitive or exemplary damages arising out of the acts or omissions of City, its employees, agents or independent contractors or where such coverage is prohibited by law or to claims arising out of the gross negligence of City, its employees, agents or independent contractors; and, (iii) not exceed Licensee’s indemnification obligation under this Agreement, if any. This coverage is primary to the City and is not contributing or pro rata with any other insurance or similar protection which is or maybe be available to or carried by the City.”
Upon receipt of notice from its insurer(s), Licensee shall provide City with thirty (30) days’ prior written notice to City of cancellation of any coverage herein. f. Primary Insurance. The insurance provided by Licensee under this Agreement shall be primary to any coverage available to City. Any insurance or self-insurance maintained by City shall be in excess of Licensee’s insurance and shall not contribute with it. g. Revised Insurance Requirements. City reserves the right, upon written notice to, review and acceptance by Licensee, to require the revision of amounts and coverage provided for herein once per Term so long as such revision amounts and coverage are reasonably related to the City’s reasonable insurance requirements. City’s requirements shall be designed to assure protection from and against the kind and extent of risk existing on the Public Rights-of-Way and Municipal Facilities. Licensee shall not install any new improvements unless Licensee has provided City with evidence of insurance as required herein and City has reasonably approved, which approval shall not be unreasonably withheld, conditioned or delayed. h. Not a limit on liability. Procurement of insurance by Licensee as required herein shall not be construed as a limitation of Licensee’s liability or as full performance of Licensee’s duty and obligation to indemnify, hold harmless and defend City under Section 21 of this Agreement (“Indemnification”).

Section 19. Performance Bond . Prior to construction of any Licensee’s Facilities, Licensee shall post a bond with the City (in the form of a performance bond issued by a reputable institution) in the amount of Three Thousand Dollars ($3,000.00) (“Performance Bond”) substantially in a form reasonably acceptable to the City Attorney. The Performance Bond is to provide recourse for the City (at its option) in the event of a default in the performance of any of Licensee’s obligations under this Agreement. Such bond shall be with a company and in a form and amount reasonably satisfactory to the City Manager and the City Attorney. This Performance Bond shall remain in place for the term of the Agreement and any subsequent extension if applicable. If additional Licensee Facilities are authorized, before construction of any additional Licensee Facilities, the amount of the Performance Bond shall be increased at a rate of Three Thousand Dollars ($3,000.00) per Licensee Facility. The maximum amount of performance bond is Two Hundred Fifty Thousand Dollars ($250,000.00) regardless of the number of facilities.

Section 20. Accident Reports. Licensee shall use good faith efforts to, within forty-eight (48) hours after Licensee’s discovery thereof, report to City any accident causing property damage or any serious injury to persons resulting from any of Licensee’s activities under this Agreement.

This report shall contain the names and addresses of the parties involved, a statement of the

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14 circumstances, the date and hour, the names and addresses of any witnesses and other pertinent information.

Section 21. Indemnification.
a. To the fullest extent permitted by law and except to the extent caused by the City’s gross negligence or willful misconduct, Licensee shall indemnify and defend City, its officers, employees, and volunteers from and against any and all claims and losses, costs or expenses for any damage due to death or injury to any person and injury to any property to the extent resulting from any acts or alleged intentional, reckless, negligent, or otherwise wrongful acts, errors or omissions of Licensee, its officers, employees, servants, agents, or subcontractors in connection with Licensee’s use of Public Rights-of-Way and Municipal Facilities in performance of this Agreement. Such costs and expenses shall include, but are not limited to, reasonable attorneys’ fees incurred by counsel of City’s choice, reasonably acceptable to Licensee, regardless of whether resolution proceeds to judgment or not. Accordingly, the provisions of this indemnity provision are intended by the Licensee and City to be interpreted and construed to provide the fullest protection possible to City under the law. Licensee acknowledges that City would not enter into this Agreement in the absence of Licensee’s commitment to indemnify and protect City as set forth herein.
b. Licensee shall hold City harmless and bear all risk of loss or damage of its Licensee Facility(s) and materials installed in the Public Rights-of-Way and on Municipal Facilities pursuant to this Agreement and City shall not be liable for any costs or expenses of repair to damaged Licensee Facility(s) including, but without limitation, damage caused by forces of nature or by City’s removal of the Wireless Telecommunication Facility(s), except to the extent that such loss or damage was caused by the willful misconduct or negligence of the City, its officials, employees, agents, contractors, subcontractors or volunteers. c. City does not, and shall not, waive any rights that it may possess against Licensee because of the acceptance by City, or the deposit with City, of any insurance policy or certificate by Licensee as required pursuant to this Agreement. This hold harmless and indemnification provision shall apply regardless of whether or not any insurance policies are determined to be applicable to the claim, demand, damage, liability, loss, cost or expense. d. The above sub-sections of this Agreement notwithstanding, except for each Party’s indemnity obligations hereunder, and damages arising from bodily injury or either Party’s negligence or willful misconduct: (a) neither Party shall be liable to the other party or to any third party for any incidental, consequential, or punitive damages arising out of or related to this Agreement, even if the Party has been advised of the possibility of such damages, and (b) each Party’s aggregate liability to the other Party for all damages, losses, and causes of action (whether in contract, tort (including negligence), or otherwise) arising out of the this Agreement shall not exceed the greater of $100,000 or two (2) times the total fees Licensee is obligated to pay hereunder during the initial twelve (12) months of this Agreement.

Section 22. Hazardous Materials. Licensee covenants and agrees that neither Licensee nor any of its Agents or Invitees shall cause or permit any hazardous material to be brought upon, kept, used, stored, generated, disposed of or released in, on, under or about the Licensed Area or

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15 any other part of City Property, or transported to or from any City Property, in violation of environmental laws. Licensee may use small quantities of hazardous materials as needed for the routine operation, cleaning and maintenance of Licensee’s Facilities and so long as all such hazardous materials are contained, handled and used in compliance with environmental laws.

Licensee shall immediately notify the City if and when Licensee learns or has reason to believe any release of hazardous material has occurred in, on, under or about the License Area or other City Property.
a. Licensee’s Environmental Indemnity. If Licensee breaches any of its obligations contained in this Section, or if any act, omission, or negligence of Licensee or any of its Agents or invitees in the performance of activities pursuant to this Agreement results in any contamination of the Licensed Area or the associated City Property, or in a release of hazardous material from, on, about, in or beneath any part of the Licensed Area or associated City Property, or the violation of any environmental law, then Licensee, on behalf of itself and its successors and assigns, shall indemnify, defend and hold harmless the City, including its Agents, and their respective successors and assigns from and against any and all claims (including sums paid in settlement of claims, reasonable attorneys’, consultants’, and experts’ fees and related costs) arising during or after the term to the extent relating to such release or violation of environmental laws; provided, however, Licensee shall not be liable for any claims to the extent such release was caused by the gross negligence or willful misconduct of the City or its Agents. Licensee’s indemnification obligation includes costs incurred in connection with any activities required to investigate and remediate any hazardous material brought onto the License Area or City Property by Licensee or any of its agents or invitees and to restore the License Area or other City Property to its condition prior to Licensee’s introduction of such hazardous material to the extent required by applicable Laws or to correct any violation of environmental Laws. Licensee specifically acknowledges and agrees that it has an immediate and independent obligation to defend the City and the other indemnified parties from any claim that actually or potentially falls within this indemnity provision even if the allegations supporting the claim are or may be groundless, fraudulent, or false, which obligation arises at the time such claim is tendered to Licensee by the indemnified party and continues until the claim is finally resolved. Without limiting the foregoing, if Licensee or any of its Agents or Invitees causes the release of any hazardous material on, about, in, or beneath the Licensed Area or associated City Property, then in any such event Licensee shall, immediately, at no expense to any indemnified party, take any and all necessary actions to return the Licensed Area and such City Property, as applicable, to the condition existing prior to the release of any such hazardous materials on the Licensed Area or such City Property to the extent required by applicable Laws or otherwise abate the release in accordance with all environmental Laws, except to the extent such release was caused by the gross negligence or willful misconduct of the City or its Agents.

Licensee shall afford the City a full opportunity to participate in any discussions with regulatory agencies regarding any settlement agreement, cleanup or abatement agreement, consent decree or other compromise or proceeding involving hazardous material.

Section 23. Revocation of Authorization. If the Licensee fails to comply with any of the material terms and conditions of this Agreement and/or any applicable Laws, the City may revoke the authorization granted herein, subject to the terms and conditions stated in Section 33, “Termination.”

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16 Section 24. Terms and Conditions Specific to this Agreement. The terms and conditions of this Agreement shall apply solely to Licensee’s Facilities and the Public Rights-of-Way and Municipal Facilities licensed pursuant to a Pole License Agreement, and shall not apply to, nor establish any precedent for, the conditions the City may impose upon Licensee if Licensee seeks to provide other telecommunications services or cable services to the public for hire within the City.

Section 25. Reservation of Rights. The rights granted by this Agreement are granted based upon representations by Licensee that its federal and state grants or certificates authorize construction and operation of activities in relation to this Agreement.

Section 26. Governing Law; Jurisdiction. This Agreement shall be governed and construed by and in accordance with the laws of the United States and the State of California without reference to general conflicts of law principles. If suit is brought by a Party to this Agreement, the Parties agree that trial of such action shall be vested exclusively in the State courts of Los Angeles County, California or in the United States District Court, Central District of California. Nothing in this section shall be interpreted to preclude either Party’s right to seek redress from the Federal Communications Commission.

Section 27. Amendment of Agreement. This Agreement shall not be changed, modified or amended except by a writing signed by both Parties.

Section 28. Merger Clause. This Agreement contains the entire understanding between the Parties with respect to the subject matter herein. There are no representations, agreements, or understandings, whether oral or written, between or among the Parties relating to the subject matter of this Agreement, which are not fully expressed herein. Each Party has relied on advice from its own attorneys, and the warranties, representations, and covenants of this Agreement itself.

The terms and conditions of this Agreement shall bind and inure to the benefit of City and Licensee and, except as otherwise provided in this Agreement, their respective heirs, distributees, executors, administrators, successors, and assigns.

Section 29. Severability. If any part of any provision of this Agreement or any other agreement, document, or writing given pursuant to or in connection with this Agreement is finally determined to be invalid or unenforceable under applicable Laws, or superseded by other lawful authority including any state or federal, legislative, regulatory or administrative authority having jurisdiction thereof, that part or provision shall be ineffective to the extent of such invalidity only, and the remaining terms and condition shall be interpreted so as to give the greatest effect to them.

Section 30. Taxes . If City is required by Laws to collect any federal, state, or local tax, fee, or other governmental imposition (each, a “Tax”) from Licensee with respect to the transactions contemplated by this Agreement, then City shall bill such Tax to Licensee in the manner and for the amount required by law, Licensee shall promptly pay such billed amount of Tax to City, and City shall remit such Tax to the appropriate tax authorities as required by Laws; provided, however, that City shall not bill to or otherwise attempt to collect from Licensee any Tax with respect to which Licensee has provided City with an exemption certificate or other reasonable basis for relieving City of its responsibility to collect such Tax from Licensee. Except

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17 as provided in this Section 30, City shall bear the costs of all Taxes that are assessed against or are otherwise the legal responsibility of City with respect to itself and its property. Licensee shall be responsible for all Taxes that are assessed against or are otherwise the legal responsibility of Licensee with respect to itself, its property, and the transactions contemplated by this Agreement.

Section 31. Non-Exclusivity. Neither this Agreement nor the permit granted hereunder is exclusive. The City reserves the right to enter into co-location agreements with other parties, including but not limited to telecommunications and information services providers (hereinafter “Carriers’’) for use of the Public Rights-of-Way or Municipal Facilities. City will not grant, after the date of this Agreement, a permit, license or any other right to any third party if, at the time such third party applies to use the Public Rights-of-Way or Municipal Facilities, City knows or has reason to know that such third party’s use may cause interference with the Licensee’s Facilities, Licensee’s use of the Public Rights-of-Way or Municipal Facilities, or Licensee’s ability to comply with the terms and conditions of this Agreement.

Section 32. Notices. All notices, requests, demands, and other communications hereunder shall be in writing and shall be delivered in person or sent by registered or certified mail, postage prepaid, commercial overnight courier with written verification of receipt. A notice shall be deemed given: (a) when delivered by personal delivery (as evidenced by the receipt); (b) two (2) business days after deposit in the mail if sent by registered or certified mail; (c) one (1) business day after having been sent by commercial overnight courier (as evidenced by the written verification of receipt) or (d) five (5) calendar days after deposit if delivered by first class mail.

Notices shall be addressed as set forth below, but any addressee may change its address by written notice in accordance herewith.

LICENSEE:

With a copy to:

CITY:

City of La Verne
La Verne City Hall
3660 D Street
La Verne, CA 91750

With a copy to:

La Verne City Attorney
Jones & Mayer
3777 N. Harbor Blvd.

Fullerton, CA 92835

Section 33. Termination.
a. The right to utilize City Property under this Agreement and applicable Pole License Agreement may be terminated by either Party upon forty-five (45) days’ prior written notice to the other Party upon a default of any material covenant or term hereof by the other Party pertaining to such City Property, which default is not cured within forty-five (45) days after receipt of written

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18 notice of default (or, if such default is not curable within forty-five (45) days, if the defaulting party fails to commence such cure within forty-five (45) days or fails thereafter diligently to prosecute such cure to completion), provided that the grace period for any monetary default shall be thirty (30) days from receipt of notice. Should Licensee use Licensee’s Facilities for a purpose that requires additional City approvals that have not been obtained, City may terminate this Agreement with respect to such Licensee’s Facilities in the manner authorized by this Section. b. Licensee may terminate the Pole License Agreement to use any one Municipal Facility for Licensee convenience with thirty (30) days’ notice to City. All payments due to City for the affected Municipal Facility shall cease upon full removal of Licensee’s Facility located thereon and restoration of the Licensed Area and affected City Property, if any, reasonable wear and tear excepted. If for any reason other than force majeure, Licensee ceases operation of any of Licensee’s Facilities, Licensee shall within 90 days cause the removal of such Licensee Facility/Facilities and have restored the relevant Licensed Area as required herein. c. If Licensee cannot obtain all regulatory approvals required for any Licensee Facility after one year from the subject Pole License Agreement effective date, then either the City or Licensee may terminate such Pole License Agreement on 60 days’ notice to the other Party delivered within 10 days after the first anniversary of that Pole License Agreement’s effective date.

The parties agree that the Commencement Date will be deemed to have not occurred for any Pole License Agreement terminated, and Licensee will have no obligation to pay the applicable fees for that Pole License Agreement and any fees paid in connection with such Pole License Agreement shall be refunded accordingly by the City.

Section 34. Removal Due to Termination. Except to the extent prohibited by Law, no later than one hundred eighty (180) days after termination of the applicable Pole License Agreement, Licensee shall, at its sole cost and expense, remove the associated Licensee Facility and, if such removal disturbs any portion of the Right-of-Way, restore such portion of the Right- of-Way to its original condition, reasonable wear and tear excepted, and further excepting landscaping and related irrigation equipment, or other aesthetic improvements made by Licensee to the Right-of-Way. Alternatively, the City may allow Licensee, in the City’s sole and absolute discretion, to abandon the Licensee Facility, or any part thereof, in place and convey it to the City and if City opts to accept such Licensee Facility, City shall take possession thereof in their then “as is” condition without any representation or warranty from Licensee as to their merchantability or fitness for any particular purpose. Licensee shall replace any removed Streetlight Pole with a matching new Streetlight Pole.

Section 35. Abandonment. If Licensee ceases to operate and abandons a Licensee Facility, for a period of ninety (90) consecutive days or more other than due to a casualty, Licensee shall, at its sole cost and expense and no more than 30 days after expiration of the 90-day time period herein, vacate and remove the Licensee Facility as required herein. If such removal disturbs any portion of the Right-of-Way, Licensee shall also, at its sole cost and expense, restore such portion of the Right-of-Way to its original condition, reasonable wear and tear excepted, and further excepting landscaping and related irrigation equipment, or other aesthetic improvements made by Licensee to the Right-of-Way. Alternatively, the City may allow Licensee, in the City’s sole and absolute discretion, to abandon the Licensee Facility, or any part thereof, in place and convey it to the City and if City opts to accept such Licensee Facility, City shall take possession

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19 thereof in their then “as is” condition without any representation or warranty from Licensee as to their merchantability or fitness for any particular purpose.

Section 36. Other Regulations. All use of the Public Rights-of-Way and Municipal Facilities by Licensee under this Agreement shall be in accordance with the laws of the United States of America, the State of California and in accordance with all applicable City rules and regu1ations and ordinances now in force, or hereinafter prescribed or promulgated by resolution or ordinance or by State or Federal law.

Section 37. Related Actions. By the granting of this Agreement, neither City nor the Council of the City is obligating itself to any other governmental agent, board, commission, or agency with regard to any other discretionary action relating to the use of the Public Rights-of- Way and Municipal Facilities. Discretionary action includes, but is not limited to, permits, environmental clearances or any other governmental agency approvals, which may be required for the development and operation of the Licensee’s Facilities within the Public Rights-of-Way and Municipal Facilities.

Section 38. Use of the Public Rights-of-Way. Licensee acknowledges that the paramount use of Public Rights-of-Way Property or Municipal Facilities is for the public. Licensee agrees to coordinate use of the Public Rights-of-Way Property or Municipal Facilities with City so as not to conflict with City’s programs and activities.

Section 39. Eminent Domain. If City receives notice of a proposed taking by eminent domain of any part of the Public Rights-of-Way and/or Municipal Facilities, City will notify Licensee of the proposed taking within thirty (30) days of receiving said notice and Licensee will have the option to: (i) declare the Agreement null and void with respect to the effected Public Rights-of-Way and/or Municipal Facilities and thereafter neither Party will have any liability or obligation hereunder; or (ii) remain in possession of that portion of the Public Rights-of-Way and Municipal Facilities that will not be taken, in which event there shall be an equitable adjustment in the Annual Compensation on account of the portion of the Public Rights-of-Way and/or Municipal Facilities so taken. With either option Licensee shall have the right to contest the taking and directly pursue an award.

Section 40. Business Summary Report. Once per calendar year, City may submit a written request to Licensee for a business summary report pertaining to Licensee’s Annual Compensation obligations for the prior twelve (12) month period, and Licensee shall provide such written accounting to City within sixty (60) days after Licensee’s receipt of such written request.

Section 1. Powers to Enter into Agreement. The individuals executing this Agreement represent and warrant that they have the right, power, legal capacity and authority to enter into and to execute this Agreement on behalf of the respective legal entities of the Licensee and the City.

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20 IN WITNESS WHEREOF the parties hereto for themselves, their heirs, executors, administrators, successors, and assigns do hereby agree to the full performance of the covenants herein contained and have caused this Agreement to be executed by setting hereunto their signatures on the day and year respectively written herein below

ATTEST:

By:

Print Name:

Title:

APPROVED AS TO FORM:

By:

Print Name:

Title:

CITY:

THE CITY OF LA VERNE

By:

Print Name:

Title:

Date: _______________________________

[Licensee Execution Page Follows]

Agenda Packet - April 20, 2026

21 This Agreement is executed by Licensee as of the date first written above.

LICENSEE:
_____________________________________,
a ___________ limited partnership d/b/a
_________________
By: __________________________________
Name: ___________________________
By: _____________________________
Its: _____________________________
Date: ___________________________

Agenda Packet - April 20, 2026

25 EXHIBIT A

POLE LICENSE AGREEMENT

Subject to the terms and conditions of the Master License Agreement for Wireless Facilities on City Streetlight Poles in the Right of Way dated _________ (“MLA”) between the undersigned Licensee and City, the following described location is licensed to Licensee for unmanned telecommunication purposes:

1. Licensee: ________________________________, a _________ limited partnership dba ________________

2. Site Address/Description: _____________________________________________ _____________________________________________________________________

Licensee Site Name/MDG#: ___________________________________________

3. Effective Dates: The “Execution Date” is the date Licensor signs this Pole License Agreement. The “Commencement Date” is ninety days (90) after the date that this Site Pole License Agreement is executed by both parties or the date that Licensee receives all permits and approvals necessary to construct and operate a Licensee Facility at the License Area, whichever occurs first.

4. Annual Compensation: ______________________________________________ (Annual Compensation based upon number of Municipal Facilities covered by this Pole License Agreement pursuant to the compensation more specifically set forth in MLA Section 6. The Annual Compensation shall be due upon June 30 each year. The initial Annual Compensation shall be prorated to the next June 30.)

5. Local Licensee contacts for access or emergencies (names, titles, phone, pagers, etc.):
______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________

6. Term/Renewals: As provided in the MLA, unless a shorter term or number of renewals is specified as a special term or condition.

_____________________________________________________________________ _____________________________________________________________________ _____________________________________________________________________

7. Special terms, conditions or other notes are attached as Attachment “2” and initialed by the parties. Examples include any Licensor use, known hazardous substances, special access, maintenance responsibilities, permit requirements, or co-location requests.
___ Check here if there are special terms or conditions to this agreement.

Agenda Packet - April 20, 2026

25 ATTACHMENTS

The following documents must be attached:

A. Preliminary description and/or map of the Licensed Area and Municipal Facility, including location of equipment, access and utility routes.

B. Equipment Technical Specifications.

C. Copy of Administrative Wireless Telecommunications Facility Permit and/or local governmental approvals.

D. Copy of City issued Building Permit.

E. Environmental Approvals.

F. Any legal description of the site developed by Licensee or submitted to the PUC.

G. Planned regular maintenance schedule.

ATTEST:

By:

Print Name:

Title:

APPROVED AS TO FORM:

By:

Print Name:

Title:

CITY:

THE CITY OF LA VERNE

By:

Print Name:

Title:

Date: _______________________________
[Licensee Execution Page Follows]

Agenda Packet - April 20, 2026

25 LICENSEE:

______________________________________,
a ___________ limited partnership d/b/a
________________
By: ___________________________________
Name: ___________________________
By: _____________________________
Its: _____________________________
Date: ___________________________

Agenda Packet - April 20, 2026
City of La Verne,City Council
Agenda Report

DATE: April 20, 2026
TO: Honorable Mayor and City Council
FROM: Christy Lopez, Finance Director
SUBJECT: PUBLIC HEARING TO CONSIDER AN INCREASE IN THE PARAMEDIC FEE FOR FISCAL YEAR 2026-27 FROM $6.70 TO $6.90.

SUMMARY
The annual review of the Paramedic Service Fee is necessary to maintain financial sustainability and high-quality emergency medical services. The City Council will determine whether an adjustment to the current fee is required based on financial projections, operational needs, and public input during the hearing. The fee adjustment, if approved, will continue to support: Paramedic services; Emergency ambulance transportation; and, Insurance billing mechanisms to ensure no out-of-pocket costs for residents.

RECOMMENDATION
That the City Council adopt the resolution titled "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LA VERNE, CALIFORNIA, ADOPTING THE FISCAL YEAR 2026-27 PARAMEDIC SERVICE FEE," to adjust the monthly paramedic service fee from $6.70 to $6.90.

DISCUSSION
In November 1980, La Verne residents approved Measure GG, establishing a dedicated funding source for the La Verne Fire Department’s Paramedic Program. This measure introduced the Paramedic Service Fee to ensure that residents could receive Advanced Life Support (ALS) services and emergency transportation without direct out-of-pocket expenses.

In 1981, revenue from the Paramedic Service Fee covered approximately 20% of the Fire Department’s operations, with personnel costs of $718,665, a total budget of $1,043,720, and an estimated 1,168 medical calls. More than 40 years later, the fee along with insurance billing revenue now supports just 7% of the Fire Department’s budget, which includes estimated personnel costs of $14 million and a total budget of $16.2 million estimated and 3,206 medical calls reported in calendar year 2025.

When the fee was originally approved, a portion of the Fire Department was staffed by volunteer or part-time firefighters, which significantly reduced program costs. Today, the department is staffed by a full-time, professional workforce, and the cost structure reflects that shift, including competitive wages and additional pay for ambulance operators and paramedic- certified staff.

Although the current cost analysis supporting the program includes the pay differential for paramedic-certified employees, it does not reflect the full operational cost, as it only accounts for a portion of salary and benefit expenses and does not include full costs for equipment. Using

Agenda Packet - April 20, 2026
Public Hearing to Consider an Increase in the Paramedic Fee for Fiscal Year 2026-27 from $6.70 to $6.90., Page 2

this simplified methodology, the estimated cost to operate the Paramedic Program in Fiscal Year 2026-27 is $3,310,254. This gap highlights the ongoing challenge: revenue from the Paramedic Service Fee is not sufficient to fully fund the program’s expenses.

The Paramedic Service Fee is billed bimonthly through the Municipal Services Bill and applies to each residential, commercial, or industrial unit. The fee is subject to annual review and may be adjusted based on financial need and service costs, with increases limited to the Consumer Price Index (CPI).

In Fiscal Year 2023-24, the fee generated $1,008,605 in revenue. In Fiscal Year 2024-25, the fee generated $1,022,458 which came in below our estimations from last year. As of July 2025, the fee is set at $6.70 per month, and is projected to generate $1,042,992 in the current Fiscal Year 2025-26.

FISCAL ANALYSIS
Based on estimated appropriations for the Fiscal Year 2026-27 Budget, operating costs for paramedic and ambulance services are projected at $3,310,254.

This figure includes 100% of the costs for the Ambulance Operators and Paramedic Services divisions, as well as 15% of personnel costs for administrative and paramedic staff assigned to other divisions. The 15% allocation corresponds to the pay rate for Firefighters, Engineers, and Captains who hold a Paramedic Certification, as their compensation is calculated at a higher rate on the salary schedule. Administrative staff costs are also included, as these positions provide oversight and support for paramedic and ambulance operations.

A 3% increase in the paramedic fee is projected to generate an additional $31,432 in revenue, bringing the total estimated revenue to $1,079,153.

ENVIRONMENTAL ANALYSIS
Not applicable.

LEGAL REVIEW
The CIty Attorney has reviewed this item.

ATTACHMENTS

1. Resolution Paramedic Service Fee Adjustment

2. 26-27 Paramedic Fee

Report Prepared By:

Isabella Guzman, Senior Accountant

Agenda Packet - April 20, 2026
RESOLUTION NO. 26-XX

A RESOLUTION OF THE CITY COUNCIL, CITY OF LA VERNE, CALIFORNIA, ADOPTING THE FISCAL YEAR 2026-27 PARAMEDIC SERVICE FEE.

WHEREAS, in 1980 voters approved a Paramedic Service Fee to be used solely for the provision and administration of emergency paramedic and ambulance services in the City of La Verne; and

WHEREAS, the City Council has received the proposed adjustments to the Paramedic Service Fee for Fiscal Year 2026-27, commencing July 1, 2026, and ending June 30, 2027; and

WHEREAS, a duly noticed public hearing was held on April 20, 2026 to take public testimony and consider the proposed adjustments to the Paramedic Service Fee for Fiscal Year 2026-27; and

WHEREAS, the City Council has determined that it is necessary to adjust the Paramedic Service fee by the October CPI of the previous year for the Los Angeles Area calculated at 3%.

NOW THEREFORE, BE IT RESOLVED by the City Council of the City of La Verne as follows:

Section 1. That the Paramedic Service Fee for fiscal year 2026-27 be $6.90 per month per commercial, industrial or residential unit, effective July 1, 2026.

Section 2. That the Mayor shall sign and the Deputy City Clerk shall certify to the passage and adoption of this Resolution and thereupon the same shall take effect and be in force.

PASSED, APPROVED AND ADOPTED this 20th day of April, 2026.

______________________________________
Mayor Tim Hepburn
_______________________________
Debra Fritz, CMC Deputy City Clerk

CERTIFICATION

Agenda Packet - April 20, 2026
I hereby certify that the foregoing [Resolution No. XX-XX] was duly and regularly adopted by the City Council of the City of La Verne at a meeting thereof held on the 20th day of April, 2026, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

____________________________________
Debra Fritz, CMC Deputy City Clerk

Agenda Packet - April 20, 2026

CITY OF LA VERNE

FY 2026-27 PARAMEDIC FEE

1 OVERVIEW

MEASURE GG
In November 1980, the residents of La Verne approved Measure GG, establishing a funding mechanism for the La Verne Fire Department's Paramedic Program.

This measure introduced a Paramedic Service Fee to ensure that residents receive Advanced Life Support (ALS) services and emergency transportation to local hospitals without incurring out-of-pocket expenses.

Key Details:
• Initial Fee: The Paramedic Service Fee was initially set at $1.75 per month per commercial, industrial, or residential unit, effective January 1981. • Current Fee: As of July 2025, the fee is $6.70 per month.

The fee generated $1,008,605 in Fiscal Year 2023-24. In Fiscal Year 2024-25, the fee generated $1,022,458.

As of July 2025, the Paramedic Service Fee was set at $6.70 per month per residential, commercial, or industrial unit. It is estimated to generate $1,047,721 at the end of Fiscal Year 2025-26. • Fee Adjustments: The fee is subject to annual review. Each April, starting from 1981, the City Council holds a public hearing to set the fee for the following fiscal year, ensuring it does not exceed the service fee limit. Annual increases related to CPI are allowed based on current year rates with a maximum CPI of 3%.
• Billing: The fee is included in the municipal services bill, typically alongside water and/or refuse charges, and is billed bimonthly. Nonpayment can result in a lien on the property or other legal actions.
• Fund Allocation: All collected fees are deposited into the Paramedic Service Fund, dedicated solely to the provision and administration of emergency paramedic and ambulance services in La Verne.

In April 2003, the City Council authorized the La Verne Fire Department to bill residents' insurance companies for paramedic services, ensuring no out-of-pocket costs for residents. Non-residents receiving emergency medical services are charged fees without consideration for out-of-pocket expenses.

Residents may receive a "Request for Insurance Information" form after using paramedic services. This form allows the billing company to charge the insurance provider. Residents are protected from additional costs beyond what their insurance covers.

The Paramedic Service Fee is crucial in maintaining the financial sustainability of La Verne's emergency medical services, ensuring residents have access to essential paramedic and ambulance services without direct charges during emergencies.

Agenda Packet - April 20, 2026

CITY OF LA VERNE

FY 2026-27 PARAMEDIC FEE

2 ESTIMATED REVENUES & EXPENDITURES

REVENUES
General Fund
Insurance Billings: $1,900,000 estimated
Measure GG
Paramedic Service Fee: $1,079,153 estimated
Total Estimated Revenues: $2,979,153

EXPENDITURES
Personnel
Administration (15%): $ 154,914 estimated
Paramedics (15%): $1,613,294 estimated
Ambulance Operators: $1,326,005 estimated
Operations
Emergency Services (15%): $ 76,950 estimated
Ambulance Operators: $ 11,850 estimated
Paramedic Services (15%): $ 127,241 estimated
Total Estimated Expenditures: $3,310,254

Agenda Packet - April 20, 2026
City of La Verne,City Council
Agenda Report

DATE: April 20, 2026
TO: Honorable Mayor and City Council
FROM: Ken Domer, City Manager
SUBJECT: PUBLIC HEARING, MAKING CEQA EXEMPTION DETERMINATIONS, AND

APPROVING, SETTING, AND PROVIDING FOR ANNUAL COST INCREASES TO AFFORDABLE HOUSING DEVELOPMENT IMPACT FEES.

SUMMARY
The City of La Verne completed a Development Impact Fee (DIF) Nexus Study for affordable housing linkage and in-lieu fees. The study establishes the maximum legally defensible fees that ensure new development contributes proportionately to the need for affordable housing within the City. Staff recommends approving the findings of the Nexus Study, establishing the maximum legally defensible fees, setting a justifiable per square footage fee as a standard fee, and authorizing the City Manager to negotiate and determine the applicable fee amounts through a development agreement on a project-by-project basis, as applicable.

RECOMMENDATION
That the City Council:

1. Conduct a public hearing on the proposed Development Impact Fee update; and

2. Find that the actions proposed herein are statutorily exempt from the California Environmental Quality Act (CEQA) pursuant to State CEQA Guidelines section 15378 (b) (4), 15061 (b) (3), and 15273 (Rates, Tolls, Fares, and Charges); and

3. Adopt a resolution titled, "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

LA VERNE, CALIFORNIA, APPROVING THE AFFORDABLE HOUSING LINKAGE & IN-

LIEU DEVELOPMENT IMPACT FEE JUSTIFICATION STUDY AND SETTING INITIAL FEES"; and

4. Approve a justifiable per square foot fee and provide authority to the City Manager to negotiate and determine an applicable fee amount on a project-by-project basis; and

5. Approve annual adjustments tied to the California Construction Cost Index (CCCI) to account for inflation in construction and acquisition costs.

DISCUSSION
The La Verne General Plan establishes policies and programs intended to support a balanced housing supply and facilitate the development and preservation of housing affordable to a range of income levels. The City’s adopted 2021–2029 Housing Element further identifies strategies to address regional housing needs and ensure adequate sites and resources are available to accommodate new housing opportunities across income categories. As part of implementing these policies and maintaining compliance with State housing requirements, the City commissioned residential and non-residential affordable housing fee studies to evaluate the

Agenda Packet - April 20, 2026
Public Hearing, Making CEQA Exemption Determinations, and Approving, Setting, and providing for Annual Cost Increases to Affordable Housing Development Impact Fees., Page 2

relationship between new development and the demand for affordable housing and to determine appropriate fee levels that can support the City’s affordable housing programs.

To plan for growth and address the impacts of new development on affordable housing demand, the City of La Verne retained DTA Public Finance, Inc. to prepare nexus studies for both residential in-lieu fees and non-residential linkage fees. An in-lieu fee is associated with construction of new housing while a linkage fee is associated with the expansion or construction of non-residential units. These studies establish a legally defensible connection between new development, the jobs and population it generates, and the resulting need for additional affordable housing for the local workforce. By analyzing employment generation, household income distributions, and the cost of delivering housing for households earning up to 120% of Area Median Income (AMI), the studies identify the maximum supportable fee level, per unit for residential development and per square foot for non-residential development, necessary to mitigate these impacts and support the provision of affordable housing. Pursuant to state law, these fees cannot be imposed on affordable housing units. Nexus studies are now a requirement of state law and cities must conduct nexus studies per Assembly Bill 602 at least every eight years.

The Nexus Studies establish the maximum legally justifiable fees under state law, as reflected in the tables below. While the City Council may adopt lower fee amounts, it may not exceed the calculated maximums.

Land Use Type Maximum Justifiable Fee (per
Square Foot)
Commercial $331.74
Office $441.66
Industrial $104.31
Institutional $372.82
Single-Family Detached $44.87 ($107,697 per unit)
Townhome $41.49 ($62,242 per unit)
Condominium $45.31 ($54,377 per unit)
Apartment $48.58 ($48,583 per unit)

Currently, the City’s linkage fee was set in 1993 and is a flat rate of $1,500 per unit, while the in- lieu fee is negotiated with developers through development agreements. As a result, it is difficult to provide a direct percentage comparison between the City’s existing fees and the newly proposed rates. However, the Nexus Studies indicate a substantial increase in fee levels, which are comparatively high relative to other cities within the San Gabriel Valley. While the rates are comparably higher, not all cities have completed nexus studies as required yet and not all cities may have an in-lieu or linkage fee as methods vary to increase affordable housing across the region. As shown in the table below, most neighboring cities do not impose affordable housing linkage or in-lieu fees, though they may have inclusionary housing ordinances or some other form of fee related to affordable housing.

City In-Lieu Fee Linkage Fee
Covina None None

Agenda Packet - April 20, 2026
Public Hearing, Making CEQA Exemption Determinations, and Approving, Setting, and providing for Annual Cost Increases to Affordable Housing Development Impact Fees., Page 3

San Dimas None None
Ontario
None None
Glendora None None
Pomona Tiered based on the unit count
and housing type. It ranges from
$0.33 per square foot up to
$11.40 per square foot.

None
Rancho
Cucamonga
None Ranges depending on
development type from $1.18
to $7.07 per square foot.

Monrovia Ranges based on housing type
from $24.50 to $29.40 per
square foot.

None
Clare
mont Fee is variab
le to the specific
project.

None
Upla
nd None None
Azusa
None None
Duarte None None

Staff recommends that the City Council approve the findings of the Nexus Studies, as required by law, but like many other cities in Southern California, adopt a lower rate to serve as the standard fee amount. In consideration of current market conditions and the potential for higher fees to discourage new development, Staff is recommending the adoption of a reduced fee. Collection of a fee will assist the City accumulate funding for future affordable housing units if not included within a new development, but the collection of the fee must be balanced with the market conditions and limiting the appeal of the City as an option for development. With the adoption of the nexus study, fees can be increased based on market conditions and requirements for affordable housing production.

As more cities begin to comply with AB 602, there will be more comparable data in which the City can ensure our fees are consistent with area averages as well local area market conditions. Additionally, there is a growing list of industry, advocate, institutional, and governmental reports analyzing fees and development. A 2019 report by the Terner Center for Housing Innovation at UC Berkeley, prepared under contract with the California Department of Housing and Community Development, titled Residential Impact Fees in California: Current Practices and Policy Considerations to Improve Implementation of Fees Governed by the Mitigation Fee Act, finds that higher development impact fees can materially affect project feasibility and housing supply, and that complex and inconsistent fee structures can create uncertainty for developers, making it more difficult to accurately estimate costs during project planning. The California YIMBY Education Fund (Yes In My Back Yard) produced a report in April 2024 titled, "The Impact of Fees: Rethinking Local Revenues for More Multifamily Housing." This report reviewed impact fees, as well as the requirements in AB 602, and provided options from a perspective of an industry group promoting the creation of affordable housing with the understanding of local government revenue needs and impact on the finance of developing housing. One policy recommendation, which continues the collection of impact fees, is to cap the impact fees at a flat rate per square foot. This allows developers to know

Agenda Packet - April 20, 2026
Public Hearing, Making CEQA Exemption Determinations, and Approving, Setting, and providing for Annual Cost Increases to Affordable Housing Development Impact Fees., Page 4

their charges upfront without discouraging the construction of smaller units, per the report. The knowledge of fees upfront has also been a request of the Building Industry Association. Providing upfront fees fulfills the intent of the legislation to increase transparency while protecting a local government's revenue derived from such fees.

Consistent with industry practice, the City can retain flexibility in implementation, with actual fee amounts to be considered and, where appropriate, negotiated on a project-by-project basis through development agreements by capping fees, or other means to take into account specific benefits and impacts of individual projects, including provision of onsite affordable housing. This approach allows the City to advance its affordable housing objectives while supporting feasible development and remaining within the intent of state law. Based on these considerations, the City proposes to establish a capped impact fee structure at a fixed rate per square foot, set below the maximum levels identified in the nexus study, to improve predictability, transparency, and overall project feasibility while continuing to support funding needs for affordable housing.

Land Use Type Justifiable Square
Foot Charge
Linkage: Commercial $10.00
Linkage: Office $15.00
Linkage: Industrial $25.00
Linkage: Institutional $20.00
In-Lieu: Single Family
Detached
$20.00
In-Lieu: Townhome $20.00
In-Lieu:

Condominium
$20.00
In-Lieu: Apartment $45.00

The City is currently developing a comprehensive ordinance revision to its municipal code to group all development impact fees into one Chapter, further ensuring transparency of development impact fees and providing the City the authority to impose the fees. Until that ordinance is adopted, the new Development Impact Fees will not be enacted until 30 days after adoption.

Posted Notices
On March 12, 2026, the draft Nexus Study was posted on the City website for review and a notice of public hearing was included in the Daily Bulletin on March 13, 2026, and March 20, 2026. In compliance with Government Code section 66016, the notice of public hearing was also emailed on March 12, 2026, to representatives from SoCal Gas, Southern California Edison, and the Building Industry Association of Southern California.

FISCAL ANALYSIS
While it is difficult to project annual revenue generated from Development Impact Fees (DIFs) due to fluctuations in the timing, scale, and type of development projects, as well as the City’s intent to negotiate applicable fee amounts on a project-by-project basis, these fees are designed to provide a flexible and reliable funding source to address affordable housing needs

Agenda Packet - April 20, 2026
Public Hearing, Making CEQA Exemption Determinations, and Approving, Setting, and providing for Annual Cost Increases to Affordable Housing Development Impact Fees., Page 5

generated by new development. Revenues collected may be leveraged in a variety of ways, including gap financing for affordable housing projects, partnerships with developers, land acquisition, or contributions toward programs that increase the supply and preservation of affordable housing within the City. Funds will be maintained in a restricted account and are not eligible for General Fund purposes. Rather, they will be held and strategically deployed when viable and impactful affordable housing opportunities are identified.

ENVIRONMENTAL ANALYSIS
Adoption of the updated Development Impact Fee program does not constitute a project under the California Environmental Quality Act (CEQA), as it establishes a funding mechanism and does not directly approve or authorize construction. Each individual capital project funded through these fees will undergo separate CEQA review at the time of its proposal and implementation.

LEGAL REVIEW
The City Attorney has reviewed and approved this report.

ATTACHMENTS

1. Resolution No. 26-XX, Comprehensive Fee Schedule Fiscal Year 2025-26 Affordable Housing Fees

2. Residential Affordable Housing Fee Nexus Study

3. Non-R
esidential Affordable Housing Fee Nexus Study

4. Affordable Housing Fees - Southern California Cities Review

Report Prepared By:

Andrea
Blockinger, Management Analyst

Agenda Packet - April 20, 2026
RESOLUTION NO. 26-xx

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LA VERNE,

CALIFORNIA, APPROVING THE AFFORDABLE HOUSING LINKAGE & IN-LIEU

DEVELOPMENT IMPACT FEE JUSTIFICATION STUDY AND SETTING INITIAL FEES

WHEREAS, the Municipal Code of the City of La Verne authorizes the City Council to establish, amend, or update fees for services, permits, and programs provided by the City; and

WHEREAS, the Mitigation Fee Act (California Government Code §§ 66000 – 66025) authorizes local agencies to impose development impact fees to ensure that future development projects mitigate their impact on the need for affordable housing in La Verne, and that any adopted residential affordable housing impact fees do not exceed the actual affordable housing impacts attributable to the development projects to which the fees relate; and

WHEREAS, Finance DTA, Inc. completed an Affordable Housing Linkage and Affordable Housing In-Lieu (Nexus) Study, dated February 6, 2026, to evaluate the nexus between new development and the City’s affordable housing need, including the associated affordability gap and proportional impact; and

WHEREAS, after notifying those parties interested in fee revisions the City provided public notice in accordance with Government Code Section 66016, published the notice of public hearing on March 13, 2026 and March 20, 2026, and posted the draft Nexus Study on the City’s website for public review on March 12, 2026; and

WHEREAS, the City Council conducted a duly noticed public hearing on April 20, 2026, to consider the proposed Development Impact Fees; and

WHEREAS, the City Council finds that the fees adopted by this Resolution represent the reasonable cost to develop affordable housing in the City of La Verne and that there is a reasonable relationship between the fee charged and the cost of affordable housing.

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of La Verne that The City Council hereby adopts the updated Development Impact Fees (DIFs) as identified in the Affordable Housing Linkage and Affordable Housing In-Lieu (Nexus) Study, dated February 6, 2026, which is attached hereto and incorporated herein by reference. The maximum specific fee amounts and methodology for calculation are set forth in the attached study.

SECTION 1. The Affordable Housing Linkage Development Impact Fee shall be set at the following rates per square footage of new and additional construction:

Commercial - $10.00; Office - $15.00; Industrial - $25.00; and, Institutional - $20.00 and the Affordable Housing In-Lieu Fee shall be set at the following rates per square footage of new construction: Single Family Detached - $20.00; Townhome - $20.00; Condominium - $20.00; and, Apartment - $45.00.

Agenda Packet - April 20, 2026
Reso No. 26-xx Page 2 of 2

SECTION 2. The Development Impact Fees shall be adjusted annually on July 1 of each year based upon the percentage change in the California Construction Cost Index (CCCI) for the preceding twelve-month period, to account for inflation in construction and acquisition costs.

SECTION 3. If any provision of this Resolution is held to be unconstitutional or unlawful, it is the intent of the City Council that such portion of this Resolution be severable from the remainder and that the remainder be given full force and effect.

SECTION 4. The Mayor shall sign and the Deputy City Clerk shall certify to the passage and adoption of this Resolution and a copy of this Resolution shall be posted for the information of the general public.

PASSED, APPROVED AND ADOPTED this 20th day of April, 2026.

Mayor Tim Hepburn
ATTEST:

Debra Fritz, Deputy City Clerk

CERTIFICATION

I hereby certify that the foregoing Resolution No. 26-XX was duly and regularly adopted by the City Council of the City of La Verne at a meeting thereof held on the 20th day of April 2026, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
____________________________________
Debra Fritz, Deputy City Clerk

Agenda Packet - April 20, 2026

Irvine | San Jose | San Francisco | Riverside
Dallas | El Paso | Raleigh | Tampa

w w w.F inance DTA .com
Public Finance
Public - Private Partnerships
Development Economics
Clean Energy Bonds

RESIDENTIAL AFFORDABLE

HOUSING IN - L IEU FEE

JUSTIFICATION STUDY

CITY OF LA VERNE
Report Date: February 6, 2026

Agenda Packet - April 20, 2026
Irvine I San Jose I San Francisco I Riverside
Dallas I El Paso I Raleigh I Tampa

www.FinanceDTA.com 18201 Von Karman Avenue, Suite 220
Irvine, CA 92612

CITY OF LA VERNE

RESIDENTIAL AFFORDABLE HOUSING IN - LIEU FEE

JUSTIFICATION STUDY
Prepared for:

City of La Verne
3660 D St. La Verne CA 91750

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com 18201 Von Karman Avenue, Suite 220
Irvine, CA 92612

CITY OF LA VERNE

LAVERNE

RESIDENTIAL AFFORDABLE HOUSING IN-LIEU FEE

JUSTIFICATION STUDY
Prepared for:

City of La Verne
3660 D St. La Verne CA 91750

TABLE

OF CONTENT S

SECTION PAGE
I EXECUTIVE SUMMARY ................................................... 1 A In - Lieu Summary ................................................................ 1 B Annual Escalation Factors ................................................. 2 II INTRODUCTION .............................................................. 3 A Overview of Methodology ................................................ 3

III LEGAL FRAMEWORK TO JUSTIFY DEVELOPMENT
IMPACT FEES .................................................................... 4 IV LAND USE AND DEMOGRAPHIC ASSUMPTIONS ..... 8
A Land Use Definitions and Employment
Densities ............................................................................... 8 B Worker Household ............................................................ 10 C Industry Sectors ................................................................ 10 D Income Distribution of Worker Households ............... 12 E Worker Households by Income Level .......................... 15

V AFFORDABILITY GAP AND IN - LIEU FEE
CALCULATION ............................................................... 16 A Affordability Gap ............................................................... 16 B Fee Calculation .................................................................. 17 VI FEE IMPLEMENTATION ................................................ 18 A Administering a Fee Program ........................................ 18 B Indexing the In - Lieu Fee ................................................. 18 C Phase - In Schedule for Fee .............................................. 18 D Waivers, Exemptions, and Refunds Overview ............ 18

APPENDICES

APPENDIX A FEE CALCULATION

APPENDIX B OCCUPATIONAL STATISTICS

APPENDIX C AFFORDABILITY GAP ANALYSIS

Agenda Packet - April 20, 2026
TABLE

OF CONTENTS
PAGE
I EXECUTIVE SUMMARY ................................................... 1 A In-Lieu Summary ................................................................ 1 B Annual Escalation Factors ................................................. 2 II INTRODUCTION .............................................................. 3 A Overview of Methodology ................................................ 3

III LEGAL FRAMEWORK TO JUSTIFY DEVELOPMENT
IMPACT FEES .................................................................... 4 IV LAND USE AND DEMOGRAPHIC ASSUMPTIONS ..... 8
A Land Use Definitions and Employment
Densities ............................................................................... 8 B Worker Household ............................................................ 10 C Industry Sectors ................................................................ 10 D Income Distribution of Worker Households ............... 12 E Worker Households by Income Level .......................... 15

V AFFORDABILITY GAP AND IN-LIEU FEE
CALCULATION ............................................................... 16 A Affordability Gap ............................................................... 16 B Fee Calculation .................................................................. 17 VI FEE IMPLEMENTATION ................................................ 18 A Administering a Fee Program ........................................ 18 B Indexing the In-Lieu Fee ................................................. 18 C Phase-In Schedule for Fee .............................................. 18 D Waivers, Exemptions, and Refunds Overview ............ 18

APPENDICES

APPENDIX A

APPENDIX B

APPENDIXC

FEE CALCULATION

OCCUPATIONAL STATISTICS

AFFORDABILITY GAP ANALYSIS
1 SECTION I

EXECUTIVE SUMMARY

City of La Verne February 6, 2026
Residential Affordable Housing In - Lieu Fee Justification Study

www.FinanceDTA.com

I EXECUTIVE SUMMARY
In order to adequately plan for new development and quantify the need for affordable housing and related costs associated with the direct and cumulative impacts of new development, DTA Public Finance, Inc. (“DTA”), was retained by the City of La Verne (the “City”) to prepare this residential nexus analysis (the “Fee Study”) and accompanying report for the City to establish a basis for a proposed residential In -Lieu fee (the “In -Lieu Fee”) . The proposed fee would be levied on new residential development within the City as a means of mitigating the impact such development has on the demand fo r affordable housing for the local workforce . The purpose of the Fee Study is to provide a legally defensible analysis of the “nexus” between new residential development projects, the additional employment generated as a result of residential spending , the resulting new worker households and their income distributions, and ultimately an estimate of those households that will need affordable housing . Importantly, the analysis examines the cost of delivering housing for households earning up to 120% of the Area Median Income (“AMI ”) and evaluates the maximum feasible fee per unit for residential development , that is required to support the provision of such housing.

A In - Lieu Fee Summary
The Fee Study establishes a connection between new residential land uses , an increase in spending that results in the introduction of new workers, and the demand for housing generate d by those new workers . Given that a portion of these workers may belong to lower - income households, a share of the resulting housing demand must be met through affordable housing options . The analysis begins by categorizing residential land uses into four distinct types: Single - Family Detached, Townhome, Condominium, and Apar tment .

The se categories are not exhaustive but serve as prototypes for determining the potential impacts on the City and provide guidance on the City’s affordable housing goals and objectives . The subsequent analysis proceeds with the following calculations:

The average sales prices for each residential land use type are determined; Anticipated average income levels for each residential land use type are estimated based on the anticipated mortgage and other home payments, required for each of the residential land use types;
Household spending in the City is estimated based on the income level and the data published by the Consumer Expenditure Survey;
Employee generation numbers based on household expenditure for each residential categor y are determined using data from IMPLAN;
Occupational and income information for each occupation is used to determine the distribution of jobs within each such occupation, with particular focus on the jobs with compensation levels addressed in the analysis;
New jobs are adjusted to new households, using area specific demographic information on the number of workers per household;

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com

I EXECUTIVE SUMMARY

SECTION I

EXECUTIVE SUMMARY
In order to adequately plan for new development and quantify the need for affordable housing and related costs associated with the direct and cumulative impacts of new development, OTA Public Finance, Inc. ("OTA"). was retained by the City of La Verne (the "City") to prepare this residential nexus analysis (the "Fee Study") and accompanying report for the City to establish a basis for a proposed residential In-Lieu fee (the "In-Lieu Fee"). The proposed fee would be levied on new residential development within the City as a means of mitigating the impact such development has on the demand for affordable housing for the local workforce . The purpose of the Fee Study is to provide a legally defensible analysis of the "nexus" between new residential development projects, the additional employment generated as a result of residential spending, the resulting new worker households and their income distributions, and ultimately an estimate of those households that will need affordable housing. Importantly, the analysis examines the cost of delivering housing for households earning up to 120% of the Area Median Income ("AMI") and evaluates the maximum feasible fee per unit for residential development, that is required to support the provision of such housing.

A In-Lieu Fee Summary
The Fee Study establishes a connection between new residential land uses, an increase in spending that results in the introduction of new workers, and the demand for housing generated by those new workers. Given that a portion of these workers may belong to lower-income households, a share of the resulting housing demand must be met through affordable housing options. The analysis begins by categorizing residential land uses into four distinct types: Single-Family Detached, Townhome, Condominium, and Apartment.

These categories are not exhaustive but serve as prototypes for determining the potential impacts on the City and provide guidance on the City's affordable housing goals and objectives. The subsequent analysis proceeds with the following calculations:
■ The average sales prices for each residential land use type are determined; ■ Anticipated average income levels for each residential land use type are estimated based on the anticipated mortgage and other home payments, required for each of the residential land use types;
■ Household spending in the City is estimated based on the income level and the data published by the Consumer Expenditure Survey;
■ Employee generation numbers based on household expenditure for each residential category are determined using data from IMPLAN;
■ Occupational and income information for each occupation is used to determine the distribution of jobs within each such occupation, with particular focus on the jobs with compensation levels addressed in the analysis;
■ New jobs are adjusted to new households, using area specific demographic information on the number of workers per household;
City of La Verne
Residential Afford able Housing In-Lieu Fee Justifi cation Study Febm a,y 6, 2026 I
1 2

SECTION I

EXECUTIVE SUMMARY

City of La Verne February 6, 2026
Residential Affordable Housing In - Lieu Fee Justification Study

www.FinanceDTA.com
The number of Extremely Low, Very Low - , Low - , and Moderate - Income households generated by the new development is calculated and coefficients of households per square foot of building area are generated; and
The number of lower income households per square foot is multiplied by the “Affordability Gap”, or the cost of delivering housing units affordable to these income groups, to generate the maximum In - Lieu Fee for the residential land uses.

The resulting fees are summarized in Table ES - 1 below . This table presents the maximum legally justifiable fees as determined by the Fee Study . These totals reflect the maximum impact fees that may be assessed on new residential construction to address its contribution to affordable housing needs . They are not proposed fee levels; they represent only the upper limits identified through this analysis .

Table ES - 1: In - Lieu Fee Summary
Land Use Type Maximum Justifiable
Fee (Per Unit)
Maximum Justifiable
Fee (Per Sq . Ft.)
Single - Family Detached $107,697 $44.87
Townhome $62,242 $41.49
Condominium $54,377 $45.31
Apartment $48,583 $48.58
B Annual Escalation Factors
The cost estimates for the In - Lieu Fee calculated in this Fee Study are stated in 202 5 dollars .

DTA further recommends that, after adoption, the above fees be reviewed each year and adjusted based upon the changes in the Engineering News - Record (”ENR”) California Construction Cost Index (“CCCI”) . This construction cost index is based upon the Building Cost Index (“BCI”) cost average s experienced in Los Angeles - L ong Beach- Anaheim as measured by the Engineering News - Recor d.

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com

SECTION I

EXECUTIVE SUMMARY
■ The number of Extremely Low, Very Low-, Low-, and Moderate-Income households generated by the new development is calculated and coefficients of households per square foot of building area are generated; and
■ The number of lower income households per square foot is multiplied by the "Affordabi.lity Gap", or the cost of delivering housing uni.ts affordable to these income groups, to generate the maximum In-Lieu Fee for the residential land uses.

The resulting fees are summarized in Table ES-1 below. This table presents the maximum legally justifiable fees as determined by the Fee Study. These totals reflect the maximum impact fees that may be assessed on new residential construction to address its contribution to affordable housing needs. They are not proposed fee levels; they represent only the upper limits identified through this analysis.

Table ES-1: In-Lieu Fee Summary
Land Use Type Maximum Justifiable Maximum Justifiable
Fee (Per Unit) Fee (Per Sq. Ft.)
Single-Family Detached $107,697 $44.87
Townhome $62,242 $41.49
Condominium $54,377 $45.31
Apartment $48,583 $48.58
B Annual Escalation Factors
The cost estimates for the In-Lieu Fee calculated in this Fee Study are stated in 2025 doll ars.

DT A further recommends that, after adoption, the above fees be reviewed each year and adjusted based upon the changes in the Engineering News- Record ("ENR") California Construction Cost Index {"CCCI"). This construction cost index is based upon the Building Cost Index ("BCI") cost averages experienced in Los Angeles-Long Beach-Anaheim as measured by the Engineering News-Record.

City of La Verne
Residential Affordable Housing In-Li eu Fee Justification Study Febma,y 6, 2026 I
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SECTION II

INTRODUCTION

City of La Verne February 6, 2026
Residential Affordable Housing In - Lieu Fee Justification Study

www.FinanceDTA.com

II INTRODUCTION
A Overview of Methodology
The Fee Study is based on the premise that new residential land uses generate additional economic activity through their spending, and this activity generates new employment for workers that will have a range of household incomes . Given the high cost of housing, many of these new workers will be unable to afford market - rate housing without experiencing significant financial strain . Consequently, the increase in lower - income worker households without access to affordable housing is considered a direct impa ct of new residential development . To address this, the proposed mitigation fee (the “In - Lieu Fee” is intended to generate revenue that supports the development of affordable housing to these new lower - income households.

This section provides an overview of the Fee Study . Each step is summarized below and discussed in more detail in the following sections:

Section III, Legal Framework : This section provides a detailed discussion on the legal framework utilized to justify the imposition and collection of the fee.

Section IV, Land Use and Demographic Assumptions : The Fee Study analyzes four residential land use categories that represent key prototypes of anticipated future development in the City . For each land use type defined, the Fee Study calculates average sales price and in turn estimates the household income, the average household spending in the City, and the resulting job creation . Recognizing that most households include more than one worker, the study converts these employment figures into worker households to determine the total number generated by each land use . Finally, the Fee Study estimates the distribution by income level of new worker households by applying the income profiles to the total household counts.

Section V , Financing Gap per Affordable Unit and Maximum Legal Fee Calculation :

This section evaluates the economic viability of constructing a market - rate dwelling unit versus constructing a dwelling unit with rents that are affordable to a Moderate - Income or Low - Income Household , to determine the affordability gap . This gap is then applied to the total housing need by income level to calculate the maximum legal fee.

Section VI , Fee Implementation : This section presents policy recommendations for implementation, administration, and other considerations .

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com

II INTRODUCTION
A Overview of Methodology

SECTION II

INTRODUCTION
The Fee Study is based on the premise that new residential land uses generate additional economic activity through their spending, and this activity generates new employment for workers that will have a range of household incomes. Given the high cost of housing, many of these new workers will be unable to afford market-rate housing without experiencing significant financial strain. Consequently, the increase in lower-income worker households without access to affordable housing is considered a direct impact of new residential development. To address this, the proposed mitigation fee (the "In-Lieu Fee" is intended to generate revenue that supports the development of affordable housing to these new lower-income households.

This section provides an overview of the Fee Study. Each step is summarized below and discussed in more detail in the following sections:
■ Section III, Legal Framework: This section provides a detailed discussion on the legal framework utilized to justify the imposition and collection of the fee. ■ Section IV, Land Use and Demographic Assumptions: The Fee Study analyzes four residential land use categories that represent key prototypes of anticipated future development in the City. For each land use type defined, the Fee Study calculates average sales price and in tum estimates the household income, the average household spending in the City, and the resulting job creation. Recognizing that most households include more than one worker, the study converts these employment figures into worker households to determine the total number generated by each land use. Finally, the Fee Study estimates the distribution by income level of new worker households by applying the income profiles to the total household counts.
■ Section V, Financing Gap per Affordable Unit and Maximum Legal Fee Calculation:

This section evaluates the economic viability of constructing a market-rate dwelling unit versus constructing a dwelling unit with rents that are affordable to a Moderate­ Income or Low-Income Household, to determine the affordability gap. This gap is then applied to the total housing need by income level to calculate the maximum legal fee.
■ Section VI. Fee Implementation: This section presents policy recommendations for implementation, administration , and other considerations.

City of La Verne
Residential Affordable Housing In-Li eu Fee Justification Study Febma,y 6, 2026 I
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SECTION III

LEGAL FRAMEWORK TO JUSTIFY

DEVELOPMENT IMPACT FEES

City of La Verne February 6, 2026
Residential Affordable Housing In - Lieu Fee Justification Study

www.FinanceDTA.com

III LEGAL FRAMEWORK TO JUSTIFY DEVELOPMENT IMPACT FEES The imposition of impact fees is an authorized method of financing the facilities necessary to mitigate the impact of new development , including affordable housing . A fee is “a monetary exaction, other than a tax or special assessment, which is charged by a local agency to the applicant in connection with approval of a development project for the purpose of defraying all or a portion of the cost of public facilities r elated to the development project...” (California Government Code, Section 66000).

A fee may be levied for each type of capital improvement required for new development, with the payment of the fee typically occurring prior to the beginning of construction of a dwelling unit or non - residential building . Fees are often levied at final map recordation, upon the issuance of a C ertificate of O ccupancy, or more commonly, at building permit issuance.

AB 1600, which created Section 66000 et seq . of the Government Code , was enacted by the State of California in 1987 . In 2006, Government Code Section 66001 was amended to clarify that a fee cannot include costs attributable to existing deficiencies, but it can fund costs used to maintain the existing Level of Service (“LOS”) or meet an adopted LOS consistent with the General Plan.

Section 66000 et seq . of the Government Code thus requires that all public agencies satisfy the following requirements when establishing, increasing, or imposing a fee as a condition of new development:

1. Identify the purpose of the fee [Government Code Section 66001(a)(1)] ;

2. Ascertain the use to which the fee will be put [Government Code Section 66001(a)(2)] ;

3. Determine that there is a reasonable relationship between the fee’s use and type of development on which the fee is to be imposed [Government Code Section 66001(a)(3)] ;

4. Establish how there is a reasonable relationship between the need for the public facility and type of development project on which the fee is to be imposed [Government Code Section 66001(a)(4)] ; and

5. Discuss how there is a reasonable relationship between the amount of the fee and cost of the public facility or portion of the public facility attributable to the development on which the fee is imposed [Government Code Section 66001( b)].

Presented below are the legal requirements as they relate to the calculation and imposition of the proposed fees addressed by this Fee Study.

Agenda Packet - April 20, 2026
dta
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LEGAL FRAMEWORK TO JUSTIFY

DEVELOPMENT IMPACT FEES

III LEGAL FRAMEWORK TO JUSTIFY DEVELOPMENT IMPACT FEES
The imposition of impact fees is an authorized method of financing the facilities necessary to mi.ti.gate the impact of new development, including affordable housing. A fee is "a monetary exaction, other than a tax or special assessment , which is charged by a local agency to the applicant in connection with approval of a development project for the purpose of defraying all or a portion of the cost of public facilities related to the development project ... " (California Government Code, Section 66000).

A fee may be levied for each type of capital improvement required for new development, with the payment of the fee typically occurring prior to the beginning of construction of a dwelhng unit or non-residential building. Fees are often levied at final map recordation, upon the issuance of a Certificate of Occupancy, or more commonly, at building permit issuance.

AB 1600, which created Section 66000 et seq. of the Government Code, was enacted by the State of California in 1987. In 2006, Government Code Section 66001 was amended to clarify that a fee cannot include costs attributable to existing deficiencies, but it can fund costs used to maintain the existing Level of Service ("LOS") or meet an adopted LOS consistent with the General Plan .

Section 66000 et seq. of the Government Code thus requires that all public agencies satisfy the following requirements when establishing, increasing, or imposing a fee as a condition of new development:

1. Identify the purpose of the fee [Government Code Section 66001(a)(1)];

2. Ascertain the use to which the fee will be put [Government Code Section 66001(a)(2)] ;

3. Determine that there is a reasonable relationship between the fee's use and type of development on which the fee is to be imposed [Government Code Section 66001(a)(3)] ;

4. Establish how there is a reasonable relationship between the need for the public facility and type of development project on which the fee is to be imposed [Government Code Section 66001( a)(4)]; and

5. Discuss how there is a reasonable relationship between the amount of the fee and cost of the public facility or portion of the publi c facility attributable to the development on whi ch the fee is impo sed [Government Code Section 66001(b}].

Presented below are the legal requirement s as they relate to the calculation and impo sition of the proposed fees addressed by this Fee Study .

City of La Verne
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A PURPOSE OF THE FEE [GOVERNMENT CODE SECTION 66001(A)(1) ] New development within the City will generate additional residents and employees . These future residents and employees will create an additional demand for new or expanded affordable housing that the existing housing stock cannot accommodate . To accommodate residential development in an orderly manner, without adversely impacting the current quality of life in the City, additional affordable housing will need to be constructed .

It is the projected direct and cumulative effect of residential development that has required the preparation of this Fee Study . Every newly developed parcel will contribute to the need for new affordable housing, and, as such, the proposed fee will be charged to all future development, irrespective of location, within the City . Importantly, many of the employees associated with any additional residential development in the City may live in affordable housing . Additionally, the availability of jobs throu ghout the City has a growth - inducing impact, in that it enhances the City’s reputation as a great place to live and work, thereby attracting new residential development that might otherwise have been constructed elsewhere . As a result, all such development projects in the City contribute to the cumulative need for new affordable housing . The fee, when collected, will be placed into a dedicated fund that will be used solely for the design, acquisition, and construction of affordable housing and other appro priate related costs to mitigate the direct and cumulative impacts of new residential development within the City.

The discussion in this subsection of the Fee Study sets forth the purpose of the Development Impact Fee (“DIF”) as required by Section 66001(a)(1) of the California Government Code.

B THE USE TO WHICH THE FEE IS TO BE PUT [GOVERNMENT CODE SECTION 66001(A)(2) ]
The fee collected will provide a source of revenue for the City to facilitate the design, acquisition, , and construction of affordable housing , and related costs necessary to mitigate the direct and cumulative demand for such housing as a result of new residential development in the City . By directly funding these costs, the fee will both enhance the quality of life for and protect the health, safety, and welfare of the existing and future City residents and employees .

C THERE IS A REASONABLE RELATIONSHIP BETWEEN THE FEE ’S USE AND THE TYPE

OF DEVELOPMENT PROJECT UPON WHICH THE FEE IS IMPOSED (BENEFIT RELATIONSHIP) [GOVERNMENT CODE SECTION 66001(A)(3)]
As discussed in Section A above, it is the projected direct and cumulative effect of future development that has prompted the preparation of this Fee Study . All new residential development within the City , irrespective of location, contributes to the direct and cumulative impacts of development on the affordable housing demand and creates the need for more such housing to accommodate growth . The derivation of fee amounts for residential development is explained in detail in Sections IV and V of this Fee S tudy . These fees will be expended exclusively for the design, acquisition, and construction of new affordable housing ,

Agenda Packet - April 20, 2026
dta
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A PURPOSE OF THE FEE [GOVERNMENT CODE SECTION 66001(A)(1)] New development wi.thi.n the City will generate additional residents and employees. These future residents and employees will create an additional demand for new or expanded affordable housing that the existing housing stock cannot accommodate. To accommodate residential development in an orderly manner, without adversely impacting the current quality of life in the City, additional affordable housing wi.11 need to be constructed.

It is the projected direct and cumulative effect of residential development that has required the preparation of this Fee Study. Every newly developed parcel will contribute to the need for new affordable housing, and, as such, the proposed fee will be charged to all future development, irrespective of location, within the City. Importantly, many of the employees associated with any additional residential development in the City may live in affordable housing. Additionally, the availability of jobs throughout the City has a growth-inducing impact, in that it enhances the City's reputation as a great place to live and work, thereby attracting new residential development that might otherwise have been constructed elsewhere. As a result, all such development projects in the City contribute to the cumulative need for new affordable housing. The fee, when collected, will be placed into a dedicated fund that will be used solely for the design, acquisition, and construction of affordable housing and other appropriate related costs to mitigate the direct and cumulative impacts of new residential development within the City.

The discussion in this subsection of the Fee Study sets forth the purpose of the Development Impact Fee {"DIF") as required by Section 66001{a){1} of the California Government Code.

B THE USE TO WHICH THE FEE IS TO BE PUT [GOVERNMENT CODE SECTION 66001(A) (2) I
The fee collected will provide a source of revenue for the City to facilitate the design, acquisition, , and construction of affordable housing , and related costs necessary to mitigate the direct and cumulative demand for such housing as a result of new residential development in the City. By directly funding these costs, the fee will both enhance the quality of life for and protect the health, safety, and welfare of the existing and future City residents and employees.

C THERE IS A REASONABLE RELATIONSHIP BETWEEN THE FEE'S USE AND THE TYPE

OF DEVELOPMENT PROJECT UPON WHICH THE FEE IS IMPOSED (BENEFIT RELATIONSHIP) [GOVERNMENT CODE SECTION 66001(A)(3))
As discussed in Section A above, it is the projected dire ct and cumulative effect of future development that has prompted the preparation of this Fee Study . All new residential development within the City, irrespective of location, contributes to the direct and cumulative impacts of development on the affordable housing demand and create s the need for more such housing to accommodate growth. The derivation of fee amounts for residential development is explained in detail in Sections IV and V of this Fee Study. These fees wi.11 be expended exclusively for the design, acquisition, and construction of new affordabl e housing, City of La Verne
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Residential Affordable Housing In - Lieu Fee Justification Study

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as that is the purpose for which th is DIF is being collected . As previously stated, all new residential development s create either a direct impact or contributes to the cumulative impact on affordable housing .

For the foregoing reasons, there is a reasonable relationship between the design, acquisition, and construction of affordable housing and new development as required under Section 66001(a)(3) of the Mitigation Fee Act.

D DETERMINE HOW THERE IS A REASONABLE RELATIONSHIP BETWEEN THE NEED

FOR THE PUBLIC FACILITY AND THE TYPE OF DEVELOPMENT PROJECT UPON WHICH THE FEE IS IMPOSED (IMPACT RELATIONSHIP) [GOVERNMENT CODE SECTION 66001(A)(4) ]
As previously stated, new residential development within the City, irrespective of location, contributes to the direct and cumulative impacts of development on the affordable housing demand and creates the need for new affordable housing to accommodate gro wth .

Moreover, the affordable housing needs identified in Section V are specifically a function of the number of projected residents within the City and do not reflect any unmet needs of existing development .

For the reasons presented herein and in Section V , there is a reasonable relationship between the need for affordable housing and all new development within the City.

E THE RE IS A REASONABLE RELATIONSHIP BETWEEN THE AMOUNT OF THE FEE AND

THE COST OF THE PUBLIC FACILITIES ATTRIBUTABLE TO THE DEVELOPMENT UPON WHICH THE FEE IS IMPOSED (“ROUGH PROPORTIONALITY” RELATIONSHIP) [GOVERNMENT CODE 66001( B)]
As set forth above, all new residential development in the City impacts existing housing needs . Each individual residential development project and its related employment effects , along with the cumulative impacts of all development in the City , will adversely impact the need for housing . Thus, the imposition of the fee to finance new affordable housing is an efficient, practical, and equitable method of permitting development to proceed in a responsible manner.

New residential development impacts affordable housing needs directly and cumulatively .

The addition of new residents creates spending on existing and new businesses, creating additional jobs, and a certain number of these new employees will require affordable housing . The proposed fee amounts are roughly proportional to the impacts resulting from new development based on the analyses contained in Section V . Thus, there is a reasonable relationship between the amount of the fee and cost of subsidizing th e necessary housing .

F RECENT LEGISLATIVE DEVELOPMENTS
In September 2021, the Governor of California signed Assembly Bill (“AB”) 602 which provides new statewide requirements for local jurisdictions seeking to impose DIFs on development projects . As stated earlier, the Mitigation Fee Act, AB 1600, establishes specific

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com

SECTION III

LEGAL FRAMEWORK TO JUSTIFY

DEVELOPMENT IMPACT FEES
as that is the purpose for which this DIF is being collected. As previously stated, all new residential developments create ei.ther a direct impact or contributes to the cumulative impact on affordable housing.

For the foregoing reasons, there is a reasonable relationship between the design, acquisition, and construction of affordable housing and new development as required under Section 66001(a)(3) of the Mitigation Fee Act.

D DETERMINE HOW THERE IS A REASONABLE RELATIONSHIP BETWEEN THE NEED

FOR THE PUBLIC FACILITY AND THE TYPE OF DEVELOPMENT PROJECT UPON

WHICH THE FEE IS IMPOSED (IMPACT RELATIONSHIP) (GOVERNMENT CODE SECTION 66001(A)(4)]
As previously stated, new residential development within the City, irrespective of location, contributes to the direct and cumulative impacts of development on the affordable housing demand and creates the need for new affordable housing to accommodate growth.

Moreover, the affordable housing needs identified in Section V are specifically a function of the number of projected residents within the City and do not reflect any unmet needs of existing development.

For the reasons presented herein and in Section V, there is a reasonable relationship between the need for affordable housing and all new development within the City.

E THERE IS A REASONABLE RELATIONSHIP BETWEEN THE AMOUNT OF THE FEE AND

THE COST OF THE PUBLIC FACILITIES ATTRIBUTABLE TO THE DEVELOPMENT UPON WHICH THE FEE IS IMPOSED (°ROUGH PROPORTIONALITr RELATIONSHIP) [GOVERNMENT CODE 66001(8)]
As set forth above, all new residential development in the City impacts existing housing needs. Each individual residential development project and its related employment effects, along with the cumulative impacts of all development in the City, will adversely impact the need for housing . Thus, the imposition of the fee to finance new affordable housing is an efficient, practical, and equitable method of permitting development to proceed in a responsible manner.

New residential development impacts affordable housing needs directly and cumulatively.

The addition of new residents creates spending on existing and new businesses, creating additional jobs , and a certain number of these new employees will require affordable housing . The proposed fee amount s are roughly proportional to the impacts resulting from new development based on the analyse s contained in Section V. Thus, there is a reasonable relationship between the amount of the fee and cost of subsidizing the necessary housing.

F RECENT LEGISLATIVE DEVELOPMENTS
In September 2021, the Governor of California signed Assembly Bill ("AB") 602 which provides new statewide requ irements for local jurisdictions seeking to impose DIFs on development projects. As stated earlier, the Mitigation Fee Act, AB 1600, establishes specific City of La Verne
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requirements that local officials must follow in establishing, increasing, or imposing development fees . Specifically, local officials must conduct a “nexus study” to demonstrate a “reasonable relationship” between the fees and the affordable housing to be funded by the fees , and the development project on which the fees are assessed . AB 602 is designed to provide additional guidance on how local agencies comply with their impact fee obligations, which will affect the methodology choice that DTA will use to calculate the fees .

Key portions of the bill affecting future DIF calculations are summarized below .

On or after January 1, 2022, fee justification studies must identify the existing LOS for each public facility, identify the proposed new LOS , and (if proposed new LOS is greater than existing LOS ) include an explanation of why the new LOS is necessary .

For housing development projects, nexus studies adopted after July 1, 2022, must calculate the amount of fees based on square footage of proposed residential units of the development, unless the local agency demonstrates that another metric is more appropriate . The bill would require that a “local agency that calculated fees proportionally to the square footage of the proposed units be deemed to have used a valid method to establish a reasonable relationship between the fee charged and the burden posed by development.” This would also apply to multi - family residences .

The bill also require s HCD, on or before January 1, 2024, to create an impact fee nexus study template that may be used by local jurisdictions to calculate their fees .

The bill require s that the template include s a method of calculating the feasibility of housing being built with a given fee level . The template must be completed by 2024, and local jurisdictions will have the option (it will not be required) to use the HCD template.

The bill authorize s any member of the public, including an applicant for a development project, to submit evidence that the city, county, or other local agency had failed to comply with the Mitigation Fee Act . The bill require s the legislative body of the city, county, or other local agency to consider any timely submitted evidence and authorize the legislative body to change or adjust the proposed fee or fee increase, as specified.

If a nexus study supports the increase of an existing fee, the local agency shall review the assumption of the nexus study supporting the original fee and evaluate the amount of the fees collected under the original fee .

Large jurisdictions (county population greater than 250,000) and cities within those counties must adopt a capital improvement plan as part of the nexus study.

Nexus studies shall be updated at least every 8 years .

Notably , AB 602 does not apply to (i) water and sewer connection and capacity charges , (ii) school fees or Quimby fees for park impacts, and (iii) Mello - Roos Programs or other special taxes . These other fees, taxes, and charges are subject to their own statutory accountability measures.

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com

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LEGAL FRAMEWORK TO JUSTIFY

DEVELOPMENT IMPACT FEES
requirements that local officials must follow in establishing, increasing, or imposing development fees. Specifically, local officials must conduct a "nexus study" to demonstrate a "reasonable relationship" between the fees and the affordable housing to be funded by the fees, and the development project on which the fees are assessed. AB 602 is designed to provide additional guidance on how local agencies comply with their impact fee obligations, which will affect the methodology choice that DT A will use to calculate the fees.

Key portions of the bill affecting future DIF calculations are summarized below. ■ On or after January 1, 2022, fee justification studies must identify the existing LOS for each public facility, identify the proposed new LOS, and (if proposed new LOS is greater than existing LOS) include an explanation of why the new LOS is necessary. ■ For housing development projects, nexus studies adopted after July 1, 2022, must calculate the amount of fees based on square footage of proposed residential units of the development, unless the local agency demonstrates that another metric is more appropriate. The bill would require that a "local agency that calculated fees proportionally to the square footage of the proposed units be deemed to have used a valid method to establish a reasonable relationship between the fee charged and the burden posed by development." This would also apply to multi-family residences.
■ The bill also requires HCD, on or before January 1, 2024, to create an impact fee nexus study template that may be used by local jurisdictions to calculate their fees.

The bill requires that the template includes a method of calculating the feasibility of housing being built with a given fee level. The template must be completed by 2024, and local jurisdictions will have the option (it will not be required) to use the HCD template.
■ The bill authorizes any member of the public , including an applicant for a development project, to submit evidence that the city, county, or other local agency had failed to comply with the Mitigation Fee Act. The bill requires the legislative body of the city, county, or other local agency to consider any timely submitted evidence and authorize the legislative body to change or adjust the proposed fee or fee increase, as specified.
■ If a nexus study supports the increase of an existing fee, the local agency shall review the assumption of the nexus study supporting the original fee and evaluate the amount of the fees collected under the original fee.
■ Large jurisdictions (county population greater than 250,000) and cities within those counties must adopt a capital improvement plan as part of the nexus study. ■ Nexus studies shall be updated at least every 8 years.

Notably, AB 602 does not apply to (i) water and sewer connection and capacity charges, (ii) school fees or Quimby fees for park impacts, and (iii) Mello-Roos Programs or other special taxes. These other fees, taxes, and charges are subject to their own statutory accountability measures.

City of La Verne
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City of La Verne February 6, 2026
Residential Affordable Housing In - Lieu Fee Justification Study

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IV LAND USE AND DEMOGRAPHIC ASSUMPTIONS
A Land Use Definitions and Employment Densities
As previously indicated, the purpose of the Fee Study is to determine the In - Lieu Fee for four (4) land use categories : Single - Family Detached, Townhome, Condominium, and Apartments . As a first step, t he existing sales prices and monthly rentals were estimated using recent listings on Zillow and are summarized in the table below .

Table 1: Residential Development Parameters
Residential Land Use Average Unit Size Average Sales
Price
Average Monthly
Rent
Single - Family Detached 2,4 00 $1,284 ,000 N /A
Townhome 1,500 $550 ,000 N /A
Condominium 1,200 $46 0,000 N /A
Apartment 1,000 N /A $2,450
Next, utilizing the valuations above, the average income required to own or rent residential propert y within each land use category was estimated . Notably, t he analysis assumes a 3- to- 1 gross income - to- housing expense ratio, meaning housing costs represent approximately 33% of gross income . Based on this assumption, housing expenses were calculated using a 20% down payment and a 30 - year fixed mortgage at a 5.00% interest rate . Additional costs , including insurance, HOA dues, property taxes, and other expenses , were estimated at 2.00% of the projected sales price for each residential land use .

Additionally, apartment expenses are based on the anticipated annual rental cost, plus ins urance equal to 2% of the annual rental amount . The resulting summary of household spending and income levels for each category is provided in the table below .

Table 2: Household Income Assumptions
Residential Land Use Single - Family
Detached Townhome Condominium Apartments
Projected Sales Price $1,284,000 $550,000 $460,000 N /A Average Mortgage
(20% Down - Payment) $1,027,200 $440,000 $368,000 N /A Annual Mortgage/Rent
(Mortgage Assumptions 5% Rate, 30 - Yr Term) $66,171 $28,344 $23,706 $29,840 Annual Insurance
(For Sale 2% of Sales Price)
(For Rent: 2% of Annual Rental)
$25,680 $11,000 $9,200 N /A
Total Housing Payments $91,851 $39,344 $32,906 $32,290 Average Household Income
(3- to - 1 Income to Housing Payment Ratio) $275,552 $118,033 $98,718 $88,200

Agenda Packet - April 20, 2026
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SECTION IV

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www.FinanceDTA.com

IV LAND USE AND DEMOGRAPHIC ASSUMPTIONS
A Land Use Definitions and Employment Densities
As previously indicated, the purpose of the Fee Study is to determine the In-Ueu Fee for four (4) land use categories: Single-Family Detached , Townhome, Condominium, and Apartments. As a first step, the existing sales prices and monthly rentals were estimated using recent Ii.stings on Zillow and are summarized in the table below.

Table 1: Residential Development Parameters
Residential Land Use Average Unit Size Average Sales Average Monthly Price Rent
Single-Family Detached 2,400 $1,284,000 NIA
Townhome 1,500 $550,000 NIA
Condominium 1,200 $460,000 NIA
Apartment 1,000 NIA $2,450
Next, uti.Hzing the valuations above, the average income required to own or rent residential property within each land use category was estimated. Notably, the analysis assumes a 3-to-1 gross income-to-housing expense ratio, meaning housing costs represent approximately 33% of gross income. Based on this assumption, housing expenses were calculated using a 20% down payment and a 30-year fixed mortgage at a 5.00% interest rate. Additional costs, including insurance , HOA dues, property taxes, and other expenses, were estimated at 2.00% of the projected sales price for each residential land use.

Additionally, apartment expenses are based on the anticipated annual rental cost, plus insurance equal to 2% of the annual rental amount. The resulting summary of household spending and income levels for each category is provided in the table below.

Table 2: Household Income Assumptions
Residential Land Use Single-Family Townhome Condominium Apartments Detached Projected Sales Price $1.284.000 $550,000 $460,000 NIA
Average Mortgage $1.027.200 $440,000 $368,000 NIA (20% Down-Payment) Annual Mortgag e/Rent $66,171 $28,344 $23,706 $29,840 (Mortgage Assumpti ons 5% Rate, 30-Yr Term) Annual Insuran ce
(For Sale 2% of Sales Price) $25,680 $11,000 $9,200 NIA (For Rent : 2% of Annual Rental)
Total Housing Payments $91,851 $39,344 $32,906 $32,290
Average Household Income $275,552 $118,033 $98,718 $88,200 (3-to-1 Income to Housing Payment Ratio} City of La Verne
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After estimating average household income for each residential land use, data from the Consumer Expenditure Survey was used to calculate average non - housing spending within the City . The survey organizes spending by income brackets and 15 major categories, such as Food at Home, Food Away from Home, Alcoholic Beverages, Apparel, and Transportation .

For each of these spending categories, DTA estimated the percentage of that spending occurring in the City . For example, DTA estimated that 100% of Food at Hom e would occur in the City; in contrast, only 50% of Food Away from Home would occur within the same local area . Based on these assumptions, estimated local expenditures are summarized below . To maintain precision, per - unit annual expenditures were converted to totals based on 100 units, as shown in the table below .

Table 3: Estimated Annual Expenditure
Residential Land Use Single - Family
Detached Townhome Condominium Apartment
Average Household Income $275,552 $118,033 $98,718 $88,200 Expenditures (as a % of Disposable
Income) 23.61% 37.78% 45.52 % 45.52 %
Total Annual Expenditure (per Unit) $65,069 $44,590 $44,933 $40,145 Total Annual Expenditure
(100 - Unit Development) $6,506,917 $4,458,971 $4,493,271 $4,014,526 The additional expenditure by residents , shown above, is expected to generate jobs, particularly in sectors such as restaurants and retail, which are closely tied to household expenditures . In order t o estimate these employment impacts by industry sector, the analysis utilized IMPLA N , a widely recognized economic modeling tool that models economic impacts using input - output accounting, tracking how changes in final demand ripple through supply chains . The tool estimates effects on over 400 industry sectors in terms of output, employment, and income, based on regional data sets . More specifically, the IMPLAN model was used to allo cate household spending across industry sectors using data from the Consumer Expenditure Survey in order to estimate number of jobs created by the increased demand for goods and services from new households (otherwise referred to as “Induced Economic Impac ts”). The table below summarizes the estimated job generation for each residential land use .

Table 4: Estimated Number of Jobs Generated
Residential Land Use Total Expenditure
(100 - Unit Project)
Induced Jobs per
Household
Total Jobs
Generated per
100 - Unit Project
Single - Family Detached $6,506,917 0.99 99.91
Townhome $4,458,971 0.5 7 57.04
Condominium $4,493,271 0.50 50.18
Apartment $4,014,526 0.45 44.83

Agenda Packet - April 20, 2026
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After estimating average household income for each residential land use, data from the Consumer Expenditure Survey was used to calculate average non-housing spending within the City. The survey organizes spending by income brackets and 15 major categories, such as Food at Home, Food Away from Home, Alcoholic Beverages, Apparel, and Transportation.

For each of these spending categories, DTA estimated the percentage of that spending occurring in the City. For example, OTA estimated that 100% of Food at Home would occur in the City; in contrast, only 50% of Food Away from Home would occur within the same local area. Based on these assumptions, estimated local expenditures are summarized below. To maintain precision, per-unit annual expenditures were converted to totals based on 100 units, as shown in the table below.

Table 3: Estimated Annual Expenditure
Residential Land Use Single-Family Townhome Condominium ApaTtment Detached Average Household Income $275,552 $118,033 $98,718 $88,200 Expenditures (as a % of Disposable 23.61% 37.78% 45.52% 45.52% Income) Total Annual ExpenditUTe (peT Unit) $65,069 $44,590 $44,933 $40,145 Total Annual Expenditure $6,506,917 $4,458,971 $4,493,271 $4,014,526 (100-Unit Development) The additional expenditure by residents, shown above, is expected to generate jobs, particularly in sectors such as restaurants and retail, which are closely tied to household expenditures. In order to estimate these employment impacts by industry sector, the analysis utilized IMPLAN, a widely recognized economic modeling tool that models economic impacts using input-output accounting, tracking how changes in final demand ripple through supply chains. The tool estimates effects on over 400 industry sectors in terms of output, employment, and income, based on regional data sets . More specifically, the IMPLAN model was used to allocate household spending across industry sectors using data from the Consumer Expenditure Survey in order to estimate number of jobs created by the increased demand for goods and services from new households (otherwise referred to as "Induced Economic Impacts"). The table below summarizes the estimated job generation for each residential land use.

Table 4: Estimated Number of Jobs Generated
Total ExpenditUTe Induced Jobs peT Total Jobs
Residential Land Use GeneTated peT (100 -Unit Prnject) Household 100-Unit Project Single-Family Detached $6,506,917 0.99 99.91
Townhome $4,458,971 0.57 57.04
Condominium $4,493 ,271 0.50 50.18
Apartment $4,014,526 0.45 44.83
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B Worker Household
Since most households include more than one worker, the Fee Study groups the employees generated by each land use into households to determine the total number of worker households generated by each land use type . According to the US Census American Community Survey, as of 20 24 the City had 13,656 workers living in households and 11,530 households, averaging approximately 1. 18 workers per household . Therefore, the Fee Study estimates the number of employee households that each land use generates by dividing the total number of workers by 1.18. The resulting estimated number of households per 100 units is shown below.

Table 5: Estimated Households per 100 Unit Project
Residential Land Use
Total Jobs
Generated per
100 - Unit Project
Employees per
Household
Total Households
(1.18 Employees/
Household)
Single - Family Detached 99.91 1.18 84.67
Townhome 57.04 1.18 48.34
Condominium 50.18 1.18 42.52
Apartment 44.83 1.18 37.99
Total 251.95 N /A 213.52
C Industry Sectors
The employees generated above will likely be engaged in a wide range of occupations .

Therefore, the goal of the Fee Study is to estimate the distribution of these new jobs created by residential spending and determine the likely industry sectors associated with such jobs for each of the residential land uses.

These industry sectors are determined based on the North American Industry Classification System (“NAICS”), which assigns numerical codes to each industry sector . NAICS codes group all industries into 22 major industry categories . The table below provides a percentage breakdown of occupations associated with each land use.

Agenda Packet - April 20, 2026
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B Worker Household

SECTION IV

LAND USE AND DEMOGRAPHIC

ASSUMPTIONS
Since most households include more than one worker, the Fee Study groups the employees generated by each land use into households to determine the total number of worker households generated by each land use type. According to the US Census American Community Survey, as of 2024 the City had 13,656 workers living in households and 11,530 households, averaging approximately 1.18 workers per household. Therefore, the Fee Study estimates the number of employee households that each land use generates by dividing the total number of workers by 1.18. The resulting estimated number of households per 100 units is shown below.

Table 5: Estimated Households per 100 Unit Project
Total Jobs Employees per Total Households
Residential Land Use Generated per (1.18 Employees/
100-Unit Project Household Household)
Single- Family Detached 99.91 1.18 84.67
Townhome 57.04 1.18 48.34
Condominium 50.18 1.18 42.52
Apartment 44.83 1.18 37.99
Total 251.95 NIA 213.52
C Industry Sectors
The employees generated above will likely be engaged in a wide range of occupations.

Therefore, the goal of the Fee Study is to estimate the distribution of these new jobs created by residential spending and determine the likely industry sectors associated with such jobs for each of the residential land uses.

These industry sectors are determined based on the North American Industry Classification System ("NAICS"), which assigns numerical codes to each industry sector. NAICS codes group all industries into 22 major industry categories. The table below provides a percentage breakdown of occupations associated with each land use.

City of La Verne
Residential Affordable Housing In-Li eu Fee Justification Study Febma,y 6, 2026 I 1 Q
11 SECTION IV

LAND USE AND DEMOGRAPHIC

ASSUMPTIONS

City of La Verne February 6, 2026
Residential Affordable Housing In - Lieu Fee Justification Study

www.FinanceDTA.com
Table 6: Percentage Breakdown of Occupations by Land Use Industries by NAICS Code Single - Family
Detached Condominium Townhome Apartment
Management Occupations (11 - 0000) 8% 8% 8% 8%
Business and Financial Operations Occupations (13 - 0000) 8% 7% 7% 7% Computer and Mathematical Occupations (15 - 0000) 3% 3% 3% 3% Architecture and Engineering Occupations (17 - 0000) 1% 1% 1% 1% Life, Physical, and Social Science Occupations (19 - 0000) 0% 0% 0% 0% Community and Social Service Occupations (21 - 0000) 2% 2% 2% 2% Legal Occupations (23 - 0000) 0% 0% 0% 0%
Educational Instruction and Library Occupations (25 - 0000) 4% 3% 3% 3% Arts, Design, Entertainment, Sports, and Media Occupations (27 - 0000) 2% 2% 2% 2% Healthcare Practitioners and Technical Occupations (29 - 0000) 7% 8% 8% 8% Healthcare Support Occupations (31 - 0000) 6% 7% 7% 7% Protective Service Occupations (33 - 0000) 1% 1% 1% 1% Food Preparation and Serving Related Occupations (35 - 0000) 11% 11% 12% 11% Building and Grounds Cleaning and Maintenance Occupations (37 - 0000) 4% 4% 4% 4%
Personal Care and Service Occupations (39 - 0000) 4% 4% 4% 4% Sales and Related Occupations (41 - 0000) 8% 8% 8% 8% Office and Administrative Support Occupations (43 - 0000) 14% 14% 14% 14% Farming, Fishing, and Forestry Occupations (45 - 0000) 0% 0% 0% 0% Construction and Extraction Occupations (47 - 0000) 1% 2% 2% 2% Installation, Maintenance, and Repair Occupations (49 - 0000) 5% 5% 5% 5% Production Occupations (51 - 0000) 2% 2% 2% 2%
Transportation and Material Moving Occupations (53 - 0000) 7% 7% 7% 7% Total 100% 100% 100% 100%
Based on the percentage allocations derived from Table 6, the anticipated number of households by occupation were determined as shown in the table below .

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com

SECTION IV

LAND USE AND DEMOGRAPHIC

ASSUMPTIONS
Table 6: Percentage Breakdown of Occupations by Land Use Industries by NAICS Code Single-Family Condominium Townhome Apartment Detached Management Occupations (11-0000) 8% 8% 8%
Business and Financial Operations Occupations (13-0000) 8% 7% 7% Computer and Mathematical Occupations (15-0000) 3% 3% 3% Architecture and Engineering Occupations (17-0000) 1% 1% 1% Life, Physical, and Social Science Occupations (19-0000) 0% 0% 0% Community and Social Service Occupations (21-0000) 2% 2% 2% Legal Occupations (23-0000) 0% 0% 0%
Educational Instruction and Library Occupations (25-0000) 4% 3% 3% Arts, Design, Entertainment, Sports, and Media Occupations (27-0000) 2% 2% 2% Healthcare Practitioners and Technical Occupations (29-0000) 7% 8% 8% Healthcare Support Occupations (31-0000) 6% 7% 7%
Protective Service Occupations (33-0000) 1% 1% 1%
Food Preparation and Serving Related Occupations (35-0000) 11% 11% 12% Building and Grounds Cleaning and Maintenance Occupations (37- 4% 4% 4% 0000) Personal Care and Service Occupations (39-0000) 4% 4% 4% Sales and Related Occupations (41-0000) 8% 8% 8%
Office and Administrative Support Occupations (43-0000) 14% 14% 14% Farming, Fishing, and Forestry Occupations (45-0000) 0% 0% 0% Construction and Extraction Occupations (47-0000) 1% 2% 2% Installation , Maintenance, and Repair Occupations (49-0000) 5% 5% 5% Production Occupations (51-0000) 2% 2% 2%
Transportation and Material Moving Occupations (53-0000) 7% 7% 7% Total 100% 100% 100%
Based on the percentage allocations derived from Table 6, the anticipated number of households by occupation were determined as shown in the table below.

City of La Verne
Residential Afford able Housing In-Lieu Fee Justific ation Study February 6, 2026
I
8%
7%
3%
1%
0%
2%
0%
3%
2%
8%
7%
1%
11%
4%
4%
8%
14%
0%
2%
5%
2%
7%
100%
11 12

SECTION IV

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City of La Verne February 6, 2026
Residential Affordable Housing In - Lieu Fee Justification Study

www.FinanceDTA.com
Table 7: Number of Households by Occupation and Land Use Industries by NAICS Code Single - Family
Detached Condominium Townhome Apartment
Management Occupations (11 - 0000) 7 3 4 3
Business and Financial Operations Occupations (13 - 0000) 7 3 3 3 Computer and Mathematical Occupations (15 - 0000) 3 1 2 1 Architecture and Engineering Occupations (17 - 0000) 1 0 0 0 Life, Physical, and Social Science Occupations (19 - 0000) 0 0 0 0 Community and Social Service Occupations (21 - 0000) 2 1 1 1 Legal Occupations (23 - 0000) 0 0 0 0
Educational Instruction and Library Occupations (25 - 0000) 3 1 1 1 Arts, Design, Entertainment, Sports, and Media Occupations (27 - 0000) 1 1 1 1 Healthcare Practitioners and Technical Occupations (29 - 0000) 6 4 4 3 Healthcare Support Occupations (31 - 0000) 5 3 2 3
Protective Service Occupations (33 - 0000) 1 0 0 0
Food Preparation and Serving Related Occupations (35 - 0000) 10 5 6 4 Building and Grounds Cleaning and Maintenance Occupations (37 - 0000) 3 2 2 1 Personal Care and Service Occupations (39 - 0000) 3 2 2 1 Sales and Related Occupations (41 - 0000) 7 4 4 3
Office and Administrative Support Occupations (43 - 0000) 12 6 7 5 Farming, Fishing, and Forestry Occupations (45 - 0000) 0 0 0 0 Construction and Extraction Occupations (47 - 0000) 1 1 1 1 Installation, Maintenance, and Repair Occupations (49 - 0000) 4 2 2 2 Production Occupations (51 - 0000) 2 1 1 1
Transportation and Material Moving Occupations (53 - 0000) 6 3 3 3 Total 85 43 48 38
D Income Distribution of Worker Households
The occupational data by household, determined above, provides a framework to estimate the household income . DTA utilized the Bureau of Labor Statistics Employment Occupation Statistics that provides earnings data by occupation and includes a distribution of earnings by occupation . Notably, given that the City would likely draw employees from an area larger than the City’s boundaries, the analysis was based on the data for the Los Angeles – Long Beach - Anaheim Metropolitan Statistical Area (the “MSA”) .

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com

SECTION IV

LAND USE AND DEMOGRAPHIC

ASSUMPTIONS
Table 7: Number of Households by Occupation and Land Use Industries by NAICS Code Single-Family Condominium Townhome Apartment Detached Management Occupations (11-0000) 7 3 4
Business and Financial Operations Occupations (13-0000) 7 3 3 Computer and Mathematical Occupations (15-0000) 3 1 2
Architecture and Engineering Occupations (17-0000) 1 0 0 Life, Physical, and Social Science Occupations (19-0000) 0 0 0 Community and Social Service Occupations (21-0000) 2 1 1 Legal Occupations (23-0000) 0 0 0
Educational Instruction and Library Occupations (25-0000) 3 1 1 Arts, Design, Entertainment, Sports, and Media Occupations (27-0000) 1 1 1 Healthcare Practitioners and Technical Occupations (29-0000) 6 4 4 Healthcare Support Occupations (31-0000) 5 3 2
Protective Service Occupations (33-0000) 1 0 0
Food Preparation and Serving Related Occupations (35-0000) 10 5 6 Building and Grounds Cleaning and Maintenance Occupations (37-0000) 3 2 2 Personal Care and Service Occupations (39-0000) 3 2 2
Sales and Related Occupations (41-0000) 7 4 4
Office and Administrative Support Occupations [43-0000) 12 6 7 Farming, Fishing, and Forestry Occupations (45-0000) 0 0 0 Construction and Extraction Occupations (47-0000) 1 1 1 Installation, Maintenance, and Repair Occupations (49-0000) 4 2 2 Production Occupations (51-0000) 2 1 1
Transportation and Material Moving Occupation s (53-0000) 6 3 3 Total 85 43 48
D Income Distribution of Worker Households
The occupational data by household, determined above, provides a framework to estimate the household income. OTA utilized the Bureau of Labor Statistics Employment Occupation Statistics that provides earnings data by occupation and includes a distribution of earnings by occupation. Notably, given that the City would likely draw employees from an area larger than the City's boundaries, the analysis was based on the data for the Los Angeles - Long Beach - Anaheim Metropolitan Statistical Area (the "MSA").

City of La Verne
Residential Afford able Housing In-Lieu Fee Justifi cation Study February 6, 2026
I
3 3
1 0
0 1
0 1
1 3
3 0
4 1
1 3
5 0
1 2
1 3
38 12
13 SECTION IV

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ASSUMPTIONS

City of La Verne February 6, 2026
Residential Affordable Housing In - Lieu Fee Justification Study

www.FinanceDTA.com
Table 8: Wage Distribution by Occupation
Wages by Occupation
(Los Angeles - L ong Beach- Anaheim MSA)
10th
Percentile
Wage
25th
Percentile
Wage
Median
Wage
75 th
Percentile
Wage
90 th
Percentile
Wage
99 th
Percentile
Wage
Management Occupations (11 - 0000) $64,210 $87,720 $131,930 $196,390 $262,480 $345,939 Business and Financial Operations Occupations (13 - 0000) $50,040 $66,230 $89,470 $124,740 $164,730 $203,538 Computer and Mathematical Occupations (15 - 0000) $60,310 $80,830 $121,480 $160,230 $192,960 $262,139 Architecture and Engineering Occupations (17 - 0000) $63,820 $81,320 $105,540 $140,880 $178,290 $221,299 Life, Physical, and Social Science Occupations (19 - 0000) $48,510 $64,350 $96,480 $127,540 $152,480 $208,878 Community and Social Service Occupations (21 - 0000) $42,240 $47,880 $62,700 $92,880 $118,700 $150,783 Legal Occupations (23 - 0000) $56,520 $77,630 $128,680 $210,550 $323,010 $425,093 Educational Instruction and Library Occupations (25 - 0000) $37,240 $46,230 $65,520 $102,490 $130,030 $177,839 Arts, Design, Entertainment, Sports, and Media Occupations (27 - 0000) $40,710 $54,000 $82,490 $122,090 $168,860 $225,827 Healthcare Practitioners and Technical Occupations (29 - 0000) $48,550 $71,720 $105,750 $151,810 $179,990 $258,688 Healthcare Support Occupations (31 - 0000) $34,600 $34,600 $34,860 $41,710 $50,050 $52,430 Protective Service Occupations (33 - 0000) $36,880 $38,450 $47,340 $87,160 $125,430 $152,890 Food Preparation and Serving Related Occupations (35 - 0000) $34,390 $35,470 $36,960 $44,700 $52,610 $58,055 Building and Grounds Cleaning and Maintenance Occupations (37- 0000) $34,820 $36,010 $39,030 $47,860 $59,860 $64,463 Personal Care and Service Occupations (39 - 0000) $34,100 $35,140 $37,040 $46,210 $63,060 $64,018 Sales and Related Occupations (41 - 0000) $34,830 $36,090 $43,950 $63,790 $102,570 $106,993 Office and Administrative Support Occupations (43 - 0000) $37,260 $43,410 $50,930 $63,580 $79,140 $91,659 Farming, Fishing, and Forestry Occupations (45 - 0000) $35,210 $37,500 $43,680 $53,610 $76,490 $76,738 Construction and Extraction Occupations (47 - 0000) $45,100 $51,950 $69,600 $96,980 $122,980 $154,605 Installation, Maintenance, and Repair Occupations (49 - 0000) $39,590 $47,870 $63,270 $82,460 $107,690 $129,793 Production Occupations (51 - 0000) $35,780 $37,750 $45,710 $58,680 $77,070 $87,549 Transportation and Material Moving Occupations (53 - 0000) $35,360 $36,920 $43,720 $55,540 $74,050 $85,006 Notably, DTA also incorporated the household income limits for extremely low - , very low - , low - , and moderate - income households . Based on the 2025 HUD guidelines for multifamily tax subsidy projec t, assuming a 3 - person household, the Area Medium Income (“AMI”) for Los Angeles County is $136,300 per household . From this data other income levels, specifically, extremely low (30%), very low (50%), low (75%), and moderate (100%), were determined.

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com

SECTION IV

LAND USE AND DEMOGRAPHIC

ASSUMPTIONS
Table 8: Wage Distribution by Occupation
Wages by Occupation 10th 25th Median
75th 9Qth 99th
Percentile Percentile Percentile Percent tie Percentile (Los Angeles-Long Beach-Anaheim MSA) Wage Wage Wage Wage Wage Wage ----------------------------------------------------
Management Occupations (11-0000) $64,210 $87,720 $131.930 $196,390 $262.480 $345,939 Business and Financial Operations Occupations (13-0000) $50,040 $66,230 $89,470 $124,740 $164,730 $203,538 Computer and Mathematical Occupations (15-0000) $60,310 $80,830 $121.480 $160,230 $192,960 $262,139 Architecture and Engineering Occupations (17-0000) $63,820 $81,320 $105,540 $140,880 $178,290 $221.299 Life, Physical, and Social Science Occupations (19-0000) $48,510 $64,350 $96,480 $127,540 $152,480 $208,878 Community and Social Service Occupations (21-0000) $42,240 $47,880 $62,700 $92,880 $118,700 $150,783 Legal Occupations (23-0000) $56,520 $77,630 $128,680 $210,550 $323,010 $425,093 Educational Instruction and Library Occupations (25-0000) $37,240 $46,230 $65,520 $102,490 $130,030 $177,839 Arts, Design, Entertainment, Sports, and Media Occupations $40,710 $54,000 $82,490 $122,090 $168,860 $225,827 (27-0000) Healthcare Practitioners and Technical Occupations (29-0000) $48,550 $71,720 $105,750 $151.810 $179,990 $258,688 Healthcare Support Occupations (31-0000) $34,600 $34,600 $34,860 $41,710 $50,050 $52,430 Protective Service Occupations (33-0000) $36,880 $38,450 $47,340 $87,160 $125,430 $152,890 Food Preparation and Serving Related Occupations (35-0000) $34,390 $35,470 $36,960 $44,700 $52,610 $58,055 Building and Grounds Cleaning and Main tenan ce Occupati ons $34,820 $36,010 $39,030 $47,860 $59,860 $64,463 (37-0000) Personal Care and Service Occupations (39-0000) $34,100 $35,140 $37,040 $46,210 $63,060 $64,018 Sales and Related Occupations (41-0000) $34,830 $36,090 $43,950 $63,790 $102,570 $106,993 Office and Administrative Support Occupations (43-0000) $37,260 $43,410 $50,930 $63,580 $79,140 $91,659 Farming, Fishing, and Forestry Occupations (45-0000) $35,210 $37,500 $43,680 $53,610 $76,490 $76,738 Construction and Extraction Occupations (47-0000) $45,100 $51,950 $69,600 $96,980 $122,980 $154,605 Installation, Maintenance , and Repair Occupations (49-0000) $39,590 $47,870 $63,270 $82,460 $107,690 $129,793 Production Occupations (51-0000) $35,780 $37,750 $45,710 $58,680 $77,070 $87,549 Tran sportation and Material Moving Occupations (53-0000) $35,360 $36,920 $43,720 $55,540 $74,050 $85,006 Notably, OTA also incorporated the household income limits for extremely low-, very low-, low- , and moderate-income households. Based on the 2025 HUD guidelines for multifamily tax subsidy project, assuming a 3-person household, the Area Medium Income ("AMI") for Los Angeles County is $136,300 per household. From this data other income levels, specifically, extremely low (30%). very low (50%), low (75%). and moderate (100%). were determined.

City of La Verne
Residential Afford able Housing In-Lieu Fee Justifi cation Study February 6, 2026
I 13
14 SECTION IV

LAND USE AND DEMOGRAPHIC

ASSUMPTIONS

City of La Verne February 6, 2026
Residential Affordable Housing In - Lieu Fee Justification Study

www.FinanceDTA.com
Table 9: Income Categories – Los Angeles County
Income Category Household Income
(3- Person Household)
Median Income $136,300
Extremely Low (30%) $40,890
Very Low (50%) $68,150
Low (80%) $121,200
Moderate (120%) $163,560
Data from Table s 8 and 9 was then used to generate the percentage of households within each income category, as shown in the table below.

Table 10 : Income Categories across Occupation
Income Categories by Occupation
(Los Angeles - L ong Beac h- Anaheim MSA) 30% AMI 50% AMI 80% AMI 100% AMI 120% AMI Above 120% AMI Total
Management Occupations (11 - 0000) 0.482% 0.465% 1.858% 1.108% 0.800% 2.856% 7.57% Business and Financial Operations Occupations (13 - 0000) 0.552% 1.275% 2.458% 1.044% 0.690% 0.705% 6.75% Computer and Mathematical Occupations (15 - 0000) 0.206% 0.272% 0.808% 0.523% 0.515% 0.713% 3.04% Architecture and Engineering Occupations (17 - 0000) 0.090% 0.103% 0.536% 0.279% 0.175% 0.224% 1.41% Life, Physical, and Social Science Occupations (19 - 0000) 0.060% 0.140% 0.230% 0.144% 0.082% 0.059% 0.72% Community and Social Service Occupations (21 - 0000) 0.260% 1.211% 0.806% 0.285% 0.137% 0.00% 2.70% Legal Occupations (23 - 0000) 0.052% 0.079% 0.159% 0.086% 0.060% 0.283% 0.72% Educational Instruction and Library Occupations (25 - 0000) 0.973% 2.158% 1.620% 0.763% 0.310% 0.223% 6.05% Arts, Design, Entertainment, Sports, and Media Occupations (27 - 0000) 0.178% 0.474% 0.511% 0.223% 0.152% 0.204% 1.74% Healthcare Practitioners and Technical Occupations (29 - 0000) 0.386% 0.653% 1.332% 0.677% 0.672% 0.858% 4.58% Healthcare Support Occupations (31 - 0000) 4.508% 1.752% 0.00% 0.00% 0.00% 0.00% 6.26% Protective Service Occupations (33 - 0000) 0.263% 0.258% 0.169% 0.082% 0.053% 0.00% 0.83% Food Preparation and Serving Related Occupations (35 - 0000) 10.185% 6.061% 0.00% 0.00% 0.00% 0.00% 16.25% Building and Grounds Cleaning and Maintenance Occupations (37- 0000) 1.335% 1.081% 0.00% 0.00% 0.00% 0.00% 2.42% Personal Care and Service Occupations (39 - 0000) 2.738% 1.788% 0.00% 0.00% 0.00% 0.00% 4.53% Sales and Related Occupations (41 - 0000) 1.972% 1.783% 1.142% 0.00% 0.00% 0.00% 4.90% Office and Administrative Support Occupations (43 - 0000) 2.182% 7.009% 2.384% 0.00% 0.00% 0.00% 11.58% Farming, Fishing, and Forestry Occupations (45 - 0000) 0.025% 0.030% 0.010% 0.00% 0.00% 0.00% 0.06% Construction and Extraction Occupations (47 - 0000) 0.616% 2.642% 2.311% 0.804% 0.422% 0.00% 6.79% Installation, Maintenance, and Repair Occupations (49 - 0000) 0.613% 2.184% 1.697% 0.469% 0.00% 0.00% 4.96% Production Occupations (51 - 0000) 0.746% 1.024% 0.370% 0.00% 0.00% 0.00% 2.14% Transportation and Material Moving Occupations (53 - 0000) 1.595% 1.838% 0.595% 0.00% 0.00% 0.00% 4.03% Total 30.018% 34.280% 19.023% 6.487% 4.069% 6.124% 100% The data in the table above provides an allocation of employees across occupations and income levels . However, in order to generate estimated employee counts by occupation, the data was realigned to each occupation as shown in Table 11, to determine the percentage of workers in each occupation that fall within each income level .

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com

SECTION IV

LAND USE AND DEMOGRAPHIC

ASSUMPTIONS
Table 9: Income Categories - Los Angeles County
Income Category Household Income
(3-Person Household)
Median Income $136,300
Extremely Low (30%) $40,890
Very Low (50%) $68,150
Low (80%) $121,200
Moderate (120%) $163,560
Data from Tables 8 and 9 was then used to generate the percentage of households within each income category, as shown in the table below.

Table 10: Income Categories across Occupation
Income Categones by Occupation 30%AMI 50%AMI 80%AMI 100%AMI 120% AMI Above (Los Angeles-Long Beach-Anaheim MSA) 120% AMI
Management Occupations (11-0000) 0.482% 0.465% 1.858% 1.108% 0.800% 2.856% Business and Financial Operations Occupations (13-0000) 0.552% 1.275% 2.458% 1.044% 0.690% 0.705% Computer and Mathematical Occupations (15-0000) 0.206% 0.272% 0.808% 0.523% 0.515% 0.713% Architecture and Engineering Occupations (17-0000) 0.090% 0.103% 0.536% 0 .279% 0.175% 0.224% Life , Physical , and Social Science Occupations (19-0000) 0.060% 0.140% 0.230% 0.144% 0.082 % 0.059% Community and Social Service Occupations (21-0000) 0.260 % 1.211% 0.806% 0.285% 0.137% 0.00% Legal Occupations (23-0000) 0.052% 0.079% 0.159% 0.086% 0.060% 0.283% Educational Instruction and Library Occupations (25-0000) 0.973% 2.158% 1.620% 0.763% 0.310% 0.223% Arts, Design, Entertainment, Sports, and Media Occupations 0.178% 0.474% 0.511% 0.223 % 0.152% 0.204% (27-0000) Healthcare Practitioners and Technical Occupation s (29-0000) 0.386% 0.653% 1.332% 0.677% 0.672% 0.858% Healthcare Suppo rt Occupations (31-0000) 4508% 1.752% 000% 000% 0.00% 000% Protective Service Occupations (33-0000) 0.263% 0.258% 0.169% 0.082% 0.053% 0.00% Food Preparation and Serving Related Occupations (35-0000) 10.185% 6.061% 0.00% 0.00% 0.00% 0.00% Building and Grounds Cleaning and Maintenance Occupations 1335% 1.081% 000% 000% 0.00% 000% (37-0000) Personal Care and Service Occup ations (39-0000) 2.738% 1.788% 0.00% 0.00% 0.00% 0.00% Sales and Related Occupations (41-0000) 1.972% 1.783% 1.142% 0.00% 0.00% 0.00 % Office and Administrative Support Occupations (43-0000) 2.182% 7009% 2.384% 0.00% 0.00% 0.00% Farming, Fishing, and Forestry Occupations (45- 0000) 0.025% 0.030 % 0.010% 0.00% 0.00% 0.00% Construction and Extraction Occupatio ns (47-0000) 0.616% 2.642% 2.311% 0.804% 0.422% 0.00% Installation, Maintenance, and Repair Occupations (49-0000) 0.613% 2.184% 1.697% 0.469% 0.00% 0.00% Production Occupations (51-0000) 0.746% 1024% 0.370% 0.00% 0.00% 0.00% Transportation and Material Moving Occupations (53-0000) 1.595% 1.838% 0.595% 0.00% 0.00% 0.00 % Total 30.018% 34.280% 19.023% 6.487% 4.069% 6.124%
The data in the table above provides an allocation of employees across occupations and income levels. However, in order to generate estimated employee counts by occupation, the data was realigned to each occupation as shown in Table 11, to determine the percentage of workers in each occupation that fall within each income level.

City of La Verne February 6, 2026
Residential Afford able Housing In-Lieu Fee Justifi cation Study Total

7.57%

6.75%

3.04%

1.41%

0.72%

2.70%

0.72%
605 %

1.74%

4.58 %
626%

0.83%

16.25%

2.42%

4.53%

4.90%

11.58%

0.06 %

6.79%

4.96%

2.14%

4.03%
100%
I 14
15 SECTION IV

LAND USE AND DEMOGRAPHIC

ASSUMPTIONS

City of La Verne February 6, 2026
Residential Affordable Housing In - Lieu Fee Justification Study

www.FinanceDTA.com
Table 11: Distribution of Occupation for Worker by Income Categories Income Categories by Occupation 30%
AMI
50%
AMI
80%
AMI
100%
AMI
120%
AMI
Above
120% AMI Total
Management Occupations (11 - 0000) 5.42% 3.61% 14.29% 12.82% 13.18% 50.67% 100 % Business and Financial Operations Occupations (13 - 0000) 6.94% 10.65% 35.09% 15.61% 11.90% 19.80% 100 % Computer and Mathematical Occupations (15 - 0000) 5.23% 3.49% 12.96% 15.12% 17.66% 45.55% 100 % Architecture and Engineering Occupations (17 - 0000) 5.61% 3.74% 28.33% 20.78% 17.74% 23.80% 100 % Life, Physical, and Social Science Occupations (19 - 0000) 6.82% 9.30% 27.23% 17.97% 16.48% 22.19% 100 % Community and Social Service Occupations (21 - 0000) 9.21% 40.27% 31.07% 12.30% 7.15% 0.00% 100 % Legal Occupations (23 - 0000) 7.08% 8.03% 18.51% 11.30% 10.35% 44.74% 100 % Educational Instruction and Library Occupations (25 - 0000) 9.97% 38.46% 32.20% 11.12% 6.45% 1.81% 100 % Arts, Design, Entertainment, Sports, and Media Occupations (27- 0000) 9.74% 24.32% 31.68% 13.99% 9.08% 11.20% 100 % Healthcare Practitioners and Technical Occupations (29 - 0000) 7.05% 8.34% 22.63% 14.74% 12.00% 35.24% 100 % Healthcare Support Occupations (31 - 0000) 63.65% 36.35% 0.00% 0.00% 0.00% 0.00% 100 % Protective Service Occupations (33 - 0000) 16.80% 40.59% 20.71% 12.72% 5.30% 3.87% 100 % Food Preparation and Serving Related Occupations (35 - 0000) 54.79% 45.21% 0.00% 0.00% 0.00% 0.00% 100 % Building and Grounds Cleaning and Maintenance Occupations (37- 0000) 38.99% 48.92% 12.09% 0.00% 0.00% 0.00% 100 % Personal Care and Service Occupations (39 - 0000) 48.93% 38.96% 12.11% 0.00% 0.00% 0.00% 100 % Sales and Related Occupations (41 - 0000) 32.56% 33.07% 16.59% 6.91% 10.86% 0.00% 100 % Office and Administrative Support Occupations (43 - 0000) 10.98% 55.34% 31.51% 2.17% 0.00% 0.00% 100 % Farming, Fishing, and Forestry Occupations (45 - 0000) 28.74% 57.40% 13.86% 0.00% 0.00% 0.00% 100 % Construction and Extraction Occupations (47 - 0000) 8.72% 31.37% 37.99% 13.31% 8.61% 0.00% 100 % Installation, Maintenance, and Repair Occupations (49 - 0000) 9.36% 36.50% 38.59% 12.84% 2.70% 0.00% 100 % Production Occupations (51 - 0000) 20.16% 56.87% 22.98% 0.00% 0.00% 0.00% 100 % Transportation and Material Moving Occupations (53 - 0000) 24.27% 56.28% 19.45% 0.00% 0.00% 0.00% 100 % E Worker Households by Income Level
The table below provides a summary of the worker households by income for each of the land uses . This data was derived from the distribution of occupations by land use from Table 8, and the distribution of occupation for worker by income category from Table 11.

Table 12: Distribution of Worker Households by Land Use (100 - Unit Project) Land Use
(10 0 - Unit Project ) 30% AMI 50% AMI 80% AMI 100% AMI 120% AMI Above 120% AMI Total
Single - Family Detached 19.75 28.66 16.95 5.81 4.64 8.86 84.67 Townhome 11.55 16.42 9.48 3.25 2.61 5.03 48.34
Condominium 10.07 14.37 8.40 2.89 2.31 4.48 42.52
Apartment 8.99 12.84 7.51 2.58 2.07 4.00 37.99
Total 50.37 72.28 42.34 14.54 11.62 22.37 213.52

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com

SECTION IV

LAND USE AND DEMOGRAPHIC

ASSUMPTIONS
Table 11: Distribution of Occupation for Worker by Income Categories Income Categories by Occupation 30% 50% 80% 100% 120% Above AMI AMI AMI AMI AMI 120%AMI Total
---------------------------------------------------
Management Occupations (11-0000) 5.42% 3.61% 14.29% 12.82% 13.18% 50.67% 100% Business and Financial Operations Occupations (13-0000) 6.94% 10.65% 3509% 15.61% 11.90% 19.80% 100% Computer and Mathematical Occupations (15-0000) 5.23% 3.49% 12.96% 15.12% 17.66% 45.55% 100% Architecture and Engineering Occupations (17-0000) 5.61% 3.74% 28.33% 20.78% 17.74% 23.80% 100% Life, Physical, and Social Science Occupations (19-0000) 6.82% 9.30% 27.23% 17.97% 16.48% 22.19% 100% Community and Social Service Occupations (21-0000) 9.21% 40.27% 31.07% 12.30% 7.15% 0.00% 100% Legal Occupations (23-0000) 7.08% 8.03% 18.51% 11.30% 10.35% 44.74% 100% Educational Instruction and Library Occupations (25-0000) 9.97% 38.46% 32.20% 11.12% 6.45% 1.81% 100% Arts, Design, Entertainment, Sports, and Media Occupations 9.74% 24.32% 31.68% 13.99% 9.08% 11.20% 100% (27-0000) Healthcare Practitioners and Technical Occupations (29-0000) 7.05% 8.34% 22.63% 14.74% 12.00% 35.24% 100% Healthcare Support Occupations (31-0000) 63.65% 36.35% 0.00% 0.00% 0.00% 0.00% 100% Protective Service Occupations (33-0000) 16.80% 40.59% 20.71% 12.72% 5.30% 3.87% 100% Food Preparation and Serving Related Occupations (35-0000) 54.79% 45.21% 0.00% 0.00% 0.00% 0.00% 100 % Building and Grounds Cleaning and Maintenance Occupations 38.99% 48.92% 12.09% 0.00% 0.00% 0.00% 100% (37-0000) Personal Care and Service Occupations (39-0000) 48.93% 38.96% 12.11% 0.00% 0.00% 0.00% 100% Sales and Related Occupations (41-0000) 32.56% 33.07% 16.59% 6.91% 10.86% 0.00% 100% Office and Administrative Support Occupations (43-0000) 10.98% 55.34% 31.51% 2.17% 0.00% 0.00% 100% Farming, Fishing, and Forestry Occupations (45-0000) 28.74% 57.40% 13.86% 0.00% 0.00% 0.00% 100% Construction and Extraction Occupations (47-0000) 8.72% 31.37% 37.99% 13.31% 8.61% 0.00% 100% Installation, Maintenance, and Repair Occupations (49-0000) 9.36% 36.50% 38.59% 12.84% 2.70% 0.00% 100% Production Occupations (51-0000) 20.16% 56.87% 22.98% 0.00% 0.00% 0.00% 100% Transportation and Material Moving Occupations (53-0000) 24.27% 56.28% 19.45% 0.00% 0.00% 0.00% 100% E Worker Households by Income Level
The table below provides a summary of the worker households by income for each of the land uses . This data was derived from the distribution of occupations by land use from Table 8, and the distribution of occupation for worker by income category from Table 11.

Table 12: Distribution of Worker Households by Land Use (100-Unit Project) Land Use 30% AMI 50% AMI 80% AMI 100%AMI 120% AMI Above Total I
(100-Unit Project) 120% AMI
Single-Family Detached 19.75 28.66 16.95 5.81 4.64 8.86 84.67 Townhome 11.55 16.42 9.48 3.25 2.61 5.03 48.34
Condominium 10.07 14.37 8.40 2.89 2.31 4.48 42.52
Apartment 8.99 12.84 7.51 2.58 2.07 4.00 37.99
Total 50.37 72.28 42.34 14.54 11.62 22.37 213.52
City of La Verne
Residential Afford able Housing In-Lieu Fee Justifi cation Study February 6, 2026
I 15
16 SECTION V

AFFORDABILITY GAP AND IN - LIEU

FEE CALCULATION

City of La Verne February 6, 2026
Residential Affordable Housing In - Lieu Fee Justification Study

www.FinanceDTA.com

V AFFORDABILITY GAP AND IN - LIEU FEE CALCULATION
A Affordability Gap
This section of the Fee Study calculates the cost to house the extremely low - , very low - , low - , and moderate - income households by determining the per unit “financing gap” that a developer would encounter when constructing a for - rent project . In other words, the cost to house a lower - income household is the difference between the value of a for - rent affordable unit and the cost to develop that unit .

Firstly, the current market - rate rent in the City for a new two - bedroom apartment is approximately $2,850 . According to the 2025 HUD guidelines for multifamily tax subsidy projects, rather than pay market - rate rents, a below 30% AMI household could afford $1,079 per month, a 30 - 50% AMI household could afford $1,798 per month, a 50 - 80% AMI household could afford $2,878 per month, and an 80 - 100% AMI household could afford $3,596 per month.

Table 13: Monthly Rental Estimates
Building Type Monthly Rent
pe r Unit 1
Market - Rate Unit $2,450
Below 30% AMI – Affordable Housing Unit $1,142
30 - 50% AMI – Affordable Housing Unit $1,90 3
50 - 80% AMI – Affordable Housing Unit $3,04 6
80 - 100% AMI – Affordable Housing Unit $3,80 6
Note :

1. Market - rate rents were sourced from Zillow listings for the City as of November 2025 . Affordable rents were obtained from U.S . Department of Housing and Urban Development Multifamily Tax Subsidy Rents for Los Angeles County.

Utilizing the rental incomes above, the estimated valuation for units applicable to each income tier was determined based on the Net Operating Income (“NOI”) (i.e., rental income less operating expenses and vacancy) and a cap rate for for - rent developments . Notably, assumed vacancy rates and the cap rates, were based on current market snapshots from CoStar Property . DTA also assumed Low - Income Housing Tax Credits (“LIHTCs”), in the form of 4% Tax Credit Financing, would be available as a partial subsidy i n developing rental units for below 30% AMI households only . Finally, the actual development cost for these rental units was estimated based on data published in recent LIHTC applications for projects in the City.

Agenda Packet - April 20, 2026
dta

SECTION V

AFFORDABILITY GAP AND IN-LIEU

FEE CALCULATION
www.FinanceDTA.com

V AFFORDABILITY GAP ANO IN-LIEU FEE CALCULATION
A Affordability Gap
This section of the Fee Study calculates the cost to house the extremely low-, very low-, low-, and moderate-income households by determining the per unit "financing gap" that a developer would encounter when constructing a for-rent project. In other words, the cost to house a lower-income household is the difference between the value of a for-rent affordable unit and the cost to develop that unit.

Firstly, the current market-rate rent in the City for a new two-bedroom apartment is approximately $2,850. According to the 2025 HUD guidelines for multifamily tax subsidy projects, rather than pay market-rate rents, a below 30% AMI household could afford $1,079 per month, a 30-50% AMI household could afford $1,798 per month, a 50-80% AMI household could afford $2,878 per month, and an 80-100% AMI household could afford $3,596 per month.

Table 13: Monthly Rental Estimates
---------------------------
Building Type Monthly Rent
per Unit 1
---------------------------
Market-Rate Unit $2,450
Below 30% AMI - Affordable Housing Unit $1,142
30-50% AMI - Affordable Housing Unit $1,903
50-80% AMI - Affordable Housing Unit $3,046
80-100% AMI - Affordable Housing Unit $3,806
Note :

1. Market-rate rents were sourced from Zil\ow listings for the City as of November 2025. Affordable rents were obtained from U.S. Department of Housing and Urban Development Multifamily Tax Subsidy Rents for Los Angeles County.

Utilizing the rental incomes above, the estimated valuation for units applicable to each income tier was determined based on the Net Operating Income ("NOI") (i.e., rental income less operating expenses and vacancy) and a cap rate for for-rent developments. Notably, assumed vacancy rates and the cap rates, were based on current market snapshots from Costar Property. OTA also assumed Low-Income Housing Tax Credits ("LIHTCs"), in the form of 4% Tax Credit Financing, would be available as a partial subsidy in developing rental units for below 30% AMI households only. Finally, the actual development cost for these rental units was estimated based on data published in recent LIHTC applications for projects in the City.

City of La Verne
Residential Afford able Housing In-Lieu Fee Justific ation Study Febma,y 6, 2026 I
16 17

SECTION V

AFFORDABILITY GAP AND IN - LIEU

FEE CALCULATION

City of La Verne February 6, 2026
Residential Affordable Housing In - Lieu Fee Justification Study

www.FinanceDTA.com
Table 14: Affordability Gap – For - Rent
Development Category
For - Rent
Product
Affordable
30 AMI
For - Rent
Product
Affordable
50 AMI
For - Rent
Product
Affordable
80 AMI
For - Rent
Product
Affordable
100 AMI
Rental Limits $1,142 $1,903 $3,046 $3,806
Gross Annual Rent $13,704 $22,836 $36,552 $45,672
Less: Vacancies ($617) ($1,028 ) ($1,645 ) ($2,055 )
Less: Operating Expenses ($5,500) ($5,500) ($5,500) ($5,500) Projected Net Revenue $6,212 $14,016 $25,740 $33,533 Cap Rate 4.90% 4.90% 4.90% 4.90%
Estimated Valuation $154,843 $332,824 $600,146 $777,893 Direct Construction Costs ($550,000) ($550,000 ) ($550,000 ) ($550,000 ) Tax Credits 4% N/A N/A N/A
Eligible Basis (75%) $412,500 $0 $0 $0
Tax Credit Financing $165,000 $0 $0 $0
Net Construction Cost ($283,500) ($405,000 ) ($405,000 ) ($405,000 ) Affordability Gap ($230,157 ) ($217,176 ) $0 $0
B Fee Calculation
To determine the In - Lieu Fee, the financing gap per affordable unit for each income level is applied to the total housing need by income level per residential land use . The result is the “maximum fee” because it is directly derived from the nexus analysis described above (i.e., new residential development generating new jobs creating new worker households and a cost to provide new affordable rental housing units to these same households).

Table 15 : Maximum Justifiable Fees
Land Use
(100 - Unit Project) 30% AMI 50% AMI 80% AMI 100% AMI 120% AMI Above 120% AMI Total
Single - Family Detached 19.75 28.66 16.95 5.81 4.64 5.24 50.92 Townhome 11.55 16.42 9.48 3.25 2.61 3.62 35.95
Condominium 10.07 14.37 8.40 2.89 2.31 3.02 29.99
Apartment 8.99 12.84 7.51 2.58 2.07 2.20 21.48
Total 50.37 72.28 42.34 14.54 11.62 14.08 138.34 Affordability Gap $230,156.73 $217,175.92 $0 N/A N/A N/A N/A Single - Family Detached $45,465.67 $62,231.79 $52,822.56 $12,038.32 $0.00 $0.00 $129,906 Townhome $26,587.01 $35,654.85 $29,564.14 $6,732.53 $0.00 $0.00 $73,930 Condominium $23,168.74 $31,208.15 $26,189.08 $5,990.84 $0.00 $0.00 $65,050 Apartment $20,700.21 $27,883.05 $23,398.74 $5,352.54 $0.00 $0.00 $58,119 The totals represent the ceiling for impact fees applicable to new residential development to mitigate their effect on the affordable housing demand . These figures are not recommendations; they indicate only the maximums determined by this analysis.

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com

SECTION V

AFFORDABILITY GAP AND IN-LIEU

FEE CALCULATION
Table 14: Affordability Gap - For-Rent
For-Rent For-Rent For-Rent For-Rent
Development Category Product Product Product Product
Affordable Affordable Affordable Affordable
30AMI SO AMI 80AMI lOOAMI
Rental Limits Sl,142 Sl,903 S3,046 S3,806
Gross Annual Rent S13,704 S22,836 S36,552 S45,672
Less: Vacancies (S617) (Sl,028) (Si,645) (S2.055)
Less: Operating Expenses (SS,500) (SS,500) (SS,500) (SS,500) Projected Net Revenue S6.212 S14,016 S25,740 S33,533
Cap Rate 4.90% 4.90% 4.90% 4.90%
Estimated Valuation S154,843 $332,824 $600,146 $777,893 Direct Construction Costs (SSS0,000) (SSS0,000) (SSS0,000) (SSS0,000) Tax Credits 4% N/A NIA NIA
Eligible Basis (75%) S412.500 so so so
Tax Credit Financing $165,000 $0 $0 $0
Net Construction Cost ($283,500) ($405,000) ($405,000) ($405,000) Affordability Gap ($230,157) ($217,176) $0 $0
B Fee Calculation
To determine the In-Lieu Fee, the financing gap per affordable unit for each income level is applied to the total housing need by income level per residential land use. The result is the "maximum fee" because it is directly derived from the nexus analysis described above (i.e., new residential development generating new jobs creating new worker households and a cost to provide new affordable rental housing units to these same households).

Table 15: Maximum Justifiable Fees
----------------------------------------------- ~
Land Use 30% AMI 50% AMI 80%AMI 100%AMI 120%AMI Above
(100-Unit Project) 120%AMI
Single-Family Detached 19.75 28.66 16.95 5.81 4.64 5.24 Townhome 11.55 16.42 9.48 3.25 2.61 3.62
Condominium 10.07 14.37 8.40 2.89 2.31 3.02
Apartment 8.99 12.84 7.51 2.58 2.07 2.20
Total 50.37 72.28 42.34 14.54 11.62 14.08
Affordability Gap $230,156.73 $217,175.92 $0 NIA NIA NIA Single-Family Detached $45,465.67 $62,231.79 $52,822.56 $12,038.32 $0.00 $0.00 Townhome $26,587.01 $35,654.85 $29,564.14 $6,732.53 $0.00 $0.00 Condominium $23,168.74 $31,208.15 $26,189.08 $5,990.84 $0.00 $0.00 Apartment $20,700.21 $27,883.05 $23,398.74 $5,352.54 $0.00 $0.00 The totals represent the ceiling for impact fees applicable to new residential development to mitigate their effect on the affordable housing demand. These figures are not recommendations; they indicate only the maximums determined by this analysis.

City of La Verne February 6, 2026
Residential Afford able Housing In-Lieu Fee Justifi cation Study Total

50.92 35.95

29.99 21.48
138.34
NIA
$129,906
$73,930
$65,050
$58,119
18 SECTION VI

FEE IMPLEMENTATION

City of La Verne February 6, 2026
Residential Affordable Housing In - Lieu Fee Justification Study

www.FinanceDTA.com

VI FEE IMPLEMENTATION
A Administering a Fee Program
Implementing a fee program requires significant planning and training, so it should be done efficiently and frequently . A well - designed program can generate sufficient funds to offset development impacts, while a poorly structured one risks underfunding and reliance on the General Fund or overcharging, which could lead to legal challenges or refund obligations.

All involved staff —across accounting, budgeting, and project management —must understand the distinction between In - Lieu Fees and other types of fees, along with the rules governing how fee revenues can be used . The fees proposed in this report are tied to a specific purpose and must be spent accordingly.

B Indexing the In - Lieu Fee
The fees presented in this Fee Study are based on current construction costs and should be adjusted annually to account for inflation , as construction costs ultimately impact the cost of providing or subsidizing affordable housing . Therefore, DTA recommends that , after adoption, the fee be reviewed annually and adjusted using a reliable index, such as the ENR BCI, which is generally used as the primary basis for indexing construction costs.

C Phase - In Schedule for Fe e
A key component of adopting this Fee will be the effective date on which the Fee becomes active . One approach adopted by cities is to set a future effective and/or waive fees for current projects that are in the development pipeline . Other approaches include a phased - in period of 1 - 2 years where the fee is set at 50% for the first year of applicability, rising to the full 100% after a 12 - month period.

D Waivers, Exemptions, and Refunds Overview
The California Government Code permits impact fee exemptions for certain land uses at the discretion of local jurisdictions . Such fee exemptions are a policy matter that should be based on the consideration of the greater public good provided by this specific use being exempted from the impact fee . The following are some considerations related to waivers, exemptions, or refunds.

Affordable Housing : Most cities waive fees for projects that are 100% affordable housing ;
Alternatives to Fees : Many cities allow developers to provide housing units or donate land instead of paying fees ;
Public Projects : Fees are typically waived for publicly owned developments ; Special Land Uses : Some cities offer waivers for non - profit buildings, religious institutions, educational facilities (both public and private), and similar land uses ;

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com

VI FEE IMPLEMENTATION
A Administering a Fee Program

SECTION VI

FEE IMPLEMENTATION
Implementing a fee program requires significant planning and training, so it should be done efficiently and frequently. A well-designed program can generate sufficient funds to offset development impacts, while a poorly structured one risks underfunding and reliance on the General Fund or overcharging, which could lead to legal challenges or refund obligations.

All involved staff-across accounting, budgeting, and project management-must understand the distinction between In-Lieu Fees and other types of fees, along with the rules governing how fee revenues can be used. The fees proposed in this report are tied to a specific purpose and must be spent accordingly.

B Indexing the In-Lieu Fee
The fees presented in this Fee Study are based on current construction costs and should be adjusted annually to account for inflation , as construction costs ultimately impact the cost of providing or subsidizing affordable housing. Therefore, OTA recommends that, after adoption, the fee be reviewed annually and adjusted using a reliable index, such as the ENR BCI, which is generally used as the primary basis for indexing construction costs.

C Phase-In Schedule for Fee
A key component of adopting this Fee will be the effective date on which the Fee becomes active. One approach adopted by cities is to set a future effective and/or waive fees for current projects that are in the development pipeline. Other approaches include a phased­ in period of 1-2 years where the fee i.s set at 50% for the first year of applicability, rising to the full 100% afte r a 12-month period .

D Waivers, Exemptions, and Refunds Overview
The California Government Code permits impact fee exemptions for certain land uses at the discretion of local jurisdictions. Such fee exemptions are a policy matter that should be based on the consideration of the greater public good provided by this specific use being exempted from the impact fee. The following are some considerations related to waivers, exemptions , or refunds.
■ Affordable Housing : Most cities waive fees for projects that are 100 % affordable housing;
■ Alternatives to Fees: Many cities allow developers to provide housing uni.ts or donate land instead of paying fees;
• Public Projects: Fees are typically waived for publicly owned developments ; ■ Special Land Uses: Some cities offer waivers for non-profit buildings, religious institutions, educational facilities (both public and private), and similar land uses; City of La Verne
Residential Affordable Housing In-Li eu Fee Justification Study Febma,y6,2 026 I
18 19

SECTION VI

FEE IMPLEMENTATION

City of La Verne February 6, 2026
Residential Affordable Housing In - Lieu Fee Justification Study

www.FinanceDTA.com
Small Buildings : Certain cities exempt smaller buildings from fees , for example, accessory dwelling units or commercial buildings under 25,000 square feet ; and Policy - Driven Reductions : To support broader policy goals, many cities reduce or exempt fees for specific types of development.

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com

SECTION VI

FEE IMPLEMENTATION
■ Small Buildings: Certain cities exempt smaller buildings from fees, for example, accessory dwelling units or commercial buildings under 25,000 square feet; and ■ Policy-Driven Reductions: To support broader policy goals, many cities reduce or exempt fees for specific types of development.

City of La Verne
Residential Afford able Housing In-Lieu Fee Justifi cation Study Febma,y 6, 2026 I
19 APPENDIX A
City of La Verne
Residential Affordable Housing In - Lieu Fee Justification Study

FEE CALCULATION

Agenda Packet - April 20, 2026

APPENDIX A
City of La Verne
Residential Affordable Housing In-Lieu Fee Justification Study

FEE CALCULATION

APPENDIX B
City of La Verne
Residential Affordable Housing In - Lieu Fee Justification Study

OCCUPATIONAL

STATISTICS

Agenda Packet - April 20, 2026

APPENDIXB
City of La Verne
Residential Affordable Housing In-Lieu Fee Justification Study

OCCUPATIONAL

STATISTICS

APPENDIX C
City of La Verne
Residential Affordable Housing In - Lieu Fee Justification Study

AFFORDABILITY GAP

ANALYSIS

Agenda Packet - April 20, 2026

APPENDIXC
City of La Verne
Residential Affordable Housing In-Lieu Fee Justification Study

AFFORDABILITY GAP

ANALYSIS

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NON - RESIDENTIAL

AFFORDABLE HOUSING

LINKAGE FEE JUSTIFICATION
STUDY

CITY OF LA VERNE
Report Date: February 6, 2026

Agenda Packet - April 20, 2026
Irvine I San Jose I San Francisco I Riverside
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www.FinanceDTA.com 18201 Von Karman Avenue, Suite 220
Irvine, CA 92612

CITY OF LA VERNE

NON - RESIDENTIAL AFFORDABLE HOUSING LINKAGE FEE

JUSTIFICATION STUDY
Prepared for:

City of La Verne
3660 D St. La Verne CA 91750

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com 18201 Von Karman Avenue, Suite 220
Irvine, CA 92612

CITY OF LA VERNE

LAVERNE

NON-RESIDENTIAL AFFORDABLE HOUSING LINKAGE FEE

JUSTIFICATION STUDY
Prepared for:

City of La Verne
3660 D St. La Verne CA 91750

TABLE

OF CONTENT S

SECTION PAGE
I EXECUTIVE SUMMARY ................................................... 1 A Linkage Fee Summary ........................................................ 1 B Annual Escalation Factors ................................................. 2 II INTRODUCTION .............................................................. 3 A Overview of Methodology ................................................ 3

III LEGAL FRAMEWORK TO JUSTIFY DEVELOPMENT
IMPACT FEES .................................................................... 4 IV LAND USE AND DEMOGRAPHIC ASSUMPTIONS ..... 9
A Land Use Definitions and Employment
Densities ............................................................................... 9 B Worker Household ............................................................ 10 C Industry Sectors ................................................................ 10 D Income Distribution of Worker Households ............... 12 E Worker Households by Income Level .......................... 15

V AFFORDABILITY GAP AND LINKAGE FEE
CALCULATION ............................................................... 16 A Affordability Gap ............................................................... 16 B Fee Calculation .................................................................. 17 VI FEE IMPLEMENTATION ................................................ 18 A Administering a Fee Program ........................................ 18 B Indexing the Linkage Fee ................................................ 18 C Phase - In Schedule for Fee .............................................. 18 D Waivers, Exemptions, and Refunds Overview ............ 18

APPENDICES

APPENDIX A FEE CALCULATION

APPENDIX B OCCUPATIONAL STATISTICS

APPENDIX C AFFORDABILITY GAP ANALYSIS

Agenda Packet - April 20, 2026
TABLE

OF CONTENTS
PAGE
I EXECUTIVE SUMMARY ................................................... 1 A Linkage Fee Summary ........................................................ 1 B Annual Escalation Factors ................................................. 2 II INTRODUCTION .............................................................. 3 A Overview of Methodology ................................................ 3

III LEGAL FRAMEWORK TO JUSTIFY DEVELOPMENT
IMPACT FEES .................................................................... 4 IV LAND USE AND DEMOGRAPHIC ASSUMPTIONS ..... 9
A Land Use Definitions and Employment
Densities ............................................................................... 9 B Worker Household ............................................................ 10 C Industry Sectors ................................................................ 10 D Income Distribution of Worker Households ............... 12 E Worker Households by Income Level .......................... 15

V AFFORDABILITY GAP AND LINKAGE FEE
CALCULATION ............................................................... 16 A Affordability Gap ............................................................... 16 B Fee Calculation .................................................................. 17 VI FEE IMPLEMENTATION ................................................ 18 A Administering a Fee Program ........................................ 18 B Indexing the Linkage Fee ................................................ 18 C Phase-In Schedule for Fee .............................................. 18 D Waivers, Exemptions, and Refunds Overview ............ 18

APPENDICES

APPENDIX A

APPENDIX B

APPENDIXC

FEE CALCULATION

OCCUPATIONAL STATISTICS

AFFORDABILITY GAP ANALYSIS
1 SECTION I

EXECUTIVE SUMMARY

City of La Verne February 6, 2026
Non - Residential Affordable Housing Linkage Fee Justification Study

www.FinanceDTA.com

I EXECUTIVE SUMMARY
In order to adequately plan for new development and quantify the need for affordable housing and related costs associated with the direct and cumulative impacts of new development, DTA Public Finance, Inc . (“DTA”), was retained by the City of La Verne (the “City”) to prepare this non -residential nexus analysis (the “Fee Study”) and accompanying report for the City to establish a basis for a proposed non -residential linkage fee (the “Linkage Fee”) . The proposed fee would be levied on new non -residential development within the City as a means of mitigating the impact such development has on the demand for affordable housing for the local workforce . The purpose of the Fee Study is to provide a legally defensible analysis of the “nexus” between new non -residential development projects, the additional employment generated, the resulting new worker households and their income distributions, and ultimately an estimate of those households that will need affordable housing . Importantly, the analysis examines the cost of delivering housing for households earning up to 120% of the Area Median Income (“AMI ”) and evaluates the maximum feasible fee per square foot of new non - residential development , that is required to support the provision of such housing.

A Linkage Fee Summary
The Fee Study establishes a connection between new non - residential land uses and the introduction of new workers, whose presence generates additional demand for housing .

Given that a portion of these workers may belong to lower - income households, a share of the resulting housing demand must be met through affordable housing options . The analysis begins by categorizing non - residential land uses into five distinct types:
commercial , hotel, office, industrial, and institutional . The precise definitions of t hese categories shall be determined by City staff on a case - by - case basis, in accordance with the City’s Zoning Ordinance . The subsequent analysis proceeds with the following calculations:

Employee generation numbers per 1,000 square f eet for each non - residential categor y were determined;
Occupational and income information for each occupation was used to determine the distribution of jobs within each such occupation, with particular focus on the jobs with compensation levels addressed in the analysis; New jobs are adjusted to new households, using area specific demographic information on the number of workers per household;
The number of Extremely Low, Very Low - , Low - , and Moderate - Income households generated by the new development is calculated and coefficients of households per square foot of building area are generated; and
The number of lower income households per square foot is multiplied by the “Affordability Gap”, or the cost of delivering housing units affordable to these income groups, to generate the maximum Linkage Fee for the non - residential land uses.

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com

I EXECUTIVE SUMMARY

SECTION I

EXECUTIVE SUMMARY
In order to adequately plan for new development and quantify the need for affordable housing and related costs associated with the direct and cumulative impacts of new development, OTA Public Finance, Inc. ("OTA"), was retained by the City of La Verne (the "City") to prepare this non-residential nexus analysis (the "Fee Study") and accompanying report for the City to establish a basis for a proposed non-residential linkage fee (the "Linkage Fee"). The proposed fee would be levied on new non-residential development within the City as a means of mitigating the impact such development has on the demand for affordable housing for the local workforce. The purpose of the Fee Study is to provide a legally defensible analysis of the "nexus" between new non-residential development projects, the additional employment generated, the resulting new worker households and their income distributions. and ultimately an estimate of those households that will need affordable housing. Importantly, the analysis examines the cost of delivering housing for households earning up to 120% of the Area Median Income ("AMI") and evaluates the maximum feasible fee per square foot of new non-residential development, that is required to support the provision of such housing.

A Linkage Fee Summary
The Fee Study establishes a connection between new non-residential land uses and the introduction of new workers, whose presence generates additional demand for housing.

Given that a portion of these workers may belong to lower-income households , a share of the resulting housing demand must be met through affordable housing options. The analysis begins by categorizing non-residential land uses into five distinct types:
commercial, hotel, office, industrial, and institutional. The precise definitions of these categories shall be determined by City staff on a case-by-case basis, in accordance with the City's Zoning Ordinance. The subsequent analysis proceeds with the following calculations:
■ Employee generation numbers per 1,000 square feet for each non-residential category were determined;
■ Occupational and income information for each occupation was used to determine the distribution of jobs within each such occupation, with particular focus on the jobs with compensation levels addressed in the analysis; ■ New jobs are adjusted to new households, using area specific demographic information on the number of workers per household;
■ The number of Extremely Low, Very Low-. Low-, and Moderate-Income households generated by the new development is calculated and coefficients of households per square foot of build ing area are generated; and
■ The number of lower income households per squar e foot is multipli ed by the "Affordability Gap", or the cost of delivering housing units affordable to these income groups , to generate the maximum Linkage Fee for the non-residential land uses.

City of La Verne
Non -Residentia l Affordable Housing Linkage Fee Justification Study Febma,y 6, 2026 I
1 2

SECTION I

EXECUTIVE SUMMARY

City of La Verne February 6, 2026
Non - Residential Affordable Housing Linkage Fee Justification Study

www.FinanceDTA.com
The resulting fees are summarized in Table ES - 1 below . This table presents the maximum legally justifiable fees as determined by the Fee Study . These totals reflect the maximum impact fees that may be assessed on new non - residential construction to address its contribution to affordable housing needs . They are not proposed fee levels; they represent only the upper limits identified through this analysis .

Table ES - 1: Linkage Fee Summary
Land Use Type Maximum Justifiable
Fee (Per Sq . Ft.)
Commercial $331.74
Office $441.66
Industrial $104.31
Institutional $372.82
B Annual Escalation Factors
The cost estimates for the Linkage Fee calculated in this Fee Study are stated in 202 5 dollars .

DTA further recommends that, after adoption, the above fees be reviewed each year and adjusted based upon the changes in the Engineering News - Record (”ENR”) California Construction Cost Index (“CCCI”) . This construction cost index is based upon the Building Cost Index (“BCI”) cost average s experienced in Los Angeles - Long Beach - Anaheim as measured by the Engineering News - Recor d.

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com

SECTION I

EXECUTIVE SUMMARY
The resulting fees are summarized in Table ES-1 below. This table presents the maximum legally justifiable fees as determined by the Fee Study. These totals reflect the maximum impact fees that may be assessed on new non-residential construction to address its contribution to affordable housing needs. They are not proposed fee levels; they represent only the upper limits identified through this analysis.

Table ES-1: Linkage Fee Summary
Land Use Type Maximum Justifiable
Fee (Per Sq. Ft.)
Commercial $331.74
Office $441.66
Industrial $104.31
Institutional $372.82
B Annual Escalation Factors
The cost estimates for the Linkage Fee calculated in this Fee Study are stated in 2025 dollars.

DT A further recommends that, after adoption, the above fees be reviewed each year and adjusted based upon the changes in the Engineering News- Record ("ENR") California Construction Cost Index {"CCCI"). This construction cost index is based upon the Building Cost Index {"BCI") cost averages experienced in Los Angeles-Long Beach-Anaheim as measured by the Engineering News-Record.

City of La Verne
Non -Residentia l Affordable Housing Linkage Fee Justifica tion Study Febma,y 6, 2026 I
2 3

SECTION II

INTRODUCTION

City of La Verne February 6, 2026
Non - Residential Affordable Housing Linkage Fee Justification Study

www.FinanceDTA.com

II INTRODUCTION
A Overview of Methodology
This Fee Study is based on the premise that new non - residential land uses generate new employment for workers that will have a range of household incomes . Given the high cost of housing, many of these new workers will be unable to afford market - rate housing without experiencing significant financial strain . Consequently, the increase in lower - income worker households without access to affordable housing is considered a direct impact of new non - residential development . To address this, the proposed mitiga tion fee (the “Linkage Fee”) is intended to generate revenue that supports the development of housing affordable to these new lower - income households.

This section provides an overview of Fee Study . Each step is summarized below and discussed in more detail in the following sections:

Section III, Legal Framework : This section provides a detailed discussion on the legal framework utilized to justify the imposition and collection of the fee.

Section IV, Land Use and Demographic Assumptions : The Fee Study analyzes five key non - residential land use categories that represent the majority of anticipated future employment - generating uses in the City . For each land use type defined, the Fee Study calculates average employment density to estimate the number of workers per 100,000 square feet . Recognizing that most households include more than one worker, the study converts these employment figures into worker households to determine the total number generated by each land use . It then identifies the occupations likely to occupy each of the five non - residential land uses and, based on these occupations , constructs the expected household income distribution for each type . Finally, the Fee Study estimates the income - level distribution of new worker households by applying the income profiles to the total household counts.

Section V , Financing Gap per Affordable Unit and Maximum Legal Fee Calculation :

This section evaluates the economic viability of constructing a market - rate dwelling unit versus constructing a dwelling unit with rents that are affordable to a Moderate - Income or Low - Income Household , to determine the affordability gap . This gap is then applied to the total housing need by income level to calculate the maximum legal fee.

Section VI , Fee Implementation : This section presents policy recommendations for implementation, administration, and other considerations .

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com

II INTRODUCTION
A Overview of Methodology

SECTION II

INTRODUCTION
This Fee Study is based on the premise that new non-residential land uses generate new employment for workers that will have a range of household incomes. Given the high cost of housing, many of these new workers will be unable to afford market-rate housing without experiencing significant financial strain. Consequently, the increase in lower-income worker households without access to affordable housing is considered a direct impact of new non-residential development. To address this, the proposed mitigation fee (the "Linkage Fee") is intended to generate revenue that supports the development of housing affordable to these new lower-income households.

This section provides an overview of Fee Study. Each step is summarized below and discussed in more detail in the following sections:
■ Section III, Legal Framework: This section provides a detailed discussion on the legal framework utilized to justify the imposition and collection of the fee. ■ Section IV, Land Use and Demographic Assumptions : The Fee Study analyzes five key non-residential land use categories that represent the majority of anticipated future employment-generating uses in the City. For each land use type defined , the Fee Study calculates average employment density to estimate the number of workers per 100,000 square feet. Recognizing that most households include more than one worker, the study converts these employment figures into worker households to determine the total number generated by each land use. It then identifies the occupations likely to occupy each of the five non-residential land uses and, based on these occupations, constructs the expected household income distribution for each type . Finally, the Fee Study estimates the income -level distribution of new worker households by applying the income profiles to the total household counts. ■ Section V, Financing Gap per Affordable Unit and Maximum Legal Fee Calculation:

This section evaluates the economic viability of constructing a market-rate dwelling unit versus constructing a dwelling unit with rents that are affordable to a Moderate­ Income or Low-Income Household, to determine the affordability gap. This gap is then applied to the total housing need by income level to calculate the maximum legal fee.
■ Section VI, Fee Implementation: This section presents policy recommendations for implementation, administration , and other considerations.

City of La Verne
Non -Residentia l Affordable Housing Linkage Fee Justification Study Febma,y 6, 2026 I
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SECTION III

LEGAL FRAMEWORK TO JUSTIFY

DEVELOPMENT IMPACT FEES

City of La Verne February 6, 2026
Non - Residential Affordable Housing Linkage Fee Justification Study

www.FinanceDTA.com

III LEGAL FRAMEWORK TO JUSTIFY DEVELOPMENT IMPACT FEES The imposition of impact fees is one authorized method of financing the facilities necessary to mitigate the impact of new development , including affordable housing . A fee is “a monetary exaction, other than a tax or special assessment, which is charged by a local agency to the applicant in connection with approval of a development project for the purpose of defraying all or a portion of the cost of public facilities r elated to the development project...” (California Government Code, Section 66000).

A fee may be levied for each type of capital improvement required for new development, with the payment of the fee typically occurring prior to the beginning of construction of a dwelling unit or non - residential building . Fees are often levied at final map recordation, upon the issuance of a C ertificate of O ccupancy, or more commonly, at building permit issuance.

AB 1600, which created Section 66000 et seq . of the Government Code , was enacted by the State of California in 1987 . In 2006, Government Code Section 66001 was amended to clarify that a fee cannot include costs attributable to existing deficiencies, but it can fund costs used to maintain the existing Level of Service (“LOS”) or meet an adopted LOS consistent with the General Plan.

Section 66000 et seq . of the Government Code thus requires that all public agencies satisfy the following requirements when establishing, increasing, or imposing a fee as a condition of new development:

1. Identify the purpose of the fee [Government Code Section 66001(a)(1)] ;

2. Ascertain the use to which the fee will be put [Government Code Section 66001(a)(2)] ;

3. Determine that there is a reasonable relationship between the fee’s use and type of development on which the fee is to be imposed [Government Code Section 66001(a)(3)] ;

4. Establish how there is a reasonable relationship between the need for the public facility and type of development project on which the fee is to be imposed [Government Code Section 66001(a)(4)] ; and

5. Discuss how there is a reasonable relationship between the amount of the fee and cost of the public facility or portion of the public facility attributable to the development on which the fee is imposed [Government Code Section 66001( b)].

Presented below are the legal requirements as they relate to the calculation and imposition of the proposed fees addressed by this Fee Study.

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com

SECTION III

LEGAL FRAMEWORK TO JUSTIFY

DEVELOPMENT IMPACT FEES

III LEGAL FRAMEWORK TO JUSTIFY DEVELOPMENT IMPACT FEES
The imposition of impact fees is one authorized method of financing the facilities necessary to mitigate the impact of new development, including affordable housing. A fee is "a monetary exaction, other than a tax or special assessment , which is charged by a local agency to the applicant in connection with approval of a development project for the purpose of defraying all or a portion of the cost of public facilities related to the development project ... " (California Government Code, Section 66000).

A fee may be levied for each type of capital improvement required for new development, with the payment of the fee typically occurring prior to the beginning of construction of a dwelling unit or non-residential building. Fees are often levied at final map recordation, upon the issuance of a Certificate of Occupancy, or more commonly, at building permit issuance.

AB 1600, which created Section 66000 et seq. of the Government Code, was enacted by the State of California in 1987. In 2006, Government Code Section 66001 was amended to clarify that a fee cannot include costs attributable to existing deficiencies, but it can fund costs used to maintain the existing Level of Service ("LOS") or meet an adopted LOS consistent with the General Plan .

Section 66000 et seq. of the Government Code thus requires that all public agencies satisfy the fallowing requirements when establishing, increasing, or imposing a fee as a condition of new development:

1. Identify the purpose of the fee [Government Code Section 66001(a)(1)];

2. Ascertain the use to which the fee will be put [Government Code Section 66001(a) (2) ];

3. Determine that there is a reasonable relationship between the fee's use and type of development on which the fee is to be impo sed [Government Code Section 66001(a) (3)];

4. Establish how there is a reasonable relationship between the need for the public facility and type of development project on which the fee is to be imposed [Government Code Section 66001(a )(4)]; and

5. Discuss how there is a reasonable relationship between the amount of the fee and cost of the public facility or portion of the publi c facility attributable to the development on whi ch the fee is impo sed [Government Code Section 66001(b}].

Presented below are the legal requirement s as they relate to the calculation and impo sition of the proposed fees addressed by this Fee Study .

City of La Verne
Non -Residentia l Affordable Housing Linkage Fee Justification Study Febma,y 6, 2026 I
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SECTION III

LEGAL FRAMEWORK TO JUSTIFY

DEVELOPMENT IMPACT FEES

City of La Verne February 6, 2026
Non - Residential Affordable Housing Linkage Fee Justification Study

www.FinanceDTA.com
A PURPOSE OF THE FEE [GOVERNMENT CODE SECTION 66001(A)(1) ] New development within the City will generate additional residents and employees . These future residents and employees will create an additional demand for new or expanded affordable housing that the existing housing stock cannot accommodate . To accommodate non - residential development in an orderly manner, without adversely impacting the current quality of life in the City, additional affordable housing will need to be constructed .

It is the projected direct and cumulative effect of non - residential development that has required the preparation of this Fee Study . Every newly developed parcel will contribute to the need for new affordable housing, and, as such, the proposed fee will be charged to all future development, irrespective of location, within the City . Importantly, many of the employees associated with any non - residential development in the City may live in affordable housing . Additionally, the availability of jobs througho ut the City has a growth - inducing impact, in that it enhances the City’s reputation as a great place to live and work, thereby attracting new non - residential development that might otherwise have been constructed elsewhere . As a result, all such development projects in the City contribute to the cumulative need for new affordable housing . The fee, when collected, will be placed into a dedicated fund that will be used solely for the design, acquisition, and construction of affordable housing and other appropriate related costs to mitigate the direct and cumulative impacts of new non - resident ial development within the City.

The discussion in this subsection of the Fee Study sets forth the purpose of the development impact fee as required by Section 66001(a)(1) of the California Government Code.

B THE USE TO WHICH THE FEE IS TO BE PUT [GOVERNMENT CODE SECTION 66001(A)(2) ]
The fee collected will provide a source of revenue for the City to facilitate the design, acquisition, and construction of affordable housing , and related costs necessary to mitigate the direct and cumulative demand for such housing as a result of new non - residential development in the City . By directly funding these costs, the fee will both enhance the quality of life for and protect the health, safety, and welfare of the existing and future City residents and employees.

C THERE IS A REASONABLE RELATIONSHIP BETWEEN THE FEE ’S USE AND THE TYPE

OF DEVELOPMENT PROJECT UPON WHICH THE FEE IS IMPOSED (BENEFIT RELATIONSHIP) [GOVERNMENT CODE SECTION 66001(A)(3)]
As discussed in Section A above, it is the projected direct and cumulative effect of future development that has prompted the preparation of this Fee Study . All new non - residential development within the City , irrespective of location, contributes to the direct and cumulative impacts of development on the affordable housing demand and creates the need for more such housing to accommodate growth . The derivation of fee amounts for non - residential development is explained in detail in Sections IV, and V and of this Fee Study . These fees will be expended exclusively for the design, acquisition, and construction of new affordable

Agenda Packet - April 20, 2026
dta
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SECTION III

LEGAL FRAMEWORK TO JUSTIFY

DEVELOPMENT IMPACT FEES
A PURPOSE OF THE FEE [GOVERNMENT CODE SECTION 66001(A)(1)] New development wi.thi.n the City will generate additional residents and employees. These future residents and employees will create an additional demand for new or expanded affordable housing that the existing housing stock cannot accommodate. To accommodate non-residential development in an orderly manner, without adversely impacting the current quality of life in the Ci.ty, additional affordable housing wi.ll need to be constructed.

It is the projected direct and cumulative effect of non-residential development that has required the preparation of this Fee Study. Every newly developed parcel will contribute to the need for new affordable housing, and, as such, the proposed fee will be charged to all future development, irrespective of location, within the City. Importantly, many of the employees associated with any non-residential development in the City may live in affordable housing. Additionally, the availability of jobs throughout the City has a growth­ inducing impact, in that it enhances the City's reputation as a great place to live and work, thereby attracting new non-residential development that might otherwise have been constructed elsewhere. As a result, all such development projects in the City contribute to the cumulative need for new affordable housing. The fee, when collected, will be placed into a dedicated fund that will be used solely for the design, acquisition, and construction of affordable housing and other appropriate related costs to mitigate the direct and cumulative impacts of new non-residential development within the City.

The discussion in this subsection of the Fee Study sets forth the purpose of the development impact fee as required by Section 66001(a}(1) of the California Government Code.

B THE USE TO WHICH THE FEE IS TO BE PUT [GOVERNMENT CODE SECTION 66001(A)(2)]
The fee collected wm provide a source of revenue for the City to facmtate the design, acquisition, and construction of affordable housing , and related costs necessary to mitigate the direct and cumulative demand for such hou sing as a result of new non-re sidential development in the City. By directly funding these costs, the fee will both enhance the quality of life for and protect the health, safety, and welfare of the existing and future City residents and employees.

C THERE IS A REASONABLE RELATIONSHIP BETWEEN THE FEE'S USE AND THE TYPE

OF DEVELOPMENT PROJECT UPON WHICH THE FEE IS IMPOSED (BENEFIT RELATIONSHIP) [GOVERNMENT CODE SECTION 66001(A)(3)]
As discussed in Section A above, it is the projected dire ct and cumulative effect of future development that has prompted the preparation of this Fee Study. All new non-residential development within the City, irrespective of location, contributes to the direct and cumulative impacts of development on the affordable housing demand and create s the need for more such housing to accommodate growth. The derivation of fee amounts for non-residential development is explained in detail in Sections IV, and V and of this Fee Study. These fees will be e xpend ed exclusively for the design, acquisition, and construction of new affordabl e City of La Verne
Non -Residentia l Affordable Housing Linkage Fee Justification Study Febm a,y 6, 2026 I
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SECTION III

LEGAL FRAMEWORK TO JUSTIFY

DEVELOPMENT IMPACT FEES

City of La Verne February 6, 2026
Non - Residential Affordable Housing Linkage Fee Justification Study

www.FinanceDTA.com
housing , as that is the purpose for which th is development impact fee is being collected . As previously stated, all new non - residential development s create either a direct impact or contributes to the cumulative impact on affordable housing .

For the foregoing reasons, there is a reasonable relationship between the design, acquisition, and construction of affordable housing and new development as required under Section 66001(a)(3) of the Mitigation Fee Act.

D DETERMINE HOW THERE IS A REASONABLE RELATIONSHIP BETWEEN THE NEED

FOR THE PUBLIC FACILITY AND THE TYPE OF DEVELOPMENT PROJECT UPON WHICH THE FEE IS IMPOSED (IMPACT RELATIONSHIP) [GOVERNMENT CODE SECTION 66001(A)(4) ]
As previously stated, new non - residential development within the City, irrespective of location, contributes to the direct and cumulative impacts of development on affordable housing demand and creates the need for new affordable housing to accommodate gro wth .

Moreover, the affordable housing needs identified in Section V are specifically a function of the number of projected residents within the City and do not reflect any unmet needs of existing development .

For the reasons presented herein and in Section V , there is a reasonable relationship between the need for affordable housing and all new development within the City.

E THE RE IS A REASONABLE RELATIONSHIP BETWEEN THE AMOUNT OF THE FEE AND

THE COST OF THE PUBLIC FACILITIES ATTRIBUTABLE TO THE DEVELOPMENT UPON WHICH THE FEE IS IMPOSED (“ROUGH PROPORTIONALITY” RELATIONSHIP) [GOVERNMENT CODE 66001( B)]
As set forth above, all new non - residential development in the City impacts existing housing needs . Each individual non - residential development project and its related increase in employment, along with the cumulative impacts of all development in the City , will adversely impact the need for housing . Thus, the imposition of the fee to finance new affordable housing is an efficient, practical, and equitable method of permitting development to proceed in a responsible manner.

New non - residential development impacts affordable housing needs directly and cumulatively . The addition of new businesses necessitates an increase in residents . A certain number of these new residents will require affordable housing . The proposed fee amounts are roughly proportional to the impacts resulting from new development based on the analyses contained in Section V . Thus, there is a reasonable relationship between the amount of the fee and cost of subsidizing the necessary housing .

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com

SECTION III

LEGAL FRAMEWORK TO JUSTIFY

DEVELOPMENT IMPACT FEES
housing, as that is the purpose for which this development impact fee is being collected. As previously stated, all new non-residential developments create either a direct impact or contributes to the cumulative impact on affordable housing .

For the foregoing reasons, there is a reasonable relationship between the design, acquisition, and construction of affordable housing and new development as required under Section 66001(a)(3) of the Mitigation Fee Act.

D DETERMINE HOW THERE IS A REASONABLE RELATIONSHIP BETWEEN THE NEED

FOR THE PUBLIC FACILITY AND THE TYPE OF DEVELOPMENT PROJECT UPON

WHICH THE FEE IS IMPOSED (IMPACT RELATIONSHIP) (GOVERNMENT CODE SECTION 66001(A)(4)]
As previously stated, new non-residential development within the City, irrespective of location , contributes to the direct and cumulative impacts of development on affordable housing demand and creates the need for new affordable housing to accommodate growth.

Moreover, the affordable housing needs identified in Section V are specifically a function of the number of projected residents within the City and do not reflect any unmet needs of existing development.

For the reasons presented herein and in Section V, there is a reasonable relationship between the need for affordable housing and all new development within the City.

E THERE IS A REASONABLE RELATIONSHIP BETWEEN THE AMOUNT OF' THE FEE AND

THE COST OF' THE PUBLIC FACILITIES ATTRIBUTABLE TO THE DEVELOPMENT UPON WHICH THE FEE IS IMPOSED (°ROUGH PROPORTIONALITr RELATIONSHIP) [GOVERNMENT CODE 66001(8)]
As set forth above, all new non-residential development in the City impacts existing housing needs. Each individual non-residential development project and its related increase in employment, along with the cumulative impacts of all development in the City, will adversely impact the need for housing . Thus, the imposition of the fee to finance new affordable housing is an efficient, practical, and equitable method of permitting development to proceed in a responsible manner.

New non-residential development impacts affordable housing needs directly and cumulatively. The add ition of new businesses necess itates an increase in residents. A certain number of these new residents will require affordable housing. The proposed fee amounts are roughly proportional to the impacts resulting from new development based on the analyses contained in Section V. Thus, there is a reasonable relationship between the amount of the fee and cost of subsidizing the necessary housing .

City of La Verne
Non -Residentia l Affordable Housing Linkage Fee Justifica tion Study Febma,y 6, 2026 I
6 7

SECTION III

LEGAL FRAMEWORK TO JUSTIFY

DEVELOPMENT IMPACT FEES

City of La Verne February 6, 2026
Non - Residential Affordable Housing Linkage Fee Justification Study

www.FinanceDTA.com

F RECENT LEGISLATIVE DEVELOPMENTS
In September 2021, the Governor of California signed Assembly Bill (“AB”) 602 which provides new statewide requirements for local jurisdictions seeking to impose development impact fees on development projects . As stated earlier, the Mitigation Fee Act, AB 1600, establishes specific requirements that local officials must follow in establishing, increasing, or imposing development fees . Specifically, local officials must conduct a “nexus study” to demonstrate a “reasonable relationship” between the fees an d the affordable housing to be funded by the fees , and the development project on which the fees are assessed . AB 602 is designed to provide additional guidance on how local agencies comply with their impact fee obligations, which will affect the methodology choice that DTA will use to calculate the fees . Key portions of the bill affecting future DIF calculations are summarized below .

On or after January 1, 2022, fee justification studies must identify the existing LOS for each public facility, identify the proposed new LOS , and (if proposed new LOS is greater than existing LOS ) include an explanation of why the new LOS is necessary .

For housing development projects, nexus studies adopted after July 1, 2022, must calculate the amount of fees based on square footage of proposed residential units of the development, unless the local agency demonstrates that another metric is more appropriate . The bill would require that a “local agency that calculated fees proportionally to the square footage of the proposed units be deemed to have used a valid method to establish a reasonable relationship between the fee charged and the burden posed by development.” This would also apply to multi - family residences .

The bill also require s HCD, on or before January 1, 2024, to create an impact fee nexus study template that may be used by local jurisdictions to calculate their fees .

The bill require s that the template include a method of calculating the feasibility of housing being built with a given fee level . The template must be completed by 2024, and local jurisdictions will have the option (it will not be required) to use the HCD template.

The bill authorize s any member of the public, including an applicant for a development project, to submit evidence that the city, county, or other local agency had failed to comply with the Mitigation Fee Act . The bill require s the legislative body of the city, county, or other local agency to consider any timely submitted evidence and authorize the legislative body to change or adjust the proposed fee or fee increase, as specified.

If a nexus study supports the increase of an existing fee, the local agency shall review the assumption of the nexus study supporting the original fee and evaluate the amount of the fees collected under the original fee .

Large jurisdictions (county population greater than 250,000) and cities within those counties must adopt a capital improvement plan as part of the nexus study.

Agenda Packet - April 20, 2026
dta
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F RECENT LEGISLATIVE DEVELOPMENTS

SECTION III

LEGAL FRAMEWORK TO JUSTIFY

DEVELOPMENT IMPACT FEES
In September 2021, the Governor of Cali.forni.a si.gned Assembly Bi.ll ("AB") 602 which provi.des new statewide requi.rements for local juri.sdi.cti.ons seeking to i.mpose development impact fees on development projects. As stated earli.er, the Mitigation Fee Act, AB 1600, establi.shes specific requirements that local officials must follow in establi.shi.ng, increasi.ng, or imposi.ng development fees. Specifically, local officials must conduct a "nexus study" to demonstrate a "reasonable relationship" between the fees and the affordable housi.ng to be funded by the fees, and the development project on which the fees are assessed. AB 602 is designed to provi.de additi.onal gui.dance on how local agencies comply wi.th their impact fee obli.gations, which wi.ll affect the methodology choice that OTA wi.ll use to calculate the fees. Key portions of the bi.ll affecting future DIF calculations are summarized below. ■ On or after January 1, 2022, fee justification studies must identify the exi.sting LOS for each publ ic facility, identify the proposed new LOS, and (if proposed new LOS is greater than existing LOS) include an explanation of why the new LOS is necessary. ■ For housing development projects, nexus studies adopted after July 1, 2022, must calculate the amount of fees based on square footage of proposed resi.dential uni.ts of the development, unless the local agency demonstrates that another metric i.s more appropri.ate. The bi.ll would require that a "local agency that calculated fees proportionally to the square footage of the proposed units be deemed to have used a valid method to establish a reasonable relationship between the fee charged and the burden posed by development." Thi.s would also apply to multi-fami.ly residences.
■ The bi.ll also requi.res HCD, on or before January 1, 2024, to create an i.mpact fee nexus study template that may be used by local jurisdi.cti.ons to calculate their fees.

The bill requires that the template i.nclude a method of calculating the feasibility of housing being bui.lt wi.th a given fee level. The template must be completed by 2024, and local jurisdictions will have the option (it will not be required) to use the HCD template.
■ The bill authorizes any member of the public , including an appli.cant for a development project, to submit evidence that the city, county, or other local agency had failed to comply with the Mitigation Fee Act. The bill requires the legislative body of the city, county, or other local agency to consider any timely submitted evidence and authorize the legislative body to change or adjust the proposed fee or fee increase, as specified.
■ If a nexus study supports the increase of an existing fee, the local agency shall review the assumption of the nexus study supporting the original fee and evaluate the amount of the fees collected under the original fee.
■ Large juri.sdicti.ons (county population greater than 250,000) and ci.ti.es wi.thi.n those counti es must adopt a capital i.mprovement plan as part of the nexus study .

City of La Verne
Non -Residentia l Affordable Housing Linkage Fee Ju stification Study Febma,y 6, 2026 I
7 8

SECTION III

LEGAL FRAMEWORK TO JUSTIFY

DEVELOPMENT IMPACT FEES

City of La Verne February 6, 2026
Non - Residential Affordable Housing Linkage Fee Justification Study

www.FinanceDTA.com
Nexus studies shall be updated at least every 8 years .

Notably , AB 602 does not apply to (i) water and sewer connection and capacity charges , (ii) school fees or Quimby fees for park impacts, and (iii) Mello - Roos Programs or other special taxes . These other fees, taxes, and charges are subject to their own statutory accountability measures.

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com

SECTION III

LEGAL FRAMEWORK TO JUSTIFY

DEVELOPMENT IMPACT FEES
■ Nexus studies shall be updated at least every 8 years.

Notably, AB 602 does not apply to (i) water and sewer connection and capacity charges, (ii) school fees or Quimby fees for park impacts, and (iii) Mello-Roos Programs or other special taxes. These other fees, taxes, and charges are subject to their own statutory accountability measures.

City of La Verne
Non -Residentia l Affo rdable Housing Linkage Fee Just ification Study Febma,y 6, 2026 I
8 9

SECTION IV

LAND USE AND DEMOGRAPHIC

ASSUMPTIONS

City of La Verne February 6, 2026
Non - Residential Affordable Housing Linkage Fee Justification Study

www.FinanceDTA.com

IV LAND USE AND DEMOGRAPHIC ASSUMPTIONS
A Land Use Definitions and Employment Densities
Table 1 presented below provides a summary of the land uses covered in this Fee Study . As previously indicated, the Fee Study will determine the Linkage Fee for four (4) land use categories : commercial , office, industrial, and institutional . Importantly, t he table shown below is meant to provide an example of typical land uses found in each category and is not intended to be a comprehensive list of all the City’s potential land uses.

Table 1: Summary of Land Use Categories
Land Use Classification Fee
Study Definition
Commercial
Includes but is not limited to buildings used as the following:

Retail ;
Service - oriented business activities, wineries/vineyards, and car washes; Department stores, discount stores, furniture/appliance outlets, home improvement centers;
Shopping centers and entertainment centers
Subregional and regional shopping centers;
Grocery stores and storage facilities.

Office
Includes but is not limited to buildings used as the following:

Business/professional offices;
Medical/dental offices;
Office park, research park, business park; and
General office buildings.

Industrial
Includes but is not limited to buildings used as the following:

Light manufacturing, warehouse/distribution, and logistics wholesaling; Wholesale and warehouse retail;
Food processing;
Industrial park; and
Industrial/light industrial.

Institutional
Include but is not limited to buildings used as the following:

Professional urgent care and private hospitals and rehabilitation centers; Private schools, trade and vocational schools, and veteran organizations; Rehabilitation centers, assisted living, and memory care facilities; and Churches, temples, mosques, and synagogues.

The existing non - residential square footage was compiled and estimated using the CoStar Real Estate Software Platform . In addition , the employees per square foot for non - residential land uses was based on information published in Nielsen Company Employment Profiles by NAICS Codes 202 5. The North American Industry Classification System ( “NAICS ”) is the standard used by Federal statistical agencies in classifying business establishments for the purpose of collecting, analyzing, and publishing statistical data related to the U.S . business economy .

Agenda Packet - April 20, 2026
dta
www.FinanceDTA.com

SECTION IV

LAND USE AND DEMOGRAPHIC

ASSUMPTIONS

IV LAND USE AND DEMOGRAPHIC ASSUMPTIONS
A Land Use Definitions and Employment Densities
Table 1 presented below provides a summary of the land uses covered in this Fee Study. As previously indicated, the Fee Study will determine the Linkage Fee for four (4) land use categories: commercial, office, industrial, and institutional. Importantly, the table shown below is meant to provide an example of typical land uses found in each category and is not intended to be a comprehensive list of all the City's potential land uses.

Table 1: Summary of Land Use Categories
Land Use Classification Fee O t· ·t·
Study e 1m 10n
Includes but is not limited to buildings used as the following:
• Retail;
• Service-oriented business activities, wineries/vineyards, and car washes ; Commercial • Department stores, discount stores, furniture/appliance outlets, home improvement centers;
• Shopping centers and entertainment centers
• Subregional and regional shopping centers ;
• Grocery stores and storage facilities.

Includes but is not limited to buildings used as the following:
• Business/professional offices;
Office • Medical/dental offices;
• Office park, research park, business park; and
• General office buildings.

Includes but is not limited to buildings used as the following :
• Light manufacturing, warehouse/distribution, and logistics wholesaling; Industrial • Wholesale and warehouse retail;
• Food processing;
• Industrial park; and
• Industrial/light industrial.

Include but is not limited to buildings used as the following:
• Professional urgent care and private hospitals and rehabilitation centers; Institutional • Private schools, trade and vocational schools, and veteran organizations; • Rehabilitation centers, assisted living, and memory care facilities; and • Churches, temples, mosques, and synagogues.

The existing non-residential square footage was compiled and estimated using the CoStar Real Estate Software Platform. In addition, the employees per square foot for non-residential land uses was based on information published in Nielsen Company Employment Profiles by NAICS Codes 2025. The North American Industry Classification System ("NAICS") is the standard used by Federal statistical agencies in classifying business establishments for the purpose of collecting, analyzing , and publishing statistical data related to the U.S. business economy .

City of La Verne February 6, 2026
Non-Residential Affordable Housing Linkage Fee Justification Study 10 SECTION IV

LAND USE AND DEMOGRAPHIC

ASSUMPTIONS

City of La Verne February 6, 2026
Non - Residential Affordable Housing Linkage Fee Justification Study

www.FinanceDTA.com
As reflected in Table 2 below , the City has approximately 6.8 million total square feet of existing non - residential development; including approximately 2.3 million square feet of commercial , 269 thousand square feet of office, 3.5 million square feet of industrial, and 700 thousand square feet of institutional .

Per the Nielsen Company’s Employment Profiles (2025), the City has 11,459 employees in these non - residential sectors, specifically 5,227 commercial employees, 1,041 office employees, 3,147 industrial employees, and 2,044 institutional employees.

Table 2: Estimated Existing Non - Residential Development Non - Residential Land Use Existing Building
Square Feet Existing Employees Employees per
1,000 Square Feet
Commercial 2,298,776 5,227 2.27
Office 269,000 1,041 3.87
Industrial 3,478,385 3,147 0.90
Institutional 700,531 2,044 2.92
Total 6,476,692 11,459 N /A
B Worker Household
Since most households include more than one worker, the Fee Study groups the employees generated by each land use into households to determine the total number of worker households generated by each land use type . According to the US Census American Community Survey, as of 20 24 the City had 13,656 workers living in households and 11,530 households, averaging approximately 1.18 workers per household . Therefore, the Fee Study estimates the number of employee households that each land use generates by dividing the total number of workers by 1.18 . The resulting estimated number of households per 100,000 square feet is shown below.

Table 3: Estimated Households per 100,000 Square Feet
Non - Residential Land Use Employees per
1,000 Square Feet
Total Employees
(100KSF Bldg.)
Total Households
(1.18 Employees/
Household)
Commercial 2.2 7 22 7 192
Office 3.87 387 328
Industrial 0.90 90 76
Institutional 2.92 292 247
Total N /A 996 884
C Industry Sectors
As a first step in identifying affordable housing needs, the analysis evaluates the likely industry sectors that would comprise each of the five non - residential land uses.