City of National City
Development Impact Fees
Annual Report for Fiscal Year 2022-23
Development Impact Fees FY 2022-23
City of National City
2 BACKGROUND
In 2005, based on a study completed for the City by MAXIMUS, Inc. and Tischler & Associates, the City Council adopted Resolution No. 2005-17, which established fees to be charged on new development in order to defray all or a portion of the cost of public facilities related to the development project. These fees are known as development impact fees (DIFs) and are permitted pursuant to the California Government Code beginning with Section 66000 (known as the Mitigation Fee Act). Pursuant to that resolution, the City collects impact fees for Police, Fire, Library, and Park facilities. While fees may be adjusted periodically to reflect construction cost increases, the City has not changed its fees since they were first adopted in 2005. The fees for these four categories are as shown in Table A below.
In 2008, the City Council adopted Ordinance 2310, which added Section 4.52 to the National City Municipal Code (NCMC) to establish a transportation development impact fee (TDIF). This fee was adopted to comply with the San Diego Association of Government’s (SANDAG’s) Regional Transportation Congestion Improvement Program (RTCIP) that requires the City to charge the fee to maintain eligibility for TransNet sales tax funding for transportation projects. SANDAG conducted a region-wide study which serves as the basis for the fee that was initially established at $2,000 per new residential unit. It is updated annually in accordance with direction provided by SANDAG. As of July 1, 2023, the TDIF is $2,741.97 per residential unit. No fee is collected for non-residential development. While such a fee is provided for in the NCMC, its imposition has been suspended per section 4.52.090.
TABLE A: DEVELOPMENT IMPACT FEE SCHEDULE (non-transportation) Facility Type
Parks &
Recreation Library Fire/EMS Police Total
Residential Per Housing Unit
Single Family $858 $172 $126 $318 $1,474
Multi-Family (4 or greater) $692 $139 $102 $257 $1,190
Mobile Home/Other $849 $139 $124 $315 $1,427
Non-Residential Per 1,000 Square Feet/Per Room for Hotel Com/Shop Ctr 25,000 SF or less $1,009 $2,549 $3,558
Com/Shop Ctr 25,001 SF - 50,000 SF $809 $2,043 $2,852
Com/Shop Ctr 50,001 SF - 100,000 SF $652 $1,649 $2,301
Com/Shop Ctr 100,001 SF - 200,000 SF $530 $1,340 $1,870 General Office 10,000 SF or less $448 $1,133 $1,581
General Office 10,001 SF - 25,000 SF $400 $1,012 $1,412 General Office 25,001 SF - 50,000 SF $367 $929 $1,296
General Office 50,001 SF - 100,000 SF $332 $840 $1,172
Business Park $282 $713 $995
Industrial Park $195 $493 $688
Warehousing $113 $286 $399
Manufacturing $144 $366 $510
Lodging $107 $270 $377
Development Impact Fees FY 2022-23
City of National City
3 REPORTING
Government Code Section 66006 requires that an annual report be prepared regarding the collection and use of the fees. Fees collected must be spent in a timely manner. If fees are not spent within a period of 5 years, a report must be filed that provides an expenditure plan that justifies keeping revenues for a longer period.
HISTORICAL SUMMARY
Over the last eighteen years, for the four facility types shown in Table A, the City has collected a combined total of $4,063,939 in development impact fees of which $2,550,879 has been spent.
A summary of the total amount collected and spent by fiscal year is shown in Table B below followed by a graph (see Figure 1) that summarizes the revenues and expenditures by facility type. Tables C through F below break out the revenues and expenditures by year for those four facility types. The revenues and expenditures by year for the TDIF are shown in Table G below.
Ending balances for fiscal year 2022-23 are unaudited.
TABLE B: NATIONAL CITY DEVELOPMENT IMPACT FEES (non-transportation) –
SUMMARY
Beginning
Balance
Revenue Expenditure
s
Ending
Balance
%
Spent
FY 2004-05 0.00 174,369.00 0.00 174,369.00
FY 2005-06 174,369.00 154,490.36 0.00 328,859.36
FY 2006-07 328,859.36 190,084.36 191,033.99 327,909.73
FY 2007-08 327,909.73 148,834.00 0.00 476,743.73
FY 2008-09 476,743.73 139,018.00 0.00 615,761.73
FY 2009-10 615,761.73 633,499.80 90,000.00 1,159,261.53 FY 2010-11 1,159,261.53 59,712.20 0.00 1,218,973.73
FY 2011-12 1,218,973.73 141,374.00 139,299.05 1,221,048.68 FY 2012-13 1,221,048.68 94,827.00 193,406.38 1,122,469.30 FY 2013-14 1,122,469.30 56,444.00 39,759.95 1,139,153.35 FY 2014-15 1,139,153.35 310,408.00 7,386.00 1,442,175.35 FY 2015-16 1,442,175.35 52,457.20 1,105,060.00 389,572.55 FY 2016-17 389,572.55 188,141.00 238,174.81 339,538.74
FY 2017-18 339,538.74 426,242.80 294,289.04 471,492.50
FY 2018-19 471,492.50 85,196.00 54,223.00 502,465.50
FY 2019-20 502,465.50 617,415.00 198,247.00 921,633.50
FY 2020-21 921,633.50 130,566.00 0.00 1,052,199.50
FY 2021-22 1,052,199.50 311,414.99 0.00 1,363,614.49
FY 2022-23 1,363,614.49 149,445.25 0.00 1,513,059.74
Total 4,063,938.96 2,550,879.22 1,513,059.74 62.8%
Development Impact Fees FY 2022-23
City of National City
4 FEE METHODOLOGY
There are three (3) methods that were used to determine the fees collected by the City for the Police, Fire, Parks and Library facilities. Each method requires that the spending of funds received be restricted as follows:
1) Plan Based Impact Fees – used for new facilities that will be needed due to the increase in development.
2) Cost Recovery Impact Fees – used to pay for existing facilities where the new development benefits from the remaining capacity and useful life of the facilities. 3) Incremental Expansion Impact Fees – used for expanding existing facilities to serve new development
Fees for Police, Fire, Library, and Parks facilities were calculated using one or more of the methods above depending upon the purpose of the fees.
STATUS OF THE FEE PROGRAM
This section, by facility type, describes the purpose for the fees, provides a history of revenues and expenditures since inception, describes how the money has been spent, and discusses the plans for future spending.
POLICE IMPACT FEES
All three (3) methods were used to calculate Police impact fees. The purpose for the fees as determined in 2005 was to accumulate funding to assist with the cost of a new police substation in conjunction with a new fire station, recover a portion of the costs associated with the police headquarters building and pay for the incremental addition of police vehicles. Revenue and expenditures are detailed below:
Total Revenue
Total Expenditures
$-
$500,000
$1,000,000
$1,500,000
$2,000,000
POLICE FIRE PARKS LIBRARY
Total Revenue $1,315,987 $538,868 $1,796,830 $412,253
Total Expenditures $1,127,008 $285,292 $928,579 $210,000 FIGURE 1
Impact Fees by Type FY2005 - FY2022
Development Impact Fees FY 2022-23
City of National City
5 TABLE C: NATIONAL CITY POLICE DEVELOPMENT IMPACT FEES POLICE Beginning
Balance
Revenue Expenditure
s
Ending
Balance
%
Spent
FY 2004-05 0.00 37,620.75 0.00 37,620.75 100%
FY 2005-06 37,620.75 35,110.86 0.00 72,731.61 100%
FY 2006-07 72,731.61 90,523.08 0.00 163,254.69 100%
FY 2007-08 163,254.69 64,753.00 0.00 228,007.69 100%
FY 2008-09 228,007.69 60,274.00 0.00 288,281.69 100%
FY 2009-10 288,281.69 179,919.00 0.00 468,200.69 100%
FY 2010-11 468,200.69 25,025.00 0.00 493,225.69 100%
FY 2011-12 493,225.69 49,968.00 115,842.78 427,350.91 100% FY 2012-13 427,350.91 30,743.00 99,433.87 358,660.04 100% FY 2013-14 358,660.04 30,080.00 19,261.68 369,478.36 100% FY 2014-15 369,478.36 76,931.00 3,086.09 443,323.27 100% FY 2015-16 443,323.27 33,240.20 407,043.05 69,520.42 100% FY 2016-17 69,520.42 70,196.00 1,146.95 138,569.47 100% FY 2017-18 138,569.47 162,282.80 282,946.90 17,905.37 100% FY 2018-19 17,905.37 25,979.00 0.00 43,884.37 100%
FY 2019-20 43,884.37 191,468.00 198,247.00 37,105.37 81% FY 2020-21 37,105.37 36,899.00 0.00 74,004.37 0.0%
FY 2021-22 74,004.37 82,252.27 0.00 156,256.64 0.0%
FY 2022-23 156,256.64 32,722.54 0.00 188,979.18 0.0%
Total 1,315,987.50 1,127,008.32 188,979.18 85.6%
Revenue received from police impact fees since fiscal year 2004-05 totals $1,315,988, of which $1,127,008 has been spent. The current balance in the account is $188,979, all of which comes from fees collected within the last four fiscal years. The funds have been used to make improvements to the Police Department headquarters building and parking structure and to purchase certain vehicular equipment. The new substation has been on hold. The expectation in 2005 was that bonds would be issued by the City to build a new combination fire station and police substation, but a subsequent downturn in economic conditions dictated that those plans be delayed. Instead, the focus has been on improvements to the Police Department headquarters building and parking structure and the purchase of police vehicles to meet increased service demands. The City will continue to apply the revenues received in this account to similar purposes.
FIRE IMPACT FEES
The plan based and cost recovery methods were used to calculate Fire impact fees. The purpose of the fees was to assist with the funding of the relocation and expansion of Station 34, assist with the cost of a future new fire station and associated apparatus, and because of its citywide benefit, recover a portion of the capital costs related to Station 31. Revenue and expenditure details follow:
Development Impact Fees FY 2022-23
City of National City
6 TABLE D: NATIONAL CITY FIRE DEVELOPMENT IMPACT FEES
FIRE Beginning
Balance
Revenue Expenditure
s
Ending
Balance
%
Spent
FY 2004-05 0.00 14,933.75 0.00 14,933.75 100%
FY 2005-06 14,933.75 13,906.50 0.00 28,840.25 100%
FY 2006-07 28,840.25 35,910.28 0.00 64,750.53 100%
FY 2007-08 64,750.53 25,663.00 0.00 90,413.53 100%
FY 2008-09 90,413.53 23,867.00 0.00 114,280.53 100%
FY 2009-10 114,280.53 71,297.00 90,000.00 95,577.53 100% FY 2010-11 95,577.53 13,464.00 0.00 109,041.53 100%
FY 2011-12 109,041.53 19,085.00 15,620.02 112,506.51 100% FY 2012-13 112,506.51 23,271.00 89,678.76 46,098.75 100% FY 2013-14 46,098.75 11,909.00 0.00 58,007.75 100%
FY 2014-15 58,007.75 30,514.00 0.00 88,521.75 100%
FY 2015-16 88,521.75 13,037.00 29,561.73 71,997.02 11.3% FY 2016-17 71,997.02 27,806.00 6,208.27 93,594.75 0.0%
FY 2017-18 93,594.75 63,724.00 0.00 157,318.75 0.0%
FY 2018-19 157,318.75 10,293.00 54,223.00 113,388.75 0.0% FY 2019-20 113,388.75 76,997.00 0.00 190,385.75 0.0%
FY 2020-21 190,385.75 14,628.00 0.00 205,013.75 0.0%
FY 2021-22 205,013.75 33,046.73 0.00 238,060.48 0.0%
FY 2022-23 238,060.48 15,516.22 0.00 253,576.70 0.0%
Total 538,868.48 285,291.78 253,576.70 52.9%
Revenue received from fire impact fees totals $538,869, of which $285,292 has been spent on items including a fire hydrant, fire apparatus, and the acquisition of a trailer that was being leased for the Station 33 Squad Program that was set up in El Toyon Park to provide faster response times in the north-eastern portion of the City. The current balance in the account is $253,265, of which $150,169 is from fees paid over the last six fiscal years and $103,095 from the two years prior. The plans for a new fire station as envisioned in 2005 have been on hold. The expectation then was that bonds would be issued by the City to build a new combination fire station and police substation, but a subsequent downturn in economic conditions dictated that those plans be put on hold. Between fiscal years 2022-23 and 2023-24, the City’s budget allocates $200,000 in Fire DIF funds towards the design of a new multi-purpose facility and fire station in El Toyon Park.
Accumulated and future revenues from Development Impact Fees will provide a small portion of the funding for this future facility.
PARKS IMPACT FEES
Development Impact Fees FY 2022-23
City of National City
7 The incremental expansion method was used to calculate Park impact fees. The purpose of the fees was to pay for new improvements in existing parks and the expansion of existing recreation centers to provide additional capacity to accommodate new development. The funds cannot be used for replacement or maintenance of equipment or facilities. Revenue and expenditure details follow:
TABLE E: NATIONAL CITY PARKS DEVELOPMENT IMPACT FEES
PARKS Beginning
Balance
Revenue Expenditure
s
Ending
Balance
%
Spent
FY 2004-05 0.00 101,454.75 0.00 101,454.75 100%
FY 2005-06 101,454.75 87,864.00 0.00 189,318.75 100%
FY 2006-07 189,318.75 24,302.00 191,033.99 22,586.76 100% FY 2007-08 22,586.76 48,658.00 0.00 71,244.76 100%
FY 2008-09 71,244.76 45,714.00 0.00 116,958.76 100%
FY 2009-10 116,958.76 317,848.80 0.00 434,807.56 100%
FY 2010-11 434,807.56 6,363.20 0.00 441,170.76 100%
FY 2011-12 441,170.76 60,230.00 7,836.25 493,564.51 100% FY 2012-13 493,564.51 33,990.00 4,293.75 523,260.76 100% FY 2013-14 523,260.76 12,040.00 20,498.27 514,802.49 100% FY 2014-15 514,802.49 169,014.00 4,299.91 679,516.58 100% FY 2015-16 679,516.58 5,148.00 458,455.22 226,209.36 100% FY 2016-17 226,209.36 73,102.00 230,819.59 68,491.77
-
34.3%
FY 2017-18 68,491.77 166,744.00 11,342.14 223,893.63 0.0% FY 2018-19 223,893.63 40,744.00 0.00 264,637.63 0.0%
FY 2019-20 264,637.63 290,584.00 0.00 555,221.63 0.0%
FY 2020-21 555,221.63 65,822.00 0.00 621,043.63 0.0%
FY 2021-22 621,043.63 163,259.15 0.00 784,302.78 0.0%
FY 2022-23 784,302.78 83,947.84 0.00 868,250.62 0.0%
Total 1,796,829.73 928,579.12 868,250.62 51.7%
Since 2005 revenue received from park impact fees totals $1,796,830 of which $928,579 has been spent on improvements in El Toyon and Kimball parks. The current balance in the account is $868,250.62, of which $735,696 was received during the last five fiscal years and $132,555 dated from the two years prior. The fiscal year 2023-24 budget allocates a total of $776,576 to three projects: $200,000 towards the design of a multi-purpose facility/fire station at El Toyon Park, $103,230 towards construction of a dog park in Las Palmas Park, and $473,346 towards construction of a dog park and lighting improvements in Kimball Park. The remainder of the funds in this account, along with future receipts, will be used towards the construction of the multi-purpose facility and to make other improvements in the City’s parks.
LIBRARY IMPACT FEES
The plan based method was used to calculate Library impact fees. The purpose of the fees was to cover a portion of the costs of the planned construction of a replacement library that was to be twice the size of the then existing library. Outside sources paid for 65% of the construction costs, Development Impact Fees FY 2022-23
City of National City
8 leaving the City to cover the remaining share for which the City issued general obligation bonds in the amount of $5,970,000. Revenue and expenditure details are as follows:
TABLE F: NATIONAL CITY LIBRARY DEVELOPMENT IMPACT FEES
LIBRARY Beginning
Balance
Revenue Expenditure
s
Ending
Balance
%
Spent
FY 2004-05 0.00 20,359.75 0.00 20,359.75 100%
FY 2005-06 20,359.75 17,609.00 0.00 37,968.75 100%
FY 2006-07 37,968.75 39,349.00 0.00 77,317.75 100%
FY 2007-08 77,317.75 9,760.00 0.00 87,077.75 100%
FY 2008-09 87,077.75 9,163.00 0.00 96,240.75 100%
FY 2009-10 96,240.75 64,435.00 0.00 160,675.75 100%
FY 2010-11 160,675.75 14,860.00 0.00 175,535.75 100%
FY 2011-12 175,535.75 12,091.00 0.00 187,626.75 100%
FY 2012-13 187,626.75 6,823.00 0.00 194,449.75 100%
FY 2013-14 194,449.75 2,415.00 0.00 196,864.75 100%
FY 2014-15 196,864.75 33,949.00 0.00 230,813.75 38.7%
FY 2015-16 230,813.75 1,032.00 210,000.00 21,845.75 0.0% FY 2016-17 21,845.75 17,037.00 0.00 38,882.75 0.0%
FY 2017-18 38,882.75 33,492.00 0.00 72,374.75 0.0%
FY 2018-19 72,374.75 8,180.00 0.00 80,554.75 0.0%
FY 2019-20 80,554.75 58,366.00 0.00 138,920.75 0.0%
FY 2020-21 138,920.75 13,217.00 0.00 152,137.75 0.0%
FY 2021-22 152,137.75 32,856.84 0.00 184,994.59 0.0%
FY 2022-23 184,994.59 17,258.65 0.00 202,253.25 0.0%
Total 412,253.25 210,000.00 202,253.25 50.9%
Revenue received since inception from library impact fees totals $412,253 of which $210,000 has been spent on a portion of the costs to upgrade the National City Library. The current balance in the account is $202,253, of which $129,878 was received during the last five years and $72,375 over the three years prior. The upgrades included a new radio-frequency identification book delivery system, additional bookshelves and other enhancements. Furthermore, the City is evaluating projects that will enhance the Library’s ability to accommodate a growing number of users over the next five years, but as an alternative, will also be considering applying the revenues collected towards the annual debt service payments on the bonds. Because the bonds were issued as voter approved general obligation bonds, applying the Library DIF revenues to the debt service would reduce the amount of property tax revenues to be collected from property owners in National City.
TRANSPORTATION IMPACT FEES
The purpose of the transportation impact fee is to defray the costs of constructing planned transportation facilities to accommodate increased traffic generated by future development and Development Impact Fees FY 2022-23
City of National City
9 on improvements that expand capacity on the Regional Arterial System (RAS) as required by the TransNet Regional Transportation Congestion Improvement Program (RTCIP). Eligible projects include such things as road widening, roadway extensions, turning lanes, traffic signal coordination, freeway to arterial interchange improvements, railroad grade separations, and expanded regional express bus and rail transit service.
TABLE G: NATIONAL CITY TRANSPORTATION DEVELOPMENT IMPACT FEES Transportation Beginning
Balance
Revenue Expenditure
s
Ending
Balance
%
Spent
FY 2008-09 0.00 16,000.00 0.00 16,000.00 100%
FY 2009-10 16,000.00 359,560.00 0.00 375,560.00 100%
FY 2010-11 375,560.00 42,967.78 0.00 418,527.78 100%
FY 2011-12 418,527.78 155,777.41 0.00 574,305.19 100%
FY 2012-13 574,305.19 106,152.06 0.00 680,457.25 100%
FY 2013-14 680,457.25 38,766.64 0.00 719,223.89 100%
FY 2014-15 719,223.89 353,481.76 13,278.79 1,059,426.86 100% FY 2015-16 1,059,426.86 12,960.14 722,319.26 350,067.74 100% FY 2016-17 350,067.74 28,145.36 277,680.74 100,532.36 100% FY 2017-18 100,532.36 498,675.62 115,000.00 484,207.98 34% FY 2018-19 484,207.98 154,616.42 101,194.84 537,629.56 0.0% FY 2019-20 537,629.56 1,078,973.70 0.00 1,616,603.26 0.0% FY 2020-21 1,616,603.26 155,409.86 0.00 1,772,013.12 0.0% FY 2021-22 1,772,013.12 245,803.61 0.00 2,017,816.73 0.0% FY 2022-23 2,017,816.73 293,539.89 52,347.50 2,259,009.12 0.0% Total 3,540,830.25 1,281,821.13 2,259,009.12 36.2%
Revenue received since inception from transportation impact fees totals $3,540,830, of which $1,281,821 has been spent on the widening of Plaza Boulevard. The current balance in the account is $2,259,009, of which $1,928,344 was received during the last five years and $330,666 in the year prior to that. The entire TDIF balance has been appropriated for the “Mobility Enhancements” project, which includes upgrades and modifications to traffic signals and related infrastructure to address mobility efficiency along major transportation corridors on the regional arterial system.