22 October 6, 2026
Honorable Mayor and City Council
City of Long Beach
California
RECOMMENDATION:
Recommendation to receive and file a presentation on development impact fees, the status of the Long Beach Development Impact Fee Nexus Study and next steps. (Citywide)
DISCUSSION
The City of Long Beach (City) collects Development Impact Fees (Impact Fees) to ensure that new development pays its fair share for the public facilities and infrastructure needed to serve additional residents and employees. Impact Fees must be assessed proportionally to the impact of new development and cannot be used for operational costs, maintenance, or to address existing deficiencies. The application of Impact Fees and the eligible uses are subject to several key regulations, including the California Mitigation Fee Act (AB 1600), adopted in 1987 and codified under California Government Code Section 66000 et seq., and Assembly Bill 602 (AB 602). Collectively these regulations require the City to prepare and adopt a comprehensive, datadriven Nexus Study codifying that the Impact Fee program includes required findings related to the purpose and use of fees and that the calculations used in determining fee levels include provisions affirming the connection between proposed fees and need. These provisions include:
• Adoption of a Capital Improvement Plan identifying the type of projects that will provide additional capacity to serve new development;
• Explanation of Level of Service describing the standards and goals for future need; and • Assessment of residential fees in proportion to unit size (i.e. by square foot.) The City’s current Impact Fees are outdated and based on various individual nexus studies that were adopted between 1989-2006. Since that time, the City has made updates to many foundational policy documents including the Land Use, Urban Design, and Housing Elements of the General Plan, which provide more up to date information on the anticipated growth expected through 2040. The City engaged the services of a consulting firm, Economic & Planning Systems, Inc. (EPS), with support from Fehr & Peers, to prepare a single, comprehensive Nexus Study to align the Impact Fee program with the growth projections in the City’s updated General Plan elements, to enhance consistency between the fees, and to adopt new requirements set by AB 602. The Nexus Study identifies facility needs, cost estimates, service population growth, and the fee calculations necessary to support a legally defensible update to the Impact Fees for the following: (1) Parks and Recreation Facilities, (2) Police Facilities, (3) Fire Facilities, and (4) Transportation Improvement.
Community Development
411 West Ocean Boulevard, 3rd Floor, Long Beach, CA 90802 (562) 570-5237
Honorable Mayor and City Council
October 6, 2026
Methodology
The prepared Nexus Study will be available for public review at https://longbeach.gov/lbcd/feeschedules/#dif following this presentation, starting October 7, 2026. The Nexus Study identifies the maximum allowable development impact fees by: (1) estimating population and employment growth and density forecasts through 2040 by using General Plan data, augmented by projections from the California Department of Finance; (2) estimating the amount and cost of capital infrastructure and facilities needed to serve this growth; and (3) calculating the maximum allowable Development Impact Fees by land use type. The estimates produced a combined adjusted service population growth of 44,144, which is an 8 percent growth over existing conditions.
The cost of new capital infrastructure and facility needs is based on the level of service provided for each impact fee category. To accommodate new growth and maintain the City’s existing service level of 3.04 acres of parkland per 1,000 service population, the City will require approximately $162.1 million, including a 2-percent administrative charge, to fund the acquisition and development of new parkland, new community and cultural facilities, new pool facilities, and park improvements that expand capacity. The total cost attributable to growth for police and fire facilities is $110.4 million, inclusive of a 2-percent administrative charge, which will support facility expansion as well as the purchase of new vehicles and equipment needed to serve additional development. Transportation project needs total $1.53 billion, with $122.7 million attributable to new growth, including a 2-percent administrative charge. Transportation impact fees are necessary to offset the cost of roadway expansions, intersection improvements, and multimodal transportation investments that are essential to support anticipated growth and advance goals related to accessibility, safety, alternative transportation, reduced greenhouse gas emissions, and long-term system sustainability.
Impact Fee Policy Considerations
While a nexus study calculation provides the maximum allowable development impact fees and ensures that rates are legally defensible within the guardrails established by the Mitigation Fee Act and AB 602, there are further factors that agencies weigh when establishing fee amounts. Higher fees can dampen investment and conflict with other priorities, especially those related to housing development. Therefore, agencies set rates in a manner that strikes an appropriate equilibrium between cost recovery, maintaining competitiveness with neighboring cities, and supporting broader policies that promote housing production and economic development. These factors and considerations will be included with and discussed when the City Council is asked to consider adopting the report and revised fee amounts when the Nexus Fee Study returns with a formal hearing item. The hearing item will discuss the need to balance the revenue generated by these fees with the need for a healthy, competitive development environment and will include a policy recommendation that ensures that impact fees in Long Beach are competitive with others in the region while also supporting funding for long-term infrastructure needs tied to development.
Another consideration often included as part of impact fees nexus studies is the rising cost of infrastructure over time due to inflation. Agencies have addressed this issue through several approaches including tying an increase in impact fees to inflationary factors and/or by using phased-in fee increases strategically to promote development. The future hearing will include Honorable Mayor and City Council
October 6, 2026
City staff’s recommendations relative to the appropriate policy approach for this issue.
Next Steps
Today’s action is a recieve and file presentation on development impact fees and background on the Long Beach Nexus Fee Study to proactively prepare the City Council and public for the upcoming hearing on the adoption of the Nexus Study and setting of new Impact Fee rates.
Today’s item does not formally present or adopt the study, its Capital Improvement Plan, or change existing Impact Fee levels. Staff will return on November 10, 2026, to conduct a public hearing to adopt the Nexus Study and proposed fee changes pursuant to California Government Code section 66016.5. The community will be notified of this hearing in compliance with requirements of the Mitigation Fee Act. If approved at that time, the proposed fees adopted by the City Council will take effect 60 days after approval, but no sooner than January 10, 2027.
This matter was reviewed by Principal Deputy City Attorney Erin Weesner-McKinley on September 22, 2026, and by Budget Analysis Officer Greg Sorensen on September 17, 2026.
TIMING CONSIDERATIONS
City Council action is requested on October 6, 2026, to ensure sufficient notice to make the Nexus Study and proposed fee adjustments available for public input for 30 days prior to a public hearing on November 10, 2026.
FISCAL IMPACT
This item does not generate a fiscal impact. Potential fiscal impacts may result from fee changes and discussion of those impacts will be included when the Nexus Study and fee resolution are presented to City Council on November 10, 2026. This recommendation will have no staffing impacts beyond the budgeted scope of duties and is consistent with existing City Council priorities.
SUGGESTED ACTION:
Approve recommendation.
Respectfully submitted,
Christopher Koontz
Director
Community Development