Report to City Council
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TO: Mayor and City Council
FROM: Angelica Frausto-Lupo, Community Development
Director
AGENDA DATE: September 1, 2026
TITLE: MUNICIPAL CODE AMENDMENT (PEN26 -0090)
(REPORT OF: COMMUNITY DEVELOPMENT)
(DISTRICT: ALL DISTRICTS)
TITLE SUMMARY: Municipal Code Amendment To Amend Chapter 8.60 – Threatened And Endangered Species, Of The Moreno
Valley Municipal Code, To Adopt And Implement The
Updated 2026 Stephens’ Kangaroo Rat (SKR) Habitat
Conservation Plan Mitigation Fee Established By The
Riverside County Habitat Conservation Agency (RCHCA)
DISTRICT: All Districts
Recommendation(s)
That the City Council:
1. Find that the proposed amendment to the Moreno Valley Municipal Code is exempt from the California Environmental Quality Act in accordance with Section 15061(b)(3) of the CEQA Guidelines; and
2. Introduce (First Reading) Ordinance No. 2026 -XX and adopt (Second Reading) the same at a subsequent City Council meeting, adopting the Updated 2026 Stephens' Kangaroo Rat (SKR) Habitat Conservation Plan Mitigation Fee established by the Riverside County Habitat Conservation Agency (RCHCA) and adopting the findings required by Government Code section 66001, incorporating the RCHCA Nexus Study by reference.
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SUMMARY
On July 9, 2026, the Riverside County Habitat Conservation Agency (RCHCA) approved an updated fee schedule for the Stephens’ Kangaroo Rat Habitat Conservation Plan (SKR HCP) based on the finding of a 2026 Nexus Fee Study (“Nexus Study”). The Nexus Study determined that the existing $500-per-gross-acre mitigation fee, which has remained unchanged since 1996, no longer generates sufficient revenue to support administration, biological monitoring, reserve management, and other HCP implementation requirements.
Adoption of the proposed Ordinance will implement RCHCA’s updated mitigation fee of $900 per gross acre for applicable development within the City. However, for single family residences on a single legally created lot, a Mitigation Fee of $250.00 shall be paid; and for agricultural development which requires a development permit, a Mitigation Fee of $500 per gross acre shall be paid. The adjustments will ensure that new development continues to contribute its proportional share of the costs associated with mitigati ng impacts to SKR habitat and maintaining the regional incidental take authorization. The updated fee schedule and supporting analysis are summarized below and provided in the RCHCA SKR HCP Nexus Study (Exhibit A).
DISCUSSION
The City of Moreno Valley, together with the cities of Corona, Hemet, Lake Elsinore, Murrieta, Perris, Riverside, and Temecula, and the County of Riverside, have formed the RCHCA to plan for, acquire, administer, operate, and maintain land and facilities for ecosystem conservation a nd the creation of habitat reserves to implement habitat and ecosystem conservation plans and programs for the species of concern.
The Stephens’ Kangaroo Rat Habitat Conservation Plan (SKR HCP) streamlines project approvals by establishing a regional inci dental take authorization, eliminating the need for costly, project -specific negotiations with wildlife agencies. To fund this program, the City collects mitigation fees from developers prior to issuing grading permits and remits them in full to the RCHCA. Because these funds are completely passed through the City to the RCHCA, implementing the updated fee schedule creates zero fiscal impact on the City’s general fund.
The SKR mitigation fee was set at $1,950 per acre in 1988 and reduced to $500 per gross acre in 1996 following adoption of the SKR HCP. The fee has not been increased or adjusted for inflation since then. According to RCHCA’s analysis, the fee would have reached approximately $995 per acre by 2024 if it had been adjusted annually for inflation using the Consumer Price Index (CPI). Consequently, the current fee does not reflect the current cost of implementing the SKR HCP.
The mitigation fee is collected from development within the SKR Fee Area to offset impacts from the loss of SKR habitat. Fee revenue supports the activities necessary
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to implement the HCP, including administration, biological monitoring, reserve management, insurance, and consulting services. These activities also support the regional incidental take authorization, which allow s qualifying development projects within the plan area to proceed without separate project -specific authorization from the wildlife agencies.
Based on historical development activity and regional projections, the Nexus Study estimated an average of 1,770 g ross acres of new development annually. Dividing the annual funding requirement by the projected acreage yields a fee of $900 per gross acre. The Nexus Study also recommends annual CPI adjustments and a comprehensive review of the fee every five to eight years, or sooner if implementation costs or development activity change significantly, to maintain adequate funding for the HCP.
After the required public review period, the RCHCA Board of Directors approved the updated fee schedule on July 9, 2026. The City’s current fee and the approved rate adjustment for the development categories listed below are shown in the table below.
Additional information on the fee update and Nexus analysis is provided in Exhibit A.
SKR MITIGATION FEE
Fee Category Current Fee Proposed Fee
Residential
$500 / acre $900 / acre
Residential Affordable $500 / acre $900 / acre
Residential Accessory Dwelling Unit (ADU) $500 / acre $900 / acre Non-Residential – General Commercial $500 / acre $900 / acre Non-Residential – Regional Commercial $500 / acre $900 / acre Non-Residential – Office $500 / acre $900 / acre
Non-Residential – Industrial $500 / acre $900 / acre
Non-Residential – High-Cube $500 / acre $900 / acre
Individual Single-Family Home Construction (Single Lot) $250 flat fee $250 flat fee Agricultural $100/acre $500/acre
If adopted, the proposed Ordinance will formally implement the updated SKR HCP mitigation fee within the City. The fee adjustment will take effect 60 days after adoption of the Ordinance.
ENVIRONMENTAL
The proposed Municipal Code Amendment (PEN26-0090) is exempt from the California Environmental Quality Act in accordance with Section 15061(b)(3) of the CEQA Guidelines in that the amendments involve general policy and procedure making, and it can be seen with certainty that there is no possibility that the amendments will have a significant effect on the environment.
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ALTERNATIVES
1. Approve the proposed Resolution and implement the automatic increase to the SKR HCP fees. Staff recommends this alternative because it is consistent with the City’s approved agreements pertaining to the RCHCA.
2. Do not approve the proposed Resolution. Staff does not recommend this alternative because it w ould be inconsistent with agreements related to the RCHCA and would create a potential financial liability for the City.
FISCAL IMPACT
No fiscal impacts are anticipated from the approval and adoption of the proposed Ordinance. The SKR HCP mitigation fees are paid by the Applicant and/or Developer to the City prior to the issuance of a grading permit and are then remitted to the RCHCA.
NOTIFICATION
The proposed Municipal Code Amendment (PEN26-0060) is City-wide. A public hearing notice for the proposed Municipal Code Amendment was published in the Press - Enterprise newspaper on July 31, 2026, and sent to a list of interested parties. In addition, Project materials were posted to the City’s website ( http://www.moreno- valley.ca.us/cdd/documents/about-projects.html) thirty (30) days prior to the scheduled public hearing.
PREPARATION OF STAFF REPORT
Prepared By: Concurred By:
Rachel Ramirez Regine Kennedy
Management Analyst Principal Planner
Concurred By: Department Head Approval:
Sergio Madera Angelica Frausto-Lupo
Planning Division Manager Community Development Director
CITY COUNCIL GOALS
Advocacy: Develop cooperative intergovernmental relationships and be a forceful advocate of City policies, objectives, and goals to appropriate external governments, agencies and corporations.
CITY COUNCIL STRATEGIC PRIORITIES
1. Economic Development
2. Public Safety
3. Library
4. Infrastructure
5. Beautification, Community Engagement, and Quality of Life
6. Youth Programs
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Report Approval Details
Document Title: STAFFREPORT_CDD_SKR-
HCP_MITIGATION_FEE_INCREASE.docx
Attachments: - Attachment A to Ordinance No. 2026-XX.docx - Ordinance No. 2026-XX to SKR-HCP.doc
- Exhibit A_RCHCA SKR HCP Nexus Study.pdf
Final Approval
Date:
Aug 26, 2026
This report and all of its attachments were approved and signed as outlined below:
Angelica Frausto-Lupo
Sean Kelleher
Anna Chacon
Felicia London, MPA
Launa Jimenez
Brian Mohan
Patty Rodriguez