Agenda packet — Newark City Council, December 14, 2023 (part 2 of 5)

City of Newark DIF Five Year Report as of June 30, 2023___________________________________________________

SUMMARY OF REVENUES AND EXPENDITURES
The schedule on the next page is divided vertically into two major sections: Revenues and Expenditures. The Revenue section shows the DIF collections by fiscal year and the interest assigned to the fee balance.

The Expenditures section shows the project costs assigned to that year’s revenues.

These costs are the “row” totals from the bottom section of the prior schedule. The expenditure section aims to show when a year’s DIFs were spent to show compliance with the Mitigation Fee Act and AB-602.

FINDINGS
Findings are presented in each DIF section and summarized at the beginning of this report.
1) Given the length of time between the last DIF update, the City Council should consider an update to the Nexus Report and DIFs.
2) RCS recommends creating a separate Park DIF for fees that meet the requirements of the Quimby Act. The fees for the Quimby Act should be kept in a separate fund from revenue generated by the Mitigation Fee Act. Revenue from the Quimby Act is unique from all other DIFs in that the revenue can be used for the rehabilitation of existing parks.
3) Based on this 5-Year Report, it is clear that Park DIFs have been committed or spent within the five-year period required by law.

Page 46 ends

PRIOR OTHER DIF/ AVAILABLE
FISCAL YEAR BALANCE DIF NON-DIF REV. INT/TSFR IN TOTAL OUTLAY TSFR OUT TOTAL BALANCE 2017-18 $ 5,725,974.07 $ 382,510.00 $ - $ 382,510.00 $ 64,057.59 $ - $ 64,057.59 $ 6,044,426.48 2018-19 $ 6,044,426.48 $ 308,596.00 $ - $ 362,522.00 $ 671,118.00 $ 2,615,361.34 $ - $ 2,615,361.34 $ 4,100,183.14 2019-20 $ 4,100,183.14 $ 596,187.00 $ - $ 596,187.00 $ 3,949,156.04 $ - $ 3,949,156.04 $ 747,214.10 2020-21 $ 747,214.10 $ 2,874,676.96 $ - $ 10,800.06 $ 2,885,477.02 $ - $ - $ - $ 3,632,691.12 2021-2022 $ 3,632,691.12 $ 1,799,853.57 $ - $ 12,573.80 $ 1,812,427.37 $ - $ - $ - $ 5,445,118.49 2022-2023 $ 5,445,118.49 $ 261,100.00 $ 99,988.00 $ 361,088.00 $ - $ - $ - $ 5,806,206.49 SUMMARY $ 5,725,974.07 $ 6,222,923.53 $ - $ 485,883.86 $ 6,708,807.39 $ 6,628,574.97 $ - $ 6,628,574.97 $ 5,806,206.49

REVENUES EXPENDITURES
FROM FY 2017-2018 THROUGH 2022-2023

CITY OF NEWARK

SUMMARY OF DEVELOPMENT IMPACT FEE REVENUES & EXPENDITURES BY
PARK IMPACT FEE (624) FUND

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APPENDICES

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APPENDIX A
RESOLUTION NO. 11,555
RESOLUTION NO. 11,555

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

NEWARK AMENDING THE MASTER FEE SCHEDULE FOR
FISCAL YEAR 2024
WHEREAS, the City Council of the City of Newark is authorized to prescribe and establish fees in regard to services or functions performed by the City for the public in a governmental and proprietary capacity; and
WHEREAS, the City Council desires to update currently established fees to cover inflation and City costs, which form the basis for the changes; and WHEREAS, a public hearing has been noticed and held in accordance with Government Code Sections 6062a, 66016, 66017 and 66018; and
WHEREAS, the City Council of the City of Newark has, from time to time, established fees by resolution for services as authorized pursuant to the Newark Municipal Code, most recently on May 26, 2022 by Resolution No. 11,354.

NOW, THEREFORE, BE IT RESOLVED that the City Council does hereby amend those portions of the City of Newark Master Fee Schedule as set forth in Exhibit "A," attached hereto and incorporated herein by this reference and made part hereof as though set forth at length for Fiscal Year 2024.

BE IT FURTHER RESOLVED that the amendments to the City of Newark Master Fee Schedule will not become effective until 60 days after adoption of this Resolution.

I HEREBY CERTIFY the foregoing resolution was introduced at a regular meeting of the City Council of the City of Newark held on July 27, 2023, by Council Member Freitas who moved its adoption and passage, which motion was carried after being duly seconded, and passed by the following vote:

AYES: Council Members Bucci, Freitas, Jorgens, Vice Mayor Collazo and Mayor Hannon
NOES: None
ABSENT: None
SECONDED: Vice Mayor Collazo
<
City Clerk
APPROVED AS TO FORM:
y��
KRISTOPHER J. KOKOTA YLO
City Attorney
Resolution No. 11,555
APPROVED: �it��
Mayor
2 City of Newark
Master Fee Schedule - Effective August 11 2023

EXHIBIT A

SUMMARY OF PROPOSED CHANGES
V. CONSTRUCTION ENTERPRISE FUND
- The proposed adjustments increase the Park Impact, Capital Facilities, Community Service/Facilities, Transportation, and Housing Impact Fees by 1.8% based on the Engineering News Record Construction Cost Index per Resolutions, 10,505, 10,633, 10,634, 10,635 and 10,184, respectively.

Enterprise Fund Account Description Fee
- Cost Center No. (in dollars)
V. CONSTRUCTION ENTERPRISE FUND
A. DEVELOPMENT
624.00.000.000 4143 2. Park Impact Fee **
a. Projects without Land Dedicated for Parks
(1) Single-Family
31,130.44/dwelling unit
(2) Multi-Family Units
22,414.32/dwelling unit
b. Projects that Dedicate Land for Parks
(1) Single-Family 9,±-74 9,339.13/dwelling
unit
(2) Multi-Family Units 6;483 6,599.69/dwelling
unit
** Established by Resolution No. 10,132 and amended by Resolution 10,505.

The above fees are effective as of August 8, 2016. Resolution 10,505 also requires the fee to be adjusted annually by the Engineering News Record Construction Cost Index, San Francisco, California.
620.00.000.000 4144 3. Capital Facilities *
a.
621.00.000.000 4144 b.

A. DEVELOPMENT, Continued
622.00.000.000 4144 C.

City of Newark
37101 Newark Boulevard, Newark, CA 94560-3796
(510) 578-4000
Public Safety 1
(1) Single-family residential �,298/unit
(2) Townhome 4,�,298/unit
(3) Multi-family residential � 2,578.59/unit
(4) Office/Commercial .,.74-. 75/square foot
(5) Manufacturing/Research & Development .,.3.1.32/square foot (6) Warehousing/Distribution -:G± .62/square foot
Community Service/Facilities 1
(1) Single-family residential � 2,877.89/unit
(2) Townhome � 2,877.89/unit
(3) Multi-family residential 1,4±4 1,439.45/unit
(4) Office/Commercial �1.07 /square foot
(6) Warehousing/Distribution M .45/square foot
Transportation 1
(1) Single-family residential &;-084 6,193.51/unit
(2) Townhome �3,219.93/unit
�
Enterprise Fund Account Description Fee
- Cost Center No. (in dollars)
(3) Multi-family residential �3,839.90/unit
(4) Office/Commercial ➔.J9 5.49/square foot
(5) Manufacturing/Research & Development b% 3.00/square foot (6) Warehousing/Distribution � 6.00/square foot
* Established by Resolution No. 8051 and amended by
Resolutions No. 9253, 10,6331
, 10,6341
, and 10,6351
623.00.000.000 4144 4. Housing
a.
b.

City of Newark
37101 Newark Boulevard, Newark, CA 94560-3796
(510) 578-4000
Residential Housing Impact Fee* (revised annually)
{l) First 1,000 sq. ft. floor area/unit** � 24.95/square foot (2) All sq. ft. over 1,000 sq. floor area/unit � 10.00/square foot * Established by Resolution No. 10,184. Floor area for a residential development equals the sum of the horizontal floor areas of a building measured from the exterior face of exterior walls or from the center line of a wall separating two buildings, excluding garages, carports, and common areas. ** No housing impact fee is charged for the first 200 sq. ft. of floor area for additions to existing dwellings.

Non-Residential Housing Impact Fee *** (revised annually) (1) Commercial 4.4Q 4.48/square foot
{2) Industrial � .84/square foot
*** Established by Resolution No. 8802. Floor area for a commercial development equals the sum of the horizontal floor areas of the a building measured from the exterior face of exterior walls or from the center line of a wall separating two buildings. Where no walls exist, the floor area is the area covered by the roof excluding two feet on each side of the structure. Outside areas used for sales or display (such as nurseries, building materials, auto sales, etc.) may be considered part of floor area when the community development director determines that the use of the outside area significantly contributes to the employee density of the building.

APPENDIX B
RESOLUTION NO. 8051
RESOLUTION NO. 8051

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

NEW ARK ESTABLISHING CAPITAL FACILITIES FEES UNDER

THE AUTHORITY OF NEW ARK MUNICIPAL CODE CHAPTER

3.24, AND AMENDING SECTION V.A.4 OF THE MASTER FEE
SCHEDULE 2000-2001
WHEREAS, the City Council of the City of Newark is authorized to prescribe and establish fees in regard to services or functions performed by the City for the public in a governmental and proprietary capacity; and
WHEREAS, Chapter 3.24 of the City of Newark Municipal Code authorizes the City Council to establish by resolution the amount of the Capital Facilities Fee to be imposed on new residential, industrial, and commercial development in the City; and WHEREAS, on June 22, 2000, the City Council adopted Resolution 8011, establishing fees for services as set forth in the Master Fee Schedule 2000-2001; and WHEREAS, on July 10, 2000, the Community Development Director held a public meeting on the proposed Capital Facilities Fee. Notice of the meeting was given to interested persons at least 14 days before the meeting and was published. At least 10 days before the meeting, the City made available to the public data indicating the amount of cost or estimated cost required to construct the facilities and the revenue sources anticipated to provide the construction cost, including general fund revenues; and
WHEREAS, on July 13, 2000, the City Council held a public hearing on this matter. Notice of the hearing was given to interested persons at least 14 days before the hearing and was published.

At least 10 days before the hearing, the City made available to the public data indicating the amount of cost or estimated cost required to construct the facilities and the revenue sources anticipated to provide the construction cost, including general fund revenues. (Government Code §§66016, 66018).

NOW THEREFORE, BE IT RESOLVED by the City Council of the City of Newark which hereby finds, declares, and resolves that:

1. Amendment of Master Fee Resolution, Section V .A. 4 of the Master Fee Schedule 2000- 2201 is hereby amended by repealing Section V. A. 4 ("Capital Facilities Impact Fee") and replacing it with a new Section V.A.4 entitled "Capital Facilities Fee," as set forth hereinbelow in Section 2.

2. Fee for development. A person who develops property shall pay a Capital Facilities Fee, unless the particular development or portion thereof is exempt under Municipal Code Section

3.24.070. The Capital Facilities Fee for residential, commercial, and industrial development is based on the capital facility needs generated by such development and is in proportion to those needs.

The Fee imposed under Municipal Code Section 3.24.050 for new development is indicated below. The Fee is based on the analysis set forth in the Capital Facilities Fee Technical Report, entitled "Newark Impact Fee Study," dated July 2000 ("Technical Report"), a copy of which is on file in the Community Development Department. The Fee shall be reviewed annually and modified as necessary by resolution based on the Technical Report and future additions and amendments to it, to provide the capital facilities necessary to implement the Capital Facilities Program and achieve the objectives of the City of Newark's General Plan.

V.A.4 CAPITAL FACILITIES FEE
Category of Land Public Community Transportation Total
Use and Fee Safety Service/Facilities CFF
Single-family $1,515.00 $1,508.00 $876.00 $3,900.00
residential (per
unit)
Multi-family $1,737.00 $1,373.00 $503.00 $3,613.00
residential (per
unit)
Commercial $1.70 $0.22 $1.29 $3.20
(per sq. ft.)
Industrial $0.25 $0.16 $0.75 $1.16
(per sq. ft.)
If an ambiguity arises in determining the type of development for which a Fee applies, the City shall use the category which in its judgment most nearly fits the proposed use. In making the determination, the City shall rely on the analysis in the July 2000 Technical Report and the specific uses described in the Zoning Ordinance.

3. AB 1600 Findina=s {Government Code §66001)
a. The purpose of the Capital Facilities Fee is to provide adequate capital facilities improvements to serve new development within the City.
b. The Fee will be used to finance a variety of capital facility improvements as prescribed in Section 3.24.100 (B) of the Municipal Code and as identified in the Technical Report, including public safety and transportation facilities and community service and facilities.
c. The Fee will fund that portion of capital facility improvements attributable to new commercial, industrial, and residential development responsible for paying the Fee.

Resolution No. 8051 2
d. The amount of the Fee bears a fair and reasonable relationship to each development's burden on and benefit from the City's public services and capital facilities improvements to be funded by the Fee, and is based on the following considerations:
• New commercial, industrial, and residential development will pay only for those capital facilities which serve new commercial, industrial, and residential development and are necessary to serve the public service needs which will be created by such new development.
• The cost of improvements needed to alleviate existing deficiencies in capital facilities, if any, are not included in this Fee.
• Each type of development shall contribute to the needed improvements in proportion to the use of public services and capital facilities by that type of development. For residential development, the Fee per new dwelling unit is based upon the proportion of total new public facilities' costs attributable to new residential development divided by the number of new residential units expected to be developed in the City through projected buildout. For commercial and industrial development, the Fee per new square foot is based upon the proportion of total new public facilities' costs attributable to new commercial and industrial development divided by the total new commercial and industrial square footage expected to be developed in the City.

4. Time of payment.

5. a. Residential. For residential development of no more than one dwelling unit, the Fee shall be paid prior to the issuance of the Certificate of Occupancy, unless the City elects to exercise the exception authorized under Government Code Section 66007(b), in which case it may become payable at an earlier date to be determined by the City. In the case of a residential development which involves construction of more than one dwelling unit, the Fee shall be paid on a lump-sum basis for the total development when the first dwelling in the development receives its Certificate of Occupancy.
b. Industrial and Commercial. For industrial and commercial development, the Fee shall be paid prior to issuance of the building permit.

Notice.

At the time of approval of a project or at the time of the imposition of the Capital Facilities Fee, the City shall provide to the project applicant a statement of:
a. The amount of the Fee and the public improvement that the Fee will be used to finance. (Government Code § 66006(f)); and
Resolution No. 8051 3
b. Notification that the 90-day approval period in which the applicant may protest has begun. (Government Code § 66020(d)).

6. Findin2s re2ardin2 funds not spent.

The City shall make certain findings once each fiscal year with respect to any portion of the Fee remaining unexpended or uncommitted in its account five years or more after the deposit of the Fee. (Government Code §66001[d])

7. .Judicial action.

Any judicial action or proceeding to attack, review, set aside, void, or annul this resolution shall be brought within 120 days. (Government Code §66022).

8. Effective date.

The Fee established by this resolution takes effect on September 26, 2000, which is at least 60 days from the date this resolution is adopted. (Government Code §66017) I HEREBY CERTIFY the foregoing resolution was introduced at a regular meeting of the City Council of the City of Newark held on July 27, 2000, by Council Member Nagy who moved its adoption and passage, which motion was carried after being duly seconded, and passed by the following vote:

AYES:

NOES:

ABSENT:

SECONDED:

ATTEST:

Council Members Boggs, Freitas, Nagy, and Mayor Smith
None
Council Member Johnson
Council Member Boggs
(� v'1
"A?PROVFf ) r.,.
s/DA VID W.
u�
SMITH
Mayor
� ��
City Clerk
Resolution No. 8051 4

APPENDIX C

PUBLIC SAFETY AND COMMUNITY

SERVICE FACILITY DEVELOPMENT

IMPACT FEE NEXUS STUDY
2017

EXHIBIT A
RESOLUTION NO. 10633
KEYSER MARSTON ASSOClATES

PUBLIC SAFETY AND COMMUNITY SERVICE FACILITIES

DEVELOPMENT IMPACT FEE NEXUS STUDY
Prepared for:

City of Newark
Prepared by:

Keyser Marston Associates, Inc.

March 2017

TABLE OF CONTENTS
I. INTRODUCTION, SUMMARY OF CURRENT PROGRAM, RESULTS, AND RECOMMENDATIONS ..................................................................................................... 1 A. Summary of Current Program and City Objectives for Impact Fees ............................. 1 B. Report Background and Legal Context ........................................................................ 1 C. Facility Standards and Cost Allocation Approach ......................................................... 2 D. Maximum and Recommended Fee Schedules ............................................................ 3 E. Fee Indexing ................................................................................................................ 3 II. MITIGATION FEE ACT NEXUS FINDINGS ...................................................................... 4 A. Purpose ....................................................................................................................... 4 B. Use of Fee Revenues .................................................................................................. 4 C. Relationship ................................................................................................................. 4 D. Need ............................................................................................................................ 4 E. Proportionality ............................................................................................................. 5 111. DEMAND FOR NEW PUBLIC SAFETY FACILITIES AND SUPPORTED IMPACT FEE AMOUNTS ........................................................................................................................ 7 A. Public Safety Facility Needs to Serve Newark through 2035 ........................................ 7 B. Service Population ....................................................................................................... 7 C. Public Safety Facility Costs Attributable to New Service Population ............................ 9 D. Distribution of Public Safety Facility Demand by Land Use ......................................... 10 E. Supported Public Safety Facility Fee Levels ............................................................... 11 IV. DEMAND FOR NEW COMMUNITY SERVICE FACILITIES AND SUPPORTED IMPACT FEE AMOUNTS ............................................................................................................... 12 A. Community Service Facility Needs to Serve Newark through 2035 ............................. 12 B. Public Service Population ........................................................................................... 12 C. Community Service Facility Costs Attributable to New Development .......................... 15 D. Distribution of Community Service Facility Demand by Land Use ............................... 15 E. Supported Community Service Facility Fee Levels ..................................................... 16 V. USE OF FEE REVENUE .................................................................................................. 17 VI. IMPACT FEES IN NEIGHBORING CITIES, MAXIMUM SUPPORTED FEES, AND RECOMMENDED FEES .................................................................................................. 18 A. Public Safety and Community Service Facility Fees in Neighboring Jurisdictions ....... 18 B. Maximum and Recommended Impact Fees ................................................................ 19 VII. FEE PROGRAM IMPLEMENTATION AND ADMINISTRATION ....................................... 20 A. Credits, Reimbursement, and Exemptions .................................................................. 20 B. Securing Supplemental Funding ................................................................................. 20 C. Annual Review and Periodic Study Update ................................................................. 20

LIST OF EXHIBITS
Exhibit 1: Current Impact Fees ................................................................................................... 1 Exhibit 2: Maximum and Recommended Fee Schedules ........................................................... 3 Exhibit 3: New Public Safety Needs ........................................................................................... 7 Exhibit 4: City of Newark Population and Employment.. ............................................................. 8 Exhibit 5: Public Service Population ........................................................................................... 9 Exhibit 6: Distribution of New Service Population by Land Use .................................................. 9 Exhibit 7: Public Safety Facility Costs Attributable to Demand from New Development.. ........... 10 Exhibit 8: Distribution of New Service Population for Public Safety Facilities by Land Use ........ 10 Exhibit 9: Distribution of Public Safety Facility Costs by Land Use Demand .............................. 11 Exhibit 10: Current and Anticipated population and commercial and industrial stock ................. 11 Exhibit 11: Supported Public Safety Facilities Impact Fees by Land Use .................................. 11 Exhibit 12: Needed Community Service Facility lmprovements ................................................. 12 Exhibit 13: City of Newark Population and Employment.. .......................................................... 13 Exhibit 14: Public Service Population ........................................................................................ 14 Exhibit 15: Distribution of New Service Population by Land Use ............................................... 14 Exhibit 16: Community Service Facility Costs Attributable to Demand from New Development.15 Exhibit 17: Distribution of Demand for New Community Service Facilities by Land Use ............ 15 Exhibit 18: Distribution of New Development's Share of Community Service Facility Costs by Land Use ................................................................................................................. 16 Exhibit 19: Existing commercial and industrial stock and anticipated amount of new space ...... 16 Exhibit 20: Supported Community Service Facilities Impact Fees by Land Use ........................ 16 Exhibit 21: Comparison Public Safety and Community Service Facility Impact Fees ................ 18 Exhibit 22: Maximum and Recommended Fee Schedules ........................................................ 19 I. INTRODUCTION, SUMMARY OF CURRENT PROGRAM, RESULTS, AND

RECOMMENDATIONS
This Public Safety and Community Service Facility nexus analysis provides the City of Newark (the City) with the necessary technical documentation to support updating its current Public Safety Facility and Community Service Facility impact fees. This nexus analysis has been prepared by Keyser Marston Associates, Inc. (KMA).

A. Summary of Current Program and City Objectives for Impact Fees The City currently levies both a public safety capital facilities fee and a community service capital facilities fee on residential and non-residential development. The fee revenues are used to fund a portion of the cost of new capital facilities to serve people who live and/or work in Newark. The portion of costs to be funded by fees on new development reflects the share of the future service population comprised of future residents/employees. The pro rata share of facility costs attributable to existing residents and employees will not be funded by fees levied on new development. The current impact fee amounts are as follows:

Exhibit 1: Current Impact Fees
: Type o� N:ew Development i:>ublic-Safety Capital - Community Service Capital I I___ _ . • Facilities Fee _ . _ _
Facility Fee
_.
_ :

Single-family residential
Multi-family residential
Commercial
Industrial
$1,989 per unit
$2,079 per unit
$1.73 per square foot
$0.17 per square foot
$1,942 per unit
$1,596 per unit
$0.36 per square foot
$0.31 per square foot
The planned future public safety and community service capital facilities are identified in the City's General Plan and capital improvement plan and through interviews with executive staff, and are detailed in Tables 4 and 5 of this report. Key planned improvements include a new library, city administration building, and police center at the city's current civic center, a performing or cultural arts center, and a new senior center.

B. Report Background and Legal Context
The Mitigation Fee Act (AB 1600 et seq.) permits cities to adopt impact fees on new development to fund the associated, additional costs of providing capital facilities to meet the demands generated by new residents and employees.

This Report provides the necessary technical analysis to support a schedule of fees to be established by an Impact Fee Ordinance and Resolution. The Mitigation Fee Act allows the City to adopt by Resolution a fee schedule consistent with the supporting technical analysis and findings provided in this Report. The Resolution's approach to setting the fee allows periodic Keyser Marston Associates, Inc.
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adjustments of the fee amount as may be necessary over time, without amending the enabling Ordinance.

The technical analysis in this Report estimates the public safety and community service facility fee schedules that will fund new development's "fair share" contribution to funding future public safety and community service facility capital improvements. The key requirements of the Mitigation Fee Act that determine the structure, scope, and amount of the updated fees are as follows:
■ Collected for Capital Facility and Infrastructure Improvements. Development impact fee revenue can be collected and used to cover the cost of capital facilities and infrastructure required to serve new development and growth in the City. However, impact fee revenue c�nnot be used to cover the operation and maintenance costs of these or any other facilities and infrastructure.
■ Cannot Fund Existing Needs. Impact fee revenue cannot be collected or used to cover deficiencies in existing City capital equipment and facilities. The portion of capital costs required to meet the needs of the City's existing population must be funded through other sources. Capital facility investments that increase service standards for existing and new development must be split on a "fair share" basis according to the proportion attributable to each.
■ Must be Based on a Rational Nexus. An impact fee must be based on a reasonable nexus, or connection, between new growth and development and the need for a new facility or improvement. As such, an impact fee must be supported by specific findings that explain or demonstrate this nexus. In addition, the impact fee amount must be structured such that the revenue generated does not exceed the cost of providing the facility or improvement for which the fee is imposed.

The City can choose to charge impact fees below the maximum, supportable fee schedule.

Such downward adjustments in the fee schedule, if selected, are typically based on policy considerations related to considerations of development feasibility and fee levels in peer cities.

C. Facility Standards and Cost Allocation Approach
A facility standard is a policy that indicates the amount of facilities required to accommodate service demand. The City's General Plan identifies new public safety and community service facilities that will be needed to serve Newark residents and employees through the 2035 planning horizon of the General Plan. As noted in the General Plan, Newark's city hall was built in 1966 and many of its systems are now outdated and the space does not fully meet the needs of Newark today. To serve the existing and future population, the General Plan identifies the need for modernizing or replacing City Hall, building a new library, performing arts center, and Keyser Marston Associates, Inc.
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police facilities. Needed improvements to be partially funded by the fees on new development are listed in Tables 4 and 5.

Pursuant to the requirements of the Mitigation Fee Act, facility costs have been allocated to new development proportionate to new development's share of the City's service population upon buildout in 2035. This approach ensures that new development will bear only it's fair share of costs and will not be funding improvements to cure existing deficiencies.

D. Maximum and Recommended Fee Schedules
Exhibit 2 shows the fee schedules supported by this study and represents the maximum public safety and community service facility fees that the City could charge consistent with the Mitigation Fee Act. The calculation of the fees is presented in Section Ill of this report. We recommend that the City adopt fees equal to the maximum fee amounts because the total impact fee obligation does not exceed the total obligation in adjoining cities and the recommended fees are needed to mitigate the facility needs of new residents and employees. However, consideration could be given to allowing for the reduction, with City Council approval, of fees to support high-income job generation and sales tax generating uses.

The fee schedules include a 2 percent (2%) administration fee, consistent with other Mitigation Fee Act program administrative costs in many other California jurisdictions.

Exhibit 2: Maximum and Recommended Fee Schedules
Residential
Commercial
Industrial
E. Fee Indexing
Public Safety Facility Fee
$2,311 per unit
$1.72 per square foot
$0.36 per square foot
Community Service Facility Fee
$3,451 per unit
$1.19 per square foot
$0.50 per square foot
Since construction costs continue to rise, it is important that the cost be indexed to inflation. The fee should be adjusted annually by a construction cost index, such as the Engineering News Record.

Keyser Marston Associates, Inc.
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II. MITIGATION FEE ACT NEXUS FINDINGS
This chapter describes the necessary "nexus" between new development in Newark and the proposed capital facilities investments, as required under the Mitigation Fee Act - Government Code Section 66000 (AB1600). The new public safety facility and community service facility development impact fees will fund new development's "fair share" of needed capital facilities as identified in the General Plan to provide an adequate level of service to Newark.

Nexus findings address: ( 1) the purpose of the fee and a related description of the facility for which fee revenue will be used, (2) the specific use of fee revenue, 3) the relationship between the facility and the type of development, (4) the relationship between the need for the facility and the type of development, and (5) the relationship between the amount of the fee and the proportionality of cost specifically attributable to new development. The subsections below describe the nexus findings for both the Public Safety Facility Impact Fee and the Community Service Facility Impact Fee.

A. Purpose
The fees will ensure that new development contributes its "fair share" towards funding the construction of new capital facilities that are identified in the City's General Plan.

8. Use of Fee Revenues
Public safety facility impact fee revenues will be used to fund a portion of the cost to construct the public safety capital facilities identified in Table 4. Similarly, the community service facility impact fee revenues will be used to fund a portion of the cost to construct the community service capital facilities identified in Table 5. These facilities will benefit the entire City of Newark.

C. Relationship
New residential development in the City of Newark will increase the demand for and use of public safety and community service facilities. Fee revenue will be used to help fund new development's pro rata share of the cost of new facilities that will be built to serve the entire City.

D. Need
The City's General Plan has identified new public safety and community service facilities that are needed to serve Newark through the year 2035. These new facilities are needed to serve both existing and new residents and employees. Each new residential and non-residential project will bring new residents and employees to the City and will generate incremental, new demand and use of the City's public safety and community service facilities. New revenues to Keyser Marston Associates, Inc.
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Page4
fund investments in new public safety and community service facilities are needed to fund needed capital facilities as identified in the City's General Plan.

Given that impact fees on new development will fund approximately 26% of the cost of new public safety capital facilities and 21% of new community service capital facilities, the City will need to secure funding from other sources to construct the capital facilities. It is anticipated that the balance of funds will come from the following sources:
• Local half cent sales tax;
• City General Fund surpluses;
• Regional, state and federal grants
E. Proportionality
The maximum, supportable public safety facilities and community service facility fee schedules have been derived by the following steps:

1. Establish the list of capital facilities to be funded, in part, by fees on new development.

The source for this list is the City's General Plan and the City's Capital Improvement Plan.

2. Establish the current and future (year 2035) population and employment estimates for the City of Newark. Sources for these estimates are the State Department of Finance, the City's General Plan, demographic research companies, and City staff.

3. Establish estimates of the current and future number of housing units, square feet of commercial space, and square feet of industrial space in the City. Sources for these estimates are the State Department of Finance, City staff, and the trends in the employment density of new development.

4. Establish the population base to be served by each capital facility to be funded by impact fees. For example, a new administration building at city hall will serve all future residents and employees. A new senior center, however, will serve all future residents, but not employees.

5. Calculate the percentage of each future service population comprised of existing residents/employees and the percentage attributable to new residents/employees.

6. For each capital facility, multiply the cost of the facility by the percentage of demand attributable to the new service population.

7. Distribute the cost allocated to new development by land use (residential, commercial, and industrial) based on the land use composition of the applicable service population.

The distribution of demand for fire facilities has been determined based on the distribution of fire/EMS protection service calls by land use.

8. Aggregate the public safety capital facility costs attributable to new development by land use.

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9. Divide each land use's share of new development cost by the projected amount of new development (units, commercial square feet, or industrial square feet) to establish the public safety facility fee amount on new development.

10. Aggregate the community service capital facility costs attributable to new development by land use.

11. Divide each land use's share of new development cost by the projected amount of new development (units, commercial square feet, or industrial square feet) to establish the community service facility fee amount on new development.

With this methodology, the fee program cost estimates are directly proportional to the relative increase in new development.

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Ill. DEMAND FOR NEW PUBLIC SAFETY FACILITIES AND SUPPORTED IMPACT FEE

AMOUNTS
A. Public Safety Facility Needs to Serve Newark through 2035 City staff have identified the following list of needed public safety facility improvements based on the facility needs identified in the City's General Plan and the City's Capital Improvement Plan.

These new facilities are anticipated to meet the City's needs through the year 2035. As shown in Exhibit 3, the total cost of capital facilities is estimated at $42 million, with a $23 million police center at the Civic Center accounting for 55% of the entire cost of new facilities.

Exhibit 3: New Public Safety Needs
Fire Admin Portion of City Administration Building $2,557,400 $2,608,548 Community Alerting and Warning System $75,000 $76,500
Fire Station No. 27 Energy Efficient Windows $40,000 $40,800 Fire Station No. 27 Training Tower $2,000,000 $2,040,000 Fire Station No. 29 Truck Exhaust System $45,000 $45,900 Replace Fire Station No. 27 $5,300,000 $5,406,000
Replace and Expand Fire Station No. 29 $6,400,000 $6,528,000 Ladder Truck/Fire Engine to serve new population $1,200,000 $1,224,000 Traffic Signal Preemption (Opticom) $160.000 $163,200
Total Fire $17,777,400 $18,132,948
� Police _ _ _ _ _ _
• I
Police Center at the Civic Center
Police Vehicles (5) to serve new population
Police Department Substation Facilities
Total Police
Total, Public Safet
B. Service Population
$23,016,600 $23,476,932
$325.000 $331,500
$850,000 $867,000
$24, 191,600 $24,675,432
$41,969,000 $42,808,380
The proposed new facilities will serve all of Newark. Therefore, the applicable service population for public safety capital facilities is both residents and employees. As shown in Exhibit 4, the City's current population is 44,733. By 2035 the population is anticipated to reach 60,510, reflecting an increase of 15,777 people over roughly the next 19 years. Approximately 19,363 people work in Newark, with employment in commercial businesses totaling approximately 12,500 and employment in industrial businesses totaling approximately 6,860. Employment is expected to grow by 4,950 through 2035.

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Exhibit 4: City of Newark Population and Employment
Population1 44,733 2,933 12,844 60,510
Employment2
Office 1,197 850 2,047
Retail 7,762 900 8,662
50 % R&D 3,545 1,350 4,895
Total Commercial 12,504 3,100 15,604
Light Industrial 1,749 300 2,049
Heavy Industrial 1,565 200 1,765
50% R&D 3,545 1,350 4,895
Total Industrial � � 1U.Q.a
Total Employment 19,363 4,950 24,313
1 State Department of Finance E-5 is source of estimate of current population. Estimate of population in 2035 is the Newark General Plan.
2 ESRI is source of current employment estimates. 2035 employment estimates have been provided City staff.

In recognition that employees' demands for city services is generally limited to the time that they are at work, the impact of employees is weighted less than the impact of residents. Based on analysis underpinning the current impact fees, it is assumed that the public facility demand created by each employee is equal to 0.36 of the impact of each resident. The fractional demand per employee is calculated by multiplying the share of daily working hours relative to activity hours (.5) by the fraction of 5 working days out of 7 days per week (. 71 ). The derived weighted average is .36.

The service population for Public Safety facilities is the sum of the resident population and.36% of the employment base. As shown in Exhibit 5, the current public safety service population is approximately 51,700 and the service population of residential units currently under construction, which will not be subject to the updated impact fee, is approximately 2,933. The service population associated with new growth through the year 2035 is estimated to total 14,626, which represents 21.1 % of the total service population in the buildout year of 2035.

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Exhibit 5: Public Service Population
Ir·-· - - ., - . ,- - -- - -
--.-----..,..,....-�-- -� ---- - -.. . ...... �-. -·�-J ·• C· F,actor --• � _-=-� ·.�ourc� _____ •_�N�ll}b�r . ;!'3r�ent'A�l�cati{?f1 _,_ --� - -- Residents
Existing SDOF, E-5 44,733 73.9%
In progress City staff+ SDOF 2,933 4.8%
New Growth 12,844 21.2%
Buildout General Plan 60,510 100.0%
Employment
Existing ESRI 19,363 79.6%
New Growth City staff 4,950 20.4%
Buildout 24,313 100.0%
Public Service Population 1
Existing 51,704 74.6%
In Progress 2,933 4.2%
New Growth 14,626 21.1%
Buildout 69,263 100.0%
1 Public service population is an allocation factor which differentiates between the impact of employees and residents. It equals resident population plus .36 of employment. Per a prior Newark General Plan, the . 36 factor reflects an adjustment of one-half (8/16) to reflect the workday's share of awake hours and an adjustment of 5/'1 to reflect the work-week's share of the number of days in a week.

The distribution of the additional 14,626 service population from 2017 through 2035 among the land uses is as follows:

Exhibit 6: Distribution of New Service Population by Land Use ; "New Service Population from
- - I
' I ' New Development I
Residential
Commercial
Industrial
Total New Service Population
- -
12,844
1,116 (3,100 X 0.36)
666 (1,850 X 0.36)
14,626

87.8%

7.6%

4.6%
100%
C. Public Safety Facility Costs Attributable to New Service Population The cost of new public safety facilities attributable to the demands of new development is generally estimated by applying the 21.1 % factor to the facility cost schedule. However, because some of the facilities are needed solely to serve the new service population, the overall percentage of costs attributable to new development is 26.1 %.1 As shown below in Exhibit 7, it 1 A new fire engine ($1.2 million), an expansion of Fire Station No. 29 to house the new engine, and five police cars ($325,000) are needed to serve exclusively the new service population. 100% of the cost of these facilities is allocated to new development. Please refer to Table 4 for a detailed allocation of costs.

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is estimated that new residents/employees will create the demand for approximately $11.2 million of new public safety capital facilities through 2035. Demand attributable to existing residents and employees is estimated to total $31.7 million.

Exhibit 7: Public Safety Facility Costs Attributable to Demand from New Development ; -:- -- • • - -- - - ·:---.. • - Total Facility Cost ----Costs Alloc£alile-fo ·New] ', • ' • • • with 2% Ad min. Fee Development - 26.1 % - - • - _____ ---=..J........ ___ - --- - ,._ - - � ---� - ---�-�:_l..;::....:__ _;._ • Total Fire
Total Police
Total, Public Safety Facility Costs
$18.1 million
$24.7 million
$42.8 million
D. Distribution of Public Safety Facility Demand by Land Use $5.7 million
$5.5 million
$11.2 million
Since impact fees are levied per unit or per square foot of new non-residential development and often vary by type of non-residential development, the service population needs to be broken down by land use. As provided in Exhibit 8, the distribution of the growth in the service population is as follows: 88% from new residents; 8% from new commercial employees; and 5% from new industrial employees. For purposes of this analysis, it has been assumed that the distribution of demand is proportionate to the distribution of the service population.

The source of demand for new fire protection facilities has been estimated based on the distribution of service calls submitted to the Newark Fire Department during calendar year 2015.

The call records and the source of calls are detailed in Table 10. As summarized below, approximately 77% of calls originated from residential homes, 19% from commercial establishments, and 4% from industrial establishments.

Exhibit 8: Distribution of New Service Population for Public Safety Facilities by Land Use -
- T�tal ,
1 ��i
_
dentia{ I' C�mmer�ial ;' -- ln
_
dustrial !
Distribution for Police Facilities1
Percentage 100%
Distribution for Fire Facilities
Percentage2
1 Exhibit 7
2Tab/e 10
100%

87.8%
77%

7.6% 4.6%
19% 4%
The demand for new public safety facilities by land use is estimated by applying these demand percentages to the facility costs attributable to new development. As shown in Exhibit 9, the costs attributable to new residential development is estimated to total $9.2 million, the cost attributable to new commercial development is estimated to total $1.5 million, and the cost attributable to new industrial development is estimated to total $451,000.

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Exhibit 9: Distribution of Public Safety Facility Costs by Land Use Demand c;-c . -� •• • • Police Facilities-• - -• Fire-Facilities -, -• - Tota!'Public Safety··· 1 I
• •
• • Facilities - - - I
. . - � -- _j_ __ ..........!._ __ .......:..• - -- - - • .. - - Facility Costs Attributable
to New Development
Residential
Commercial
Industrial
$5.5 million1
$4.8 million (87.8%)
$0.4 million (7.6%)
$0.2 million (4.6%)
1Totals may not add due to rounding.

E. Supported Public Safety Facility Fee Levels
$5.7 million
$4.4 million (77%)
$1.1 million (19%)
$0.2 million (4%)
$11.2 million
$9.2 million (84%)
$1.5 million (12%)
$0.5 million (4%)
Since impact fees are levied per unit of new development, the growth of the service population must be translated into projected new residential units and new building square footage. Based on US Census data, an average household size of 3.23 has been assumed to convert population projections into projected residential units. City staff has provided estimates of existing commercial and industrial stock and the amount of new space anticipated to be built through 2035. See Exhibit 10 below.

Exhibit 10: Current and Anticipated population and commercial and industrial stock i -- •
Growth.in Service New Households; New i
· Population - 2017 Commercial and Industrial SF - I
_ _
th�o�gh 2035
_ _
2 _
017 through 2035 i
Residential Population
Commercial Service Population
Industrial Service Population
12,844
1,116
666
3,977
880,000 sq. ft.
1,250,000 sq. ft.

Supported fee amounts on new development to fund needed public safety facilities are determined by dividing the portion of costs attributable to the demand generated by new development by the magnitude of new development anticipated through 2035. As shown in Exhibit 11, impact fees of $2,311 per residential unit, $1.72 per square foot of new commercial development and $0.36 per square foot of new industrial development are warranted to fund the construction of public safety facilities in Newark to serve the needs generated by new development.

Exhibit 11: Supported Public Safety Facilities Impact Fees by Land Use Costs Allocated to New Development
New Development (Units or SF)
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$9,187,925
3,977
$2,311
$1,512,565
880,000
$1.72
$451,442 $11,151,931
1,250,000
$0.36

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IV. DEMAND FOR NEW COMMUNITY SERVICE FACILITIES AND SUPPORTED IMPACT

FEE AMOUNTS
A. Community Service Facility Needs to Serve Newark through 2035 City staff have identified the following list (Exhibit 12) of needed community service facility improvements based on the facility needs identified in the City's General Plan and the City's Capital Improvement Plan. These new facilities are anticipated to meet the City's needs through the year 2035. As shown, the total cost of capital facilities is estimated at $71.46 million. The largest planned expenditures include a $21.1 million new library at the civic center, a $17.3 million new city administration building at the civic center, a $9 million performing arts center, and a $7.5 million senior center.

Exhibit 12: Needed Community Service Facility Improvements I Community Service Facilities --
•
- Total Cost Total, With 2.00% Admin.1
-· - - - - -- -·
City Administration Building at Civic Center $17,262,450 $17,607,699 Equipment Shop Heavy Duty Vehicle Hoist $60,000 $61,200 History Center (Phases 2,3,4) $4,000,000 $4,080,000
Library at the Civic Center $21,098,550 $21,520,521
Mowry Avenue Backup Walls $900,000 $918,000
New Fuel Management System $60,000 $61,200
New Senior Center $7,500,000 $7,650,000
Newark Boulevard Backup Walls $1,200,000 $1,224,000
Performing (or Cultural) Arts Center $9,000,000 $9,180,000 Service Center Fuel Tank Canopy $130,000 $132,600
Service Center Storage Facility $400,000 $408,000
Service Center Waste Disposal Upgrades $250,000 $255,000 Silliman Complex Restroom/Maintenance Facility $700,000 $714,000 Thornton Avenue Streetscape $2,200,000 $2,244,000
Electrical Vehicle Charging Stations $200,000 $204,000
New Homeless Shelter $1,500,000 $1,530,000
Service Center Expansion $5,000,000 $5,100,000
Total Community Facilities $71,461,000 $72,890,220
B. Public Service Population
The proposed new community facilities will serve all of Newark. Therefore, the applicable service population for most community service capital facilities is both residents and employees.

As shown in Exhibit 13, the City's current population is 44,733. By 2035 the population is anticipated to reach 60,510, reflecting an increase of 15,777 people over roughly the next 19 years. Approximately 19,363 people work in Newark, with 12,500 employed in commercial Keyser Marston Associates, Inc.
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businesses and 6,860 employed in industrial businesses. An additional 4,950 employees are expected through 2035.

Exhibit 13: City of Newark Population and Employment
r
·-
.
--
..
----
_
- -----
_
---- --, - ,- - -· --- -�Additio�� ----- - - - -1
: •
.
• 20·11 through • ·I
' . • .-. . ' • 2016 •• ,!n progress • 2035 .. - 2035 J 1 j_ - - ---�-=- --·-----·--....&J.c:,�-- - -- - -�-� -------·----� -- --�- ----#-- __ #_ - - ------ Population1 44,733 2,933 12,844 60,510
Employment2
Office 1,197 850 2,047
Retail 7,762 900 8,662
50 % R&D 3,545 1,350 4,895
Total Commercial 12,504 3,100 15,604
Light Industrial 1,749 300 2,049
Heavy Industrial 1,565 200 1,765
50% R&D 3,545 1,350 4,895
Total Industrial 6.859 1 850 8 709
Total Employment 19,363 4,950 24,313
1 State Department of Finance E-5 is source of estimate of current population. Estimate of population in 2035 is the Newark General Plan.
2 ESRI is source of current employment estimates. 2035 employment estimates have been provided City staff.

In determining the population to be served by the new facilities, it is recognized that employees' demands for city services is generally limited to the time that they are at work. Therefore, employees are weighted less than residents. Based on that analysis that was undertaken to support the current impact fees, it is assumed that the public facility demand created by each employee is equal to 0.36 of the impact of each resident. The fractional demand per employee is calculated based on a fraction of 8 hours out of 16 activity hours per day (.5) times the fraction of 5 working days out of 7 days per week (.71). The derived weighted average is .36.

The public service population for all community service facilities except the senior center is the sum of the resident population and.36% of the employment base. As shown in Exhibit 13, the current service population is approximately 51,700 and the service population of residential units currently under construction, which will not be subject to the updated impact fee, is approximately 2,933, The service population associated with new growth through the year 2035 is estimated to total 14,626, which represents 21.1 % of the total service population in the buildout year of 2035.

Given that employment does not contribute to the need for senior centers, the service population for the senior center is the residential population. As shown in Exhibit 14, it is estimated that the City's population will increase by 12,844 from 2017 through 2035 from new . residential development, excluding new units currently under construction, which will be subject Keyser Marston Associates, Inc.
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to the existing fees. The additional 12,844 residents will account for 21.2% of Newark's population by 2035. Therefore, 21.2% of the cost of the senior center is estimated to be attributable to the impacts of new development.

Exhibit 14: Public Service Population
I . - --- - - - - - -- -- -- ---- - 7
[ , . .

Percent !
!
· Factor _ . ___ �our�
e __ --�ll!!lber � ��oc�t�� -�I
Residents
Existing SDOF, E-5 44,733 73.9%
In progress City staff+ SDOF 2,933 4.8%
New Growth 12,844 21.2%
Buildout General Plan 60,510 100.0%
Employment
Existing ESRI 19,363 79.6%
New Growth City staff 4,950 20.4%
Buildout 24,313 100.0%
Public Service Population <1J
Existing 51,704 74.6%
In Progress 2,933 4.2%
New Growth 14,626 21.1%
Buildout 69,263 100.0%
1 Public service population is an allocation factor which differentiates between the impact of employees and residents. It equals resident population plus .36 of employment. Per a prior Newark General Plan, the .36 factor reflects an adjustment of one-half (8/16) to reflect the workday's share of awake hours and an adjustment of 5ll to reflect the work-week's share of the number of days in a week.

The distribution of the additional 14,626 service population from 2017 through 2035 among the land uses is presented in Exhibit 15:

Exhibit 15: Distribution of New Service Population by Land Use i
- -
All facilities, except senior center
Residential
Commercial
Industrial
Total New Service Population,
All except Senior Center
Senior Center
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New Service Population from
New Development
12,844
1,116 (3,100 X 0.36)
666 (1,850 X 0.36)
14,626
12,844
'
-
I
,I -

87.8%

7.6%

4.6%
100.0%
100%

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C. Community Service Facility Costs Attributable to New Development The cost of new community service facilities attributable to the demands of new development is estimated by applying the 21.1% factor to the facility cost schedule for all improvements, excluding the senior center, and applying a factor of 21.2% to the total cost of the senior center.

As shown in Exhibit 16, it is estimated that new residents/employees will create the demand for approximately $15.4 million of new community service capital facilities through 2035, which accounts for approximately 21.1 % of total project costs. Demand attributable to existing residents and employees is estimated to total $57.5 million.

Exhibit 16: Community Service Facility Costs Attributable to Demand from New Development l • -•• --- . -
Total F��illty Cost -- - c�
-
sts Allocable't� I
r wl_th 2% Admin. Fee New Development I
• --- --·- - - -- - ____ J
Total Community Facilities, excluding senior center
Senior Center
Total, Community Service Facility Costs
$65.24 million
$ 7.65 million
$72.89 million
D. Distribution of Community Service Facility Demand by Land Use $13.78 million (21.1%)
$1.62 million (21.2%)
$15.40 million (21.1 % )
Since impact fees are levied per unit or per square foot of new non-residential development and often vary by type of non
-
residential development, the service population needs to be broken down by land use. As provided in Exhibit 17, the distribution of the growth in the service population for facilities excluding the senior center is as follows: 87.8% from new residents;

7.6% from new commercial employees; and 4.6% from new industrial employees. For the senior center, 100% of the cost is apportioned to residential development. For purposes of this analysis, it has been assumed that the distribution of demand is proportionate to the distribution of the service population.

Exhibit 17: Distribution of Demand for New Community Service Facilities by Land Use ' -
Total Residential Co,;mer�ial - Industrial !
- -- -
Distribution for Community Facilities, Excluding the Senior Center1 Percentage 100% 87.8% 7.6%
Distribution for Senior Center
Percentage 100% 100% 0%
1 Exhibit 16

4.6%
0%
The demand for new public safety facilities by land use is estimated by applying these demand percentages to the facility costs attributable to new development. As shown in Exhibit 18, the costs attributable to new residential development is estimated to total $13.72 million, the cost attributable to new commercial development is estimated to total $1.05 million, and the cost attributable to new industrial development is estimated to total $0.63 million.

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Exhibit 18: Distribution of New Development's Share of Community Service Facility Costs by Land Use
-
Facility Costs Attributable
to New Development $1.62 million $13.78 million $15.40 million Residential Demand $1.62 million (100%) $12.10 million (87.8%) $13.72 million (89%) Commercial Demand $0.00 million (0%) $1.05 million (7.6%) $1.05 million (7%) Industrial Demand $0.00 million (0%) $0.63 million (4.6%) $0.63 million (4%) E. Supported Community Service Facility Fee Levels
Since impact fees are levied per unit of new development - per residential unit or per square foot of new commercial or office development, the average household size and the average employment density is needed to convert the demand of new residents/employees into the demand of new residential units and new building square footage. Based on US Census data, an average household size of 3.23 has been assumed. City staff has provided estimates of existing commercial and industrial stock and the amount of new space anticipated to be built through 2035, which are presented in Exhibit 19.

Exhibit 19: Existing commercial and industrial stock and anticipated amount of new space ' -
Growth in Service Population - - New Hou-seholds; New -; , - 2017 through 2035 Commercial and Industrial
: _ SF - 2017 through 2035 :;
Residential Population
Commercial Service Population
Industrial Service Population
12,844
1,116
666
3,977
880,000 sq. ft.
1,250,000 sq. ft.

Supported fee amounts on new development to fund needed community service facilities are determined by dividing the portion of costs attributable to the demand generated by new development by the magnitude of new development anticipated through 2035. As shown in Exhibit 20, impact fees of $3,451 per residential unit, $1.19 per square foot of new commercial development and $0.50 per square foot of new industrial development are warranted to fund the construction of community service facilities in Newark to serve the needs generated by new development.

Exhibit 20: Supported Community Service Facilities Impact Fees by Land Use � _ . _ -
-
Residential -
_
Commercial
_
Industrial - • !otal -:

Costs Allocated to New Development
New Development (Units or SF)
Impact Fee per UniUSF
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$13,722,088
3,977
$3,451
$1,051,188
880,000
$1.19
$627,322
1,250,000
$0.50
$15,400,598

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V. USE OF FEE REVENUE
The City plans to use public safety facility fee revenues to construct the facilities identified in Exhibit 3. The City plans to use community service facility fee revenues to construct the facilities identified in Exhibit 12.

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VI. IMPACT FEES IN NEIGHBORING CITIES, MAXIMUM SUPPORTED FEES, AND

RECOMMENDED FEES
A. Public Safety and Community Service Facility Fees in Neighboring Jurisdictions KMA surveyed the impact fees levied by the nearby cities of Union City, Fremont, and Milpitas.

The impact fees levied in these cities are presented in Appendix Tables A-1, A-2 and A-3, and summarized in Exhibit 21.

As shown, the distribution of types of impact fees and the total fee amount varies considerably among the jurisdictions and by land use. Newark is the only jurisdiction with a dedicated public safety fee for police and fire department capital improvements. In comparison, Union City has a general capital facilities fee, which it levies only on residential development. Both Union City and Milpitas do not levy any material impact fees on non-residential development. Newark's total fee amount on new residential development is significantly less than the fees levied in Union City and Milpitas. Newark's residential fees are also less than the fees levied in Fremont, but the difference is not as large.

Newark's impact fees on commercial development are within the band of fees charged by Fremont but significantly more than the fees levied by Union City and Milpitas, both of which do not levy any significant charges on new commercial development. Newark's impact fees on industrial development are less than the fees levied by Fremont but more than the negligible fees levied in Union city and Milpitas.

Exhibit 21: Comparison Public Safety and Community Service Facility Impact Fees* - � -- -- - - - - - -- - - - ,
L _ Newark Fremont lJ_nic:>n City Milpitas _
Public Safety Facility Fees
$1,989 - 3BR = $371;
Residential $2,079 4BR = $457 $0 $0
Commercial $1.73 $0.18-$0.31 $0 $0
Industrial $0.17 $0.10 -$0.24 $0 $0
Community Service Facility Fees
$1,596 3BR = $2,569 $8,624
Residential $1,942 4BR = $3,163 $12,231 $0
Commercial $0.36 $0.55 -$0.92 $0 $0
Industrial $0.31 $0.31 -$0.71 $0 $0
Total Fees
$22,135 3 BR= $29,158 $38,138 $29,089-
Residential $29,732 4 BR= $31,012 $42,075 $44,673
Commercial $7.06 $6.22 -$7.57 < $1.00 $0
Industrial $1.85 $2.03 -$4.53 < $1.00 $0
*excludes affordable housing fees levied on residential development and fees levied on building permit valuations or any basis other than per unit or per square foot.

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8. Maximum and Recommended Impact Fees
We recommend that the adopted fees be set at the amounts supported by this nexus study given that the proposed public safety and community service facility fee amounts and total fees in Newark (after adoption of the recommended fees) would not exceed the levies in neighboring communities.

Exhibit 22: Maximum and Recommended Fee Schedules
Residential
Commercial
Industrial
Public Safety Facility Fee
$2,311 per unit
$1.72 per square foot
$0.36 per square foot
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Community Service Facility Fee
$3,451 per unit
$1.19 per square foot
$0.50 per square foot

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VII. FEE PROGRAM IMPLEMENTATION AND ADMINISTRATION
The Mitigation Fee Act includes a series of reporting requirements designed to ensure that development impact fee revenues are properly accounted for, used appropriately, and that, where funds are ultimately not used, are reimbursed. In addition, jurisdictions adopting fee programs should determine their preferred approach to updating the fee schedule and whether they intend to allow for exemptions, credits, and reimbursements (under any additional circumstances). The following fee program implementation and administration parameters are our standard recommendations. The City's existing program may already include some or all of these recommendations.

A. Credits, Reimbursement, and Exemptions
Under certain and limited circumstances, as determined by the City, the Impact Fee Resolution could allow developers subject to the fee to obtain credits, reimbursements, or exemptions. In cases of redevelopment, the demolition of space should provide a fee credit. In other words, the gross fee obligation should be calculated based on the scale of the proposed new development, with a fee credit to be applied for existing square footage to be removed (or retained) using the applicable fee for the existing square footage (land uses). Existing developments that are being replaced due to a natural disaster are also exempt from the impact fees.

All other fee credits and/or reimbursements should not be allowed by right but rather should be subject to review by City staff and Council to ensure that such credits or reimbursements are warranted and appropriate.

8. Securing Supplemental Funding
The maximum, supportable development impact fee is set to cover the public safety and community service facilities investments needed to fund the demands generated by new development. As presented in this analysis, new development is estimated to generate only a portion of the demand for the planned facilities and therefore the fee levies are anticipated to provide only a fraction of the funds needed to construct the facilities. It is anticipated that the City of Newark will need to secure additional funding in order to complete the capital facilities.

C. Annual Review and Periodic Study Update
The Mitigation Fee AcUAB 1600 (at Gov. C. §§ 66001(c), 66006(b)(1)) stipulates that each local agency that requires payment of a fee make specific information available to the public annually within 180 days of the last day of the fiscal year. This information includes the following:
• A description of the type of fee in the account
• The amount of the fee
• The beginning and ending balance of the fund
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• The amount of fees collected and interest earned
• Identification of the improvements constructed
• The total cost of the improvements constructed
• The fees expended to construct the improvement
• The percentage of total costs funded by the fee
Because of the dynamic nature of growth and capital equipment requirements, the City should monitor inventory activity, the need for improvements, and the adequacy of the fee revenues and other available funding. To the extent particular issues are identified, adjustments to the fee program may be required.

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Table 1
City of Newark Population and Employment
I . - - - - • . -.. «--- � - Additio-nal� 2017
' � I 2016 . In progress . • through 2035 2035 1
Population'
Employment'
Office
Retail
50 %R&D
Total Commercial
Light Industrial
Heavy Industrial
50%R&D
Total Industrial
Total Employment
44,733 2,933
1,197
7,762
3,545
12,504
1,749
1,565
3,545
19,363
�
12,844 60,510
850 2,047
900 8,662
1,350 4,895
3,100 15,604
300 2,049
200 1,765
1,350 4,895
� �
4,950 24,313
' State Deportment of Finance E-5 is source of estimate of current population. Estimate of population in 2035 is the Newark General Pion.
2 ESRI is source of current employment estimates. 2035 employment estimates hove been provided City staff Prepared by Keyser Marston Associates, Inc.
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Table 2
Residential Units and Non-Residential Gross Building Area ; •
- --- - - • • ---Additional· 2017 I 1 2016 . In progress through 2035 2035 :

Res1dent1al Housing Units
Commercial SF2
Office
Retail
50%ofR&D
Total Commercial
Industrial SF'
Light Industrial
Heavy Industrial
50%R&D
Total Industrial
otal Commercial+ Industrial SF
13,470 908
est.
290,000
3,500,000
1,290.000
5,080,000
1,200,000
5,100,000
�
1,290,000
12,670,000
3,977 18,734
130,000 420,000
300,000 3,800,000
450.000 1,740,000
880,000 5,960,000
200,000 1,400,000
600,000 5,700,000
�
450.000
�
1,740,000
2,130,000 14,800,000
' Stole Deportment of Finance E-5 is source of estimate of current housing units. Estimates of future units Is based on General Pion estimates of population and SDOF overage household size of 3.31. 1 Estimates a/ non-residential gross building area have been provided by City staff and KMA based on standard employment density factors.

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Table 3
Population Fair Share Allocation: Existing/New Development and Public Service Population - -- - - -
- I Factor Source Number Percent AllocationI
Residents
Existing SDOF, E-5 44,733 73.9%
In progress City staff+ SDOF 2,933 4.8%
New Growth � 21.2%
Buildout General Plan 60,510 100.0%
Employment
Existing ESRI 19,363 79.6%
New Growth City staff 4.950 20.4%
Buildout 24,313 100.0%
Public Service Population (1)
Existing 51,704 74.6%
In Progress 2,933 4.2%
New Growth 14.626 21.1%
Buildout 69,263 100.0%
' Public service population is on ollocotion foctor which differentiates between the impoct of emloyees and residents. It equols resident populaitan plus .36 of employment. Per o prior Newark General Pion, the .36 factor reflects on adjust met of one-half (8/16) to reflect the workday's shore of awake hours ond on odjustemt of 5/7 to re/feet he workweeks's share of o week.

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Table 4
New Public Facllltles Needs and Portion of Needs Attributable to New Development Impact Fee Study
Newark, CA

2.00% % of Need Generated by: Allocation of Costs
Total, With Existing New Method of Existing New
Fire Total Cost Admin. D�velo�m�nt Develo�ment Allocation Develo�ment Develo�ment Fire Adm In Portion of City Administration Building $ 2,557,400 $2,608,548 78.9% 21.1% 1 $2,057,701 $550,847 Community Alerting and Warning System $ 75,000 $76,500 78.9% 21.1% 1 $60,346 $16,154 Fire Station No. 27 Energy Efficient Windows $ 40,000 $40,800 78.9% 21.1% 1 $32,184 $8,616 Fire Station No. 27 Training Tower $ 2,000,000 $2,040,000 78.9% 21.1% 1 $1,609,214 $430,786 Fire Station No. 29 Truck Exhaust System $ 45,000 $45,900 78.9% 21.1% 1 $36,207 $9,693 Replace Fire Station No. 27 $ 5,300,000 $5,406,000 78.9% 21.1% 1 $4,264,416 $1,141,584 Replace and Expand Fire Station No. 292 $ 6,400,000 $6,528,000 65.3% 34.7% 1 $4,264,416 $2,263,584 LadderTruck/Fire Engine to serve new population $ 1,200,000 $1,224,000 0.0% 100.0% 1 $0 $1,224,000 Traffic Signal Preemtion (Opticom) $ 160,000 $163,200 78.9% 21.1% 1 $128,737 $34.463 Total Fire $ 17,777,400 $ 18,132,948 68.7% 31.3% $ 12,453,221 $ 5,679,727 Police
Police Center at the Civic Center $ 23,016,600 $23,476,932 78.9% 21.1% 1 $18,519,312 $4,957,620 Police Vehicles (5) to serve new population $ 325,000 $331,500 0.0% 100.0% 1 $0 $331,500 Police Department Substation Facilities $ 850,000 $867,000 78.9% ll.lli 1 $683,916 $183.084 Total Police $ 24,191,600 $ 24,675,432 77.8% 22.2% $ 19,203,228 $ 5,472,204 Total, Public Safety $ 41,969,000 $ 42,808,380 73.9% 26.1% $ 31,656,449 $ 11,151,931 1 Allocated based on service population.
1 The cost to repface the station is $5.3 million. The cost of tile expansion is $1..1 million. The replacement cost Is distributed to existing and new development proportionate to their shore of service population. 100% of the expansion cost Is allocated to new development.

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Table 5
New Community Service Facilities Needs and Portion of Needs Attributable to New Development Impact Fee Study
Newark, CA
Total Cost
Communlt� Service Facilities
City Administration Building at Civic Center $ 17,262,450 Equipment Shop Heavy Duty Vehicle Hoist $ 60,000
History Center (Phases 2,3,4) $ 4,000,000
Library at the Civic Center $ 21,098,550
Mowry Avenue Backup Walls $ 900,000
New Fuel Management System $ 60,000
New Senior Center $ 7,500,000
Newark Boulevard Backup Walls $ 1,200,000
Performing (or Cultural) Arts Center $ 9,000,000
Service Center Fuel Tank Canopy $ 130,000
Service Center Storage Facility $ 400,000
Service Center Waste Disposal Upgrades $ 250,000
Silliman Complex Restroom/Maintenance Facility $ 700,000 Thornton Avenue Streetscape $ 2,200,000
Electrical Vehicle Charging Stations $ 200,000
New Homeless Shelter $ 1,500,000
Service Center Expansion $ 5,000,000
Total Community Facilities $ 71,461,000
' Allocated based on service population.
2 Allocated based on residential population.

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2.00% % of Need Generated by:

Total, With Existing New
Admin. Develogment Develogment
$17,607,699 78.9% 21.1%
$61,200 78.9% 21.1%
$4,080,000 78.9% 21.1%
$21,520,521 78.9% 21.1%
$918,000 78.9% 21.1%
$61,200 78.9% 21.1%
$7,650,000 78.8% 21.2%
$1,224,000 78.9% 21.1%
$9,180,000 78.9% 21.1%
$132,600 78.9% 21.1%
$408,000 78.9% 21.1%
$255,000 78.9% 21.1%
$714,000 78.9% 21.1%
$2,244,000 78.9% 21.1%
$204,000 78.9% 21.1%
$1,530,000 78.9% 21.1%
$5,100,000 1.[,ili 21.1%
$ 72,890,220 78.9% 21.1%
Allocation of Costs
Method of Existing New
Allocation Develogment Dev�logmen!
1 $13,889,484 $3,718,215
1 $48,276 $12,924
1 $3,218,427 $861,573
1 $16,976,036 $4,544,485
1 $724,146 $193,854
1 $48,276 $12,924
2 $6,026,169 $1,623,831
1 $965,528 $258,472
1 $7,241,461 $1,938,539
1 $104,599 $28,001
1 $321,843 $86,157
1 $201,152 $53,848
1 $563,225 $150,775
1 $1,770,135 $473,865
1 $160,921 $43,079
1 $1,206,910 $323,090
1 �4,023,034 �1,076,966
$ 57,489,622 $ 15,400,598

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Table 6
Allocation of New Development's Share of Public Safety Facilities' Costs by Land Use Impact Fee Study
Newark, CA
Total facilities
Needs Attributable
to New
Develoement
Fire
fire Admln Portion of City Administration Building $550,847 Community Alerting and Warning System $16,154
Fire Station No. 27 Energy Efficient Windows $8,616
Fire Station No. 27 Training Tower $430,786
Fire Station No. 29 Truck Exhaust System $9,693
Replace Fire Station No. 27 $1,141,584
Replace and Expand Fire Station No. 29 $2,263,584
LadderTruck/Flre Engine $1,224,000
Traffic Signal Preemtion (Opticom) $34.463
Total Fire $5,679,727
Police
Police Center at the Civic Center $4,957,620
Police Vehicles (5) $331,500
Police Department Substation Facilities $183.084
Total Police $ 5,472,204
Total, Public Safety $11,151,931
'Allocation Method
Table Ref.
#1- Service Population
#2 - Residential Population
#3- Distribution of city-wide calls for fire/EMS services /Appendix A}
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Method1
3 3
3 3
3 3
3 3
3 1
1 1
Resident/al

87.8%
100.0%

77.16%
Residential Commercial Industrial
$425,029 $106,201 $19,617
$12,465 $3,115 $575
$6,648 $1,661 $307
$332,392 $83,054 $15,341
$7,479 $1,869 $345
$880,838 $220,093 $40,654
$1,746,564 $436,409 $80,611
$944,429 $235,982 $43,589
$26,591 $6.644 $1.227
$4,382,434 $1,095,027 $202,266
$4,353,602 $378,274 $225,744
$291,111 $25,294 $15,095
$160.778 lli.2ZQ $8,337
$4,805,491 $417,537 $249,176
$9,187,925 $1,512,565 $451,442
Commercial Industrial

7.6% 4.6%

0.0% 0.0%

19.28% 3.56%

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Table 7
Allocation of New Development's Share of Community Service Facilities' Costs by Land Use Impact Fee Study
Newark, CA
Total Facilities
Needs Attributable
to New Allocation
DeveloRment Method'
Commun it:£ Service Facilities
City Administration Building at Civic Center $3,718,215 1 Equipment Shop Heavy Duty Vehicle Hoist $12,924 1
History Center (Phases 2,3,4) $861,573 1
Library at the Civic Center $4,544,485 1
Mowry Avenue Backup Walls $193,854 1
New Fuel Management System $12,924 1
New Senior Center $1,623,831 2
Newark Boulevard Backup Walls $258,472 1
Performing (or Cultural) Arts Center $1,938,539 1
Service Center Fuel Tank Canopy $28,001 1
Service Center Storage Facility $86,157 1
Service Center Waste Disposal Upgrades $53,848 1
Silliman Complex Restroom/Maintenance Facility $150,775 1 Thornton Avenue 5treetscape $473,865 1
Electrical Vehicle Charging Stations $43,079 1
New Homeless Shelter $323,090 1
Service Center Expansion $1,076,966 1
Total Community Facilities $15.400,598
'Allocation Method
Table Ref. Resident/al
111- Service Population 87.8%
112 - Residential Population 100.0%
Toto/ Community Facilities $15,400,598
senior $1,623,831
non-senior $13,776,767
'¼all
%senior
% non senior
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\\SF-FSZ\wp\16\16090\003\revlsed analysis 03 16 17; 3/16/2017 Residential Commercial Industrial
$3,265,202 $283,705 $169,308
$11,349 $986 $588
$756,602 $65,739 $39,232
$3,990,802 $346,751 $206,932
$170,235 $14,791 $8,827
$11,349 $986 $588
$1,623,831 $0 $0
$226,981 $19,722 $11,769
$1,702,355 $147,913 $88,271
$24,590 $2,137 $1,275
$75,660 $6,574 $3,923
$47,288 $4,109 $2,452
$132,405 $11,504 $6,866
$416,131 $36,157 $21,577
$37,830 $3,287 $1,962
$283,726 $24,652 $14,712
$945.753 $82.174 $49,039
$13,722,088 $1,051,188 $627,322

89.1% 6.8% 4.1%
Commercial Industrial

7.6% 4.6%

0.0% 0.0%
$13,722,088 $1,051,188 $627,322
$1,623,831 $0 $0
$12,098,257 $1,051,188 $627,322

89.1% 6.8% 4.1%
100% 0% 0%

87.8% 7.6% 4.6%

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Table 8
Public Safety Facilities Impact Fees by Land Use
Costs Allocated to New Development
New Development (Units or SF)
Impact Fee per Unit/SF
Current fee
Residential
$9,187,925
3,977
$2,311
$2,000
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$1,512,565 $451,442 $11,151,931
880,000 1,250,000
$1.72 $0.36
$1.73 $0.17

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Table 9
Community Service Facility Impact Fees by Land Use
Costs Allocated to New Development
New Development (Units or SF)
Impact Fee per Unit/SF
currentfee
Residential
$13,722,088
3,977
$3,451
$1,900
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$1,051,188 $627,322 $15,400,598
880,000 1,250,000
$1.19 $0.50
$0.36 $0.31

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Table 10
Distribution of Fire Protection Service Calls by Land Use Newark, CA
Source· City of Newark
Count ol Incident#
Occupancy Descr
All Olher Residential
Apar1ments
Heallh Care and Penal Institutions
Hotels and Motels
lnduslry, Uillily, Defense, Laboratortes, Manufacturing Other
Other Structures (vacant buildings, building under construction, outbuildings, bridges.eel)
others
Private Dewelllngs (1 or 2 family), Including mobile homes Public Assembly (Church, restaurant, clubs, eel)
Schools and Colleges
-
Storage In Structures (barns, vehicle storage garages, general storage, eel)
Stores and Offices
(blank)
ResidenUal. Other
Boarding/Rooming House, Residential Hotels
Grand Total
Not Included In land use distribution
Other Residential
Single Family
Multifamily
Commerclal
Industrial
Total
Total included In land use distribution
Breokdown oj Fire Protection service Population by Land Use Residential
Commercial
Industrial
Total Included In analysis
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\\SF·FS2\wp\16\16090\003\revised analysis 0316 17; 3/16/2017 Incident Type
Cancelled False Alann
73 3
8 24
8 7
1 2 ,_ 55
1 17 I
1 32
19 6 25
,_ 130
9 2
156 267
721 22.8%
12 0.4%
757 23.9%
1116 35.3%
471 14.9%
l!l blli
3164 77.2%
2443
1885 77,161'
471 19.281'
§1 3.56%
2443 100.0¾
HazMal Olher Fires Rescue, EMS Services Call Struclure Fire Grand Total 3 ---3
4 2 109 20 5 213
77 5 1 66
1 50 2 1 62
11 6 4 45
1 1
36 31 357 119 3 561
27 2 32
20 15 497 157 13 757
2 6 102 12 140
2 9 6 �1 51
3 2 B B 42
7 1 211 26 - 276
130
882 19 912
8 1 9
75 57 2351 383 31 3320
3320

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APPUIDIX TA8LEA•l
COMPARISON OFRESJDEHTIAL IMPACT FEES, EXQUOING AffOR0ABLE HOUSING FEES NEWARK AND NE-IGH80RltlG JURlSDlOIONS
OTYOF NE.WARK
lmpacthu/du' Newark Dublin
Arts Requffemtnl $270 Sn Below
Fire Impact Fee None Sf: $B70, MF: $5,44
Park fadlitlts / P.uklind MF: $18,000 5F/Mf: $18,646
Dedfcalion Fee1 Sf: $25,000
Public Fitcility Impact Fe:e1 Pub/k Saftry MF: $2,079, SF{MF: $5,798 Sf: $1,989
Comm. Strvlcr MF: $1,S96
SF: $1,942
1raf1Sportot/on � MF: $460,
Totol MF: $4,135,
SF: S4 732
Tr�tnc lmp1.ct Ferc Included In None
Publlc Fadllty Ferc
Trf.Yalley Tnniportatfon None SF:$3,060
Dtvetopmtnl Fte:• MF:$2,108
Total Feu / du Sf: $29,732 Sf: $28,'374
MF:$22,115 MF:$27,096
FusosXDIBl'V
Arts Reaufrement Su Above :i,. 20 du: o.s" BPV
G1m(ril Plin Cost Recoverw .S% BPV None
Tot11l"of8PV .S% BPV 0.S"BPV
Fees l'.SF Bllildlna f Potfloll
Fire Equipment Acqubitfon None See Above
Fees as" of Bu/ld(ng and Pion
General Pl1n Cost RtCOVl!ry SetAhOVt' None
Fremont
None
06St:$143
1BR: $214
28R: $300
JBR: $371
4SR: $457
+BR: ♦$86/BR
OM:$9,220
lBR: $13,830

2.BR: $19,362
3BR: $23,'371
4BR: $29,502
+BR:+S,531/BR
OBR:$988
lBR:$1,483
26R: $2,076
3BR: $2,569
4BR: $3,163
+flR: +�593/BR
0/lBR: $2,012
2/MR: $2,247
4♦8R:<34"1
None
0bR:$12,363
lBR: $17,539
29ft: $23,985
lBR: $29,153
4BR: $31,012
+BR: $6,210/BR
None
None
None
SeeAbolle
15'4 ofBulldln,: and Plan
Chtct. Permlb
Notes: lhls chart prestnts ,n ovtrvltw and terms mIy be simplified. Consult code and dty staff for more Information.

H1yward
None
None
5F0! $11,953
SfA: $11,395
MF:$9,M3
Nooe
Noo•
None
SFO: $11,953
SFA:$11,395
MF:$9,&Sl
None
Nooe
Nooe
Nooe
12" of BulldlnJ and Plan
Check Permits
Mllpitu Pleu1nton S11n tJt11ndro Union City
Nont None None See Below
None None None See Below
Varin by pop. dtnsfty Sf:$9,709,MF:$7,%9 Sf: $16,079; subdivldon:

SFD: $44,673 MF:$14,054 Vories by pop. dtMlfy
SFA: $3S,438 $28,193 (avg.)
MF (2-4 du): $36,13J Non•Subdlvhlon:

MF (S♦-duJ: $29,089 $2,466 pfut $280 (�lBR},
$4SS (28R), $630 (3+BRI
None SF0:$4,730 None SF: $12,231, MF: $8,624
SfA: $3,532
MF:$2,88S
None Sf: $4,707 $1,337•$2,01 s:

MF: $3,294 senior: $667·$897 5
None SF:$3,060 None None
MF:$2,108
V•tlu by pop, density SFD: $22,206 � SubdjvMon
SFD: $44,673 SFA: $20,056 SF:$17,416-$18,094 SF:$42,075 SFA: $35,438 MF:$16,256 MF: $15,391-$16,069 MF:$38,131
MF (2-4 du): $36,131 � Non-Subdlvls[2:o
MF (5+ du): $29,089 SF:$16,746-$16,976 SF
MF: $14,721•$14,951 �18R: $16,628
lBR:$16,801
38R: $16,978
MF
0-lBR: $12,691
2BR: $11,866
38R: $13,041
None None None 1%8PV
None None Noo, None
None None Non, 1%8PV
None !lone None $1.40 PSF occupl,1ble space
above 2nd s1nn1
None None Noo, None
Abbrevla1lons· SF,. Sln&le Family SFA • Sf Attadil!d
MF"' Multl·Famlly BpV"' Building Permit V,1lue
PSF • Per Square Foot
Bl\:btdtoom
SfD"' SF De!achtd
du,._ Dwell!n1 unit
1 Euludts on,sll.e lnch.1don1ry r�ulremCfltJ.
, For Mllpltn •rid Un!on City, fu k MlimIlt'd bastd on populitlon den11tki de1fv.d from Ce MIA and D0F dit.i. lo Ml1pltu, developer mIv submit •titernItl\'e popula0on f"ltlmate. 40Kof Mllpltu fff may be mtt throu1.h 1he prnvi�!on or p,fvate open spue:. ,Gene111ly supports stxh fadllllti at llbn1le:s, pub ilnd other coirtmunlry buftdlnv:. llew,illk fee ln<ludH 1r1osport1llofl laclijlfn. 'RriJ0111I tucoUKlt'd on bthlllf of thrlrJ.V,lltYTlll\iportltlon Onelopmellt DkUkL Pt11parN by Ke)'lerMIr.t<MiA5wdIlc,, loc. Page 32
FIiename: C:\Uura\ldeenty'Dnkt119Vlewal1( A-4 A,5;.Ul812015;hgt

Appendix Table A-3
Comparison of Non-residential Impact Fees'
Impact Fees Newark Fremont1 MIipitas Union City'
Commercial $0.36 Capital Facilities Impact Fee:

Industrial $0.31 Office $0.92
Retall / service $0.55
Public Facilities Impact Warehouse $0.39 None None Fee Light Industrial $0.31 Manufacturing $0.56
Research & Development $0.71
Hotel/ Motel (per room) $174.00
(Public Safety) Office $0.31
Commercial $1.73 Retail/ Service $0.18
Industrial $0.17 Warehouse $0.13
Fire Impact Fee Light Industrial $0.10 None See below.

Manufacturing $0.19
Research & Development $0.24
Hotel/ Motel (per rooml $59.00
Park Facilities/ None None None None Parkland Dedication Fee Commercial $1.38 Office $5.00 Traffic Signalization Fee:

Industrial $0.68 Retall / Service $6.84 Office/ retail $0.30 Warehouse $1.51 (assuming FAR of .4 )
light Industrial $3.62 Research & Development/ $0.12 Traffic Impact Fee No City-wide fees Industrial Research & Development $3.59 (assuming FAR of .5)
Manufacturing $2.52
Hotel/ Motel (per room) $2,04 6.00
Business Park $4.23
Affordable Housing Commercial $3.59 None None None Industrial $0.69 Commercial $7.06 Office $6.22
industrial $1.85 Retail/ service $7.57
Warehouse $2.03
light Industrial $4.03
Total Fee Research & Development $4 .53 No City wide lees Manufacturing $3.26
Hotel/ Motel (per room) $2,279.00
Business Park (Office) $5.45
Business Park $4 .97 Manufacturing)
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\\SF-FS2\wp\16\16090\003\non-resldentlal fee comparison 02 13 17; 2/14/2017 Appendix Table A-3
Comparison of Non-residential Impact Fees
Impact Fees Newark Fremont1 Milpitas Union Clly2
Fees as% of Permit
Value
Private-Permit valuation Negotiated between
over $50 million: Developer and City
Must construct Public Art
Private• Permit valuatton or pay In-lieu fee
Arts Requirement None No citywide fee. None
over $250,000: equivalent to 1% of
permit valuation
N/A-must construct Public
Public-Permit valua lion Art with a value
over $250,000: equivalent to 1% of
permit valuation
General Plan Cost None 15% of building permit fee. None 0.1% of permit valuation.

Recovery
Other Fees
Fire Equipment
Offlce /Professional/ Hotel $1.40 /sq.ft. of space
Acquisition See above. See above. None Buildings above the second story lndustrlal Buildings $,06 /sq.ft. of roof area
Sources and notes:
• Unless otherwise specified, prices are calculated per square foot of building area. The table excludes the Impact fees that are related to utilities such as sewer/ water connection fees and school/ specific districts.

1. City of Fremont, Fee Schedule, Effective: September l, 2016

2. City of Union City, Master Fee Schedule, Fiscal Year 2016- 2017. In terms of Traffic Signalization Fees, It sets $5,241/ acre for commercial 2onlng and $2,620/ acre for Industrial 2onlng.

Keyser Marston Associates, Inc. Page35
\\SF-FS 2\wp\16\16090\003\non-resldentlal fee comparison 02 13 17; 2/14/2017

APPENDIX D
RESOLUTION NO. 10,633
RESOLUTION NO. 10,633

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

NEWARK ESTABLISHING AN IMPLEMENTING

RESOLUTION FOR THE PUBLIC SAFETY FACILITIES

IMPACT FEE, UNDER GOVERNMENT CODE SECTION
66001, IN ACCORDANCE WITH MUNICIPAL CODE SECTION

3.24.040 AND AMENDING THE MASTER FEE SCHEDULE TO

REFLECT THESE CHANGES
WHEREAS, the City Council of the City of Newark, a general law city ("City"), is authorized to prescribe and establish fees in regard to services or functions performed by the City for the public in a governmental and proprietary capacity; and WHEREAS, California Government Code Section 66000 et seq. allows local governments to impose impact fees on new development in order to recover the cost of improvements that are needed to serve that new development; and WHEREAS, Chapter 3.24 ("Development Impact Fees") of the Newark Municipal Code authorizes the City Council to adopt implementing resolutions establishing development impact fees in order to mitigate the impacts that projects have upon the City's ability to provide public facilities;
WHEREAS, the existing fee needs to be brought into conformity with ctment conditions in the City; and
WHEREAS, the City desires to have an updated Public Safety Facilities Impact Fee that will ensure that all new development pays the cost to provide public safety facilities needed to support new development; and
WHEREAS, the City has retained Keyser Marston Associates to prepare the Public Safety and Community Service Facilities Development hnpact Fee Nexus Study, dated March 2017, which establishes a reasonable relationship between the public safety fee and the purpose of the fee, which study is incorporated herein and attached as Exhibit A; and WHEREAS, the City has duly noticed, advertised, scheduled, and held a Public Heming on May 25, 2017; and
WHEREAS, on May 25, 2017 the City Council reviewed material presented in the staff report including the Public Safety and Community Service Facilities Development hnpact Fee Nexus Study, concerning the pmpose of the fee and the relationship between the fee and its purpose; and
NOW THEREFORE, BE IT RESOLVED by the City Council of the City of Newark which hereby finds, declares, and resolves that:
1) The City hereby receives and approves the Public Safety and Community Service Facilities Development Impact Fee Nexus Study ("Fee Study"), which is attached as Exhibit A to this Resolution.
2) In adopting this Resolution, the City Council is exercising its powers under Chapter 3.24 of the Newark Mwticipal Code, as well as pursuant to Atticle XI, Sections 5 and 7 of the Califom.ia Constitution, Chapter 5 of Division I of the Government Code ("Mitigation Fee Act"), commencing with Section 66000, collectively and separately.
3) After considering the Fee Study, th.is Resolution, and the testimony received at a public hearing, the City Council hereby makes the following find.ings:
a) 1n accordance with Section 66001, subdivision a, paragraph 1 of the Mitigation Fee Act, the purpose of the fees set forth in this Resolution, as specified in Exhibit A, is to provide for an expansion in public safety capital facilities in the City as new growth occurs;
b) In accordance with Section 66001, subd.ivision a, paragraph 2 of the Mitigation Fee Act, the fees collected pursuant to this Resolution, as specified in Exltibit A, shall be used to acquire land and to construct improvements, such as Police and Fire stations and buildings and other public safety facilities for the City, and shall be used to fund any admin.istrative cost associated with the public safety impact fee program; c) In accordance with Section 66001, subdivision a, paragraph 3 of the Mitigation Fee Act, there is a reasonable relationship between the fees use (to pay for the acquisition and construction of public safety facilities) and the type of development for which the fees are imposed in that the fees will be applied to development in the City, which will generate demands for public safety facilities;
d) In accordance with Section 66001, subdivision a, paragraph 4 of the Mitigation Fee Act, the Fee Study demonstrates that there is a reasonable relationship between the amount of the Public Safety Facilities Impact Fee and the cost of public safety facilities attributable to the development upon wltich the fee is proposed. Since the need for public safety facilities is inherently population-driven, associated public safety facility costs are assessed based on average household population and employment; and e) In accordance with Section 66001, subdivision b of the Mitigation Fee Act, there is a reasonable relationship between the amount of the fees and cost of providing the pub lie safety facilities att1jbutable to the development in the City upon which the fees are imposed in that the fees have been calculated by apportioning the cost of public safety facilities acquisition and consh·uction to the number of residents and employees attracted by each type of development.

Resolution No. 10,633 2
4) The City finds pursuant to the California Environmental Quality Act ("CEQA") this action is not a "project" because the Resolution provides a mechanism for funding of public safety facilities but does not involve a commitment to any specific project for such purposes that may result in a potential significant impact on the Environment (CEQA guidelines Section 15378, Pub. Res. Code Section 21080(b)(8)(D)).
5) The cost estimates set fo1th in the Fee Study are reasonable estimates for acquiring and constructing public safety facilities and the fees expected to be generated by future development will not exceed the future projected cost of acquiring and constructing public safety facilities.
6) The method of allocation of the fees to particular development bears a fair relationship and is roughly proportional to each development's burden on and benefits from the public safety facilities to be funded by the fees, in that the fees are calculated based on the number of residents each particular development will attract.
7) The Fee Study is a detailed analysis of how public safety services will be affected by development in the City and the public safety facilities necessary to accommodate that development.
8) The fees are consistent with the General Plan and, pursuant to Government Code Section 65913.2, the City Council has considered the effects of the fees with respect to the City's housing needs as established in the housing element of the General Plan.
9) The fee amounts set forth in this Resolution include the fair and reasonable costs of administration of the fee programs and are within the requirements of the Mitigation Fee Act and other applicable law.
10) The fees are subject to adjustment, which approximate the fluctuation in market costs, and shall be adjusted annually in accordance with the Engineering News Record Constmction Cost Index, San Francisco, California. 11) The City does hereby approve the following public safety impact fees on new residential and commercial development for public safety facilities as follows:

Residential Development
Type of Unit Fee per Unit
Single Family Unit $3,451
Townhome Unit $3,451
Multiple Family Units $2,071
Resolution No. 10,633 3
Commercial Development
Type of Use Fee per Square Foot
Office/Commercial $.60
Manufacturing/Research $.25
and Development
Warehousing/Distribution $.50
(These fees shall be adjusted annually in accordance with the Engineering News Record Construction Cost Index, San Francisco, California.)
12) The city council may elect to waive the payment of the impact fee if a residential or nomesidential development project provides community benefits in excess of those required by the impacts of the project, and if the city council finds that the expected benefits to the community exceed those that would be provided by the payment of the Public Safety Facility Impact Fee. Such community benefits may include the provision of senior housing, the generation of significant taxes, or the elimination of nuisances.
13) The Public Safety Facilities Impact Fees shall not apply to approved projects that are covered by a Development Agreement or Vesting Tentative Map unless the provisions of the document al low the application of such fees. 14) Developers shall be given a credit against this fee for the actual cost of public safety facilities included in their developments.
15) The Master Fee Schedule shall be amended to reflect the Public Safety Facility Impact fees as set forth in this Resolution.
16) Effective Date: This resolution shall be effective upon date of adoption of this Resolution. In accordance with Government Code Section 66017, the fees set by this Resolution shall be effective 60 days from the effective date of this Resolution.
17) Severability. Each component of the fees and all portions of this Resolution are severable. Should any individual component of the fees or other provisions of this Resolution be adjusted to be invalid and unenforceable, the remaining component or provisions shall be and continue to be fully effective, and the fees shall be fully effective except as to that component which has been judged to be invalid.

Resolution No. 10,633 4
I HEREBY CERTIFY the foregoing resolution was introduced at a regular meeting of the City Council of the City of Newark held on May 25, 2017, by Council Member Hannon, who moved its adoption and passage, which motion was carried after being duly seconded, and passed by the following vote:

AYES:

NOES:

Council Members Hannon, Freitas, Vice Mayor Bucci and Mayor Nagy None
ABSENT: Council Member Collazo
SECONDED: Vice Mayor Bucci
AS TO FORM:

Resolution No. 10,633 5
APPROVED:
tt---�-11�
s/ALAN L. NAtfylJ
Mayor

APPENDIX E
RESOLUTION NO. 10,634
RESOLUTION NO. 10,634

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

NEW ARK ESTABLISHING AN IMPLEMENTING

RESOLUTION FOR THE COMMUNITY SER VICE

FACILITIES IMPACT FEE, UNDER GOVERNMENT CODE
SECTION 66001, IN ACCORDANCE WITH MUNICIPAL
CODE SECTION 3.24.040 AND AMENDING THE MASTER

FEE SCHEDULE TO REFLECT THESE CHANGES
WHEREAS, the City Council of the City ofNewai-k, a general law city ("City''), is authorized to prescribe and establish fees in regard to services or functions performed by the City for the public in a governmental and prop1ietary capacity; and WHEREAS, California Government Code Section 66000 et seq. allows local governments to impose impact fees on new development in order to recover the cost of improvements that are needed to serve that new development; and WHEREAS, Chapter 3.24 ("Development Impact Fees") of the Newark Mtmicipal Code authorizes the City Council to adopt implementing resolutions establishing development impact fees in order to mitigate the impacts that projects have upon the City's ability to provide public facilities;
WHEREAS, the existing fee needs to be brought into conformity with current conditions in the City; and
WHEREAS, the City desires to have an updated Community Service Facilities Impact Fee that will ensure that all new development pays the cost to provide community service facilities needed to support new development; and
WHEREAS, the City has retained Keyser Marston Associates to prepare the Public Safety and Community Service Facilities Development Impact Fee Nexus Study, dated March 2017, which establishes a reasonable relationship between the Community Service Facility Fee and the purpose of the fee, which study is incorporated herein and attached as Exhibit A; and WHEREAS, the City has duly noticed, advertised, scheduled, and held a Public Heming on May 25, 2017; and
WHEREAS, on May 25, 2017 the City Council reviewed material presented in the staff report including the Public Safety and Community Service Facilities Development Impact Fee Nexus Study, concerning the purpose of the fee and the relationship between the fee and its purpose; and
NOW THEREFORE, BE IT RESOLVED by the City Council of the City of Newark which hereby finds, declares, and resolves that:
1) The City hereby receives and approves the Public Safety and Community Service Facilities Development Impact Fee Nexus Study ("Fee Study''), which is attached as Exhibit A to this Resolution.
2) In adopting this Resolution, the City Council is exercising its powers under Chapter 3.24 of the Newark Municipal Code, as well as pursuant to Article XI, Sections 5 and 7 of the California Constitution, Chapter 5 of Division 1 of the Government Code ("Mitigation Fee Act"), commencing with Section 66000, collectively and separately.
3) After conside1ing the Fee Study, this Resolution, and the testimony received at a public hearing, the City Council hereby makes the following findings:
a) In accordance with Section 66001, subdivision a, paragraph 1 of the Mitigation Fee Act, the purpose of the fees set forth in this Resolution, as specified in Exhibit A, is to provide for an expansion in community service capital facilities in the City as new growth occurs; b) In accordance with Section 66001, subdivision a, paragraph 2 of the Mitigation Fee Act, the fees collected pursuant to this Resolution, as specified in Exhibit A, shall be used to acquire land and to construct improvements identified in Exhibit A and shall be used to fund any administrative cost associated with the community service impact fee program;
c) In accordance with Section 66001, subdivision a, paragraph 3 of the Mitigation Fee Act, there is a reasonable relationship between the fees use (to pay for the acquisition and construction of community service facilities) and the type of development for which the fees are imposed in that the fees will be applied to development in the City, which will generate demands for community service facilities;
d) In accordance with Section 66001, subdivision a, paragraph 4 of the Mitigation Fee Act, the Fee Sh1dy demonstrates that there is a reasonable relationship between the amount of the Community Service Facilities Impact Fee and the cost of community service facilities attributable to the development upon which the fee is proposed. Since the need for community service facilities is inherently population-driven, associated community service facility costs are assessed based on average household population and employment; and
e) In accordance with Section 66001, subdivision b of the Mitigation Fee Act, there is a reasonable relationship between the amount of the fees and cost of providing the community service facilities attributable to the development in the City upon which the fees are imposed in that the fees Resolution No. 10,634 2
have been calculated by apportioning the cost of community service facilities acquisition and construction to the number of residents and employees attracted by each type of development.
4) The City finds pursuant to the California Environmental Quality Act ("CEQA") this action is not a "project" because the Resolution provides a mechanism for funding of community service facilities but does not involve a commitment to any specific project for such purposes that may result in a potential significant impact on the Environment (CEQA guidelines Section 15378, Pub. Res. Code Section 21080(b )(8)(D)).
5) The cost estimates set forth in the Fee Study are reasonable estimates for acquiring and constructing conununity service facilities and the fees expected to be generated by future development will not exceed the future projected cost of acquiring and constrncting community service facilities. 6) The method of allocation of the fees to particular development bears a fair relationship and is roughly proportional to each development's burden on and benefits from the community service facilities to be funded by the fees, in that the fees are calculated based on the number of residents each particular development will attract.
7) The Fee Study is a detailed analysis of how community services will be affected by development in the City and the community service facilities necessary to accommodate that development.
8) The fees are consistent with the General Plan and, pursuant to Government Code Section 65913.2, the City Council has considered the effects of the fees with respect to the City's housing needs as established in the housing element of the General Plan.
9) The fee amounts set forth in this Resolution include the fair and reasonable costs of administration of the fee programs and are within the requirements of the Mitigation Fee Act and other applicable law.
10) The fees are subject to adjustment, which approximate the fluctuation in market costs, and shall be adjusted annually in accordance with the Engineering News Record Construction Cost Index, San Francisco, California. 11) The City does hereby approve the following community service impact fees on new residential and conm1ercial development for community service facilities as follows:

Resolution No. 10,634 3
Residential Development
Type of Unit Fee per Unit
Single Family Unit $2,311
Townhome Unit $2,311
Multiple Family Units $1,156
Commercial Development
Type of Use Fee per Square Foot
Office/Commercia 1 $.86
Manufacturing/Research $.18
and Development
Warehousing/Distribution $.36
(These fees shall be adjusted annually in accordance with the Engineering News Record Construction Cost Index, San Francisco, California.)
12) The city council may elect to waive the payment of the impact fee if a residential or nonresidential development project provides community benefits in excess of those required by the impacts of the project, and if the city council finds that the expected benefits to the community exceed those that would be provided by the payment of the Community Service Facility Impact Fee. Such community benefits may include the provision of senior housing, the generation of significant taxes, or the elimination of nuisances.
13) The Community Service Facilities Impact Fees shall not apply to approved projects that are covered by a Development Agreement or Vesting Tentative Map unless the provisions of the document allow the application of such fees. 14) Developers shall be given a credit against this fee for the actual cost of community service facilities included in their developments.

Resolution No. 10,634 4
15) The Master Fee Schedule shall be amended to reflect the Cormmmity Service Facility Impact fees as set forth in this Resolution.
16) Effective Date: This resolution shall be effective upon date of adoption of this Resolution. In accordance with Government Code Section 66017, the fees set by this Resolution shall be effective 60 days from the effective date of this Resolution.
17) Severability. Each component of the fees and all portions of this Resolution are severable. Should any individual component of the fees or other provisions of this Resolution be adjusted to be invalid and unenforceable, the remaining component or provisions shall be and continue to be fully effective, and the fees shall be fully effective except as to that component which bas been judged to be invalid.

I HEREBY CERTIFY the foregoing resolution was introduced at a regular meeting of the City Council of the City ofNewark:held on May 25, 2017, by Council Member Hannon, who moved its adoption and passage, which motion was carried after being duly seconded, and passed by the following vote:

AYES:

NOES:

ABSENT:

SECONDED:

Council Members Hannon, Freitas, Vice Mayor Bucci and Mayor Nagy None
Council Member Collazo
Vice Mayor Bucci
\
TO FORM:

APPROVED:
� ,t,, /J�
s/ALAN L. NAG1'J l)
Mayor
Resolution No. 10,634 5

APPENDIX F

TRANSPORTATION IMPACT FEE

NEXUS REPORT
cm
r't
• •

EXHIBIT A
RESOLUTION NO. 10,635
jiP '411111
, _,. �[XAGON T�ANSPO�TATION (ONSULTANTS, IN<.

City of Newark
Transportation Impact Fee Nexus Study
Prepared for:

City of Newark
March 28, 2017
Hexagon Transportation Consultants, Inc.

Hexagon Office: 4 North Second Street, Suite 400
San Jose, CA 95113
Hexagon Job Number: 16AV07
Phone: 408.971 .6100
Client Name: Mr. Terrence Grindall
San Jose• Gilroy• Pleasanton• Phoenix www.hextrans.com
Areawide Circulation Plans Corridor Studies Pavement Delineation Plans Traffic Handling Plans Impact Fees Interchange Analysis Parking Transportation Planning Traffic Calming Traffic Control Plans Traffic Simulation Traffic Impact Analysis Traffic Signal Design Travel Demand Forecasting Newark Transportation Impact Fee Nexus Study March 28, 2017 Table of Contents

1. Introduction ................................................................................................................................. 3

2. Traffic Impacts and Proposed Improvements .............................................................................. 4

3. Maximum Supported Transportation Impact Fee ......................................................................... 5

4. Transportation Impact Fees in Other Cities ................................................................................. 6 Appendices
Appendix A
Appendix B
Appendix C
Future Residential and Employment Growth
Conceptual Drawings Intersection Improvements
Cost Estimates Intersection Improvements
List of Tables
Table 1
Table 2
Table 3
Table 4
Projected Increase in PM Peak Hour Trips by 2035 ............................................................ 3 Newark Transportation Impact Fee Improvements and Cost Estimates ............................... 4 Maximum Supported Impact Fee ........................................................................................ 5 Transportation Impact Fees in Other Cities ......................................................................... 7 �[XAGON Pa ge I ii
Newark Transportation Impact Fee Nexus Study March 28, 2017 1 Introduction
This report presents the results of the analysis to update the Transportation Impact Fee in the City of Newark, California. The Mitigation Fee Act (Government Code Sections 66000-66025) was originally enacted through Assembly Bill 1600 in 1987 and requires that a reasonable relationship (nexus) be established between the projects or mitigations to be funded by an impact fee and the impacts caused by new development. This report serves as the nexus study required by the Mitigation Fee Act and documents the reasonable relationship between projected growth in Newark and the maximum supported Transportation Impact Fee (TIF).

The basis of this study is the 2013 City of Newark General Plan Update Draft EIR. Based on land use data in the General Plan, it is projected that there will be an additional 6,208 residential units and 2,882 jobs by the year 2035. The number of trips that this new growth would generate was estimated with standard trip generation rates for different land use categories from the Institute of Transportation Engineers' Trip Generation Manual, 9th Edition (2012). The projected number of residential units and amount of commercial square footage for each land use category is presented in Table 1. As shown in Table 1, this new development is estimated to generate 6,208 additional PM peak hour trips.

Table 1
Projected Increase in PM Peak Hour Trips by 2035
New
ITE Land PM Peak Hour Trip Dwelling Units or New PM Peak Hour Land Use Use Code Rate 1'2 ksf Trips
Residential (units)
Single Family 210 1.00 2,055 2,055
Town homes 230 0.52 1,375 715
Apartments 220 0.62 2,703 1,676
Senior 252 0.2S 75 19
Employment-Based (ksf)
Industrial 110 0.97 149.6 145
Commercial n/a 1.77 902.0 1,598
Total 6,208
n/a: not applicable
ksf =Square Feet* 1,000
1 Trip rates, except for Commercial, are from ITE Trip Generation Manual, 9th Edition, 2012. 2 Average rate for office and retail per 1,000 square feet, weighted by number of projected office and retail jobs Appendix A presents a summary of the residential projects and the number of units that were included in the analysis. Also included is a tabulation that shows the growth in employment by different types of development. These growth numbers were included in the travel demand forecasting model that was used to forecast the future traffic volumes for the General Plan Update Draft EIR.

Pa ge I 3
Newark Transportation Impact Fee Nexus Study March 28, 2017

2. Traffic Impacts and Proposed Improvements
As described in the City of Newark General Plan Update Draft EIR, the new development that is projected to occur by the year 2035 would result in significant impacts to six intersections. Appropriate mitigation measures were developed as part of the Draft EIR for each of these impacted intersections such that the impact would be reduced to a less than significant level. Furthermore, City staff has identified additional improvements that could lead to increases in alternative mode use and reduce the number of vehicle trips, thereby also mitigating the increased congestion caused by new development.

An effective multimodal transportation system will allow people to choose modes of transportation other than the single-occupant vehicle and will make bicycling, walking, and taking transit attractive, safe, cost-competitive and time-competitive choices. All of the improvements proposed to be at least partially funded with Transportation Impact Fees and the estimated cost of each improvement is presented in Table 2. Conceptual drawings of the Intersection improvements and their cost estimates are presented in Appendices B and C, respectively.

Table 2
Newark Transportation Impact Fee Improvements and Cost Estimates General Plan EIR Intersection Improvements 1 Cost($)
Ardenwood &SR 84 WB Ramps 2 Convert northbound through lane into a left turn lane Newark Blvd & SR 84 EB Ramps Add an eastbound right-turn lane Thornton Ave & Gateway Blvd Add a southbound through lane Thornton Ave & Cherry Street Add a westbound left-turn lane Mowry Ave & Cherry Street Add a westbound right-turn lane Stevenson & CherrtwS�t,_,,re"'e,.,.t_
2 ______ -1Add a northbound through lane
Sub Total
Other Transportation Improvement Projects 3
,_fentral Avenue Railroad Overcrossing
Dumbarton Transit Station
Bike/ pedestrian railroad overcrossing at the Dumbarton Transit Station Cherry Street Class 1 bike route
Sub Total
Total
,�
,_
212,000
1,192,000
3,282,000
1,103,000
1,924,000
364,000
8,077,000
Cost($)
8,300,000
7,700,000
2,800,000
4,000,000
22,800,000
30,877,000
1 These cost estimates include planning-level estimates of the work involved to meet the improvements required by the EIR.

The estimates do not include items outside the scope of the EIR (e.g. other improvements on Thornton Ave, such as sidewalks).

The estimates also does not include ROW acquisition costs. Costs rounded to the nearest $1,000. 2 These cost estimates reflect 50% of the total improvement costs. Since these intersections straddle the city boundary of Newark and Fremont, it is assumed that Newark's share would be 50% of the cost. • These transportation improvement projects and cost estimates were provided by City Staff.

Thus, for the purpose of calculating the Transportation Impact Fee, the City's share of total improvement cost is $30,877,000.

I
Pa ge I 4
Newark Transportation Impact Fee Nexus Study March 28, 2017

3. Maximum Supported Transportation Impact Fee
The maximum legally supported transportation impact fee has been calculated by dividing the cost of the improvements to be funded by the TIF, by the number of additional PM peak hour trips that would be generated by new development by the year 2035. This methodology provides a clear nexus between the new development, the improvements to be funded, and the amount of the fee. The cost of the improvements to be funded with impact fees is $30,877,000. The projected number of trips generated by new development, as shown in Table 1, is 6,208 additional PM peak hour trips. The resulting maximum impact fee is $4,974 per PM peak hour trip.

This per PM peak hour trip amount can be converted to a per unit or per thousand square feet (KSF) amount by using the PM peak hour trip generation rates shown in Table 1. Table 3 presents the resulting TIF per dwelling unit for residential uses and per ksf for commercial uses, based on a TIF of $4,974 per PM peak hour trip.

Table 3
Maximum Supported Impact Fee
TIF per
Land Use ITE Category
PM Peak Hour
Trip Rate 1'2 Dwelling Unit or ksf 3
Residential (units)
Single Family 210 1.00 $4,974
Townhomes 230 0.52 $2,586
Apartments 220 0.62 $3,084
Senior 252 0.25 $1,243
Employment-Based (ksf)
Industrial 110 0.97 $4,824
,-Commercial n/a 1.77 $8,814
n/a: not applicable
1 Trip rates , except for Commercial , are from ITE Trip Generation Manual, 9th Edition, 2012. 2 Average Rate for Office and Retail per l,000square feet, weighted by employment type. 3 TIF rates based on $4,974 per PM peak hour trip.

Since construction costs continue to rise, it is appropriate to index these impact fees to inflation. The fees should be adjusted annually by a construction cost index, such as the Engineering News Record. �
........

Pa ge I 5
Newark Transportation Impact Fee Nexus Study March 28, 2017

4. Transportation Impact Fees in Other Cities
In order to establish a transportation impact fee of $4,974 per PM peak hour trip in the context of TIFs charged by other cities in the Bay Area, information on current TIF levels in some Bay Area cities was compiled. A recent (internet) survey focused on nearby cities of Fremont and Milpitas and cities on the Peninsula and in the South Bay. These fees are presented in Table 4. Note that the survey included only impact fees charged for transportation improvements, not for such other purposes as public safety, community facilities, housing, or parkland. Some cities specify impact fees on a "per dwelling unit" or "per thousand square feet (ksf)" basis; other cities define fees solely on a "per trip" basis.

As can be seen in Table 4, Newark's existing TIF amounts are much lower than any of the other cities included in the survey. The updated TIF amount for single-family and multi-family units would be higher than the amounts charged by most other cities included in the survey. The fee of $4,974 per single family unit would be lower than the average fee of $5,515 computed for all cities included in the survey.

The impact fees for commercial space vary greatly between the cities, from $1,280 per ksf in downtown Redwood City to $26,127 per ksf in the Transit Area District in Milpitas. The new Newark fee of $8,814 per ksf is somewhat higher compared to most other cities that were surveyed.

The impact fees for industrial space vary from $1,160 per ksf in downtown Redwood City to $14,440 per ksf in North San Jose. The new Newark fee of $4,824 per ksf is higher compared to fees charged for industrial development in most other cities that were surveyed.

Some cities have chosen to exempt certain land uses from their TIF or use lower rates for land uses that they want to encourage. For example, Mountain View charges an extremely high TIF on office and R&D land uses in the North Bayshore area, but a far lower TIF on retail uses, because they want to encourage retail projects in that area in order to reduce total Vehicle Miles Traveled (VMT) in the city.

As another example, in the North San Jose area, the City of San Jose exempts all retail under 100,000 square feet from the TIF and only charges the TIF on large regional-serving retail projects over that size.

Page I 6
Newark Transportation Impact Fee Nexus Study March 28, 2017 Table 4
Transportation Impact Fees in Other Cities
Single F an11ly Multi Family Off,ce R&D Industrial Hotel City or Area w1th111 City Per PM Trip Per d.u. Per d.u. Per ksf Per ksf Per ksf Per Room East Bay Cities
Newark 1
Current TIF $ 801 $ 460 $ 1,380 $ 680
Updated TIF $ 4,974 $ 4,974 $ 3,084 $ 8,814 $ 8,814 $ 4,824 Fremont 2 $ 2,247 $ 2,247 $ 4,997 $ 3,588 $ 2,515 $ 2,046 Milpitas
TAD Impact Fee l $ 32,781 $ 36,600
Fee for Transportation Improvements $ 9,561 $ 26,127
Peninsula/South Bay Cities
San Jose
North San Jose Area $ 15,410 $ 9,677 $ 7,742 $ 14,440 $ 4,299 Evergreen-East HIiis Area $ 15,148 $ 13,170
US 101/0akland Ave/Mabury Rd $ 35,767 per PM peak hour trip that would use one of the Improved interchange, 1-280/Wlnchester Blvd. $ 25 641 per PM Jleak hour trip that would use the proposed off-ramp Improvement Menlo Park
Citywide $ 3,108 $ 3,139 $ 1,927 $ 4,630 $ 3,330 $ 2,280 $ 1,834 Supplemental Downtown $ 379 per PM peak hour trip within El Camino Real/Downtown Specific Plan area Redwood City
Non-Downtown $ 1,617 $ 992 s 2,380 $ 1,710 $ 1,550 $ 945 Downtown $ 1,212 $ 744 $ 1,790 $ 1,280 $ 1,160 $ 709
San Carlos $ 3,052 $ 1,892 $ 4,547 $ 3,266 $ 2,228 $ 1,831 San Mateo $ 3,763 $ 3,422 $ 2,101 $ 3,135 $ 2,042
Los Altos $ 6,152 $ 3,777 $ 9,076
Mountain View
North Bayshore Area $ 22,470 $ 22,470 $ 2,000
Sunnyvale
South of SR 237 $ 2,197 $ 1,348 $ 3,240 $ 2,131 $ 1,610 $ 1,327 North of SR 237 $ 5,931 - $ 5,746 $ 4,346 $ 4,494
Los Gatos 4 $ 9,020 $ 8,587 $ 5,998 $ 9,949 $ 7,315 $ 6,287 $ 7,369 Half Moon Bay $ 6,414 $ 3,499 $ 4,021 $ 4,021 $ 2,515
Sources: TIF amounts are from each city's website.
1 The current Newark TIF Is from the City's Master Fee Schedule as of July 1, 2016. 2 Fremont specifies TIF amounts for residential uses based on the number of bedrooms. Amount shown is for 2-3 bedroom units. 3 Transit Area Development Impact Fee includes fees for many services and improvements. The fee for just the transportation improvements was estimated from data presented in Table S on Page 10 of the Transit Area Development Impact Fee Update Final Report, February 2014. 'Los Gatos specifies Its TIF as $902 per DAILY trip. PM peak hour trip amount has been approximated as 10 times the daily amount.

Amounts for specific land uses have been calculated using daily ITE trip generation rates and $902 per dally trip. �[XAGON Page 7
City of Newark
Transportation Impact Fee Nexus Study
Technical Appendices
Appendix A
Future Residential and Employment Growth
I Residential Develop�ent Projects
PM Peak Hour Trips Rate .
1 1.00 0.52 0.62
Location Single Family Town homes Apartments
Timber 84 80
Cedar Lane Town homes 85
Prima 42 146 93
Baptist Church Site (Equinox) 15
Casa Bella 14
Ruschin School Site 77
Bavshores 187 360
Dumbarton TOD-SSH Towns 88
Dumbarton TOD- Senior
Dumbarton: Trumark 244
Dumbarton TOD Gatewav West 321 268
36731 Svcamore 14
Sanctuary 385
7843 Railroad 6
6840 Rieh 18
Filbert Townhomes 16
Freitas (Robsen Homes) - _J � I 180
Ashland Dumbarton TOD 11_ - 120 '
Old Town Residential II 400
FMC Dumbarton TOD -----, II 180
Area4 Ir 700 -
Honeywell TOD II 210
·-
Greater Newark Apartments 1,800
Totals 2,055 1,375 2,703
PM Peak-Hour Trips 2,055 715 1,676
Under Construction 141 325 93
Approved 1,214 716 14
Pending 0 34 6
Long Range 700 300 2,590
Totals 2,055 1,375 2,703
1 PM Peak hour trips by --·-
land use type calculated based ITE trip generation rates: - • Single Family - ITE Code 210
Town homes -- ITE Code 230 --- --
�part_ments/Condos --
ITE Code 220 -
Senior Housing [Attached] ITE Code 252

0.25 Total PM Peak
Senior Units Hour Trips
164 126
85 44
281 176
15 15
14 7
77 77
547 374
88 46
75 75 19
244 244
589 460
14 9
385 385
6 4
18 9
16 8
180 94
I 120 62
- 400 248
180 112
700 700 -
- 210 130
1,800 1,116
75 6,208 4,465
19 0 559 368
75 2,019 1,614
0 40 21
0 3,590 2,462
75 6,208 4,465
__ ,_ ---
- � -- -
·--
-
-I-�-
Commercial Development Projects
SF of Development 3
PM Peak Hour Trip Rate per KSF •

0.97 2.78 1.49
PM Peak Hour Trips
TAZ
Increase in
GP Jobs 1
Industrial Retail Office Industrial Retail Office Industrial Retail Office 931 20 20 8,000 8
933 40 40 16,000 16
930 97 97 38,800 38
918 110 55 55 27,354 18,430 76
922 110 55 55 27,656 18,229 77
932 217 217 86,800 84
934 511 57 454 28,319 151,454 79
935 1,778 227 1,551 113,612 516,926 316
Totals 2,883 374 394 2,115 149,600 196,941 705,039 145 548 1,051,580 1,744
Notes
TAZ = Traffic Analysis Zone
1 As reported in Newark's General Plan
2 Derived from commercial development descriptions from Newark's General Plan. 3 Square Feet per of development calculated based on ITE PM peak-hour trip rates per 1,000 square feet and per employee.

Light Industrial (Includes Manufacturing ITE Code 110 Assume 2.50 jobs per 1,000 square feet Retail ITE Code 820 Assume 2.0 jobs per 1,000 square feet Office (Includes R&D) ITE Code 710 Assume 3.33 jobs per 1,000 square feet 4 PM Peak hour trips by land use type calculated based ITE Trip Generation Rates. Retail rate Includes a 25% pass by reduction. 27 27
226
770
1,051
Appendix B
Conceptual Drawings Intersection Improvements
� ...........,..

Hcx,gon Transpooation
Consultnnts, Inc.
4 North StG-Ond S11oet, Suite -400
San JOSI, California 95113
Phone: www.hextr11ns..com (-408) 971-6100

CONCEPTUAL IMPROVEMENTS FOR TIF CALCULATION
ARDENWOOD BLVD AND STATE ROUTE 84
NEWARK. CA
ORA� BY: V. CHANG
DATE: 1114'2016

GRAPHIC SCALE
0 60 80 HX> 120 t..---�----------i
1 fflCH "" 60 FI(f
.,........... Hexagon Tr.msportation � Consullanls, Inc. '4 North Second Street, Suite ◄00
San JOH, Califomla 95113
Phone: (◄08) 971-6100
YMw.hextramu:om

CONCEPTUAL IMPROVEMENTS FOR TIF CALCULATION

THORNTON AVENUE ANO GATEWAY BOULEVARD

NEWARK, CA
DRA'MI BY; V. CHANG
DATE.: 11l4no16
GRAPHIC SCALE L-----t Ii
200
I
1 IPICH • 100 fEET
.......,....
� Hexagon Transportation
Consuhants, Inc.
-4 Nor1h Second Strut, SUitt 400
San Jose, Calil'omla 95113
Phone: (◄08) 971-8100 www.hextranu:om

CONCEPTUAL IMPROVEMENTS FOR TIF CALCULATION

THORNTON AVENUE AND CHERRY STREET

NEWARK, CA

RESTRIPING, WIDEN ROAD, SIGNAL

MODIFICATION, NARROW PORKCHOP ISLAND,
REBUILD MEDIAN ISLAND, REBUILD CURB REnJRN,

ROW ACQUISITION UTILITY RELOCATION DRAIN
DRAWN BY: V. CHANG
DATE: 1114/2018

GRAPHIC SCALE
0 t;;-,.;;,,-,i � 60 80 100 120
1 IUctl ..., 60 f[£T
� � Hexagon 1'ransportalion
Consultants, Inc.
4 Nonh Second Stfetil, Sui1e '400
San Jose, Cafitomia 95113
Phone: (403) 971--8100 WW\V,hUtrans..com

CONCEPTUAL IMPROVEMENTS FOR TIF CALCULATION

MOWRY AVENUE AND CHERRY STREET
NEWARK.CA
DRAWN BY: V. CHANG
DATE: 11/4'2016

GRAPHIC SCALE
0 40 60 80 t....-�� I
1 mcH '"' 40 rrcr
,..-...it Hexagon Transportation.
.........., Consultants, Inc.
4 N1>nh Second SIJnt. Sutt• 400
SWI JOH, C.tifomla 95113
Phon.: www.h(408) Im.a100
txtrans com
REBUILD MEDIAN (360'),

RESTRIPING, SIGNAL

MODIFICATION, RELOCATE MEDIAN
UTILmES, RELOCATE MEDIAN

STREET LIGHTS TO ROADSIDE
� �-:�::-�:--:----...,fi
g�:__.....,_, __ �
\:; t C ...::..

CONCEPTUAL IMPROVEMENTS FOR TIF CALCULATION

STEVENSON BOULEVARD AND CHERRY STREET

NEWARK, CA
DRAWN BY: V. CHANG
DATE: 111412G16

GRAPHIC SCALE
0 60 80 100 120 t..-----�
1 ttlt,H • 60 Fl'.El
Appendix C
Cost Estimates Intersection Improvements
Planning-Level Improvement Cost Estimate
Ardenwood Bl/Newark Bl and WB SR84
Item Description
Miscellaneous
Earthwork
Asphalt Concrete Pavement w/ aggregate base
Install Median Island
Import Fill Soil
Roadway Excavation
PCC Curb and Gutter
PCC Curb Ramp
PCC Sidewalk
Remove Asphalt Concrete Pavement
Remove Median Island
Remove PCC Curb and Gutter
Remove Sidewalk or Curb Ramp
PROJECT: ---------- Newark ---------- TIF
LO CAT 1O N: __ __:_A.c..rd::..:e:.:..nc:.cw..:.o..:..od.:::....;:cB.c...1/N'-'-e::..:w..:..:a;;;.r;.;_k .::.B'-1 a:c.n.;.:d;..cWc..:...:::.B.;.:S:.:..R..:..:8'-'4 __ _ DATE: 3/10/2017
Unit Qty. Unit Price Extension
CY $ 95.00 $ -
SF 160 $ 18.00 $ 2,880.00
SF 600 $ 35.00 $ 21,000.00
CY $ 25.00 $ -
SF $ 5.00 $ -
LF 80 $ 45.00 $ 3,600.00
EA 1 $ 5,000.00 $ 5,000.00
SF $ 30.00 $ -
SF 200 $ 8.00 $ 1,600.00
SF $ 10.00 $ -
LF 80 $ 11.00 $ 880.00
SF $ 10.00 $ -------- -- --
-
Remove Storm Drain Inlet
Install Storm Drain Inlet
Install Metal Beam Guardrail
Remove Tree
Restripina and Sianage
Signal modification
Subtotal �- �
Total Materials & Labor Cost
Other Costs
Mobilization
Environmental Mitiaation
Stormwater Treatment
Clearing and grubbing
Construction Staaina, Traffic Control, and Construction Area Signs Contingency, Enaineerina and Administration Costs
Subtotal
lrotal Task Cost
Hexagon Transporlation Consultants, Inc.

EA
EA
LF
EA
LS
EA
-,,, ---
LS
LS
LS
LS
LS
LS
-
�
$ 2,000.00 $ -
$ 4,000.00 $ -
$ 50.00 $ -
$ 600.00 $ -
1 $ 3,000.00 $ 3,000.00
1 $ 200,000.00 $ 200,000.00
$ 237,960.00
$ 237,960.00
1 7% of Materials $ 16,657.20
$ -
1 30% of Materials $ 71,388.00
$ -
1 6% of Materials $ 14,277.60
1 35% of Materials $ 83,286.00
$ 185,608.80
$ 423,568.80 1
Page I of I
Planning-Level Improvement Cost Estimate
Ardenwood Bl/Newark Bl and EB SR84
Item Description
Miscellaneous
Earthwork
Asphalt Concrete Pavement w/ aggregate base
Install Median Island
Import Fill Soil
Roadway Excavation
PCC Curb and Gutter
PCC Curb Ramp
PCC Sidewalk
Remove Asphalt Concrete Pavement
Remove Median Island
Remove PCC Curb and Gutter
Remove Sidewalk or Curb Ramp ____
Remove Storm Drain Inlet
Install Storm Drain Inlet
Install Metal Beam Guardrail
Remove Tree
Restriping and Signage
Signal modification
ROW Acquisition
Subtotal - I ....,.. � 1r� -,='n -
Total Materials & Labor Cost
Other Costs
Mobilization
Environmental Mitiqation
Stormwater Treatment
Clearing and grubbing
Construction Staging, Traffic Control, and Construction Area Signs ContinQencv, EnQineerinQ and Administration Costs
Subtotal
lrotal Task Cost
Hexagon Transpmtation Consullants, Inc.

I '--..---.

PROJECT: --------------------Newark TIF
LO CAT 1O N: Ardenwood Bl/Newark Bl and EB SR84
--
��
! '
--------------------
Unit Qty.

CY 800
SF 6,650
SF
CY 800
SF
LF 220
EA 2
SF 1,000
SF 4,000
SF
LF 220
SF --900
EA 2
EA 2
LF 300
EA
LS 1
EA 1
-
LS 1
LS 1
LS 1
LS 1
LS 1
LS 1
DATE: 3/10/2017
Unit Price
$ 95.00
$ 18.00
$ 35.00
$ 25.00
$ 5.00
$ 45.00
$ 5,000.00
$ 30.00
$ 8.00
$ 10.00
$ 11.00
-$ ---10.00 ·- $ 2,000.00
$ 4,000.00
$ 50.00
$ 600.00
$ 12,000.00
$ 200,000.00
Extension
$ 76,000.00
$ 119,700.00
$ -
$ 20,000.00
$ -
$ 9,900.00
$ 10,000.00
$ 30,000.00
$ 32,000.00
$ -
$ 2,420.00
f--- $ 9,000.00
$ 4,000.00
$ 8,000.00
$ 15,000.00
$ -
$ 12,000.00
$ 200,000.00

NOT INCLUDED IN ESTIMATE
7% or Materials
200000
30% or Materials
3% of Materials
6% of Materials
35% of Materials
$ 548,020.00
$ 548,020.00
$ 38,361.40
$ 200,000.00
$ 164,406.00
$ 16,440.60
$ 32,881.20
$ 191,807.00
$ 643,896.20
$ 1. 191,916.20 1
Page t of I
Planning-Level Improvement Cost Estimate
PROJECT: -------------------- Newark TIF
LOCATION: _____ T_ho_r_n_to_n_A_
v_e_a_n_d_G_a_te_w_a.,_y_B_I ___ _
DATE: 1/27/2017
Thornton Ave and Gateway Bl
Item Description Unit Qty. Unit Price Extension
Miscellaneous
Earthwork CY 3,000 $ 95.00 $ 285,000.00
Asphalt Concrete Pavement w/ aggregate base SF 46,000 $ 18.00 $ 828,000.00 Install Median Island SF $ 35.00 $ -
Import Fill Soil CY 3,000 $ 25.00 $ 75,000.00
Roadway Excavation SF $ 5.00 $ -
PCC Curb and Gutter LF $ 45.00 $ -
PCC Curb Ramp EA $ 5,000.00 $ -
PCC Sidewalk SF $ 30.00 $ -
Remove Asphalt Concrete Pavement SF 21,000 $ 8.00 $ 168,000.00 Remove Median Island SF $ 10.00 $ -
Remove PCC Curb and Gutter LF $ 11.00 $ -
Remove Sidewalk or Curb Ramp SF $ 10.00 $ ----
- --- -- -- ---- c---r---- - ----- Remove Storm Drain Inlet Install Storm Drain Inlet
Install Metal Beam Guardrail
Remove Tree
Widen small culvert
Restriping and Signage
Signal modification
Subtotal 17-LJ =-._.- �
Total Materials & Labor Cost
Other Costs
Mobilization
Environmental Mitigation
Stormwater Treatment
Clearing and grubbing
Construction Staging, Traffic Control, and Construction Area Signs Continoencv, Enoineerino and Administration Costs
Subtotal
!Total Task Cost
Hexagon Transportation Consultants, Inc.
�-
EA
EA
LF
EA
LF
LS
LS
::-;
LS
LS
LS
LS
LS
LS
-
a:. .-, '
$ 2,000.00
$ 4,000.00
300 $ 50.00
$ 600.00
12 $ 1,000.00
1 $ 10,000.00
1 $ 200,000.00
1 7% of Materials
1 25% of Materials
1 30% of Materials
1 3% of Materials
1 6% of Materials
1 35% of Materials
$ -
$ -
$ 15,000.00
$ -
$ 12,000.00
$ 10,000.00
$ 200,000.00
$ 1,593,000.00
$ 1,593,000.00
$ 111,510.00
$ 398,250.00
$ 477,900.00
$ 47,790.00
$ 95,580.00
$ 557,550.00
$ 1,688,580.00
$ 3,281,580.00 1
Page I of I
Planning-Level Improvement Cost Estimate
Thornton Ave and Cherry St
Item Description
Miscellaneous
Asphalt Concrete Pavement w/ aggregate base
Install Median Island
Import Fill Soll
Roadway Excavation
PCC Curb and Gutter
PCC Curb Ramp
PCC Sidewalk
Remove Asphalt Concrete Pavement
Remove Median Island
Remove PCC Curb and Gutter
Remove Sidewalk or Curb Ramp
Remove Storm Drain Inlet ---- Install Storm Drain Inlet Remove Tree
Restriping and Signage
Signal modification
Streetlight and utilities relocation
ROW Acquisition
Subtotal .LJ --..... -- - - -
Total Materials & Labor Cost
Other Costs
Mobilization
Environmental Mitigation
Stormwater Treatment
Clearing and grubbing
Construction Staging, Traffic Control, and Construction Area Signs Contingency, Engineering and Administration Costs
Subtotal
!Total Task Cost
Hexagon Transpo1tation Consultants, Inc.
c...!
PROJECT: ---------------- Newark TIF ----
LO CAT I0 N: _____ T_h_o_rn..;.to_n_A_v_e'--a_n_d'--'-Che-'--r�ry,_..;...St'-___ _ Unit Qty.

SF 3,200
SF 250
CY
SF 1,250
LF 750
EA 2
SF 4,450
SF 1,400
SF 800
LF 750
SF 4,450
EA 1
EA 1
EA 6
LS 1
LS 1
LS 1
:....,,-
LS 1
LS
LS 1
LS 1
LS 1
LS 1
Lr--
DATE: 1/27/2017
Unit Price
$ 18.00 $ 57,600.00
$ 35.00 $ 8,750.00
$ 25.00 $ -
$ 5.00 $ 6,250.00
$ 45.00 $ 33,750.00
$ 5,000.00 $ 10,000.00
$ 30.00 $ 133,500.00
$ 8.00 $ 11,200.00
$ 10.00 $ 8,000.00
$ 11.00 $ 8,250.00
$ 10.00 $ 44,500.00
$ 2,000.00 $ 2,000.00
$ 4,000.00 $ 4,000.00
$ 600.00 $ 3,600.00
$ 10,000.00 $ 10,000.00
$ 250,000.00 $ 250,000.00
$ 25,000.00 $ 25,000.00

NOT INCLUDED IN ESTIMATE
7% of Materials
25% of Materials
30% of Materials
1% of Materials
6% of Materials
35% of Materials
$ 616,400.00
$ 616,400.00
$ 43,148.00
$ -
$ 184,920.00
$ 6,164.00
$ 36,984.00
$ 215,740.00
$ 486,956.00
$ 1. 103,356.00 1
Page I of I
Planning-Level Improvement Cost Estimate
Cherry St and Mowry Ave
Item Description
Miscellaneous
Asphalt Concrete Pavement w/ aaaregate base
Install Median Island
Import Fill Soil
Roadway Excavation
PCC Curb and Gutter
PCC Curb Ramp
PCC Sidewalk
Remove Asphalt Concrete Pavement
Remove Median Island
Remove PCC Curb and Gutter
Remove Sidewalk or Curb Ramp
Remove Storm Drain Inlet
Install Storm Drain Inlet
Remove Tree
Restriping and Signage
Signal modification
Streetliaht and utilities relocation
Subtotal __ f L - -- 1
Total Materials & Labor Cost
Other Costs
Mobilization
Environmental Mitigation
Stormwater Treatment
Clearing and grubbing
Construction Stagina, Traffic Control, and Construction Area Signs Continaencv, Enaineerina and Administration Costs
Subtotal
jrotal Task Cost
I lexagon Transportation Consultants, Inc.

PROJECT: ----------------- Newark TIF ----
LO CAT 10 N: _____ C=he:..:.r:..1.ry_:S:..:t..:a::..:n.::.d.:.:M.:..:o;..;:wc:...ry'-'A'--"v.:..:e::__ ___ _ DATE: 1/27/2017
Unit Qty. Unit Price Extension
SF $ 18.00 $ .

SF $ 35.00 $ .

CY $ 25.00 $ .

SF $ 5.00 $ .

LF $ 45.00 $ .

EA $ 5,000.00 $ .

SF $ 30.00 $ .

SF $ 8.00 $ .

SF $ 10.00 $ .

LF $ 11.00 $ .

SF $ 10.00 $ .

EA '-- $ 2,000.00 $ -- ---
.

EA $ 4,000.00 $ .

EA $ 600.00 $ .

LS 1 $ 5,000.00 $ 5,000.00
LS 1 $ 125,000.00 $ 125,000.00
LS $ 25,000.00 $ . - -'-- . $ 130,000.00
$ 130,000.00
LS - __! -- ---- 7% of Materials $ �o�
LS 25% of Materials $ .

LS 30% of Materials $ .

LS 3% of Materials $ .

LS 1 6% of Materials $ 7,800.00
LS 1 35% of Materials $ 45,500.00
$ 62,400.00
$ 192,400.00 1
Page I of I
Planning-Level Improvement Cost Estimate
Cherry St and Stevenson Bl
Item Description
Miscellaneous
Asphalt Concrete Pavement w/ aggregate base
Install Median Island
Import Fill Soil
Roadway Excavation
PCC Curb and Gutter
PCC Curb Ramp
PCC Sidewalk
Remove Asphalt Concrete Pavement
Remove Median Island
Remove PCC Curb and Gutter
Remove Sidewalk or Curb Ramp
Remove Storm Drain Inlet ------ Install Storm Drain Inlet Remove Tree
Restriping and Signaoe
Signal modification
Streetlight and utilities relocation
Subtotal
Total Materials & Labor Cost
Other Costs
Mobilization
Environmental Mitigation
Stormwater Treatment
Clearing and grubbing
Construction Staoing, Traffic Control, and Construction Area Sions Continaencv, Enaineerina and Administration Costs
Subtotal
jrotal Task Cost
Hexagon Transpo1tation Consultants, Inc.
-
PROJECT: --------------------Newark TIF
LO CAT 1O N: _____ C_h_e_rry..__S_t_a_nd_S_te_v_e_ns_o_n_B_I ____ _ DATE: 1/27/2017
Unit Qty. Unit Price Extension
SF 2,200 $ 18.00 $ 39,600.00
SF 1,400 $ 35.00 $ 49,000.00
CY $ 25.00 $ .

SF $ 5.00 $ .

LF 720 $ 45.00 $ 32,400.00
EA $ 5,000.00 $ .

SF $ 30.00 $ .

SF 1,400 $ 8.00 $ 11,200.00
SF 2,200 $ 10.00 $ 22,000.00
LF 720 $ 11.00 $ 7,920.00
SF $ 10.00 $ .

EA � 2,000.00 $ ---- --- -----.

EA $ 4,000.00 $ .

EA $ 600.00 $ .

LS 1 $ 12,000.00 $ 12,000.00
LS 1 $ 200,000.00 $ 200,000.00
LS 1 $ 35,000.00 $ 35,000.00
$ 409,120.00
$ 409,120.00
LS �-1 7% of Materials $ __ 28,638.-4,Q_
LS 25% of Materials $ .

LS 1 30% of Materials $ 122,736.00
LS 3% of Materials $ .

LS 1 6% of Materials $ 24,547.20
LS 1 35% of Materials $ 143,192.00
$ 319,113.60
$ 728,233.60 1
Page I of I

APPENDIX G
RESOLUTION NO. 10,635
RESOLUTION NO. 10,635

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

NEWARK ESTABLISHING AN IMPLEMENTING

RESOLUTION FOR THE TRANSPORTATION IMPACT FEE,
UNDER GOVERNMENT CODE SECTION 66001, IN

ACCORDANCE WITH MUNICIPAL CODE SECTION

3.24.040 AND AMENDING THE MASTER FEE SCHEDULE

TO REFLECT THESE CHANGES
WHEREAS, the City Council of the City of Newark, a general law city ("City"), is authorized to prescribe and establish fees in regard to services or functions performed by the City for the public in a governmental and proprietary capacity; and WHEREAS, California Government Code Section 66000 et seq. allows local governments to impose impact fees on new development in order to recover the cost of improvements that are needed to serve that new development; and WHEREAS, Chapter 3.24 ("Development Impact Fees") of the Newark Municipal Code authorizes the City Council to adopt implementing resolutions establishing development impact fees in order to mitigate the impacts that projects have upon the City's ability to provide public facilities;
WHEREAS, the existing fee needs to be brought into conformity with current conditions in the City; and
WHEREAS, the City desires to have an updated Transpmiation Impact Fee that will ensure that all new development pays the cost to provide transportation facilities needed to support new development; and
WHEREAS, the City has retained Hexagon Transpmiation Consultants to complete a Transp01iation Impact Fee Nexus Study, dated March 28, 2017, which establishes a reasonable relationship between the Transportation Impact Fee and the purpose of the fee, which study is incorporated herein and attached as Exhibit A; and
WHEREAS, the City has duly noticed, advertised, scheduled, and held a Public Hearing on May 25, 2017; and
WHEREAS, on May 25, 2017 the City Council reviewed material presented in the staff report including the Transpo1iation Impact Fee Nexus Study, concerning the pmpose of the fee and the relationship between the fee and its purpose; and NOW THEREFORE, BE IT RESOLVED by the City Council of the City of Newark which hereby finds, declares, and resolves that:
1) The City hereby receives and approves the Public Safety and Transpmiation Development Impact Fee Nexus Study ("Fee Study"), which is attached as Exhibit A to this Resolution.
2) In adopting this Resolution, the City Council is exercising its powers under Chapter 3.24 of the Newark Municipal Code, as well as pursuant to Article XI, Sections 5 and 7 of the California Constitution, Chapter 5 of Division 1 of the Government Code ("Mitigation Fee Act"), commencing with Section 66000, collectively and separately.
3) After considering the Fee Study, this Resolution, and the testimony received at a public hearing, the City Council hereby makes the following findings:
a) In accordance with Section 66001, subdivision a, paragraph 1 of the Mitigation Fee Act, the purpose of the fees set fmih in this Resolution, as specified in Exhibit A, is to provide for an expansion in transpmiation capital facilities in the City as new growth occurs;
b) In accordance with Section 66001, subdivision a, paragraph 2 of the Mitigation Fee Act, the fees collected pursuant to this Resolution, as specified in Exhibit A, shall be used for transpmiation related improvements identified in Exhibit A and shall be used to fund any administrative cost associated with the transp01iation impact fee program;
c) In accordance with Section 66001, subdivision a, paragraph 3 of the Mitigation Fee Act, there is a reasonable relationship between the fees use (to pay for the acquisition and construction of transpmiation facilities and imiprovements) and the type of development for which the fees are imposed in that the fees will be applied to residential and comercial development in the City, which will generate demands for transpmiation facilities;
d) In accordance with Section 66001, subdivision a, paragraph 4 of the Mitigation Fee Act, the Fee Study demonstrates that there is a reasonable relationship between the amount of the Transportation Impact Fee and the cost of transpo1iation improvements attributable to the development upon which the fee is proposed. Since the need for transportation facilities is inherently travel driven associated transportation facility costs are assessed based on h·ansportation trips; and
e) In accordance with Section 66001, subdivision b of the Mitigation Fee Act, there is a reasonable relationship between the amount of the fees and cost of providing the public safety facilities attributable to the development in the City upon which the fees are imposed in that the fees Resolution No. 10,635 2
have been calculated by apportioning the cost of transportation facilities acquisition and constrnction to the amount of transpo1iation demand created by residents and employees attracted by each type of devel opm.ent.
4) The City finds pursuant to the California Environmental Quality Act ("CEQA") this action is not a "project" because the Resolution provides a mechanism for funding of transportation facilities but does not involve a commitment to any specific project for such purposes that may result in a potential significant impact on the Environment (CEQA guidelines Section 153 78, Pub. Res. Code Section 21080(b )(8)(D)).
5) The cost estimates set forth in the Fee Study are reasonable estimates for acquiring and constructing transpo1iation facilities and improvements and the fees expected to be generated by future development will not exceed the future projected cost of acquiring and constrncting transpmiation facilities. 6) The method of allocation of the fees to pmiicular development bears a fair relationship and is roughly proportional to each development's burden on and benefits from the transportation facilities to be funded by the fees, in that the fees are calculated based on the amount of transportation demand created by residents and employees attracted by each type of development. 7) The Fee Study is a detailed analysis of how transpmiation services will be affected by development in the City and the transpmiation facilities necessary to acconunodate that development.
8) The fees are consistent with the General Plan and, pursuant to Government Code Section 65913.2, the City Council has considered the effects of the fees with respect to the City's housing needs as established in the housing element of the General Plan.
9) The fee amounts set forth in this Resolution include the fair and reasonable costs of administration of the fee programs and are within the requirements of the Mitigation Fee Act and other applicable law.
10) The fees are subject to adjustment, which approximate the fluctuation in market costs, and shall be adjusted annually in accordance with the Engineeiing News Record Construction Cost Index, San Francisco, California. 11) The City does hereby approve the following transpmiation impact fees on new residential and commercial development for transportation facilities as follows:

Resolution No. 10,635 3
Residential Development
Type of Unit Fee per Unit
Single Family Unit $4,974
Town.home Unit $2,586
Multiple Family Units $3,084
Commercial Development
Type of Use Fee per Square Foot
Office/Commercial $4.41
Manufacturing/Research $2.41
and Development
Warehousing/Distribution $4.82
(These fees shall be adjusted annually in accordance with the Engineering News Record Construction Cost Index, San Francisco, California.)
12) The city council may elect to waive the payment of the impact fee if a residential or nomesidential development project provides community benefits in excess of those required by the impacts of the project, and if the city council finds that the expected benefits to the community exceed those that would be provided by the payment of the Transportation Impact Fee. Such community benefits may include the provision of senior housing, the generation of significant taxes, or the elinrination of nuisances.
13) The Transportation Impact Fees shall not apply to approved projects that are covered by a Development Agreement or Vesting Tentative Map unless the provisions of the document allow the application of such fees. 14) The Master Fee Schedule shall be amended to reflect the Transportation Impact fees as set forth in this Resolution.

Resolution No. 10,635 4
15)
16)
Effective Date: This resolution shall be effective upon date of adoption of this Resolution. In accordance with Government Code Section 66017, the fees set by this Resolution shall be effective 60 days from the effective date of this Resolution.

Severability. Each component of the fees and all po1tions of this Resolution are severable. Should any individual component of the fees or other provisions of this Resolution be adjusted to be invalid and unenforceable, the remaining component or provisions shall be and continue to be fully effective, and the fees shall be fully effective except as to that component which has been judged to be invalid.

I HEREBY CERTIFY the foregoing resolution was introduced at a regular meeting of the City Council of the City of Newark held on May 25, 2017, by Council Member Hannon, who moved its adoption and passage, which motion was carried after being duly seconded, and passed by the following vote:

AYES:

NOES:

ABSENT:

SECONDED:

Council Members Haimon, Freitas, Vice Mayor Bucci and Mayor Nagy None
Council Member Collazo
Vice Mayor Bucci
APPROVED:
()L_�-/,��
s/ALAN L. NAGY
Mayor
Resolution No. 10,635 5

APPENDIX H
RESOLUTION NO. 8802
RESOLUTION NO. 8802

RESOLUTION ESTABLISHING AN INCLUSONARY

HOUSING IN-LIEU FEE SCHEDULE AND A

NONRESIDENTIAL DEVELOPMENT HOUSING IMP ACT
FEE SCHEDULE IN ACCORDANCE WITH CHAPTER 17.18

OF THE NEWARK MUNICIPAL CODE
WHEREAS, the City Council of the City of Newark has established an inclusionary housing program which allows the payment of an in-lieu fee under certain circumstances; and WHEREAS, the City Council has adopted a nonresidential development housing impact fee; and
WHEREAS, the City of Newark hired Economic and Planning Systems to prepare an Affordable Housing Fee Study, dated April 2004, which: (1) examined the amount of subsidy needed to produce housing units affordable to moderate, low, and very low income households; (2) found a clear nexus between the development of nonresidential land uses and the number of housing units that will be needed to accommodate for very low, low, and moderate income households as a result of the development; and (3) quantified this need; and WHEREAS, for the nonresidential development impact fee, the City Council has determined that the fee shall be set at a rate lower than the maximum allowable because of the revenue generated by nonresidential uses, the subsidies that are provided by other sources, and the need to remain competitive with other cities.

NOW, THEREFORE, the City Council resolves as follows:

1. Amount of Fee
a. To establish the inclusionary housing in-lieu fee at $6,704 per market rate unit, as calculated in the Affordable Housing Fee Study; and
b. To establish the nonresidential development housing impact fee at $2.65 per square foot for new commercial development, and $0.49 per square foot for new industrial development, which are lower than the maximum allowable fee calculated in the Affordable Housing Fee Study; and
c. To provide that these fees shall annually be revised effective July 1 of each year, commencing on July 1, 2005, by the percentage change in the Engineering NewsRecord's Building Cost Index, or a similar index designated by the City Manager, over the previous year.

2. Time of Payment
a. The inclusionary housing in-lieu fee shall be paid on a lump sum basis for the total development before the first Certificate of Occupancy is issued for any structure within the residential development project; and b. The nonresidential development housing impact fee shall be paid prior to issuance of a building permit for any structure within the nonresidential development project.

I HEREBY CERTIFY the foregoing resolution was introduced at a regular meeting of the City Council of the City of Newark held on May 27, 2004, by Vice Mayor Torrico who moved its adoption and passage, which motion was carried after being duly seconded, and passed by the following vote:

YES:

NOES:

Council Members Freitas, Johnson, Nagy, Torrico, and Mayor Smith None
ABSENT: None
SECONDED: Council Member Nagy
ATTEST:
d�;t.�
s/KA THLEEN L. SLAFTER
Deputy City Clerk
City Attorney
RESOLUTION NO. 8802
APPROVED:

VIDW.S
Mayor
2 APPENDIX I

NEWARK AFFORDABLE HOUSING
STUDY

EXIDBITD

FINAL REPORT
Econo
Plnnnlng Systems
II.al ir.roi. Eto,,,.,u,
&,rwl!Ol ·-·
hllul'IM/IN
.,_, IIH Polley

NEWARK AFFORDABLE HOUSING FEE STUDY
Prepared forCity of Newark
Prepared by.

Economic & Planrung Systems, Inc.

April 2004
BPS#10222
Bl!RKl!Ll!Y
2501 'Ninth St, Sulll 200
Btrktlty, CA 9Ol0-1SIS
WWW •P•Y• 0011>
Phont SI 0-141 -9190
,.. )10-141,920&
BAORAMl!NTO DEHVER
Phone 916-649-&0IO PIion, 303-6l3.JSJ7
Pu 916,649-1070 Pu lOJ,62),900

TABLE OF CONTENTS
I. INTRODUCTION AND SUMMARY OF FINDINGS........................... .. ... .. ..... 1 TI.

Summary of Findmgs.. .. ... 1
AFFORDABLE HOUSING FBB CALCULATIONS .. .... 2
Inclusionary Housing In-Lieu Fee . . . . . . ..... ... . . ................ .. .. . . . 2 Nonrestdenttal Development Housmg Impact Fee....................... ... . . . . ..... 8 Affordable Housing and Associated Fee Revenue . . . . ..... ................... 15 Affordable Housing Demand .... ... .. . . ... ... .......... .... . . .. ....... 18 III. REGIONAL FEE COMPARISON . .. .... .............. 19

LIST OFT ABLES
Table 1.

Table 2
Table 3
Table4
Table 5.

Table 6.

Table 7
Table8
Table9
Table 10.

Tablell
Table 12
Table 13
Table 14
Total Affordable Housing Need· Income Limits by Category.. ,. . .. .... 3 Total Affordable Housing Need Calculahon of Ability to
Pay for Housing by Income Category......... . ... . ... . . . . 4 Total Affordable Housing Need Calculation of Substdy Required ........ . 6 Nonres1denttal Development Housmg Impact Fee.

De ta tied Employment Information . .. ... .. .. ..... 9 Nonresidential Development Housing Impact Pee.

Households Reqwnng Assistance for Commemal Sector . ... .. .. 10 Nonr�s1dent1al Development Housing Impact Fee;
Households Requmng Assistance for Industnal Sector. . . . .. 13 Calculation of Nonresidential Development Housing Impact Fees .. . 16 Comparison of Pro1ected Affordable Housing Demand and
Supply ... .... , . , ..

Reg1onnl Comparison of Total Development Fees
Smgle-Fnm1ly Development Fees Per Umt ... ..

Mulhfam1ly Development Fees Per Umt . .

Ret.ul Development Fees per Sq Ft
17 .20
.. 21
.. 22
23 Commercial/Office Development Fees per Sq. Ft. ...... . ... .. . . .. .. . . 24 Cenernl lndustnal Development Fees Per Sq Ft . ..... ...... . .......... 25 Final Report
Newark Affordable Housing Fee Study
Apnl 23, 2004
I. INTRODUCTION AND SUMMARY OF FINDINGS
This Newark Fee Study Report provides the City of Newark with the necessary techmcal documentation for adophon and implementation of two development fees· (1) a Nonresidential Development Housing Impact Fee to fund the development of . affordable housing w1thm the City and (2) an lnclus1onary Housing In-Lieu Fee, also designed to fund affordable housing
Following this Introductory Chapter, Chapter II describes the methodology and provides fee calculations for both the nonresidential housing impact fee and the inclusionary housing m-heu fee In Chapter III, the proposed fees, as well as other existing fees, are compared with the total fee burden m other East Bay cities.

SUMMARY OF FINDINGS
The key findings from this Draft Report are provided below with a more detailed description of the analysis proVJded m subsequent chapters 1 Inclusionary Housing ln-Lieu Fee. The subsidy requirements associated with providmg 337 affordable housing units, consistent with the City of Newark's proposed mclus1onary housmg program, corresponds to an estimated maximum anlieu fee of $6,704 per-market rate unit developed This estimate assumes that rental projects will receive federal and state·affordable housmg tax credits equal to 35 percent of production costs for low- and very low- income units 2 Nonresidential Development Housing Impact Fee. Assuming that nonres1denhal development pays 100 percent of its subsidy requsrem·ent, the estimated maximum non-residential impact fees are $9.47 per square foot for new commercial development and $1 76 per square foot for new industrial development This estimnte nssumes that rental projects will receive federal and state affordable housing tnx credits equal to 35 percent of productton costs for low- and very lowincome umts

3. Regional Fee Comparison. BPS compared the total burden from all development fees for various East Bay c1hes These comparisons tndtcate that if the two development fees are adopted at the levels 1denhfied m this Report, the total residential fee m Newark will be lower than the average fees of comparable )urlsdtcttons The total fee charged to retail development would be roughly 2 percent lower than the average fee in comparable cities. However, the proposed fee for commerc1al/office would be roughly 61 percent higher than the average fee m comparable Jurisd1chons, while the fee charged to general industrial uses would be approximately 17 percent higher than average fees m nearby cihes 1 H \1011tNM¼\""""1\R£VISED F/N,IU Of\1021Z,.,Qht
Final Report
Newark Affordable Housing Fee Study
April 23, 2004

IL AFFORDABLE HOUSING FEE CALCULATIONS
Tius Chapter provides the Ctty of Newark W1th esbmates of the expected maximum inclusionary housmg in·lieu and nonresidential development housing impact fees. The analysis assumes that the affordab]e housmg subsidy will be generated by both residential and nonresidential development.

INCLUSION ARY HOUSING IN-LIEU FEE
The first step in calculahng an mclusionary housmg m·heu fee is to detennine moderatemcome, low-income and very low-income households' abihty to pay for housing.

Ab1hty to pay is then compared with actual housmg production costs to determine the affordabthty gap or difference between ability to pay and production cost The affordability gap is equ1va]ent to the subsidy necessary to develop viable affordable housing The inclusionary in-lieu fee is calculated based on the affordability gap and mclus1onary housing program requirements.

ABILITY TO PAY FOR HOUSING BY INCOME CATEGORY
California's Housing and Comrnumty Development Department defines income categories m relahon to the County rnedmn mcome, depending upon househo]d size Based on Alameda County median income, the upper mcome hm1t for the very lowincome cntcgory IS $.34,475 for a 3-person household and $'38,300 for a 4-person household. A household 1S defined as low income if its income is greater than those of very low-mcome fa mt hes, but less than or equal to $44,818 for 3-person households, or $49,790 for 4•person hou&eholds. A household 1s defined as moderate income 1f its income is greater than those of low-income households, but less than or equa] to $68,950 for 3-person households, or $76,600 for 4-person households The mcome hmlts for each type of household are shown m Table 1
In Table 2, the mcome limits for low- and very low-mcome households are translated into an estimate of the maximum home price that each type of household could pay. For owner-occupied homes, the eshmated annual income (see Table 1) for each group is mu\hphed by the HUD gmdehne of maximum mortgage-to-income raho (0.25) to amve at the maximum affordable monthly payment Next, the owner-occupied home value is calculated, assuming an annual interest rate of 7 percent, a 20 percent down payment, and a 30-year term loan.1 Usmg the assumptions outlined above, a moderate-income 1 While many low-income fam1hea are unlikely to have a 20 percent down payment, such a policy doea pcnmt the City to allocate its affordable housing funds more c ff1c1ently than If a lower down payment 1s assumed This also serves as an m�nbve for low•mcome fam1hes to save (or a down payment Down payment assistance programs are also avaUable
2 H \ l<lUm..t l�rl\l!tvlSfO PINIIL4 Of\ IOU',w/2 w
Table 1
Total Affordable Housing Need: Income Limits by Category Newark Fee Studies; EPS #10222
Assumed Annual Income Limit
UnttType
Moderate Income
Low Income
Very Low Income
Percent
of Median
(1)
100%
65%
50%
3-Person 4.Person
Household Household
(2) (3)
$68,950 $76,600
$44,818 $49,790
$34,475 $38,300
(1) The CahfomIa Department of Housing and Community Development deffnes Moderate Income as 80-120% of median income, Low Income as 50-80% of median mcome and Very Low Income as less than 50% of median income For this analysis, the m1dpornt of the income range 1s used in calculations requinng a single income llm1t. (2) Based on HUD 2003, Alameda County median Income for 3-person HH as $68950 (3) Based on HUD 2003, Alameda County median Income for 4-person HH as $76600 Sources. ABAG, Callfom1a Deptartment of Housing and Community Development, HUD; Economic & Planning Systems, Inc.

Table2
Total Affordable Housing Need: calculation of Ability to Pay for Housing by Income Category Newark Fee Studies; 1:;g:�,%.\ #10222
�

AFFORDABILITY CALCULATION
Hou5ehold
Hem Monthly .Affordable
Payment Home Value
Moderate Income Category
Owner-Occupced $1,436
Rental Unrts $1,374
Low Income Category
Owner--Occupied $934
Rental UnllS $820
Vety Low Income Category
Owner-Occupced $718
Rental Unrts $587
{1) See Table 1 for Income Assumpt,ons.
(2) Mortgage calculated usmg annual interest rate of 7 percent (3) Mortgage calculated on 360-month loan
(4) Mortgage calculated assuming a 20 percent down payment. (5) Assumes a mortgage-to-income ratJo of O 25 ·
(6} Assumes a rent--to-mcome ratio of 0.3
$269,888
$188,123
$175.429
$112,353
$134,944
$80,367
4-Person - Househokt -
Monthly
Payment
$1,596
$1,565
$1,037
$945
$798
$683
Affordable
Home Value
$299,832
$214,313
$194,891
$129,375
$149,916
$93,462
Notes
(1)- (5)
(1) and (7) - (8)
(1)- (5)
(1 ). (6}. (7). (9}
(1)- (5}
(1 ), (6), (7), {10)
{7} Assumes a capJtahzation rate of 8 5 percent, and management expenses (taxes, insurance and manenanc:e} of 3% of value (8) Assumes
for Bay Area
monthly
rental
operatrng
units
expenses of $350 for Moderate Income category, based on comparable expenses (9) Assumes monthly operating costs of $300 for Low Income category (10) Assumes monthly operating costs of $275 for Very Low Income category.

Nata: Due to rounding, some figures shown may dffr9r slightly from ac:Cual c:alculadons.

Source· Economic and Pranning Systems, Inc
a-.-&PfaM,,g�lnc� Hl�<-:?J
Final Report
Newark Affordable Housing Fee Study
Apnl 23, 2004
famtly can afford to pay between $270,000 (3-person household) and $300,000 (4-person household) for an owner-occupied home A low-income family can afford to pay between $175,000 (3-person household) and $195,000 (4--person household) for an owner-occupied home A very low-mcome household can afford to pay between $135,000 and $150,000.

For rental uruts, the maximum monthly payment IS calculated usmg HUD's maximum housmg expenses-to-income raho of 0.3 and deduchng estimated monthly operating costs. A capitalizahOn rate of 8 5 percent is used to calculate the home value, based on projected net operahng income (3 percent of home value to rover taxes, insurance and maintenance) Maximum affordable rental home values range from $188,000 to $214,000 for modernte-mcorne households, $112,000 to $129,000 for low-moome households and from $80,000 to $93,000 for very low-inoome households
BOY$ING PRODUCTION COSTS
Table 3 compares the produchon costs of owner-occupied and rental um ts with the maximum home values that moderate-, low- and very low-income families are able to pay 11,c af£ordnb1hly gap represents the subsidy that would be required to bridge the difference
The first column in Table 3 shows esbmated home production prices for four types of housing units. 2- and 3•bedroom owner-occupied units, and 2- and 3-bedroom rental . ,tJn\ts .As s_he>wn,. tl_,e cost to bu lid a 2-bedroom owner-occupied home 1s roughly $263,000 Production cost includes land cost, bu1idmg costs, ·marketing/sales cost nnd developer profit or fee The $263,000 estimate is lower than actual prices m the competttivc market for several reasons. First, this analysis assumes that the City of Newark will lure a not-for-proftt development firm to construct its affordable housing projects Given this assumption, marketmglsales costs and proht are lower than would be experienced with private (for-profit) development. Conversations with affordable housing developers active m the California market suggest that marketing/sales cost equal to one percent of new home sale proceeds and a developer fee equal to f,ve percent of new home sale proceeds_,s reahshc Private developers generally require a five percent markctmg/sales cost and 20 percent developer fee Second, 1t 1s 1mportan t to point out that the net production oosts shown for very lowand low-income rental umts account for other potenhal fundmg sources For examp)e, it is assumed that low• and very-low moome rental uruts will quahfy for Low Income Housing Tax Credits (LIHTC) suffictent to fund 35 percent of produchon coats. The federal LlHfC program makes tax credits available for rental pro1ects that set aside units for low• and very low�income households The State of Cah.forrua operates a similar program • A ]muted amount of tax credits valued at 9 percent of qualified project costs a�e made available each year and sold to prOJect investors. In retum for project equity that typically equals between 70 and 80 percent of production costs, the investor receives the tax credits for a period of ten years. Although the "9 percent" tax credits are highly 5 H \IOllm..rt\Rqo,t\AEVlSEO f/NAU Of\10212,,1>11/l I«
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Final Report
Newark Affordable Housing Fee Study
April 23, 2004
competit1Ve, the "4 percent'' credits are more widely available, and cany fewer restnct1ons. This type of tax credit typically attracts investment equal to between 30 and 40 percent of total development costs, according to the California Tax Credit Allocation Committee.

AFFORDABILITY GAP
The "affordability gap" refers to the difference between the amount that a low-income household is able to pay for housmg and the cost of producing that housing. For example, as presented m Table 3, a low-income family of three can afford a maximum of approxunately $175,000 for a 2-bedroom owner-occupied home. Given the $263,000 cost of producing the housmg, the shortfall for the 3-person low-income fanuly is about $88,CXX>.

HOUSING SUPPLY BY INCOME CATEGORY
The City has asked th�t EPS evaluate an mclus1onary housing program m whrh 15 percent of new umts are affordable 2 Of the 15 percent, it is assumed that affordable housing will be evenly drntributed across owner-occupied housing and rental housmg • based on zoning of residential land identified in the City of Newark Housing Element.

Of the nffordable owner--occup1ed housmg, 15 percent must be affordable to households with low incomes. Furthermore, 1t is assumed that the remoinmg 85 percent of affordable owner-occupied housing will be made affordable for households with • moderate incomes as developers w1ll likely prefer to construct moderate-mcome uruts over very-low income unit& Of the affordable rental units, 40 percent must be afford.iblc to households with very-low mcom� 40 percent must be affordable to households with low income, and 20 percent must be affordable to households with moderate income

SUBSIDY REQUIRED TO ADDRESS AFFORDABLE HOUSING NEED
Given the distribution of affordable housmg supply by income category established by the City's proposed mclus1onary housmg program, the weighted average shortfall per affordable unit ts calculated to be $36,883 (fable 3) Multiplying the number of proiected affordable units by the eshmated shortfall per unit will calculate the total subsidy needed. This can then be divided by the projected number of market rate umts to determine the fee per market rate umt. This 1s the same as mulhplying the $36,883 shortfall by 17 6 percent (or 15/85) to account for the 15 percent affordable housing requirement Tlus produces an in-heu fee of $6,509 per market-rate urut. This fee is discussed in the context of forecasted deve�opment later m tlus chapter. 1 The City's proposed mdus1onary housmg program apphes to singlo fom1ty and mulhfam1ly developments with (1ve or more units,
J H \llllllNiolt\l!qo,1\�!l'IIWFIIM�tOf\lOlJl,'IMl2 IIK Final Report
Newark Affordable Housing Fee Study
April 23, 2004

NONRESIDENTIAL DEVELOPMENT HOUSING IMPACT FEE
As new nonresidential development occurs in the City of Newark, thousands of new jobs will be created in the City. Because some of these Jobs wlll be low-paying positions, the influx of new employees wlll create an mcrease m demand for affordable housmg units. The purpose of the nonresidential development housing impact fee is to charge new development its fair share of costs to provide affordable housing as needed to new residents and employees.

FlITURE EMPLOYMENT GROWTH BY INDUSTRY
The first step ln calculabng the non-residenbal impact fue 1s to eshmate the number of new jobs that are likely to be created by new development before the City is completely built out Based on City Planning Department eshrnates of development capacity m the City, BPS projects thnt 807 new commcrcinl nnd 6,570 new mdustnal Jobs will be created (see Table4).,

PROTECTED INCOME BY INDUSTRY AND OCCUPATION
As shown In Table 4, the average salary in Alameda County 1s $27,954 for commercial workers and $49,984. for mdustnal workers 4 Wtthm both of these mdustries is a vanety of occupations rnngmg from executives and managers to clcncal staff and machine operators Table 4 shows the distribution of occupallons for these mdustnes m ... Alameda County, and allocates the forecasted new jobs to each occupahon To account for the income d1fferenhal between these occupations, a salary factor was calculated using data obtained from the U.S Bureau of Lnbor Stahstics For example, a clencal worker typically makes 72 percent of the average commeroal or lndustnal mcome. Usmg the salary factor, estimated incomes are calculated for each industry by occupation. As shown m Table 4, an admm1strative/clerical worker has an estimated income of $20,161 in the commercial sector and $36,049 m the industrial sector.

HOUSEHOLD DEMAND GENERA TED BY EMPLOYMENT GROWTI-l
In Table 5, the 8(17 new commercial JObs are translated into the number of housing uruts that will be demanded in the City of Newark. The first column m Table 5 shows the occupahonnl dtstnbuhon that was presented m Table 4 To nd1ust for youth workers, > These ei1tlmatea are based upon the avoilab1hty of developable land that 1& zoned for commerctal and mdustnat uses, reapect1vely These csltmates do not wrrespond to ABAG pl'O)ethons • Average sal11nea for these 1ndustnes were obtained from the 1997 lkonomic Census, and updated ac.wrchng to the consumer price Index published by the Bureau of Labor Slahshc:s 8 II\ 10ll!Hffl:\�\«EVl5ED FJNA�,o,\JOm/....n"'
Table4
Newark
Non-Residential Development Housing Impact Fee: Detailed Employment Information tte Studies; w;;.,� #10222
ttem
All Qocupat,ons (S)
Dlstnbutlon of �obs bit: Occtmation
Whlta Collar Employment
Exec:uttvelManagel
Profes:s10nal/Specustty
Tecnn,aa11s and Related Support
Seles
AdnumstratMilOencal
Servic:aOccupatlons
Blue
Preasaon
Collar
Production/Craft/Repair
Employment
Madine ()perators/Assemblors
TransportatlOnlMatenal Mowlg
l-lan(lerw/Helpen!
Total Jobs
Salary
FKtcr
(1)
1 Cl6

1.50 071
06'9
072
062
099
059

0.75 054
COMMERC&Al.

Occ:upat,onal Jobi by
Distribution Occupation
(2) (3)
8070
135% 1091
209% 1688
45'(, 367
159% 1280
120% 969
189% 1522
48% 389
25% 201
30% 244
40% 319
100% 8069

INDUSTRIAL
Salary Occupational Jobs by
Dimmwon Occupation
(4) (2) (3)
$27,954 6,5698
$46,316 158"' 1.035 S
$41,995 230% 1,5102
$19.737 48"' 3148
$19,312 52"" 342.3
$20,161 172% 1.1290
$17�7 96% 6301
$27,� 81% 5307
$16,499 87% 5726
$20,833 49% 3248
$15,105 27% 1801
100% 6,519.9
(1) Occupabons at& assigned a salary factcr ID reflect varypg wages for dl1fenlnt oca,palll:Jns Wllhil\ the same industry These faclas -calQJ!aled U$lll9 Census data for the san Franasc:o MctropolCl'I Area. and >Nere obtained from the Bul138U oS Labor S&allsbc:s (2) New jobs are di:5tnbuted by ocx:upa110n using Census data for Alameda County Similar tnfcrmatlon for employment m Alameda County is not avadable (3) The runber of new )Obs am allocated to different oco q,st,ms usng the "Oc:cupatJonal Oistnbubon" pe, c:entage, Salary
(4)
$49,984
$82,815
S75,089
$35,290
$34,531
$36,049
$30,838
$49.395
$29,501
$37,250
$27,008
(4} Salanes ara es11mated for aac:h occupation by mulbplylng the •Saay FactDr" bof the "Average SalalY (S) N\lmber of Jobs esbmated rn Newatk Development lmpa:t Fee Study, Final Report Ave,age salary obtall18d from 1997 Economc Cen:sus Summary Sta1lstlcs for Alameda County Sista numbers subsbluled .as necessary AdJuSliad for 2003 CPI Sowce
Nola: CU. to rounchng, -flslura .,_ Dl1I)' dlffarallgb'II)' frDm adml cak;ulabons US Census. US Bureau of Labor statmtJc:s, As3oc:lafion of Bay Ania GoYemments, EC0n01t1C &: Planning Syst&ms, Inc ec..-&��h:4'ZJf100,I
Table
Non-ResJdentiaf
5 Newartt Fee Stud-;
Defllopment Housing Impact Fee: Households R8qumng Assistance fur commercfal Sector w;�i #10222
bm
.Aaumpqc,ns
Nurnberd�perHouaehald
Percent ol
P8r081ltof2-&mer�
HOUMholds 110 l.Mt 1n �
,.,¥le.�� (t)
WIID Colar
ProfesslonallSpaty
�n•nt
Tedlnaansand
Sales
R.iated Support
Admlnl5lratMI/Cl8nca
Servtce�
Blue Collar
Pnlc:nal
Employment
Mada» Operalm/�
Produdl0nfCndtlRepa
T�Ma'fflg
�
TOTAL
(1) See Table 4 for detailed c:aJc:uaton
Cocnrnerdal Sedlx' Jobs and HOUNholds
New Pwcent Adult Jobs Haul hid■
Jobs Adult Cr-■-1
(1) © __ (3)
170
16%
1091 96% 104 7 101
1688 96% 1620 tS7
367 96'lf. 352 34
1280 63% 806 78
969 63% 611 59
1522 96% 14&1 141
389 96% 374 36
201 96% 193 19
244 96'lf. 234 23
lli 9&'J, � 30
8069 7004 �7
Two&nMr
Numbar ._
(4) - (_5}
72%
73 $92,632
112 $83.990
24 $39,473
56 $38.624
42 $40,322
10 t $34,493
26 $55,250
13 $32,998
18 $41,665
ll· $30,210
488
0M-Ern«'
Numbar lneoiM
("} (5)
28%
28 $C6..316
-44 $41,.995
10 $19,737
22 $19.312
1 7 $20,161
40 $17.247
10 $27,625
05 $16,499
06 S2C.833
il SlS..105
191
(2) Dam oblaa!ed from #le Bu,..u d Labor S1n&b, Report en Youth Empic¥nllnt and 11197 Economic Cenaus for Slato of Callfama {3) Thlt llUmbor ol MW pbS is dMded by a facaotof 1 70110-.. farltle numbard e,,�yees par hcu:sehold, • -.nated by lhe ASIIOCalCn of Bay Area • Go,,a ,.,.,es To& resu11ng number or,_ houtellolds .. ""ltlpliad by 16% 11> lldpJat tar the number of hausehglda 1oca11ng in Newm; (Cm) (4) Tiw number of,-"'-rk llauMfdds-al0c:allld IO� W,Nil" _,.. (28%) an,1 cbM, __,_ famdtN cn'J'} NDe9: Oueto-.ndlng.•-tlgu,Mllhawr'l--,dl8w.....,fraaiac:lm1cP (5) Theestmatacl incomo byoc;g!plb:,r' (see Tae-4),s nll.llbplied by 2 fcrWlll-tnccme households Solftlll
,,. ..

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Final Report
Newark Affordable Housing Fee Study
Apr1I 23, 2004
who will not reqmre housing units and are particularly common m the commercial sector, youth employment data from the Bureau of Labor Stahstlcs is used to estimate the number of new jobs that will be held by adults
According to ABAG Projechons (2000), there is an average of 1.7 workers per household m the area nnmediately surrounding Newark 5 So, the estimated 700 adult jobs expected m the commercial sector were divided by the 1 7 employee-per-household factor to arrive at an estimate of 412 new households expected to be formed by new employees.

Of this total, only 16 percent are likely to be demanded w1thm the City, based upon journey-to-work data for the Qty of Newark obtained from the 2000 Census The result of these calculnt1ons 1s an estimated 68 households thnt wlll require housing m the City of Newark. The remaining 344 households are expected to locate mother 1unsd1ctions.

AFFORDABLE HOUSING DEMAND GENERATED BY NEW EMPLOYMENT
As md1cated earlier, ABAG esbmates that the average household has 1.7 employees.

The next set of calculattons m Table 5 IS designed to allocate the number of new households demanded to one• and two-earner households. It is assumed that 72 percent of new households will be composed of two wage earners, and the eshmated salary for each occupahon 1s mulhplted by two to yield an estimated household mcome The remammg 28 percent of households are assumed to be compnsed of one earner, and the total household mcome 1s eshmated to equal the salnry for each occupahon, as shown m Tables 6
On the second page of Table 5, these households arc categorized by income category according to the income hrmts descnbed m the fn'St sechon of this Chapter. As shown, 1t is estimated that approximately 5 moderate-income households, 18 low-income households nnd 25_very low-income households will be created w1thm the City of Newa�k. In the next three sets of columns, the number of new affordable housmg umts was distributed by urut type and size.7 At the bottom of each column 1s the total subsidy required for that type of urut, using the same per umt subsidy that was calculated in Table 3 The fmal column of Table 5 shows the total number of affordable uruts required for the commeraal sector, as well as the total subs1d y required As shown, new commerctal development generates the need for $2.97 mtlhon m affordable housing subs1d1es for the 49 affordable housing uruts required. A s1m1lar analysis is conducted for the industrial sector in Table 6. lndustnal development 1s responsible for an estimated $9 21 mJ.lllon m affordable housing subs1d1es for 350 units.

Thus, the total nonres1dcnhal subsidy reqmrement ls approximately $1218 million s Area includes lhe c1hea of Newark. Umon Ctly, Fremonl, Hayward, San Leandro, Dubhn and Pleasanton 'The number of households are allocated to single �amer families (28%) and double -earner fam1hes (72%) baaed on Census 2000 data from Newark
'Affordable housing unit d1stnbuhon 1s consistent with the requirements of the proposed Ulclus1onery hou11ng policy
12 H \ IOUlNm\11,pon\lU:Vl!EO FINIIU CM\1m1ft""1 "°"
T.mle6
�I
Newark
Development Housfng lmpaet Fee; H�lds Requiring Assistance for Industrial Sector Fee Studla, lliWii #10222
1111m
�
Number-of Employees per�
Percent
Pen:entof
of Households 10 l.JVe 111 Newark
0ccuDatlonal
2-Eamer �
Oiatnbut!On (t)
Wlllta
�
�lty
Collar EsnploynMnt
�cn:::el
T�
Salas
end Related Suppo,t
Servk:eOccupatJo,m
Blue Col.-Eqlloymant
MadwwOpenrtin/AAembian.
p,-, �
T,•ispo.
�pers
1a11011/Ma""'w1 �
TOTAL
(1) see Tlll!le 4 for dnNd c:ab11B110n
lndus1nal Sedor Jobs and Hoo••hokis
New Pvcent Adutt �
Joba Adult Jobs CrMtitd
{11 m el
170
16%
1,035S 100% 1,035 5 1001

1.5102 100% 1,510 2 14S9
3146 100% 3146 304
3423 100% 3423 331

1.1290 100% 1.1290 1091
6301 915% 6049 584
5307 100% 5307 513
5726 1� 5728 553
3248 100S 3248 314
1801 1� 1ll!U ill
6,5699 6,544 7 6323
Houaeholda
Two-&,-
Huml:ler �
(41 (51
72%
719 $165.630
104 8 S150.17B
218 $70,580
238 $89,062
784 $72,098
420 $61,675
368 $98,789
397 sse.002
225 $74,500
ru $54,017
$3
12) Oala obtNllld fram lhe 8u!waJ al ub:r $laZIStca. Report on Yculh Em�and 1997 EcalomicC.-S for Slllfeof c.lrfomla .._llolda
�
Humber Income
� �l
2B"
2S2 $82,815
411 $75,089
86 $35.290
93 $34,531
307 $36.049
185 $30,838
144 $49,395
156 $29.501
88 $37.250
ti SZ],008
1781
(3) n.

G«>VWffllallll'O
numbe.-Of ,-pt,s • dMCled by• CliclDr-of 1 7010 �au. runberof ei,iplo� -per houNl!old. a esmnaled t,ylhe A9IOCIIIClon of Bay Ive Toa tllSl.(ting number Of oow hcluNllolds • nmlllplld by 18'J, 1D adjlllt for1he number of houletloids.locllllng" Nawart (c.ntus) (4) Tho nl.ffltlerofrww ,._.,. hcllaehokta-alloc:llacl ID aigle -r.an.... (28'!(,) in,t ct:::,,bhs ..,.. fllmlies �) Nala..DualD,_lag,-....._.,_,iiWYdl&r,dlgtsayfllml-.cwl
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Final Report
Newark Affordable Housing Fee Study
April 23, 2004
To calculate the nonresidential housing impact fee, the total subS1dy needs must be dJvided among the number of developable commercial and industnal square feet to amve at the per square foot fee for each type of development The $2 <n m1lhon m subsidy requirements attributed to commercial growth was divided by nearly 323,000 square feet of anbcipated development to arrive at a fee of $J 20 L1kewise, the industrial subsidy requirement of $9,21 million was divided by 5.4 milhon developable square feet to amve at a per square foot fee of $1.71. These calculations are shown in Table 7.

AFFORDABLE HOUSING AND ASSOCIATED FEE REVENUE
The proposed mclusionary housing program is projected to produce a total of 337 housing units that ere affordable to households with moderate incomes or less. Thls figure is based on the inclusionary housing program requirement that ·15 percent of new urnts be affordable, and City of Newark Housmg Element projected construction of 2,249 units subj
ect to the mclus1onary housing program through bwldout.8 Whtie the City's proposed inclus1onary housing program ts aimed at producing units, an m-heu fee is allowed as an altemahve under certain arcumstances This fee, calculated at $6,509 per market rate urut, 1s sufnc1ent to cover the affordabd1ty gap between the amount very low, low and moderate income households can pay and the cost to construct the unit. If all new market rate res1denhal development (1,912 uruts) were to pay the in-lieu fee, revenue would come to $12.4 mt!hon Tlus 1s the subsidy needed to provide 337 affordable uruts
New nonres1dent1al development m Newark is expected to generate demand for 399 affordable housing units The subsidy needed for 399 umts 1s $12.2 mtlhon. If all projected new nonresidenbal development were to pay the maximum possible fee, which 1s descnbed in Table 11, the revenue generated would match the needed subsidy of $12 2 million
In sum, the City of Newark mclusionary housing program and non-residential development housing impact fee are anhapated to provide a maximum of 736 affordable units. Table 8 details this forecast of affordable housing supply. The estimated maximum total subsidy that could be provided by the m-lteu fee and the impact fee combined would be approximately $24 6 trulhon EPS recommends that the fee program mclude an add1honaf amount equal to 3 percent of the total affordable housmg fee revenue to cover City admirustrative costs.

Spec1f1cally, tlus "admuustrative fee" would be included to cover City program costs 1 The City expects 2,249 housing units w1thm developments of five or more units, with 54 add1t1onal uruts m emaller developments
15 H ll(IWM,n\11,port\R6Vl&EO F/N�L4 O,\IOlllJI..U h(
Table 7
Calculation of Non-Residential Development Housing (mpact Fees Newark Fee Studies; filf.@#10222
SUBSIDYTO BE RINOED BY N�UNKAGEFEES
Subsfdy
�
�
SUbslcly
&/bsldy
Requn,n,enls
Req�Altnllullld 10 CommMoal Gcow1h
Allnbuled ID lrd.lSlnlll Gtowll'I
(1) Seo Table 3 for calc:ulabcn d 5l.lbs,dy �
TotalSubsldy
$2,988,727
$9,210,362
F-orKast ofSquara Feet
322,780 Sq Ft
5,400,400 Sq fl
(2) Qxnmeraal fee IS equal 10 the C:011111f11aal growth autady � dMcfed by lhe lo.1'C8$18d nurrber of new COOdOeiaal squllllt feet (3) See Table 3 for c:ato debon of Mibsldy raqunmeras
(4) lndlllllmll foe IS equal ID 1he indUl!tnal growtti subaldy reqtlll"llfflllfllS dMdlld bylh& folecasted IU'llberof MW incalS1nll squa1I feet �
SouR;es
DuelO rounding, -flgu_ .,_ mayddlersi91!QrfllWll acllal eaieula1kins Qty of Newarll, ABAG, Econcm,c & Pl;an,.ng Syn,rns, Inc ,_._&��loc:. 4ID'aOI
SUbsldylSq.R.
$920
$171
Neas
(1). {2)
(3), {4)
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Final Report
Newark Affordable Housmg Fee Study
Apnl 23, 2004
such as additional staff hme, consultant fees, and land carrying costs (e.g. the cost of buying land with City funds and holding it unhl an affordable housmg developer 1s located).

The add1t10nal adm1rustrab.ve fee brings the in-heu fee to $6,704 per market rate urut and the impact fee to $9 47 and $1.76 per square foot for commercial and mdustnal development, respechvely Including the add1honal three percent admtrustrahve fee, the estimated maximum total subsidy provided by both the in-heu fee and the impact fee combined 1s approximately $25 4 milhon

AFFORDABLE HOUSING DEMAND
Accordtng to ABAG's Regional Housing Needs Oetermmahon (RHND), there 1s a need m the City for 28 percent of new housing units to be affordable to moderate income households. S1m1h1rly, low income households wdl need 9 percent of new uruts and very low income households will require 16 percent Given the total number of uruts that the city can accommodate (2,303) as calculated m the Housing Element and updated by the Plannmg Department, the RHND d1stnbution suggests demand for 645 moderate mcome units, 207 low income units, and 369 very low mcomc units The proposed mclus1onary housing program is projected to produce a total of 337 housing units that are affordable to households with moderate mcomes or less. If the non-residcnhal development housing impact fee were funded at the maximum level possible, that fee would generate suffl.cient funds to subs1d1.ze an ndd1t10nal 399 uI)lts The total of 736 affordable umts is less than the 1,221 umts of affordable housing needed, nccoremg to the Newark Housmg Element projechons and the RHND d1stnbuhon, Tables compares the number of housinguruts that will be needed m the CJty and the number of housing units that could be provided by the indus1onary housing program and the non-residential development housing impact fee by income level For each income category, the RHND forecasts a lugher number of affordable umts needed than the lnclus1onary housing program and maximum impact foe could subs1d1ze. There are no Income catcgones for wluch the proposed mclus1onary housing program and impact fee would oversupply affordable umts.
18 H \l0"1Hwrk\�\R£YISED f/NAt404\10ll�J .lot
Final Report
Newark Affordable Housing Fee Study
April 23, 2004
Ill. REGIONAL FEE COMPARISON
The purpose of this Chapter is to guide the City's policy dec1s1on making by comparing the proposed fees with the total fee burden charged by several JUnsd1chons in the Bast Bay that are adjacent to or within close proxn�ity of the City of Newark' BPS reviewed the development fees of seven cities, mcludmg Fremont, Umon City, Milpitas, Hayward, Pleasanton, Livermore, and Dubhn The fee comparisons are summanzed in Table 9.

The compansons mdkate that 1f the fee levels for the two fees descnbed m this Report are adopted at the maximum levels, then the total residential fee m Newark will be less than the average fees of comparable Jur1sdktlons. L1kew1se, the retail fee will be roughly 2 percent lower than the average fee an nearby cities On the other hand, the proposed commercial fee would be roughly 61 percent higher than the average fee found an comparable mumc1palihes, and the mdustnal fee would be approximately 17 percent higher than average fees found m nearby c1hes (please note that the City m.iy adopt a lower fee).

METHODOLOGY
As shown m Tables 10 through 14, the fee comparisons evaluate five land uses mcludang single-fam1ly, multifamily, retail, comm_ercial/offace, and general industrial.

Tho rcs1denhal comparison analyzes the average fees per unit for the following two prototypes· a 2,200-square-foot home.with a 450-square foot garage, at 6 6 units per acre, and a 1,000-square-foot unit m n 100-umt complex on 3 8 acres The prototypes for the nonres1denh11l comparison include a 20,000-squnre-foot convenience retail project on 1 84 acres, a 50,000-square-foot commerc1al/off1cc proJect on 2.67 acres, and a 50,000- square-foot industrial project on 2.3 acres.

The data used m the fee comparisons are based on interviews and other informahon obtamed from each City since August 2003 It is often diflicult to compare fees for generic prOJects because much development occurs m areas that have special proJect fees and/or assessments The prototype proJects and fees included m tlus analysis are assumed to occur in areas where the ma1onty of development capacity 1s located in each 1unsdiction. In some cases this means that an assessment is applicable Newark retail fees, mcludmg the maximum non-resldent1al development housing impact fee, would total $17.49 per square foot, which Is about 2 pel'cent lower than the East Bay cities studied The commerc1al/off1ce fee, mdudmg the maximum impact fee, would be approximately 61 percent higher than average The mdustnal fee, mcludmg the maximum impact fee, would total $5 72 per square foot, which 1s roughly 17 percent higher than the average fee charged m similar East Bay cities • City fees m th!& 11nalys1a include only development impact fees, the compansons do not mclude building permit/plan check fees because these are not used to fund lac:thlles, but rather to pay for staff time. 19 H IIWUMortl llqlwtlUVISED fl/Ml.f Of \l�l ht
Table9
Regional Comparison of Total Development Fees
City of Newark Fee Studies: J&@] # 10222
Land Use Existing Proposed
Type Newark Newark Fremont Union City Milpitas Hayward Pleasanton Livermore Dublin Single Family Unit $23,552 $33,254 $45,416 $53,619 $15,398 $20,490 $54,651 $66,180 $67,968 Mufti-Family Unit $17,011 $25,993 $32,509 $42,397 s12.n9 $14,153 $36,063 $60,175 $47,145 Retail $6.02 $17.49 $1258 $402 $994 • $636 $28.99 $2091 $4193 Commerciar/Office $802 $17.49 $966 $280 $342 $458 $1693 $2051 $1822 General Industrial $3.96 $5.n $4.62 $274 $2.29 $302 $15 30 $437 $1.89 Sources· Respecbve Planning Departments, Economic & Planning Systems, Inc cliffarent.

Caution: These figures are estimates meant for planning and comparison purposes only. Actuat fees for a given parcel could be lr-1�?<��5 makes no representation that all it.ms for aH areas are curmnt as of today. Some fps may have been updated since estimates shown in this table Wf'! made.

Average of
Comparison
Cities
$46,246
$35,031
$17.82
$10.88
$4.89
&0nomic ��-Inc; 4l23l20<U H"\1<J222Nwrlt.WodeVandcomp3 tve,s,on 1) . .

TC,.10
Single
�
FmNty
B:aed
entF-Per Un11
on a2.200 94ft unit. 450 sq.ft � and an -aeeot 6 6 Wll1S per acre.

J\lllwwtc(1) Rw/lrx1t

0.W.

Drainage�
opm,tnt lmpect Fe-Per Unrt
S.--
Wai." Calneebon
Connlcbon Fee $2,618 $2.,846 (9)
Fee $8,380 $10,360 (10)
TranaponetJOn $176 $2.254
Parle Faabms Foe ST.219
Parle Oedic:all0n-lMIIIU Fee $2.998 $13,529
Mordable
Fi�
Houslngll.ow
lmpact�
n:ome
Safaly
housing
Fee $1,515 $278
Pubk
.$8,704
FeatJlln/Capl!al faglllJes Fe& $1,508 $2,578
Olt1IW Gerenll � Time TaXBII $270 $1,644 (21
)
School OIS1nd Fees (23). (24) $8,404 $4,708
Tobi Dwalop,nartlmpactf-. PwUnlt $33,254 $45,,4111
Watf!:r ,.._. Amuqibcns One SIB" meter
(1
) lncbios eltlmales of the l'l8W affixdlbla housng fee a:, well a, exr:sll0!11- (2) Asa.me$ dw.elcpmeut is not ri Ruby H• arm
Unllln=v
$2.846 (8)
$10,380 (10)
$83 (13)
$19,000 (14)
$8.908
$3,084 (22)
$9,328
$53,819
-□• Haywanf
St53 (4)
. $1,121 $3.391
$506 S5,022 (11)
$l900
$8,825 $3,000
$1,950 (20)
$4,246 $6,974
$15,398 $20,490
(3) Mdpdas fees are baNCl by lccllllcn and P'0flld type Fees an Ills -lysls are� bMed on � calculallon:s by C.., t1llff PleesanlDnfZI t.rnm,cn
$1,126 $1,795 (5)
$10,400 $9,850
$11,820 (
S5J)07
12) $13.322 (8)
(15) SS.11611 (15)
$4,911 $9,413
$3,203 $13,585 (16)
$3,312
$14,872 $12.24-8
$5,4,651 $68.110
(4
) A
apply
1131 re. forc:ninage tndudas system and app,r1i!Jnarlcl9 fer 100 bne:srfeet. IMHn ID lmlllllg a,d standard SlnJdUrllS • manhDlas, ..aulls. etc Addrllcl1al � ID ea.ch adltllcnal 100 LF and ncn-caidllid s1ruC1unt
(5) lndudlls City.., and County (Zone 7) f9e, 1he Cony Seo charge per sq11a19 fcol o/ lfflpWYl0UI Qll'face (8) Based on so 522 per siuant root or unp11M0US ...-face (7) lnc:IUdas OSRSD ---c0nti11Cfaa11 feea. assemblyfeearictZ.cne 7feef0r General 5eMc8 Nea. irldudes s,s---� (8) lnduda 518" water meter'
(9) PrOY1ded bylh011Sarmry0$nd. Ila� leelS IOb9dlldMtasofSeplei,lber, 2003 Be,edondw mnmum-.ltdagi,d Amounlvanm byprQfKt (10) S8Mt'8 p!UVlded by Mlnlllda Counly Waler o.1nd. and IIICludes 5/8" meter •nd--n l'llllllla!lcn as Wllll u fllablaes c::aMedlDn ctmge (11} Serw:esprowdodbyQtyol�
(12) lrlduda Zone 7 o.stnct • wt'ld1.,.. ti:, 811 r.wdevek,prnenttn Ille Qty (13) BaNd on $617 pencr•
(14) Qty at Um0n C4y � pmt deoc..ilioi, .weu re. en• case by cwi baal$ (15} lncluda t:ie Traffic Impact Fee and 1hlt Tn-Valey Transpc,tallcn 0..1l0pmeait Fee (16) Maxrnum amcunt lh8t can be c:hargld
(17) 8.-:1 en lhe fee al $79,754 por unrt for ud> 1wdeubiil w1II reqund but net buC (I• , 5"' ol lhe tclal nllmbar o( U1111$) a, • projeeto( 20 uma cc more (18) "--'-for Eatllm Dut,fin, wtuch ts slight!'f tugt,.,.ttlal'l lhat ofw.tlern Dublin (19} Nctse Millgallor\ .Feefcr Easllem Dublin prOJBCts otl'f (20) lndudesSuppiemenlal Ekaflng Ca1Slrucoon� 1,.._., .. ,1 Tax and Buldlng �end lmpn:MlmO!ltTax (21) ThoCrtycfR'eancnt ctwges • � BIJaWM Tax
Dublin
$1,149 (6)
$9.,900
$15,765 (7)
$5,843
$14.040 (18)
$821
$3,988 (17)
$3,965 (18)
$4 7 (19)
$12,693
$87,968
(22) Unocn City ctwges mrmtrvdllre 1mproW11tment 1-liar ,w:luulwl "'-'lopnent 111 OelcclD lndustnal Parit Study Araa (OIPSA). � about 1110 al ht Clll( The r-lndudue DIPSA fee Qf $2783 plwl $300 of Miaxln 81w pmng fee
(23) PnMded by Urrfied Sch00f o.sn:t
(24) Foes per squan, feat are $2 05 for Fftlm0nt arl\f Alar--. S3 85 fer U111cn Qty, S1 93 fer Oakland � ...._ $1 84 t,r Hayward. and $6 SO far Pleaanlon Swrw � Plarnng Ooper!rnanta, eca-& Plarrang Systems. Inc ,..._,1atbi
CauUcn· nw nwn.,. •st1ma1as � toe Pl!DIJ!Ost and 9"!"R!!JMl!'l RUIJ!O!!! ontr ASu!I ,_,for• 'B"r P!'E!I 92¥152 ... � ;'.i,,w, m-,.,.. :!9 -r----..,_..hc:�
tt.t11n lt!IIJf for;,O ,,,__ c:u"!QtasR(w,,, Sol!! .... max 11m bfflI mdat,ld •nc, -,,..,_� ,.,,.. ..,._ mast, Htlm21- e a UD,__T:>
T..,._11
.......
11--.1
De,MIO
ar,Uy
pment F.-Pw Umt
on a 1.000 sq ft. unit, 100 unrt complex on 3 a acres, with a .-asp at Z6 t unlta par ac:na.

Newant (1
) Fremont tJnionCl!v Mr-12l
Oevdo
SlormOrai
pment Impact F- P.r Unit
S-Colu.ec:DOl,Fee
nage
WalllrCow!edlonFee
$2,618 $2,a.&8 {9) $2.846 (9) $818
$7,390 $9.390 (8) $9,390 (8} $506
T� $503 $1,749 $71 (11) $800
Park Faobbel Fee $$,805
Park � Fee $2,278 $9,006 $17,000 (12) $8,625
Allbtdable
Fll'&-Poke
�n::omehoullr,g
Impact Fee/PU!>& S!aCy Fee S1,737 $185
Publlc:
$6.704
� Genonar
Faalatl9slCaplta F110�81 Fee $1,373 St,716 $6.282
Fees,'One-T,me Taxes $27'0 $1,122 (19
Sc:hod Oistnd "-
) $2,568 (20)
(21), (22) $3,120 $1,690 $4,240 $1,930
Taal DI,.,,.� Impact Faes Pw Unit $25,993 $32,509 $42,397 $12.771 (1) Include& eArllllllas of the new affordable hottsang fee as well aa eioaung fees Havwmd Pleasanton (3)
$153 (4) $512
$3,018 $6,854
SS.022 (10) $11,820 (10)
$3,505 (12)
$2.300 $3,524
$1,068
$2.020
$1,410 (18)
$2,2SO $6.760
$14,153 $38,063
(2) Milpitas fees an, based by l0artlon and � type Fee, in du analyszs ant mlrnales based on pnM0US calculallclns by Qty mlf (3) Aaunleadvwvlopmentssnotlll�H.IIIIINI
l..Mlnn0re
$834 (5)
$9,850
$13,322 (7)
$3.642 (12}
$9.413
$13,585 (14)
$9,529
$60,175
(4) A ffat1ae fDrcna,ege inclvd• sys119m and� fer 100 m.rfaet. ba-tn lio 81CA111 and� $11UCIU1'8S • manholes, YIMIS, etc Addltl0nal CXIS1S applyl0 eadl addmcnal 100 LF and nan-Gndlsd�
{S) Includes Oty r.. and County (Z,clr1e 7) fee, lhe (:Qrrty tlle chsve per aqua,e fool ot lffl!)8rYl0US surfaal (6) Basvd en $0 522 per 9qllln foot of lfflpeMOUS lurfaat (7) lndudes 518" rn11111r
(8)
(9) ProYlded
Includes OSRSD
by Unai
.._.comedlcn
Sanlta,y Dtllnet.
fees,�-
this upcS:at8cl N '5
and
ID be�
ZOne 7 fae
u
far
d
Goner11
Seplamber,
SeM:e
2003
Ne&..

Based
ndudes
on lhe
518"
nw,mum W1118r nwerarnourll charged Amount vanes by prqect (10) Serw:es prowidad by Qty o/ Hayward
(11) Bas9d on S1 ,&53 per acn
(12} Oupl8ic rate cs assumad For Algfe lDt prqects of less lhlln two Ul'lll:S, a bedroom tax fee � SOl,mtli,185 Jiargod mstaad of part IIH■ fan at a rate of $260 per-bedroom (13) Includes ll'le Traffic: Impact Fae and the Tn-V.allay Traospoitatu, Oevelclpment Fee (14) � amount lhllt cai be c:hatged
(15) Based on the tee of $79,754 perumt for Udl l9Sldanml uni req.ired but not bu1ll (1 e , 5% ot the !Dlal numl>9r of units) 111 a prqac:t of 20 units or more (16) �feeslar&a11ern0ubbn.�moatd-�takaplael
(17) NolaMmgatioriF-6:Jr&.starnDubllllprqectsonly
(18) tncludes SUpplanwntal Building Canstnldlon and �ementTax and Bisldlng � and I� Tax Dublin
$522 (6)
$7,425
$15,765 (8)
$4,470 (13)
S8,T76 (16)
$513
$3,988 (15)
S2.4n c1s}
S2 9 (17)
$$7,145
{19) The City of Fremont char;esa CQnllrur;lian &la.a Tax (20)
$2268
Union Qty cta.rvee 1nfnlslntduta lfflPCN&,Mflt fN for� dlMllcprneilt lfl Deldo lnduslnal � Study NIia (OIPSA). 1ap.ew1lll,g about 1/10 of Iha Qty The faa tndudea DIP plus $300 ol Mmal Blvd prMg fee
(21) Pl'IMded by Undie<f School Olllnr:t
Soun:la
(22} F-.

RespeclM,
p.,--cii.mv
Planning
foot are Depiirirnems,
S2 os for Fremont
Ec01101nc
and Alameda. $3 as for Un10n City. $1 93 for Oakland and MIipitas, St 84 for Hayward, and $6 50 for Pleasa.ito11 & Plamlng Systems. Jnc
Camon; Il!!e flgur.s are DUO!!M ...U few plannmg and 01!!PPrie! pwposes oniY AsPfl1 ,_.fora 9MP P![C!I � be difJmnt, ;":;,;i:: mae, no 1!Pf.....11ation that 1a ftfrns for all --CU!'!!!! as of'Pdlr, SgM INs mn hpe been updapd sance�!Dlln s'-t 1n ttJ: Sl!ft !m! made. -,--�-- HUOZ211 PC Cs r_m,._..o
. . .

Tatlfe12
Retail
o-lapment F.s p.,. Sq Ft
Band on a 20,000 Sq Fl. ProJKt, an ntimatad 1 84 acres, with a 0.25 F .A R.

Newadc(1l Frnmont
O-SOpmentF-PwSq.R
Wirta
s10rm0ra,nage
s-C<lnnedion Feo $297 $1 34 (6)
Conl'9dlon Fee $122 $217 (9)
Tn.nspatsbo,, $129 $794 (11)
Park Faalllles Fee
Park Dadlcatlon-al-l Fee
Affordal:Ae
F1At-Police
Housing/
lrnpllct Fff / Pubbc: Safoty Fee $170 $010
Public
Law n:iome tiou.,g $947
Other-General
Faallbesl capltal F8Cllmes Fee $022 $069
School OlStnct
F�TimeT- $032
Fees $0.31 $034
Totai o.v-,opme11t F- Per $qJ't $17.At $1251
U1110n-r.,i; M11.-r:t1 1-ia..-d P!easan1Dnf2\
$001 (<4) $051
$134 (6) $063 $017 (7) $378
$217 (9) $012 $HIS $13 03 (12)
SO 17 (14) $900 $10 36 (13)
$055
$041
$396 (15)
$034 $019 $034 $034
$"-02 $9.9' $63& $21..99
Wsor Meter AAumpbDns Two 1 S" mews, one fotdcmeAc use and one for 1rnga11cn use Metllr sae may be ddferent pn,JeCt � proJOCt (1) lndudes estimates d UlO nf1W affon1able houa,g fee as WIiii 8S exzsllng feet (2) Assumes dew:lopment IS not en Ruby Htll area
(3) MilJ)l!as ,_ an, baecl by IOCailofl and pro,ecttype F4!ea in ttss analysis ate enll19tes baaed on pnMOU5 calallltlons by Qty staff (4) Dnimage fees vary depend11g on amount cl ,,_r '9eC and lands t;I $buctlM'eS reqused Bao fee m $153 winch 1ndudes 100 br.ar feet (S) lnducles Clly fee and COUnty (Zone 7) fee c:ha,ved per sc;uant foot cl tmper,,IOUS IU'faoe (6) Provided by l)lion Sanllary Olllnd, this updated fa& IS 1D be effec:tlva III d September, 2003 lNermgre DublW\
$062 (5) $052
$0<49 (8) $251
$666 (10) $1S03 (16)
$1199 (13) $21 82 (17)
$1 29 (18)
$012
$081
$027 (18)
$002 (19)
$034 $034
S2D91 $41..93
(7)
oxygen
&aed on
dem3nd
a mimmum fee of $3.391 Fees vary based on per gallon of dally capac:rty, pounds per-year of blod'lellllC3I CIXY90fl demand and pounda per year er btochernlcal and IU� sollds Amount 1/MeS by prqed SIZ8 an:I type
(8) Assumes a mrnmum ol 8 fixtures l..rvennorll charves a St. 125 fee for each nxaue Fccues WIii vary by pR>JeCI $IZ8 and type (9) Service pnMded by Alameda County Water Dislnd, and W!Clud8s 1 5" me1et and $IIIVIC8 bne lllS'38atJon as wea as faclll1les r;omedKln charge (10) IM:udes 1 5' meter
(11) Impact fee for fast� matlcatsl gas ltaoli$ A one 1mO eice,IJ)IIOll applies ID r1ltad adddlons up 1D 10% of exllllng floor 8ffla, but� 10 750 tqU8fe feet (12) Include$ Zone 7 Dlatnct foe, which applies to al new dlWlllop,rae.it ri the Qty (13) lndudes lhe Traffic; Impact Fee and the Tn-Vale)'Transports,an lleYeiopmenl Fee (1-4) Based on $1,&53 per ecnr
{15) Includes �Budding Cons1nJdlon tmpro,,oementTax
{18) Assune$ 1 5" turbo__. mnn, inc:ludeS OSRSO and Zane 7Wlltlll' comocton fee and asembly r- (17) lndudes R!lglonal Traffic Fee of $114/SqR and Traffic� and PlezilrrlDn fnt8rthange fee of $517 pertnp get,e,aled by lhe l)n)JOd A11a1anCS fee ra!e far EasCem Dublin and average dally 11118 of 40 '1qlll per projlld
(18) A=umes fees for Emlt9m Ollblin, which us 81,;t,11y hlghec lhan Westam Oublsn (19) lndudes noc:se mrtlga!IOn ree
Soura, RespeclMa Planning Depa,1ments. &on01111C & Plarnng Systems. Inc c,ut,on Jhnt 11pyrp am gt1matp "!tint for Rflnn1na and cornpartpn 2"T9MI onty, !!!!Rf Ml 1Pc I a!mJ PICSlf S9Yid bf dlff!r!9t. ¢7't4? meMI no CIR!tff!•taP.,., tha\all mma ford.,... ... BRJ'!ntn 9'tl>d!Y Some ma a,ay 11ayt bttO updpd NDO-♦- 1bmm fnthls Ride,_. roadt --..---- H"lt=tilllArf:'llteedQa --tD�1}
..

Table13
�
o.v.tapmant
BaMd
F- Per Sq.Ft.
on a 50,000 Sq.A. Prctect, a11 at&uat9d 2.ftt acras, wttb a 0.43 F.A R.

Newmtr;(1) Fremont
Dnefopment
Storm
F- Per Sq.ft.

Sewer
Drainage
watarConnecbonFee
ComiecllC>n Fee $297 $1 34 (6)
$122 $1 02 (9)
Transportallon $129 $570
Park Faalibe$ Fee
Flnt-Poltce
ParlcOecicaborHn-1.aFee
Affordable Housing/
Impact Fee / Public Safaty Fee $170 $017
Pubic
Low sncome h0using $947
Famtle3l C8piml Faalltles Fee $022 $110
SChool
Other General
DIStnct
Fees/On&-T1me Taxes $032
Fees $031 $034
Total Development FMs Per Sq.Ft $1749 $9.66
lJnlonr..!u �r,i1 Pleasantcnr7l
$0003 (4) $051
$134 $070 $007 (7) $236
$102 (9) $008 $117 $7 01 (10)
$0 10 {13) $234 $5.53 (12)
$055
$063
$3 00 (14)
$034
$2.80
$031 $034 $034
$3.42 $458 $16.93
Watsr Meter Assump110nS Two 'Z' � one for domestic IJS9 and one for ,mgation use Meler lllZ9 may b& different project by pRlJlld (1) lncbles estimates of the MW affordable housing fee as well as 9XISllng fees (2) Asaumos..CMN81opment is not an Ruby HIii aaa
(3) Mllpdas fees an, based� locatxm and pn)J9Cttype Fees 11'1 thl5 analysis ere ea:srnates based on pr'8¥l0UI" ea!Qliamnl � City smff (4) Dnmage fess vary depeix11ng on am.ant er lirlear l'aet and lands of structure5 niqwed Bae ree � $153 wt.:ti lnCludas 100 linear feet (5) lnc:ludes Qty fee and County (Zone 7) feecharved per square foot d mpeMOUS surface lMmlOl'8
$062 (5)
$020 (8)
$426 (11)
$14 � (12)
$052
$034
$20.51
{8) Provided by Union Sanitaty Or:stnct, this updated fee i:s 10 be etJedlve as of September, 2003 Based on the rninmum amount charged Amou'll vanes by piqaet (7) Baaed
0X)'9eO
on
demand
a minmum fee of $3.391 Fees V8l'f based on per gallon ot dally capaaty, pounds per year of blochemlcal and pounds per yelW' of blocheill'IICIII oqgen demand a1d suspended solids (8) AGUITIM a mrumum of 8 fixlures l.Jverm0re dlargaa an $1.125 fee for each fix1Ure Ftxues WII vary by prqeet size and type (9) SeMee prtMded by Alaml:,da � water Distnct. and n:ludes Z' ffll!ter and seMCe.llrru ulSlallaboi, as well as faolrbes COlll'l8dlOn c:ha (10) lncludllS Zono 7 DIStnet feo, whx:h applies ID al ,_ cllt¥dDpment 11'1 the City (11) Includes Z' memr
(12) includes the Traffic Impact Fee Md the T�Vallay Transportabon Development Fee (13) Basedori$1,853peraae
(14) Includes Sus,plernental 8u1ldmg Construdion lmpRMJment Ta. (15) A5sumas 2• turtx> water meters, 1ncudes DSRSO and Zone 7 waler connedion fee and aaembly fee (16) lrdldes RegioMf Traffic Fee of $3 07/SqFt aid Traffic lmpect and Pteasan!D,J lrrten;hange fae of $517 pertnp ganeraled by the prqect Assumes fee nltB for Eastern Dube, and awrage daily rate of 20 lnps per prqect {17) Assumes fees for Eastem Dublin. wtuch JS 8'lgt1Uy higher Chan Western Clw)lin (18) Includes nome mrtlga1ron fee
Soun:a Respedrw Plarnng Oepartmenb, Economlc & Planning Sy$tema, Inc Caution: These figures are !!lf matas meant for P'!Mlog and eosnpamon purposes only Actual fps far a qtv.n parca, c:aald be d!ff!,ent �,4;->, maJcas no rap •w,tptlon that"''' ltfT! for all !!Pl -cu"!otg of today Some faes may hayt bpi, "l'l!k!!!! •Inc, estl!,.., Jhown In this table-mp Oublrn
$052
$251
$829 (15)
$328 (16)
$251 (17)
$024
$0 53 (17)
$001 (18)
$034
$18.22
6--.,,,,�-- HU� �0:S(l!w.-1J
• • • .

Table
General
14 lndustnal
Baud
De, llapc,_,t F-Par Sq Ft.
on ;a SU.GOO Sq Ft Projec:t, an ubmatitd 2 3 acras, Wl1h • o 50 F A.R �(t) Fremont
Dnelopment
Stgnnl)ruvge
F-Per Sq Fl
S.--ConnedlortFee $124 $134 (6)
Watt,r COmedlcln Feo $094 $1 02 {11,
T,1111SpOf1aba, $075 $1 29 (12]
ParkF�Fee
Part DedK::ulloi rll'!-I.Jeu Fee
Alfordablo
Fn-Police
lbmng
mpact Fee I �IC Safety Fee S025 $008 (12]
I Low inc:cme tiou.19 $176
Pubbe Faalrllea/Ca,Dllal Facdilla Fee SO 16 SO 55 (12]
Olhw
School
General
Olstn:t
Fees/One.Tsne T- $031
Fees $031 $034
l"-"UIV
St 34 (6)
St 02 (11
$004 (15)
$034
-r.n HayWalll f'la:sanll:ln Cl.I I.N8mlar9 Dublin
$0003 (4l $051 SO 62 (5) $052
$097 $007 (7) S2 36 (10) $020 (8} S2 51 (18)
$007 $117 S7 01 (13) $4 26 (9) $829 (19)
$094 $41S (14) $83' (14) $622 (20)
$111 (22)
S010
$055 $025 (16)
$038 $023 (22)
$1 44 (17} $000 (21)
$031 $034 $034 $034 $034
Total o-.!opmMt Fea Per Sq Ft $572 $462 $2.74 $229 $3.02 $15.le $i2.CM $1932 Water Meler' AssumpCIOns Two Z-rziele!'s. one fordomellbc: use and one tor ,mgat,on � Mels'IIZlt may be dllfwent Pl\lf8d by prqea (1) Includes elllmalesd th&,_ a1rordable hou8111 fe& aa well as em11ng fees (2) AQufflltS dewlopment ss not in Ruby Hill area
(3) MIJXIN fees are baled by locallan and piqact l)lpe � in 1h11: analysa .. emnates based on 1:Jr1MOU1 i;aJc:ulllllona by Qty llatr (-4) � fNs vary dapendirlg on ainaunt of ir.w feet and kinds of strudurea requred S-fee • $153 which indudm 100 llnawfeet. (5) Includes Qty fee and Ccunty (Zone 7) fee CNrged per� foot of lllpl!IMCIUS aurface (B) � by U.-s..m,y Oland. hsupdacl ,_a ID b&�xof Se!)lember. 2003 8asad an Ul8 mnnwmamountc:tagad AmoUnt � by p,qecl (7)
oxygen
Based on
dMllnd
• mnmum fee d$3.38l Fees vary b898d on per gallon of dally capaaty. pounds per,,_ ot biudww,ical andpa,nb per� a( blod,e,,a:al � danWld � � lobds
(8) �-fflnlJ1Um of a lixllna 1..Mlm10te dwves a $1, t2S fee l'or each 1ix11n FDdlnsWIII vay by pnlf8d SZIII a type (9) lnlcudes T mecc,
(10) BaAd on general olllce re.
(11) Senice p'CMded by Ala-neda CountyWatar Oainct. and .-dJdes r mater and AMCt tne lmllRlllon a W911 • � ca■l9dlai, � {12) The City's snpcatfi■e � haa ltne dllfarwit ltidultnlll caeego.-� llgtit lllduslnlland manufactumg, 11:!e waatlOlma fees used lor1hls analyll:s (13) lndudlls Zone 7 0ls1nd re.. whid'l �to .. ,-d$<welup,-11n lhe City (14) lndudn lhe Traffic: lqlact Fee and Ille Tn-v.y Tiail:SpOrtak;ilt CMalc,:.,ell Fee (15) Based on S927 per acn
(18) 8a:Nd on '9e for manufadunng
{17} lncuies SllpP!m,MIIUl BulidJng C0natNdl0rl L14110,wnentTax {18) 8aMtne fN for-rehOuM (general l'8l9JI) Fees may vary case by C8S8 depend� on 1h11 exact Ralllnt and $cale d the busines, liw8I of Waler usage ancfwata generated.� 111fon118bui1 must besubmtlad tohl wvcedislra in onSll'IDQllla fM enm.te (19) Aaumn 2" turbo wata" memrs, ,ocu:f• DSRSD lll'ld Zol» 7 W;Jlarc:oc■MldlC)il fee and -bly fee (20) Includes Regional Tiaffic Fee of $2 081SqFt md Traffic lmpllcl and � lntarchanga fee of $517 P91' tnp generated by 1he p,qed Aaumes fee rate for &siem Dublin and -aee dally,_ of 8 tnps per pnJJaCt (21) Includes .-rndlgabon fee
(22) As1umea ,_ for Entam Dublln, wtuch is sllglllly hlgl1« thlin Ww.ern Dublin Sourca � Plannsns Deparli,.-\ta, Economic & Planning� lni; Caution: Ibne fiau,... .,. ..,... 111•,ttor pflnrpnq and compan:por E1"'P"¥1 ?Dlf, Ac:tu!f.,,_ ,on atno ps,r S'RMld,.. dlf!!!!nt 17 �

1.«�-ffl!!cn no
that •II --fw .. , ... --Cl!!!!!l-of 19dn. Some,.., Mr(..__, •e!-!r! -.IIICII .,,,, .... fflffl) In t!"!tab!! wt!!--- -""'-�ho-
' [
r
Hit02221 Mi9 IOu O r_o:,,.,_.,. fJ
.. . •
•
•
'
•
Importance of the Comparisons
Final Report
Newark Affordable Housing Fee Study
April 23, 2004
The imposition of development fees increases the cost of development. For those developers who have already purchased land at current market pnces, any imposition of higher fees m the short-term could have the result of makmg their developments Jess feasible In the long-term, land prices could adJust in the market to reflect the higher cost of development Thus, 1f market pnces remam flat, the value of undeveloped land declines. If the total cost of development 1s much higher m one JUnsdicaon than other compehhve areas, the impos1tlon of lugher fees can cause demand to sluft to those other lower-cost locat.tons.

Nonresidential development, in general, ts more "footloose" than residential uses While employment opporturuhes create restdenhal demand, residential development is also dependent on the presence of other ameruties such as schools, parks, cultural mstituhons, and other quality of hfe charactenshcs. Office and tndustrial development is tied more to economic characteristics of a location, such as the cost of land, taxes, and the cost of new development. Consequently, development impact fees may have a greater affect on the type and amount of commerctal and mdustnal development m the Ctty than on res1denbal development
2 6 II \102.UNwk I 1'qorllll.liVIS15D FINAU OI I lDllljl,wJ ..

APPENDIX J
RESOLUTION NO. 10,184
RESOLUTION NO. 10,184

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEW ARK

ESTABLISHING AFFORDABLE UNITS NEEDED TO FULLY MITIGATE

THE IMPACT OF RESIDENTIAL DEVELOPMENT ON THE NEED FOR
AFFORDABLE HOUSING; AND HOUSING IMPACT FEES FOR

RESIDENTIAL DEVELOPMENTS
WHEREAS, on February 25, 2010, the City Council of the City of Newark adopted the Housing Element of the General Plan in compliance with State law, which includes the goal of encouraging the provision of a range of housing opportunities to meet the City's share of the regional housing need and, to implement that goal, includes Program 8 to review the City's affordable housing ordinance and consider amendments to respond to market conditions; and WHEREAS, to implement the affordable housing goals and programs of the City's Housing Element, including Program 8 in the City's 2007-2014 Housing Element, the City Council has considered and introduced on this same date an ordinance to repeal the City's existing affordable housing ordinance (Chapter 17 .18 of the Newark Municipal Code) and add a new Chapter 17.18 (the "Affordable Housing Ordinance") which, among other things: 1) authorizes the imposition of housing impact fees on residential developments to mitigate the impact of such developments on the need for affordable housing in the City; and 2) continues to authorize the imposition of housing impact fees for nonresidential developments to mitigate the impact of such projects on the need for affordable housing in the City; and WHEREAS, land prices are a key factor preventing development of new affordable housing. New housing construction in the City which does not include affordable units aggravates the existing shortage of affordable housing by absorbing the supply of available residential land. This reduces the supply of land for affordable housing and increases the price of remaining residential land. At the same time, new market-rate housing contributes to the demand for goods and services, increasing local employment at very low, low, and moderate-income wage levels, which will increase the demand for and exacerbate the shortage of housing available to persons at those income levels; and
WHEREAS, to further implement the affordable housing goals, objectives, policies, and programs of the City's 2010 Housing Element and to ensure that the housing impact fees adopted by this resolution do not exceed the actual affordable housing impacts attributable to the development projects on which the fees are imposed, the City Council has considered the "Residential Nexus Analysis, Newark, California" elated March 2014 and prepared by KeyserMarston Associates, Inc. (the "Nexus Study"), which study demonstrates that, to fully mitigate the burdens created by new market-rate units in residential projects on the need for very low, low, and moderate-income housing, a housing impact fee of $23.80 to $35.60 per square foot of new market rate development would be needed, or from 12 percent to 21 percent of units in each residential development would need to be affordable to very low, low, and moderate-income households; and
WHEREAS, the City Council now desires to repeal the Inclusionary Housing In-Lieu Fee and to adopt housing impact fees for residential developments as authorized by Section

17. l 8.030(B) of the Affordable Housing Ordinance, which housing impact fees do not exceed the justified fees needed to mitigate the actual affordable housing impacts attributable to the developments on which the fees are imposed, and which fees are lower than the amount found by the Nexus Study to be needed to fully mitigate the burdens created by new market-rate units in residential projects on the need for affordable housing to ensure that residential projects remain economically feasible; and
WHEREAS, the City Council also desires to adopt the percentage of affordable units needed to fully mitigate the impact of residential developments on the need for affordable housing, as authorized by Section 17.18.060(A) of the Affordable Housing Ordinance; and WHEREAS, in compliance with the Affordable Housing Ordinance, all housing impact fees collected shall be deposited into the City's affordable housing fund to be used solely to increase and preserve the supply of housing affordable to households of very low, low, and moderate incomes (including necessary administrative costs); and WHEREAS, at least ten days prior to the date this resolution is being heard, data was made available to the public indicating the amount of cost, or estimated cost, required to provide the service for which the fee or service charge is levied and the revenue sources anticipated to provide the service, including general fund revenues in accordance with Government Code Section 66019; and
WHEREAS, at least fourteen days prior to the date this resolution is being heard, notice was provided to those persons or organizations who had requested notice of these fees, in accordance with Government Code Section 66019; and
WHEREAS, notice of the hearing on the proposed fees was published twice in the manner set forth in section 6062a as required by Government Code Section 66018; and WHEREAS, a duly and properly noticed public hearing was conducted by the City Council on April 10, 2014.

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Newark, California, as follows:

1. Recitals. The foregoing recitals are true and conect and incorporated by this reference.

2. Repeal of lnclusionary Housing In-Lieu Fees. The City Council hereby repeals and removes the Inclusionary Housing In-Lieu Fee established by Resolution No. 8802 and amended by Resolution No. 9398.

3. Adoption of Residential Housing Impact Fees. The City Council hereby adopts housing impact fees for residential development as shown on Exhibit A, attached hereto and incorporated by this reference.

Resolution No. 10,184 2

4. Annual Adjustment to Housing Impact Fees. The City Council may review housing impact fees from time to time. For any annual period during which the City Council does not review the housing impact fee, fee amounts shall be adjusted once by the community development director based on the percentage increase in the Engineering News-Record Construction Cost Index for San Francisco, California.

5. Percentage of Affordable Units Needed to Fully Mitigate Impacts of Residential Development. The City Council hereby determines that the following percentages of affordable units will fully mitigate the impacts of residential development on the need for affordable housing:

Required Affordable Single Single Townhome Condo Apartment Units* Family Family
Lar�e Lot Small Lot
Very Low Income 11% 10% 8% 9% 6%
Low Income 5% 5% 4% 4% 3%
Moderate Income 5% 4% 4% 4% 3%
TOTAL 21% 19% 16% 17% 12%
*Definitions of proJect types and affordability categories are contained m the Nexus Study.

Notwithstanding the above, for a specific residential development, the City Council may determine that an alternative distribution of affordable units will fully mitigate the impacts of that development on the need for affordable housing, based on community needs and the characteristics of the development.

6. California Environmental Quality Act. The City Council hereby finds that adoption of this resolution is exempt from the California Environmental Quality Act because it can be seen with certainty that there is no possibility that the fees may have a significant effect on the environment, in that this resolution contains no provisions modifying the physical design, development, or construction of residences or nonresidential structures (CEQA Guidelines Section 1506l(b)(3)).

7. Effective Date. This Resolution shall go into full force and effect on June 9, 2014, [60 days after adoption] but only if Ordinance No. 473 to add the new Affordable Housing Ordinance is effective prior to that date.

Resolution No. 10,184 3
I HEREBY CERTIFY the foregoing resolution was introduced at a regular meeting of the City Council of the City of Newark held on April 10, 2014, by Council Member Freitas, who moved its adoption and passage, which motion was carried after being duly seconded, and passed by the following vote:

AYES:

NOES:

ABSENT:

SECONDED:

Council Members Freitas, Marshall, Vice Mayor Apodaca and Mayor Nagy
None
Council Member Collazo
Council Member Marshall
IL�il�
City Clerk
Resolution No. 10,184 4

EXHIBIT A
Enterprise Fund Account Descriptio� Fee
- Cost Center No. (in dollars)
A. DEVELOPMENT, Continued
401-0000 3860 4. Housing
ILF
a. Residential Housing Impact Fee* (revised
annually)
First 1,000 sq. ft. floor $20/square foot
area/unit**
All sq. ft. over 1,000 sq. floor $8/square foot
area/unit
*Established by Resolution No. 10,184. Floor area
for a residential development equals the sum of the
horizontal floor areas of a building measured from
the exterior face of exterior walls or from the center
line of a wall separating two buildings, excluding
garages, carports, and common areas.
**No housing impact fee is charged for the first 200
sq. ft. of floor area for additions to existing
dwellings.
b. Non-Residential Housing Impact Fee*** (revised
annually)
( 1) Commercial $3.51/square foot
(2) Industrial $0.65/square foot
***Established by Resolution No. 8802. Floor area
for a commercial development equals the sum of
the horizontal floor areas of a building measured
from the exterior face of exterior walls or from the
center line of a wall separating two buildings.

Where no walls exist, the floor area is the area
covered by the roof excluding two feet on each side
Resolution No. 10,184
of the structure. Outside areas used for sales or
display (such as nurseries, building materials, auto
sales, etc.) may be considered part of floor area
when the community development director
determines that the use of the outside area
significantly contributes to the employee density of
the building.

NOTE: This resolution does not modify the non-residential housing impact fee nor the method of calculating the non-residential housing impact fee. The method for calculating the fee is identical to that previously contained in Section 17.18.020(G).

Resolution No. 10,184

APPENDIX K

RESIDENTIAL NEXUS

ANALYSIS, NEWARK

CALIFORNIA

KEYSER MARSTON ASSOCIATES

RESIDENTIAL NEXUS ANALYSIS
Newark, California
Prepared for
City of Newark
Prepared by:

Keyser Marston Associates, Inc.

March 2014
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TABLE OF CONTENTS
Page
EXECUTIVE SUMMARY 1
INTRODUCTION AND OVERVIEW 7
A. MARKET RATE UNITS AND HOUSEHOLD INCOME 11
B. THE IMPLAN MODEL 27
C. THE KMA JOBS HOUSING NEXUS MODEL 31
D. MITIGATION COSTS 43
ADDENDUM: ADDITIONAL BACKGROUND AND NOTES ON SPECIFIC
ASSUMPTIONS 51
APPENDIX 1: MARKET SURVEY
APPENDIX 2: SUPPORTING TECHNICAL ANALYSIS TABLES
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EXECUTIVE SUMMARY
Keyser Marston Associates (KMA} prepared this residential nexus analysis for the City of Newark pursuant to a contractual agreement. The report will form one of the bases for recommendations for the adoption of a housing impact fee consistent with the applicable requirements of the Mitigation Fee Act. This Executive Summary contains a concise overview of the residential nexus analysis; full documentation of the analysis is contained in the body of the Report and its Appendices.

A. Residential Nexus Analysis
A residential nexus analysis demonstrates and quantifies the impact of new market rate housing development on the demand for affordable housing. The underlying nexus concept is that the newly constructed market rate units represent net new households in Newark. These households represent new income in Newark that will consume goods and services, either through purchases of goods and services or 'consumption' of government services. New consumption translates to jobs; a portion of the jobs are at lower compensation levels; low compensation jobs relate to lower income households that cannot afford market rate units in Newark and therefore need affordable housing.

1. Impact Methodology and Models Used
The analysis is performed using two models. The IMPLAN model is an industry accepted, commercially available model developed over 30 years ago to quantify the impacts of changes in a local economy, including the employment impacts of changes in personal income. The input into the IMPLAN model is net new personal income in Newark available for expenditures; the IMPLAN model then estimates a distribution of expenditures and ultimately produces a quantification of jobs generated by industry. The KMA Jobs Housing Nexus model, which was initially developed over 25 years ago to analyze the income structure of job growth, is used to determine the household income of new employee households and identify how many are in three housing affordability tiers including Very Low-, Low-, and Moderate-Income.

2. Market Survey and Residential Prototypes
The first step of the nexus analysis is to identify residential prototypes that are representative of what is generally being built by the private marketplace in Newark. KMA developed programmatic assumptions in consultation with the City of Newark for five residential prototypes - four ownership prototypes and one rental prototype. KMA then undertook a market survey of projects covering these prototypes to estimate sales prices and rent levels for the prototype units. The prototypes are summarized in the following table.

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Prototypical Residential Units
Single Family Single Family Townhome Condo Apartment I Large Lot I Small Lot Avg. Unit Size 2,500 SF 2,000 SF 1,500 SF 1,300 SF 850 SF Avg. No. of Bedrooms 4 BR 3 BR 3 BR 2 BR 2 BR
Avg. Sales Price/ Rent $787,500 $700,000 $562,500 $580,000 $2,000 Imo.

From the sales prices and rent levels, household income is determined using assumptions with respect to a share of income spent on housing and housing purchase terms. For ownership units, 35% of income is spent on housing (including mortgage payments, property taxes, home owner association dues, and insurance). Renters are assumed to spend 30% of their income on rent. These relationships are grounded in state housing policy and reflective of the current averages for Alameda County.

Gross household income is adjusted to a net amount available for expenditures after deducting the portion of income dedicated to income taxes, contributions to Social Security and Medicare, savings, and repayment of household debt. Housing costs are not deducted as part of this adjustment step because they are addressed separately as expenditures within the IMPLAN model. The adjusted household income available for expenditures becomes the input into the IMPLAN model. As a result, household income associated with each of the prototypes is as follows:

Household Income
Single Family Single Family Townhome Condo Apartment I Large Lot I Small Lot Gross Household Income $159,000 $142,000 $116,000 $124,000 $80,000 Percent Income Available 67% 67% 67% 67% 71% for Expenditures Household Income
Available for Expenditures $107,000 $95,000 $78,000 $83,000 $57,000 flnput to IMPLAN modell
The nexus analysis is conducted on 100-unit project modules (i.e., 100 new households) for ease of presentation and to avoid awkward fractions.

3. IMPLAN Model Results
The IMPLAN model was applied to link household income to job growth occurring in Alameda County. The IMPLAN model distributes spending among various types of goods and services (industry sectors) based on data from the Consumer Expenditure Survey and the Bureau of Economic Analysis Benchmark input-output study, to estimate employment generated. Job creation, driven by increased demand for products and services, is projected for each of the industries that will serve the new households. The employment generated by this new household spending is summarized below.

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Jobs Generated Per 100 Units
Single Family Single Family Townhome Condo Apartment I Large Lot I Small Lot Annual Household
Expenditures, 100 Units $10,650,000 $9,510,000 $7,770,000 $8,310,000 $5,680,000 Total Jobs Generated, 73.1 64.8 53.0 56.6 37.5 100 Units The IMPLAN model quantifies jobs generated at establishments that serve new residents directly (i.e. supermarkets, banks or schools), jobs generated by increased demand at firms which service or supply these establishments {wholesalers, janitorial contractors, accounting firms, or any jobs down the service/supply chain from direct jobs), and jobs generated when the new employees spend their wages in the local economy and generate additional jobs.

Retail, restaurants, and health care represent the largest share of jobs generated by household expenditures.

4. Compensation Levels of Jobs and Household Income
The output of the IMPLAN model - the numbers of jobs by industry - is then entered into the Keyser Marston Associates jobs housing nexus analysis model to quantify the compensation levels of new jobs and the income of the new worker households. The KMA model sorts the jobs by industry into jobs by occupation, based on national data, and then attaches local wage distribution data to the occupations, using recent Alameda County data from the California Employment Development Department (EDD). The KMA model also converts the number of employees to the number of employee households, recognizing that there is, on average, more than one worker per household, and thus the number of housing units in demand for new workers is reduced.

The output of the model is the number of new worker households by income level (expressed in relation to the Area Median Income, or AMI} attributable to the new residential units and new households in Newark. Three categories of addressed: Very Low (under 50% of AMI), Low (50% to 80% of AMI) and Moderate (80% to 120% of AMI).

Following are the numbers of worker households by income level associated with the Newark prototype units.

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New Worker Households by Income Level per 100 Market Rate Units Single Family I Single Family
Large Lot I Small Lot
Very Low (Under 50% AMI) 13.2 11.7
Low (50%-80% AMI) 7.4 6.5
Moderate (80%-120% AMI) 7.2 6.3
Total, Less than 120% AMI 27.8 24.5
Greater than 120% AMI 6.3 5.7
Total, New Households 34.1 30.2

5. Impact Fee Levels Supported by the Nexus Analysis
Townhome

9.5 5.3

5.2 20.0

4.7 24.7
Condo Apartment

10.2 6.7

5.7 3.7

5.5 3.7

21.4 14.1

5.0 3.4

26.4 17.5
The last step in the analysis puts a dollar amount on the cost of mitigating the affordable housing impacts. The conclusions of the nexus analysis, expressed as the number of worker households by income affordability category, are linked to the cost of delivering housing to the households in need. Each income or affordability tier is associated with a subsidy needed to produce and deliver a unit at the specified affordability level; this subsidy is referred to as the 'affordability gap.'
Affordability gaps are calculated for each of the three affordable tiers. The analysis assumes households earning less than 80% of Area Median Income will be assisted in rental units, while households earning between 80% and 120% of Area Median Income will be assisted in ownership units.

The resulting affordability gaps are as follows:
■ $240,000 for households in the under 50% AMI category; ■ $214,000 for households in the 50% to 80% AMI category; and, ■ $169,000 for households in the 80% to 120% AMI category.

When the affordability gap conclusions for each income tier are linked to the number of affordable units required as a result of market rate development (as indicated in the inset table on the next page) and divided by 100 units, the result is a Total Nexus Cost per new market rate residential unit. The results per unit are:

Nexus Per Market Rate Unit or Maximum Supported Impact Fee per Unit Affordability
Income Cateaorv Gap
Very Low (30% - 50% AMI) $240,000
Low (50%-80% AMI) $214,000
Moderate (80%-120% AMI) $169,000
Total Nexus Costs
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Single Single
Family/ Family I
Larae Lot Small Lot Townhome
$31,600 $28,000 $22,900
$15,800 $13,900 $11,300
$12,200 $10,700 $8,700
$59,600 $52,600 $42,900
Condo Apartment
$24,500 $16,100
$12,100 $8,000
$9,300 $6,200
$45,900 $30,300
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The Total Nexus Costs, or Mitigation Costs, indicated above, may also be expressed on a per square foot level. The results per square foot of building area (net rentable or sellable Sq.Ft.) are as follows:

Total Nexus Cost or Maximum Supported Impact Fee Per Sq.Ft. of Building Area Single Single
Affordability Family I Family I
Income Category Gap Large Lot Small Lot Townhome Condo Apartment Prototype Size 2,500 SF 2,000 SF 1,500 SF 1,300 SF 850SF Very Low (30% - 50% AMI) $240,000 $12.60 $14.00 $15.30 $18.80 $18.90 Low (50%-80% AMI) $214,000 $6.30 $7.00 $7.50 $9.30 $9.40 Moderate (80%-120% AMI) $169,000 $4.90 $5.40 $5.80 $7.20 $7.30 Total Nexus Costs $23.80 $26.40 $28.60 $35.30 $35.60
These costs express the total linkage or nexus costs for the five prototype developments in Newark. These total nexus costs represent the ceiling for any impact fee requirement placed on market rate development. The totals are not recommended levels for fees; they represent only the maximums established by this analysis, below which fees may be set.

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INTRODUCTION AND OVERVIEW
The following report documents and quantifies the linkages between new market-rate residential development in the City of Newark and the demand for additional affordable housing. The analysis, which demonstrates support for a Housing Impact Fee, has been prepared by Keyser Marston Associates (KMA) for the City of Newark in accordance with a contractual agreement.

The City of Newark has an lnclusionary Housing Ordinance adopted in 2004 requiring all residential projects with five or more units to set-aside 15% of units as affordable. Payment of a fee in-lieu of providing units is subject to approval by the Council. Due to limited housing development since the time the lnclusionary Housing Ordinance was adopted, no inclusionary units have been produced under the program.

Since the 2004 adoption of the City's inclusionary housing program, there have been several court cases affecting inclusionary housing programs. The Palmer case in particular precludes cities from requiring the inclusion of affordable units in rental projects unless the developer receives a density bonus or certain regulatory concessions and agrees by contract to restrict the rents. Palmer and other recent and pending cases have encouraged cities to seek alternative strategies to address the need for affordable housing.

At this time, the City is considering replacement of its inclusionary program with a Housing Impact Fee applicable to new market rate residential development. Fee revenues would be used to assist construction of new affordable units as mitigation for increased affordable housing needs linked to new market rate residential construction. Advantages of housing impact fees compared to inclusionary include the ability to apply requirements to rental projects and greater flexibility to produce affordable units of the type and in the locations that best fit community needs. The City already has a Housing Impact Fee that applies to non-residential development.

Analyses of the impacts of new development are called linkage or nexus analyses. This nexus analysis establishes maximum supportable Housing Impact Fee levels based on a quantification of the impact that new market rate residential development has on the need for affordable housing.

The Nexus Concept
At its most simplified level, the underlying nexus concept is that the newly constructed units represent net new households in Newark. These households represent new income in Newark that will consume goods and services, either through purchases of goods and services or "consumption" of governmental services. New consumption translates to jobs; a portion of the jobs are at lower compensation levels; low compensation jobs relate to lower income households that cannot afford market rate units in Newark and therefore need affordable housing.

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Use of This Study
The nexus study has been prepared for the limited purpose of determining nexus support for a Housing Impact Fee in the City of Newark affecting new residential construction. We caution against the use of this study, or any impact study for that matter, for purposes beyond the intended use. All impact studies are limited and imperfect, but can be helpful for understanding the externalities created by new development. The nexus analysis presented in this report is an impact analysis only and the nexus amounts are not recommended fee levels.

Methodology and Models Used
The methodology or analysis procedure for this nexus analysis starts with the sales price or rental rate of a new market rate residential unit, and moves through a series of linkages to the gross income of the household that purchased or rented the unit, the income available for expenditures on goods and services, the jobs associated with the purchases and delivery of those services, the income of the workers doings those jobs, the household income of the workers and, ultimately, the affordability level of the housing needed by the worker households.

The steps of the analysis from household income available for expenditures to jobs generated were performed using the IMPLAN model, a model widely used for the past 35 years to quantify the impacts of changes in a local economy, including employment impacts from changes in personal income. From job generation by industry, KMA used its own jobs housing nexus model to quantify the income of worker households by affordability level.

To illustrate the linkages by looking at a simplified example, we can take an average household that buys a house at a certain price. From that price, we estimate the gross income of the household (from mortgage rates and lending practices) and the portion of income available for expenditures. Households will "purchase" or consume a range of goods and services, such as purchases at the supermarket or services at the bank. Purchases in the local economy in turn generate employment. The jobs generated are at different compensation levels. Some of the jobs are low paying and as a result, even when there is more than one worker in the household, there are some lower and middle-income households who cannot afford market rate housing in Newark.

The IMPLAN model quantifies jobs generated at establishments that serve new residents directly (e.g., supermarkets, banks or schools), jobs generated by increased demand at firms which service or supply these establishments, and jobs generated when the new employees spend their wages in the local economy and generate additional jobs. The IMPLAN model estimates the total impact combined.

Net New Underlying Assumption
An underlying assumption of the analysis is that households that purchase or rent new units represent net new households in Newark. If purchasers or renters have relocated from Keyser Marston Associates, Inc.
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elsewhere in the city, vacancies have been created that will be filled. An adjustment to new construction of units would be warranted if Newark were experiencing demolitions or loss of existing housing inventory. However, the rate of housing unit removal is so low as to not warrant an adjustment or offset.

On an individual project basis, if existing units are removed to redevelop a site to higher density, then there could be a need for recognition of the existing households in that all new units might not represent net new households, depending on the program design and number of units removed relative to new units.

Since the analysis addresses net new households in Newark and the impacts generated by their consumption expenditures, it quantifies net new demands for affordable units to accommodate new worker households. As such, the impact results do not address nor in any way include existing deficiencies in the supply of affordable housing.

Geographic Area of Impact
Housing impacts, like most types of impacts, occur irrespective of political boundaries. Like other types of impact analyses, such as traffic, impacts beyond city boundaries are experienced, are relevant, and are important. The City of Newark regulates land use within its boundaries and is the only jurisdiction in a position to require mitigation of impacts from new residential development occurring there, including mitigation of impacts extending beyond the City's boundaries.

While much of the housing impacts documented in the nexus analysis will occur within the City of Newark, some impacts will be experienced elsewhere in the County and beyond. The nexus analysis focuses on impacts occurring within Alameda County but includes impacts outside the County boundaries to the limited degree that households make some expenditures or seek certain services in neighboring counties. The IMPLAN model uses a data set specific to Alameda County that computes the jobs generated within the County. The input to the IMPLAN model used in the analysis is household income available for expenditures, without adjusting to a local share. While it is expected that households will make most expenditures within Alameda County, some expenditures on goods and services may occur in neighboring counties. Given the precise share is difficult to quantify particularly as relates to services such as medical care, and because expenditures occurring outside the County and the resulting impacts are still appropriately included in the nexus analysis, no adjustment to a local share is made.

Market Rate Residential Project Types
Five prototypical residential project types were selected for analysis in this nexus study. The prototypes were intended to represent the range of product types currently being built in Newark or which are expected in the future including:

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■ Single Family Detached (SFD) / Large Lot
■ Single Family Detached / Small Lot
■ Townhomes
■ Stacked Flat Condominiums
■ Apartments
Affordability Tiers
The nexus analysis addresses the following three income or affordability tiers:
■ Very Low Income (under 50% of Area Median Income or AMI) ■ Low Income (50% to 80% AMI)
■ Moderate Income (80% to 120% AMI)
Report Organization
The report is organized into four sections as follows:
■ Section A. presents information regarding the prototypical new market rate residential units and the estimated household income of purchases or renters of those units. ■ Section B. describes the IMPLAN model which is used in the nexus analysis to translate household income into the estimated number of jobs in retail, restaurants, healthcare, and other sectors serving new residents.
■ Section C. presents the linkage between employment growth associated with residential development and the need for new lower income housing units required in each of three income categories.
■ Section D. quantifies the nexus or mitigation cost based on the cost of delivering affordable units to new worker households in each of the three lower income categories.

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A. MARKET RATE UNITS AND HOUSEHOLD INCOME
This section describes the prototypical market rate residential units and the income of the purchaser and renter households. Market rate prototypes are representative of new residential units currently being built in Newark or that are likely to be built in Newark over the next several years. Household income is estimated based on the amount necessary for the mortgage or rent payments associated with the prototypical new market rate units and becomes the basis for the input to the IMPLAN model described in Section B of this report. These are the starting points of the chain of linkages that connect new market rate units to incremental demand for affordable residential units.

This section provides a summary of the prototypes and household income. More description and supporting tables are provided in Appendix 1.

Recent Housing Market Activity and Prototypical Units
KMA identified five residential prototypes in consultation with City staff; these prototypes are representative of the types of development that the City of Newark expects to see over the coming years. KMA then undertook a market survey of projects covering these prototypes. The survey was conducted in December 2013 and January 2014 and included the City of Newark as well as the neighboring cities of Fremont and Union City. At that time, there were no new residential projects actively marketing in Newark; however, Fremont has one new single family and two new townhome developments. KMA also obtained data on sales of existing homes in Newark, Union City and Fremont built since 1990. Stacked flat condos have been absent from the market in Newark but are included in the nexus analysis to address the potential for stacked flat condos to be built in Newark at some point in the future. For stacked flat condos, the sales price is based on an estimate of the price required for development of this prototype to become feasible.

The results of the market survey and the selection of five prototypes are summarized in the table on the following page. The main objective of the survey was to establish current sales prices or rents per unit and per square foot for the various residential project types recently developed, or expected to be developed in the future, in Newark. Table A-1 at the end of this section provides a more detailed summary of the five market rate prototypes.

It is important to note that the prototypes analysis is intended to reflect average or typical residential projects in the Newark market rather than any specific project. It would be expected that specific projects would vary to some degree from the prototypes.

In summary, the prototypes tested in the nexus analysis are as follows:

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Prototypical Residential Units
Avg. Unit Size
Avg. No. of Bedrooms
Avg. Sales Price/ Rent
Single Family
I Large Lot
2,500 SF
4 BR
$787,500
Single Family
I Small Lot
2,000 SF
3 BR
$700,000
Income of Housing Unit Purchaser or Renter
Townhome
1,500 SF
3 BR
$562,500
Condo
1,300 SF
2 BR
$580,000
Apartment
850 SF
2 BR
$2,000 Imo.

After the prototypes are established, the next step in the analysis is to determine the income of the purchasing or renting households in the prototypical units.

Ownership Units
To make the determination for ownership units, terms for the purchase of residential units used in the analysis are slightly less favorable than what can be achieved at the current time since current terms are not likely to endure. The selected terms for the analysis are: 20% down payment, 30 year fixed rate mortgage, 5.25% interest rate. The assumption of a 20% down payment is based on the median for purchase loans in Alameda County 1
. The interest rate at 5.25% reflects an
estimate of the longer term average based on the experience over the past ten years. 2 Current rates as of February 2014 are about 1 % lower. Tables A-2 through A-5 at the end of this section provide the details.

All ownership product types include an estimate of homeowners' insurance, homeowner association dues, and property taxes which are included along with the mortgage payment as part of housing expenses for purposes of determining mortgage eligibility3 . The analysis estimates
gross household income based on the assumption that these housing costs represent, on average, approximately 35% of gross income. The assumption that housing expenses represent 35% of gross income is reflective of the average for new purchase loans originated in Alameda County4 and is consistent with criteria used by lenders to determine mortgage eligibility5 .
1 Median down payment at 20% is based on Freddie Mac data on its portfolio of mortgages within zip codes corresponding to Alameda County and is specific to principal residence purchase loans originated during 2 nd quarter
of 2012, the most recent period available at the time the data was accessed. 2 Based on Freddie Mac Primary Mortgage Market Survey weekly average rates for 30 year fixed rate mortgages during the period from 2004 through 2013.
3 Housing expenses are combined with other debt payments such as credit cards and auto loans to compute a Debt To Income (DTI) ratio which is a key criteria used for determining mortgage eligibility. 4 New purchase loans in Alameda County have an average debt to income ratio of 34.96% based on data from Freddie Mac on its portfolio of mortgages within zip codes corresponding to Alameda County and specific to principal residence purchase loans originated during 2
nd quarter of 2012, the most recent period available at the time the data was accessed. Debt to income ratio includes other forms of debt such as student loans, credit cards, and auto loans which suggests a ratio including only housing expenses would be less than 35%. Applying a ratio below 35% in the analysis would have produced a higher estimate of gross household income and higher resulting nexus findings; therefore, application of a 35% ratio represents a conservative assumption for purposes of the nexus analysis.

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Apartment Units
Household income for renter households is estimated based on the assumption that rent represents, on average, 30% of gross household income, a percentage that is consistent with the average for Newark reported by the Census of 28.9%. 6 While slightly above the average from the Census, the 30% factor was selected for consistency with the California Health and Safety Code standard for relating income to affordable rent levels 7. Selection of 30% produces a lower estimate of gross household income and lower resulting nexus conclusions than if the exact average from the Census at 28.9% were used; therefore, this represents a conservative approach for purposes of the nexus analysis. While leasing agents and landlords may permit rental payments to represent a slightly higher share of total income, use of the 30% factor, which is representative of the average, is appropriate. Further, many renters will choose to spend less than 30% of their income on rent where possible, since, unlike an ownership situation, the unit is not viewed as an investment with value enhancement potential. The resulting relationship is that annual household income is 3.3 times annual rent.

The estimated gross household incomes of the purchasers or renters of the prototype units are calculated in tables A-2 through A-6, and summarized below.

Household Income
Gross Household Income
Single Family
I Large Lot
$159,000
Income Available for Expenditures
Single Family
I Small Lot
$142,000
Townhome Condo Apartment
$116,000 $124,000 $80,000
The input into the IMPLAN model used in this analysis is the net income available for expenditures. To arrive at income available for expenditures, gross income must be adjusted for Federal and State income taxes, contributions to Social Security and Medicare, savings, and payments on household debt. Per KMA correspondence with the producers of the IMPLAN model (IMPLAN Group LLC), other taxes including sales tax, gas tax, and property tax are handled internally within the model as part of the analysis of expenditures. Housing costs are addressed separately, as described below, and so are not deducted as part of this adjustment step. Table A-7 at the end of this section shows the calculation of income available for expenditures.

Income available for expenditures is estimated at approximately 67% of gross income in the case of the ownership prototypes. The estimate is based on a review of data from the Internal 5 Fannie Mae mortgage underwriting eligibility criteria establishes a debt to income threshold of 36% above which tighter credit standards apply. A debt to income ratio of up to 45% is permitted for borrowers meeting specified credit criteria; however, most households have other forms of debt such as credit cards, student loans, and auto loans that would be considered as part of this ratio.
6 2010-2012 American Community Survey.
7 Health and Safety Code Section 50052.5 defines affordable rent levels based on 30% of income.

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Revenue Service and California Franchise Tax Board tax tables. Per the Internal Revenue Service, households earning between $100,000 and $200,000 per year, or the residents of our prototypical ownership units, will pay an average of 13% of gross income for federal taxes. State taxes are estimated to average 5% of gross income based on tax rates per the California Franchise Tax Board. The employee share of the FICA payroll taxes for Social Security and Medicare is 7.65% of gross income (conservatively assumes all earners in the household are within the $117,000 ceiling on income subject to Social Security taxes).

Savings and repayment of household debt represent another necessary adjustment to gross income. Savings includes various IRA and 401 K type programs as well as non-retirement household savings and investments. Debt repayment includes auto loans, credit cards, and all other non-mortgage debt. Savings and repayment of debt are estimated to represent a combined 8% of gross income based on the 20 year average derived from United States Bureau of Economic Analysis data.

The percentage of income available for expenditure for input into the IMPLAN model is prior to deducting housing costs. The reason is for consistency with the IMPLAN model which defines housing costs as expenditures. The IMPLAN model addresses the fact that expenditures on housing do not generate employment to the degree other expenditures such as retail or restaurants do, but there is some limited maintenance and property management employment generated.

After deducting income taxes, Social Security, Medicare, savings, and repayment of debt, for purchasers of one of the new ownership prototypes, the estimated income available for expenditures is 67%. This is the factor used to adjust from gross income to the income available for expenditures for input into the IMPLAN model. As indicated above, other forms of taxation such as property tax are handled internally within the IMPLAN model.

Income available for expenditures for the prototypical renter household is based on the same evaluation, but a lower income tax bracket applies to the renter households. The result is that the renter household would have an estimated 71 % of income available for expenditures. The rate of savings and debt repayment is assumed to be the same for the renter household as for households in the ownership prototypes.

Estimates of household income available for expenditures are presented in the following table:

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Income Available for Expenditures
Single Family Single Family Townhome Condo Apartment I Large Lot I Small Lot Gross Household Income $159,000 $142,000 $116,000 $124,000 $80,000 Percent Income Available 67% 67% 67% 67% 71% for Expenditures Household Income
Available for Expenditures $107,000 $95,000 $78,000 $83,000 $57,000 [Input to IMPLAN model]
The nexus analysis is conducted on 100-unit building modules for ease of presentation, and to avoid awkward fractions. Tables A-8 and A-9 summarize the conclusions of this section and calculate the household income for the 100-unit building modules. This is the input into the IMPLAN model.

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TABLE A-1

SUMMARY OF PROTOTYPES

RESIDENTIAL NEXUS ANALYSIS

CITY OF NEWARK, CA
Density
Average Unit Size
Avg. Number of Bedrooms
Market Rate Price
1 ta·r!;I� ti;>f �inglf Fa.mil�
! __ De.Jacti�9J -,
8 du/acre
2,500 sf
4 BR
$315 $787,500
(l) Stacked Flat Condomium based on feasible price.

Prepared by Keyser Marston Associates, Inc.

Newark Prololypes 1.24.14; Prototypes
�-.Srnall,Lof Sirigle -
'.· f �milY.bitact}E}{f -
12 du/acre
2,000 sf
3 BR
$350 $700,000
r---_-- --1 L _ "T QWnhome§
18 du/acre
1,500 sf
3 BR
$375 $562,500
r--s·ta.ckecf Flat I l ,i; oodoro1n-1um�
50 1,300 sf
2 BR
• ,2:3 Stciry1--j
'._. ��P@rtrneru�· .
25 du/acre
850 sf
2 BR
$446 $580,000 (
1 ) $2.35 $2,000

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TABLE A-2
PROTOTYPE 1: rSFD / LARGE LOT

SALES PRICE TO INCOME RATIO

RESIDENTIAL NEXUS ANALYSIS

CITY OF NEWARK, CA
Sales Price
Mortgage Payment
Downpayment @ 20%
Loan Amount
Interest Rate
Term of Mortgage
Annual Mortgage Payment
Other Costs
Property Taxes
HOA Dues / Maintenance
Homeowner Insurance
Total Annual Housing Cost
% of Income Spent on Hsg
$315 /SF 2,500 SF 1
20% 2

1.25% of sales price 4
$200 per month 5

0.20% sale price 6
Annual Household Income Required
Sales Price to Income Ratio
Notes
(1) Based on Market Survey.

Prototype 1
SFD / Large Lot
$787,500 1
$157,500
$630,000

5.25% 3
30 years
$41,700
$9,800
$2,400
$1,600
$55,500
35% 7
$159,000

5.0 (2) Median down payment at 20% is based on Freddie Mac data on its portfolio of mortgages within zip codes corresponding to Alameda County and specific to principal residence purchase loans originated during 2nd quarter of 2012. (3) Average mortgage interest rate for prior 10 years derived from Freddie Mac Primary Mortgage Market Survey and about

0.75% above current favorable rates. Based on weekly average rates for 30 year fixed rate mortgages during the period from 2004 through 2013.
(4) 1.25% property tax rate is inclusive of ad valorem taxes plus estimated fixed charges and assessments. (5) Based on HOA dues for new single family project currently selling in Fremont from the Market Survey. (6) Estimated from quote obtained from Progressive Insurance. (7) Based on Freddie Mac data on mortgages originated in Alameda County which reflect an average debt to income ratio of 35% including both housing expenses and other debt like auto loans and credit cards. Were other debt excluded, the ratio would likely be lower than 35%. Using a ratio less than 35% would have increased the supported maximum fee levels from those reflected in the analysis; therefore, 35% represents a conservative estimate.

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TABLE A-3
PROTOTYPE2:SFD/SMALL LOT

SALES PRICE TO INCOME RATIO

RESIDENTIAL NEXUS ANALYSIS

1.25% of sales price 4
$200 per month 5

0.20% sale price 6
Annual Household Income Required
Sales Price to Income Ratio
Notes
(1) Based on Market Survey.

Prototype 2
SFD / Small Lot
$700,000 1
$140,000
$560,000

5.25% 3
30 years
$37,100
$8,800
$2,400
$1,400
$49,700
35% 7
$142,000

4.9 (2) Median down payment at 20% is based on Freddie Mac data on its portfolio of mortgages within zip codes corresponding to Alameda County and specific to principal residence purchase loans originated during 2nd quarter of 2012. (3) Average mortgage interest rate for prior 10 years derived from Freddie Mac Primary Mortgage Market Survey and about

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TABLE A-4
PROTOTYPE 3: TOWNHOME

SALES PRICE TO INCOME RATIO

RESIDENTIAL NEXUS ANALYSIS

1.25% of sales price 4
$235 per month 5

0.20% sale price 6
Annual Household Income Required
Sales Price to Income Ratio
Notes
(1) Based on Market Survey.

Prototype 3
Townhome
$562,500 1
$112,500
$450,000

5.25% 3
30 years
$29,800
$7,000
$2,820
$1,100
$40,720
35% 7
$116,000

4.8 (2) Median down payment at 20% is based on Freddie Mac data on its portfolio of mortgages within zip codes corresponding to Alameda County and specific to principal residence purchase loans originated during 2nd quarter of 2012. (3) Average mortgage interest rate for prior 10 years derived from Freddie Mac Primary Mortgage Market Survey and about

0.75% above current favorable rates. Based on weekly average rates for 30 year fixed rate mortgages during the period from 2004 through 2013.
(4) 1.25% property tax rate is inclusive of ad valorem taxes plus estimated fixed charges and assessments. (5) Based on average HOA dues for two townhome projects currently selling in Fremont identified in the market survey. (6) Estimated from quote obtained from Progressive Insurance for HO-6 "walls in" policy covering interior of unit and personal property. Exterior of structure and common area assumed to be covered by separate homeowners association policy.
(7) Based on Freddie Mac data on mortgages originated in Alameda County which reflect an average debt to income ratio of 35% including both housing expenses and other debt like auto loans and credit cards. Were other debt excluded, the ratio would likely be lower than 35%. Using a ratio less than 35% would have increased the supported maximum fee levels from those reflected in the analysis; therefore, 35% represents a conservative estimate.

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TABLE A-5
PROTOTYPE4:CONDO

SALES PRICE TO INCOME RATIO

RESIDENTIAL NEXUS ANALYSIS

1.25% of sales price 4
$350 per month 5

0.20% sale price 6
Prototype 4
Condo
$580,000 1
$116,000
$464,000

5.25% 3
30 years
$30,700
$7,300
$4,200
$1,200
$43,400
35% 7
$124,000

4.7 (1) No new or newer stacked flat condos were identified in the market survey. Price represents an estimate of the sales price required for development feasibility.
(2) Median down payment at 20% is based on Freddie Mac data on its portfolio of mortgages within zip codes corresponding to Alameda County and specific to principal residence purchase loans originated during 2nd quarter of 2012. (3) Average mortgage interest rate for prior 10 years derived from Freddie Mac Primary Mortgage Market Survey and about

0. 75% above current favorable rates. Based on weekly average rates for 30 year fixed rate mortgages during the period from 2004 through 2013.
(4) 1.25% property tax rate is inclusive of ad valorem taxes plus estimated fixed charges and assessments. (5) Based on average HOA dues for a sampling of existing 2 bedroom condos in Newark as reported by MLS. (6) Estimated from quote obtained from Progressive Insurance for HO-6 "walls in" policy covering interior of unit and personal property. Exterior of structure and common area assumed to be covered by separate homeowners association policy.
(7) Based on Freddie Mac data on mortgages originated in Alameda County which reflect an average debt to income ratio of 35% including both housing expenses and other debt like auto loans and credit cards. Were other debt excluded, the ratio would likely be lower than 35%. Using a ratio less than 35% would have increased the supported maximum fee levels from those reflected in the analysis; therefore, 35% represents a conservative estimate.

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TABLE A-6
PROTOTYPE5:RENTAL

RENT TO INCOME RATIO

RESIDENTIAL NEXUS ANALYSIS

CITY OF NEWARK, CA
Market Rent
Monthly
Annual
% of Income Spent on Rent
( excludes utilities)
$2.35 /SF
Annual Household Income Required
Annual Rent to Income Ratio
Notes
850 SF 1
Prototype 5
Rental
$2,000 2
$24,000
30% 3
$80,000

3.3 (1) No new or newer stacked flat condos were identified in the market survey. Price represents an estimate of the sales price required for development feasibility.
(2) Based on the results of the market survey. Represents rent levels applicable to new units. (3) Renter households are assumed to spend 30% of income on rent, or slightly more than the median for Newark renter households at 29.1 % and slightly less than the median for all of Alameda County at 31 % per the 2008 - 2012 American Community Survey. While landlords may permit rental payments to represent a slightly higher share of total income, 30% represents an average.

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TABLE A-7

INCOME AVAILABLE FOR EXPENDITURES'

RESIDENTIAL NEXUS ANALYSIS

CITY OF NEWARK, CA
Prototype 1 :

SFD I Large Lot
Gross Income 100%
(Less) Federal Income Taxes (avg. rate)' 12.7%
(Less) Average State Income Tax Rate 0 5%
(Less) FICA Tax Rate• 7.65%
(Less) Savings and other deductions� 8%
Percent of Income Available for 67%
Expenditures 6 [Input to IMPLAN model]
Notes:

Prototype 2:

SFD I Small Lot
100%

12.7%
5%

7.65%
8%
67%
Prototype 3: Prototype 4: Prototype 5:

T.ownhome Condo Rental
100% 100% 100%

12.7% 12.7% 9.5%
5% 5% 4%

7.65% 7.65% 7.65%
8% 8% 8%
67% 67% 71%
1 Gross income after deduction of taxes and savings. Income available for expenditures is the input to the IMPLAN model which is used to estimate the resulting employment impacts. Housing costs are not deducted as part of this adjustment step because they are addressed separately as expenditures within the IMPLAN model.

L Reflects average tax rates (as opposed to marginal) based on U.S. Internal Revenue Services. Tax Statistics. Table 3.2 Returns with Total Ir.come Tax: Total Income Tax as a Percentage of Adjusted Gross Income, by Selected Marital Status and Size of Adjusted Gross Income, Tax Year 2011 (2011 tax year is the most recent available). For Prototypes 1 - 4, the average tax rate for AGI of $100,000 to $200,000 of 12.7% is applied. For Prototype 5, the average tax rate for AGI of $75,000 to $100,000 of 9.5% is applied. j Average tax rate estimated by KMA based on marginal rates per the California Franchise Tax Board and ratios of taxable income to gross income estimated based on U.S. Internal Revenue Service data. The higher average tax rates applicable to single or married filing separately tax filers is applied in the analysis so as to produce a conservative (likely understated) estimate. 4 For Social Security and Medicare. Conservatively assumes all income will be subject to Social Security taxes. The current ceiling on applicability of Social Security taxes is $117,000 (ceiling applies per earner not per household). :> Household savings including retirement accounts like 401k / IRA and other deductions such as interest costs on credit cards, auto loans, etc, necessary to determine the amount of income available for expenditures. The 8% rate used in the analysis is based on the average over the past 20 years computed from U.S. Bureau of Economic Analysis data, specifically the National Income and Product Accounts, Table 2.1 "Personal Income and It's Disposition."
6 Deductions from gross income to arrive at the income available for expenditures are consistent with the way the IMPLAN model and National Income and Product Accounts (NIPA) defines income available for personal consumption expenditures. Income taxes, contributions to Social Security and Medicare, and savings are deducted; however, property taxes and sales taxes are not. Housing costs are not deducted as part of the adjustment because they are addressed separately as expenditures within the IMPLAN model.

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FOR SALE PROTOTYPES: SALES PRICE TO INCOME SUMMARY

RESIDENTIAL NEXUS ANALYSIS

CITY OF NEWARK, CA
100 Unit
Per Unit Per Sq.Ft. Building Module

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PROTOTYPE1:SFD/LARGE LOT
Units 100 Units
Building Sq.Ft. (net salable area) 2,500 250,000
Sales Price $787,500 $315 $78,750,000
Sales Price to Income Ratio 5.0 5.0
Gross Household Income $159,000 $15,900,000
Income Available for Expenditur, 67% of gross $107,000 $10,65 0,000 PROTOTYPE2:SFD/SMALL LOT
Units 100 Units
Building Sq.Ft. (net salable area) 2,000 200,000
Sales Price $700,000 $350 $70,000,000
Sales Price to Income Ratio 4.9 4.9
Gross Household Income $142,000 $14,200,000
Income Available for Expenditur, 67% of gross $95,000 $9,510,000 Prepared by: Keyser Marston Associates, Inc. Page 23
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FOR SALE PROTOTYPES: SALES PRICE TO INCOME SUMMARY

RESIDENTIAL NEXUS ANALYSIS

CITY OF NEWARK, CA
100 Unit
Per Unit Per Sq.Ft. Building Module

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PROTOTYPE 3: TOWNHOME
Units 100 Units
Building Sq.Ft. (net salable area) 1,500 150,000
Sales Price $562,500 $375 $56,250,000
Sales Price to Income Ratio 4.8 4.8
Gross Household Income $116,000 $11,600,000
Income Available for Expenditur, 67% of gross $78,000 $7,770,000 PROTOTYPE4:CONDO
Units 100 Units
Building Sq.Ft. (net salable area) 1,300 130,000
Sales Price $580,000 $446 $58,000,000
Sales Price to Income Ratio 4.7 4.7
Gross Household Income $124,000 $12,400,000
Income Available for Expenditur, 67% of gross $83,000 $8,310,000 Notes:
(1) Represents net income available for expenditures after income tax, payroll taxes, and savings. See Table A-7 for derivation.

Source: See Tables A-2 to A-7.

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NEW MARKET RATE RESIDENTIAL HOUSEHOLD SUMMARY

RESIDENTIAL NEXUS ANALYSIS

CITY OF NEWARK, CA
Per Unit
PROTOTYPE5:RENTAL
Units
Building Sq.Ft. (net rentable area) 850
Rent
Monthly $2,000
Annual $24,000
Rent to Income Ratio 3.3
Gross Household Income $80,000
Income Available for Expenditure 1 71% of gross $57,000 Notes:
100 Unit
Per Sq.Ft. Building Module
100 Units
85,000
$2.35 /SF $200,000
$28.20 /SF $2,400,000

3.3 $8,000,000
$5,680,000
(1) Represents net income available for expenditures after income tax, payroll taxes, and savings. See Table A-7 for derivation.

Source: Table A-6 and A-7.

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B. THE IMPLAN MODEL
Consumer spending by residents of new housing units will create jobs, particularly in sectors such as restaurants, health care, and retail, which are closely connected to the expenditures of residents. The widely used economic analysis tool, IMPLAN (IMpact Analysis for PLANning), was used to quantify these new jobs by industry sector.

IMPLAN Model Description
The IMPLAN model is an economic analysis software package now commercially available through the IMPLAN Group, LLC. IMPLAN was originally developed by the U.S. Forest Service, the Federal Emergency Management Agency, and the U.S. Department of the Interior Bureau of Land Management and has been in use since 1979 and refined over time. It has become a widely used tool for analyzing economic impacts for a broad range of applications from major construction projects to natural resource programs.

IMPLAN is based on an input-output accounting of commodity flows within an economy from producers to intermediate and final consumers. The model establishes a matrix of supply chain relationships between industries and also between households and the producers of household goods and services. Assumptions about the portion of inputs or supplies for a given industry likely to be met by local suppliers, and the portion supplied from outside the region or study area are derived internally within the model using data on the industrial structure of the region.

The output or result of the model is generated by tracking changes in purchases for final use (final demand) as they filter through the supply chain. Industries that produce goods and services for final demand or consumption must purchase inputs from other producers, which in turn, purchase goods and services. The model tracks these relationships through the economy to the point where leakages from the region stop the cycle. This allows the user to identify how a change in demand for one industry will affect a list of over 400 other industry sectors. The projected response of an economy to a change in final demand can be viewed in terms of economic output, employment, or income.

Data sets are available for each county and state, so the model can be tailored to the specific economic conditions of the region being analyzed. This analysis utilizes the data set for Alameda County. As will be discussed, much of the employment impact is in local-serving sectors, such as retail, eating and drinking establishments, and medical services. A significant portion of these jobs will be located in Newark or nearby. In addition, the employment impacts will extend throughout the County and beyond based on where jobs are located that serve Newark residents. In fact, Newark is part of the larger Bay Area economy and impacts will likewise extend throughout the region.

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Application of the IMP LAN Model to Estimate Job Growth The IMPLAN model was applied to link income to household expenditures to job growth.

Employment generated by the household income of residents is analyzed in modules of 100 residential units to simplify communication of the results and avoid awkward fractions. The IMPLAN model distributes spending among various types of goods and services (industry sectors) based on data from the Consumer Expenditure Survey and the Bureau of Economic Analysis Benchmark input-output study, to estimate employment generated.

Job creation, driven by increased demand for products and services, was projected for each of the industries that will serve the new households. The employment generated by this new household spending is summarized below.

Jobs Generated Per 100 Units
Single Family Single Family
I Large Lot I Small Lot Townhome Condo Apartment
Annual Household
Expenditures, 100 Units $10,650,000 $9,510,000 $7,770,000 $8,310,000 $5,680,000 Total Jobs Generated,
100 Units 73.1 64.8 53.0 56.6 37.5
Table 8-1 provides a detailed summary of employment generated by industry. The table shows industries sorted by projected employment. The Consumer Expenditure Survey published by the Bureau of Labor Statistics tracks expenditure patterns by income level. IMPLAN utilizes this data to reflect the pattern by income bracket. In the case of the Newark prototypes, the large lot single family units are in the $150,000 and up income category, while the other ownership prototypes are in the $100,000 to $150,000 category and the apartment prototype is in the $75,000 to $100,000 category. Estimated employment is shown for each IMPLAN industry sector representing 1 % or more of total employment. The jobs that are generated are heavily retail jobs, jobs in restaurants and other eating establishments, and in services that are provided locally such as health care. The jobs counted in the IMPLAN model cover all jobs, full and part time, similar to the U.S. Census and all reporting agencies (unless otherwise indicated).

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TABLE B-1

IMPLAN MODEL OUTPUT

EMPLOYMENT GENERATED

RESIDENTIAL NEXUS ANALYSIS

CITY OF NEWARK, CA
Per 100 Market Rate Units
Prototype 1: Prototype 2: Prototype 3: Prototype 4: Prototype 5: %of SFD / large lot SFD / Small lot Townhome Condo Rental Jobs Household Expenditures (100 Market Rate Unit, $10,650,000 $9,510,000 $7,770,000 $8,310,000 $5,680,000 Jobs Generated by Industry 2
Retail Stores - Food and beverage 2.7 2.3 1.9 2.0 1.2 4% Retail Stores - General merchandise 2.6 2.2 1.8 2.0 1.2 3% Retail Stores - Motor vehicle and parts 1.6 1.4 1.1 1.2 0.7 2% Retail Stores - Miscellaneous 1.6 1.4 1.1 1.2 0.7 2%
Retail Stores - Clothing and accessories 1.5 1.3 1.1 1.1 0.7 2% Retail Stores - Health and personal care 1.1 0.9 0.8 0.8 0.5 1% Retail Stores - Building and garden supply 0.9 0.7 0.6 0.6 0.4 1% Retail Nonstores - Direct and electronic sales 0.8 0.7 0.6 0.6 0.4 1% Subtotal Retail 12.9 11.0 9.0 9.6 5.8 17%
Offices of physicians and dentists 4.0 4.1 3.4 3.6 2.5 6% Private hospitals 3.4 3.5 2.8 3.0 2.1 5%
Nursing and residential care facilities 2.4 2.5 2.0 2.2 1.5 4% Medical and diagnostic labs and outpatient care .LQ .LQ 0.8 0.9 0.6 2% Subtotal Health Care 10.8 11.1 9.1 9.7 6.8 17%
Food services and drinking places 9.5 9.0 7.4 7.9 5.3 14% Real estate including property management 2.3 2.4 1.9 2.1 1.8 4% Private household operations 2.6 2.1 1.8 1.9 1.2 3%
Wholesale trade businesses 1.6 1.8 1.5 1.6 1.4 3%
Individual and family services 1.9 1.6 1.3 1.4 0.8 2%
Civic, social, professional organizations 1.3 1.1 0.9 1.0 0.6 2% Other private educational services 1.8 1.1 0.9 1.0 0.5 2% Elementary and secondary schools 1.7 1.1 0.9 1.0 0.5 2% Personal care services 1.1 1.0 0.8 0.9 0.6 2%
Employment services 1.1 1.0 0.8 0.9 0.6 2%
Banking and depository credit 1.0 0.9 0.7 0.8 0.5 1%
Home health care services 0.8 0.8 0.7 0.7 0.5 1%
Securities, investments, and related 0.9 0.7 0.6 0.7 0.4 1% Automotive repair and maintenance 0.8 0.7 0.6 0.6 0.4 1% Services to buildings and dwellings 0.8 0.7 0.6 0.6 0.4 1% Child day care services 1.2 0.7 0.6 0.6 0.3 1%
Grantmaking and social advocacy organizations 0.8 0.6 0.5 0.5 0.3 1% Colleges, universities, and professional schools 0.9 0.5 0.4 0.4 0.2 1% All Other 17.2 14.7 12.0 12.8 8.3 23%
Total Number of Jobs Generated 73.1 64.8 53.0 56.6 37.5 100% ' Estimated employment generated by expenditures of households within 100 prototypical market rate units. Employment estimates are based on the IMPLAN Group's economic model, IMPLAN, for Alameda County.
2 For Industries representing more than 1 % of total employment.

Prepared by: Keyser Marston Associates. Inc.
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C. THE KMA JOBS HOUSING NEXUS MODEL
This section presents a summary of the analysis linking the employment growth associated with residential development, or the output of the IMPLAN model (see Section B), to the estimated number of lower income housing units required in each of three income categories, for each of the five residential prototype units.

Analysis Approach and Framework
The analysis approach is to examine the employment growth for industries related to consumer spending by residents in the 100-unit modules. Then, through a series of linkage steps, the number of employees is converted to households and housing units by affordability level. The findings are expressed in terms of numbers of affordable units per 100 market rate units.

The analysis addresses the affordable unit demand associated with single family detached, townhomes, condos, and rental units in Alameda County. The table below shows the 2014 Alameda County Area Median Income (AMI), as well as the income limits for the three categories that were evaluated: Very Low (50% of AMI), Low (80% of AMI), and Moderate (120% of AMI). The income definitions used in the analysis are those published by the California Department of Housing and Community Development (HCD).
2014 Income Limits for Alameda County
Household Size (Persons)
1 2 3 4 5 6+
Very Low (30% - 50% AMI) $32,750 $37,400 $42,100 $46,750 $50,500 $54,250 Low (50%-80% AMI) $47,350 $54,100 $60,850 $67,600 $73,050 $78,450 Moderate (80%-120% AMI) $78,550 $89,750 $101,000 $112,200 $121,200 $130,150 Median (100% of Median) $65,450 $74,800 $84,150 $93,500 $101,000 $108,450 The analysis is conducted using a model that KMA developed and has applied to similar evaluations in many other jurisdictions. The model inputs are all local data to the extent possible, and are fully documented in the following description.

Analysis Steps
The tables at the end of this section present a summary of the nexus analysis steps for the prototype units. Following is a description of each step of the analysis.

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Step 1 - Estimate of Total New Employees
Table C-1 commences with the total number of employees associated with the new market rate units. The employees were estimated based on household expenditures of new residents using the IMPLAN model (see Section B).

Step 2 -Changing Industries Adjustment and Net New Jobs The local economy, like that of the U.S. as a whole, is constantly evolving. In the Oakland, Fremont, Hayward Metropolitan Division (defined as Alameda and Contra Costa Counties), over the past twenty years, employment in manufacturing sectors of the economy has continued to decline along with employment in State and Federal government, telecommunications, and banking. Defense related employment has also declined from around 12,000 jobs twenty years ago to near zero today. Jobs lost over the last decade in these declining sectors were replaced by job growth in other industry sectors.

Step 2 makes an adjustment to take these declines, changes and shifts within all sectors of the economy into account recognizing that jobs added are not 100% net new in all cases. A 25% adjustment is utilized based on the long term shifts in employment that have occurred in some sectors of the local economy and the likelihood of continuing changes in the future. Long term declines in employment experienced in some sectors of the economy mean that some of the new jobs are being filled by workers that have been displaced from another industry and who are presumed to already have housing locally. Existing workers downsized from declining industries are assumed to be available to fill a portion of the new retail, restaurant, health care, and other jobs associated with services to residents. This is a conservative assumption given some displaced workers may exit the workforce entirely by retiring rather than seek a new job in one of the industries serving new residents.

The 25% downward adjustment used for purposes of the analysis was derived from California Employment Development Department data on employment by industry in Alameda and Contra Costa County over the twenty year period from 2012 to 1992. The 2012 data set reflects a higher unemployment rate at 9% than the 6.6% unemployment rate in 1992 which will tend to overstate any long term declines since the 2012 data also reflects some cyclical or short term declines relative to the 1992 employment data. Over this period, approximately 38,000 jobs were lost in declining industry sectors. Over the same period, growing and stable industries added a total of 158,000 jobs. Figures are adjusted to exclude losses in department of defense employment given there are almost no defense jobs left in the area and so continuing declines in this sector is not expected to be a factor in the in the future. The figures are used to establish a ratio between jobs lost in declining industries to jobs gained in growing and stable industries at 25% 8
. The 25% factor is applied as an adjustment in the analysis, effectively assuming one in 8 The 25% ratio is calculated as 38,000 jobs lost in declining sectors excluding defense divided by 158,000 jobs gained in growing and stable sectors= 23.9% (rounded to 25%).

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Newark City CouncilDecember 14, 2023

Newark City Council
December 14, 2023