CITY OF LAGUNA BEACH
ANNUAL DEVELOPMENT
IMPACT FEES AND SEWER
CONNECTION FEE REPORT
Exhibit A
9 Table of Contents
Letter of Transmittal .................................................................................................................. i
INTRODUCTION
Legal Requirement for Development Impact Fee Reporting ................................................ 1 Description and Purpose of Development Impact Fees........................................................ 2 Description and Purpose of Sewer Connection Fee ............................................................ 3 Fee Schedule ...................................................................................................................... 4
FINANCIAL SUMMARY REPORT
Summary Report – Development Impact/Sewer Connection Fees ...................................... 7
NOTE TO THE DEVELOPMENT IMPACT FEE REPORT
Note 1 – Refund of Developer Fee ...................................................................................... 9
DEVELOPMENT IMPACT FEE AND
SEWER CONNECTION FEES PROJECTS IDENTIFICATION ............................................10 10 11
INTRODUCTION
LEGAL REQUIREMENTS FOR DEVELOPMENT IMPACT FEE REPORTING A. California Government Code Section 66006 (b)
Government Code Section 66006 (b) defines the specific reporting requirements for local agencies that impose AB 1600 DIF on new development. Annually, for each separate fund established for the collection and expenditure of DIFs, the local agency shall, within 180 days after the last day of each fiscal year, make available to the public the information shown below for the most recent fiscal year.
• A brief description of the fee in the account or fund. • The amount of the fee.
• The beginning and ending balance of the account or fund. • The amount of the fees collected, and the interest earned. • An identification of each public improvement on which fees were expended and the amount of the expenditures on each improvement, including the total percentage of the cost of the public improvement that was funded with fees. • An identification of an approximate date by which the construction of the public improvement will commence, if the local agency determines that sufficient funds have been collected to complete financing on an incomplete public improvement. • An identification of each public improvement identified in a previous report as “incomplete” and whether construction began on the approximately date noted in the previous report. If construction did not commence by the approximate date provided in the previous report, the reason for the delay and a revised approximate date that the local agency will commence construction.
• A description of each interfund transfer or loan made from the account or fund, including the public improvement on which the transferred or loaned fees will be expended, and, in the case of an interfund loan, the date on which the loan will be repaid, and the rate of interest that the account or fund will receive on the loan. • The amount of refunds made, and the number of persons or entities identified to receive those refunds due to insufficient funds being collected to complete financing on incomplete public improvements, and the amount of reallocation of funds made due to administrative costs of refunding unexpended revenues exceeding the amount to be refunded.
B. California Government Code Section 66001 (d)
For all funds established for the collection and expenditure of DIFs, Government Code Section 66001 (d) has additional requirements. For the fifth fiscal year following the first deposit into the fund and every five years thereafter, the local agency shall make all of the following findings with respect to that portion of the fund remaining unexpended, whether committed or uncommitted:
12 • Identify the purpose for which the fee is to be put. • Demonstrate a reasonable relationship between the fee and purpose for which it is charged.
• Identify all sources and amounts of funding anticipated to complete financing in incomplete improvements.
• Designate the approximate dates on which the funding is expected to be deposited into the appropriate account or fund.
C. Additional Notes
The State of California Government Code Section 66002 states that local agencies that have developed a fee program may adopt a Capital Improvement Program (CIP) indicating the approximate location, size, and timing of projects, plus an estimate for the cost of all facilities or improvements to be financed by fees.
DESCRIPTION AND PURPOSE OF DEVELOPMENT IMPACT FEES
The City collects DIFs to offset and address the impacts of new development on facilities and infrastructure. Currently, there are six DIF categories. While each fee category has its own methodology for determining fees, two main principles apply throughout:
1) The City aims to maintain the existing level of service as the City continues to grow; and 2) New development should pay its fair share of the City’s infrastructure needs.
Library Impact Fee – The City Council adopted Ordinance No. 1351 in 1999 (Laguna Beach Municipal Code Chapter 25.85 to provide for acquiring, building, improving, expanding, maintaining, and operating public libraries located within the City, including, but not limited to the purchase of books, reference materials, equipment, furnishings, and other necessary supplies.
The demand and need for such facilities and services results directly from the increase in density in the City by the development of land that was previously vacant or by the construction of additional residential units on land that is already developed.
Parking In-Lieu Certification Fee –Laguna Beach Municipal Code Section 25.52.006 (E) requires an in-lieu parking certificate for areas designated by the City Council to be hardship areas and for which special districts are formed for the purpose of providing central or common parking facilities and/or improving public transit. The City Council may grant relief from the City’s parking requirements to the extent the private property owner or lessee participates in or contributes to parking in the central facility and/or improving public transit by acquiring in-lieu parking certificates equivalent to the number of spaces required for his or her individual development, up to a maximum of three certificates for any one site, except as otherwise described in the Laguna Beach Municipal Code.
Park and Recreation Dedication In-Lieu Impact Fee – The City Council adopted Ordinance No. 1352 in 1999 (Laguna Beach Municipal Code Section 21.08.130) to require that five acres of property for each one thousand persons residing within the City be devoted to local park and recreational purposes. Therefore, as a condition of approval of a final map or parcel map, the 13 developer shall dedicate land, pay a fee in lieu thereof, or both, at the option of the City, to be used for the purpose of providing park or recreation facilities reasonably related to the subdivision.
Art In-Lieu Fee – The City Council adopted Ordinance No. 1119 in 1986 (Laguna Beach Municipal Code Chapter 1.09) to require certain development projects either provide artwork or pay an inlieu fee that will be used to provide sites for and works of art in public places.
Drainage Impact Fee – The City Council adopted Ordinance No. 1027 in 1982 (Laguna Beach Municipal Code Section 25.53.008 to provide for improving and expanding drainage facilities located within the City.
Housing In-Lieu Impact Fee –Laguna Beach Municipal Code Section 25.96.070 established a Citywide inclusionary housing program that provides requirements and procedures to develop housing that would be affordable to households of extremely low, very low, low, or moderate incomes, meet the City’s regional share of housing needs, and implement the goals and objectives of the General Plan and Housing Element. To comply with the City’s inclusionary housing requirements, applicants may pay a housing in-lieu fee. Housing in-lieu fees may be expended for any costs directly related to the production or preservation of affordable housing in the City. These fees may also be used for City staff that conduct periodic inspections to ensure that the constructed inclusionary housing units comply with the affordable housing agreement, affordable housing site plan, including housing plan, affordable housing covenants, and all other City and zoning requirements.
DESCRIPTION AND PURPOSE OF SEWER CONNECTION FEE
The most recent sewer connection fee was approved by the City Council on June 25, 2025, with the adoption of Resolution No. 25.047. The purpose of the fee is to connect a structure to the public sewer system. Similar to California Government Code section 66006 (b). California Government Code section 66013 (d) defines the specific reporting requirements for local agencies that impose a fee for sewer connections. The local agency shall make available to the public, within 180 days after the last day of the fiscal year, the following information for that fiscal year:
• A description of the charges deposited in the fund.
• The beginning and ending balance of the account or fund and the interest earned from investment of moneys in the fund.
• The amount of charges collected in that fiscal year.
• An identification of each public improvement on which charges were expended and the amount of the expenditure for each improvement, including the total percentage of the cost of the public improvement that was funded with those charges if more than one source of funding was used.
• An identification of each public improvement on which charges were expended that was completed during that fiscal year.
• Each public improvement that is anticipated to be undertaken in the following fiscal year.
14 • A description of each interfund transfer or loan made from the capital facilities fund.
The information provided, in the case of an interfund transfer, shall identify the public improvements on which the transferred moneys are, or will be expended. The information, in the case of an interfund loan, shall include the date on which the loan will be repaid, and the rate of interest that fund will receive on the loan.
FEE SCHEDULE
The table below lists Fees in effect as of June 30, 2025.
Developer Impact Fees
Description Fee
Library Impact Fee $200 per each new residential unit
Parking In-Lieu Certification Fee $23,000.00
Park and Recreation Dedication In-Lieu Fee
(Pay fee equal to the value of land and based on
the average sales price per acre of vacant
residentially zoned property calculated annually
in January utilizing data from the preceding
three-year calendar period.)
1 dwelling unit per acre or more = 0.6% park
land
1 dwelling unit per 1/2 to 1 acre or more =
1.2% park land
1 dwelling unit per 10,000 square feet to 1/2
acre = 1.73% park land
1 dwelling unit per 9,000 to 9,999 square
feet = 2.7% park land
1 dwelling unit per 8,000 to 8,999 square
feet = 3.01% park land
1 dwelling unit per 7,000 to 7,999 square
feet = 3.4% park land
1 dwelling unit per 6,000 to 6,999 square
feet = 3.9% park land
1 dwelling unit per 5,000 to 5,999 square
feet = 4.58% park land
10 to 19 dwelling units per acre = 5.79%
park land
20 to 29 dwelling units per acre = 9.3% park
land
30 to 39 dwelling units per acre = 12.56%
park land
40 to 49 dwelling units per acre = 15.58%
park land
50 to 59 dwelling units per acre = 18.4%
park land
60 to 69 dwelling units per acre = 21.05%
park land
70 to 79 dwelling units per acre = 23.4%
park land
80 to 89 dwelling units per acre = 25.85%
park land
15 Developer Impact Fees (continued)
Description Fee
90 to 99 dwelling units per acre = 28% park
land
100 dwelling units per acre and larger
=29.07% park land
Art In-Lieu Fee 1.25% of the total project valuation
Drainage Fee
North Local Drainage Area None
West Local Drainage Area None
Central Local Drainage Area
Dwelling, single-family The lessor of (a) $9,483 per dwelling or (b) $15,098 per gross acre prorated on the total
area of the lot.
Dwelling, two-family or multi-family The lessor of (a) $7,111 per dwelling or (b) $15,098 per gross acre prorated on the total
area of the lot.
Commercial, industrial $15,098 per gross acre prorated on the total area of the lot.
Housing In-Lieu Fee
Affordable Unit $348,197 per unit
Rental Affordable Unit $247,317 per unit
Converted or Demolished Residential Unit $221 per square foot 16 Sewer Connection Fee
The City’s sewer connection fee is applicable to all new residential, commercial, and industrial additions of 500 square feet and over as follows:
Fee
Single Family $4,722 per dwelling unit
$215 per 100 square feet
Multi-Family:
Condominiums $4,644 per dwelling unit
Apartments (2 units) $4,171 per dwelling unit
Apartments (3+ units) $3,827 per dwelling unit
Commercial: $4,722 per EDU* (as calculated below):
Light Strength EDUs= est. gpd**/(175 x 0.69)
Medium Strength EDUs= est. gpd**/(175 x 0.69)
Heavy Strength EDUs= est. gpd**/(175 x 0.69)
Hotel and Motel Units $1,500 plus $150 per 100 square feet of floor area per unit. Minimum $4,375
Car Wash $17,190 per connection
$8,590 per connection
Restaurants $2,970 plus $210 per 100 square feet of
floor area
Industrial $2,970 plus $210 per 100 square feet of
floor area
* = EDU = Equivalent Dwelling Unit
** = Applicant's estimated gallons per day of indoor water use.
Accessory Dwelling Units and
Additions/Remodels
Description
Car Wash which recycles 50% or
more water utilized on the operation
17 Park and
Recreation Housing Sewer
Library Parking In-Lieu Dedication In-Lieu Art In-Lieu Drainage In-Lieu Connection Impact Fee Certification Fee Impact Fee Impact Fee Impact Fee Impact Fee Fee (Fund 110) (Fund 120) (Fund 122) (Fund 123) (Fund 124) (Fund 127) (Fund 137/637) Beginning Fund Balance 06/30/24 83,480.00 $ $ 1,010.22 $ 130,771.28 $ 395,790.59 $ 779,989.87 83,191.12 $ - $ Revenues
Developer Fees 200.00 - 104,502.53 - - - -
Sewer Connection Fees - - - - - 160,222.65 -
Interest Income - 28.00 2,886.46 12,828.34 2,306.14 21,622.12 -Other Revenue - - - 14,000.00 - - - Total Revenues 200.00 28.00 2,886.46 131,330.87 2,306.14 21,622.12 160,222.65 Expenditures
59616 Transfers out to CIP (NOTE 3) - - 86,600.00 - - - - 72085 Digital Research and Marketing - - - 29.00
72106 Public Art Projects - - - 24,283.00
C2112 Pipeline Rehab (Zone 5) - - - - - 160,222.65 -
Total Expenditures - - 86,600.00 24,312.00 - 160,222.65 - Ending Fund Balance (A) 06/30/25 83,680.00 $ $ 1,038.22 $ 47,057.74 $ 502,809.46 $ 801,611.99 85,497.26 $ - $ Five-Year Revenue Test:
Fiscal Year 2020/21 $ 6,400.00 $ 13.00 $ 9,340.00 $ 32,878.92 $ 1,077.00 $ 87,168.83 Fiscal Year 2021/22 1,200.00 10.00 6,978.00 10.00 804.00 3,830.97Fiscal Year 2022/23 800.00 12.00 1,825.00 71,596.84 986.00 3,334.46 Fiscal Year 2023/24 800.00 18.00 44,127.12 106,399.38 1,516.00 31,703.42Fiscal Year 2024/25 200.00 28.00 2,886.46 117,330.87 2,306.14 21,622.12 Total Revenue Received for Five-Year Period Ended 6/30/2025 (B) $ 9,400.00 $ 81.00 $ 65,156.58 $ 328,216.01 $ 6,689.14 $ 147,659.80 Development Impact Fees
CITY OF LAGUNA BEACH
Development Impact Fees/Sewer Connection Fees
Pursuant to Government Code Sections 66006 and 66013
as of June 30, 2025
Financial Summary Report of
7 18
Park and
Recreation Housing Sewer
Library Parking In-Lieu Dedication In-Lieu Art In-Lieu Drainage In-Lieu Connection Impact Fee Certification Fee Impact Fee Impact Fee Impact Fee Impact Fee Fee (Fund 110) (Fund 120) (Fund 122) (Fund 123) (Fund 124) (Fund 127) (Fund 137/637) Development Impact Fees
CITY OF LAGUNA BEACH
Development Impact Fees/Sewer Connection Fees
Pursuant to Government Code Sections 66006 and 66013
as of June 30, 2025
Financial Summary Report of
Unexpended Impact Fees and Interest in Excess of Total Receipts for Last Five Years (A) Less (B) $ 957.22 74,280.00 $ - $ 174,593.45 $ 78,808.12 $ 653,952.19 $ Committed to Capital Projects - Fiscal Year 2025/26 $ - -$ $ - -$ -$ -$ Amount in Excess of Allowed Deposit $ 74,280.00 $ 957.22 $ 174,593.45 - $ $ 653,952.19 78,808.12 $ Notes:
(2) - Fees have not been committed to a future project as of June 30, 2025, because the City is still accumulating sufficient revenue to fund the cost of new facilities.(1) - The five-year revenue test is met in accordance with Government Code Section 66001(d).(3) - The transfer to the Capital Improvement Fund (#616) was made to fund the Main Beach Park Renovation Project (C2004). (Refer to page 9 of this report.) 8 19
NOTE TO THE DEVELOPMENT IMPACT FEE REPORT
The note addresses an item required by California Government Code Section 66006 (b).
Note 1 – Refund of Developer Fee
At this time, all fees being collected pursuant to the DIF program have been earmarked for current or future capital projects necessary to maintain the current levels of services within existing service areas to serve new development.
20 DEVELOPMENT IMPACT FEE AND SEWER CONNECTION FEES PROJECT
IDENTIFICATION
The DIF projects identification table illustrates the following reporting requirements defined by California Government Code Section 66006 (b):
• An identification of each public improvement on which fees were expended and the amount of expenditures on each improvement, including the total percentage of the cost of the public improvement that was funded with fees.
• An identification of an approximate date by which the construction of the public improvement will commence if the local agency determines that sufficient funds have been collected to complete financing on an incomplete public improvement.
SEWER CONNECTION FEES PROJECT IDENTIFICATION
The Sewer Connection Fee projects identification table illustrates the following reporting requirements defined by California Government Code Section 66013 (d):
• An identification of each public improvement on which fees were expended and the amount of expenditures on each improvement, including the total percentage of the cost of the public improvement that was funded with fees.
• An identification of each public improvement that is anticipated to be undertaken in the following fiscal year.
21 Estimated Estimated Budget Actual % Funded
Completion Project Through Through with Development
Project No. Project Name Project Phase Date Cost 6/30/2025 6/30/2025 % Complete Impact Fees Park and Recreation Dedication In-Lieu Fee Impact Fee (Fund 122) C2004 Main Beach Park Renovation Construction January 2026 1,642,365 $ 86,600$ $ 86,600 86.3% 5.3%
CITY OF LAGUNA BEACH
Development Impact Fees Project Identification
Fiscal Year Ended June 30, 2025
Development Impact Fees
11 22
Estimated Estimated % Funded
Completion Project with Sewer
Project No. Project Name Project Phase Date Cost Budget Actual % Complete Connection Fees Fiscal Year 2024/25
C2112 Pipeline Rehab (Zone 5) Completed April 2025 $ 166,164 $ 160,223 $ 160,223 100.0% 96.4% Project Planned for Fiscal Year 2025/26
C1807 Anita St Lift Station Reconstruction
CITY OF LAGUNA BEACH
Sewer Connection Fees Project Identification
Fiscal Year Ended June 30, 2025
Sewer Connection Fee Portion
12 23