PREPARED BY: Nicolle Burnham, Parks and Public Works Director Gabrielle Whelan, Town Attorney
Reviewed by: Town Manager, Assistant Town Manager, Town Attorney, and Finance Director 110 E. Main Street Los Gatos, CA 95030 ● (408) 354-6832 www.losgatosca.gov
TOWN OF LOS GATOS
COUNCIL AGENDA REPORT
MEETING DATE: 04/02/2024
ITEM NO: 17
ADDENDUM
DATE: April 1, 2024
TO: Mayor and Town Council
FROM: Laurel Prevetti, Town Manager
SUBJECT: Receive a Report on the Transportation Impact Fee and Provide Direction REMARKS:
Attachment 3 contains public comment received before 11:01 a.m. on Monday, April 1, 2024.
Attachments Previously Received with the Staff Report:
1. Asset Based Transportation Impact Fees in California (Partial List)
2. Summary of Alternatives
Attachment Received with the Addendum:
3. Public Comment received before 11:01 a.m. on Monday, April 1, 2024.
ATTACHMENT 3
From: Phil Koen
Sent: Saturday, March 30, 2024 10:13 AM
To: Mary Badame <[email protected]>; Matthew Hudes <[email protected]>; Rob Rennie <[email protected]>; Rob Moore <[email protected]>; Maria Ristow <[email protected]>
Cc: Laurel Prevetti <[email protected]>; Gabrielle Whelan <[email protected]>; Wendy Wood <[email protected]>
Subject: Agenda Item # 17 - public comment
[EXTERNAL SENDER]
Dear Honorable Mayor and Members of the Town Council,
I recommend the Town Council repeal the ac�ons taken on January 16, 2024, and redo the Nexus Study by adop�ng Op�on #3. The Nexus Study is fatally flawed in that it does not provide any reasonable alloca�on of future infrastructure investment to new development based on a nexus finding that establishes a reasonable rela�onship according to need, benefit, and
propor�onality.
A traffic impact fee can only be used to mi�gate the impacts of new development on facili�es or infrastructure and can only be spent on capital projects that improve or expand facili�es to accommodate growth in service demand from new
development. Fee revenues cannot be used for rehabilita�on unless related to a major capital project upgrade nor can they be used for maintenance or opera�ng costs. The Nexus study must allocate the fair share of facility costs to new
development. The study prepared for the Town fails to do this.
The major failing of the study is that it is purposely designed to “tax” new development to fund all the cost of certain
transporta�on projects the Town Council wishes to develop ATTACHMENT 3
over the next 20 years, regardless of whether they are truly required to accommodate growth. For example, State Route 17 Corridor Conges�on Relief Project accounts for $10.5m or 25% of the total new infrastructure investment listed in the Nexus study. The reason for this project was outlined in an October 4, 2023, Staff Report to the Town Council. The report stated, “the project was requested by the Town in an effort to improve traffic flow on Highway 17, discourage cut through traffic in Los Gatos, and improve pedestrian and bicycle safety along
Highway 9 near the on and off ramps to Highway 17”. These are largely exis�ng condi�ons with minimal rela�onship to
incremental impacts from future development. And yet 100% of the cost of this project was included in the TIF project cost summary.
Worse, when asked by the Town Council if this project could be removed from the list, Staff replied if the project is removed there would be no known funding source for the 10% Town match requirement for the Measure B Conges�on Management Funds. If removed, the impact fee in every land use category would be materially reduced. For example, the impact fee for mul�-family dwelling units would be reduced by 30% or $4,274 per dwelling unit. Based on this, the true intent of the Nexus Study was not to allocate the fair share of this project cost to new development but rather to allocate all the project cost to new development regardless of the true propor�onality. Simply put, the goal was to extract maximum fee revenue from new development regardless of true propor�onality.
ATTACHMENT 3
I would also request that the Town release to the public all documents received from the third party legal and technical advisers who reviewed the Nexus Study. I previously requested these documents and was informed by the Town Atorney that “atorney-client privileged informa�on on this topic has been provided to the Town Council. Staff an�cipates sharing public informa�on at a future Town Council mee�ng”. There is no reason to withhold these documents from the public given the importance of this analysis and the public good that would come from sharing this informa�on.
One last comment I would respec�ully request the Council to consider. When the Nexus Study was discussed at the January 16, 2024 Town Council mee�ng, one member of the Town
Council though�ully suggested the Nexus Study be reviewed by the Finance Commission. This sugges�on was not accepted by a majority of the Council members for reasons that are s�ll not en�rely clear. In retrospect, this was unfortunate because of where we now find ourselves.
I am poin�ng this out because the role of the Finance
Commission is to independently advise the Council on
important financial issues. The Commission is capable and willing to act as an independent advisor to the Town Council, if requested. A nexus study is a technical document and needs to be a well-organized and factually correct report that can be relied upon when making the required findings in accordance with the relevant sec�ons of the Government Code. This report has severe shortcomings which could have been pointed out to ATTACHMENT 3
the Town Council if the Finance Commission had been engaged.
I would encourage the Town Council to honor the people’s wishes when they approved the Finance Commission and ask for the commission’s input before making cri�cal financial