CITY OF PACIFICA
COUNCIL AGENDA SUMMARY REPORT
1/8/2024
1 SUBJECT:
2022-2023 Mitigation Fee Act Development Fee Review
RECOMMENDED ACTION:
Adopt a resolution entitled "A Resolution of the City Council of the City of Pacifica Approving 2022-2023 Annual and Five-Year Impact Fee Report for the Fiscal Year Ending June 30, 2023.” STAFF CONTACT:
Yulia Carter, Assistant City Manager
650-501-6004
[email protected]
Lisa Petersen, Public Works Director
650-738-3767
[email protected]
BACKGROUND/DISCUSSION:
The City of Pacifica, like many other local agencies, levies fees on new development within the City in order to fund public capital improvements necessitated by such development (Development Fees). In 1987 the State enacted Assembly Bill No. 1600, adding Section 66000 et seq. to the Government Code, commonly known as AB 1600 or the Mitigation Fee Act. The Mitigation Fee Act imposes certain accounting and reporting requirements on local agencies that collect Development Fees. The proposed action before the City Council is designed to ensure that the City complies with the accounting and reporting requirements of the Mitigation Fee Act.
1. A local jurisdiction must follow the process to make certain determinations regarding the purpose and use of the fees and to establish a “nexus” or connection between a development project and the public improvement being financed with the fee.
2. The fee revenue must be segregated from the general fund in order to avoid commingling of public improvement fees and the general fund.
3. If a local jurisdiction has had possession of a development fee for five years or more and has not committed that money to a project or actually spent that money, then it must make findings describing the continuing need for that money each fiscal year after the five years has expired.
4. If a local jurisdiction cannot make the findings required under paragraph 3, then the City must go through a refund procedure.
The City of Pacifica’s Municipal Code authorizes collection of the following Development Fees covered by the Mitigation Fee Act:
• Traffic Impact Mitigation Improvement Fees for Highway One Improvements (Chapter 15,Title 8) - Fund 12
• Traffic Impact Mitigation Fees for the Improvement of the Manor Drive/Palmetto Pacifica City Council 2
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Avenue/Oceana Boulevard Intersection (Chapter 18, Title 8) - Fund 14 • Planned Drainage Facilities Fees (Article 1, Chapter 4, Title 7) - Fund 19 • Capital Projects Fees (Article 2, Chapter 4, Title 7) - Fund 22 • In-Lieu Parking Facilities Fee (Resolution No. 17-86, amended April 27, 2020 by Resolution 23-2020) - Fund 25
• Dedications and Fees for Park and Recreational Purposes (Chapter 19, Title 8) - Fund 26
• Sewer Connection Charges, (Article 1, Chapter 11, Title 6) - Fund 34 • Street Improvement Fee, (Section 214, Article 2, Chapter 2, Title 7 and Chapter 21, Title 8) - Fund 13
• Housing In-Lieu Fee (Resolution No. 24-2007)
• Tree In-Lieu Fee (Section 4-12-23, Chapter 12, Title 4) - Fund 29 The Mitigation Fee Act mandates that for accounting purposes, Development Fees and related interest must be accounted for separately and used only for the purposes for which the Development Fees were collected. The City tracks Development Fee activity through dedicated revenue accounts and specific expenditure allocations to appropriate projects.
Mitigation Fee Act Reporting Requirements
The Mitigation Fee Act requires that, within 180 days after the close of the fiscal year, the City must make available to the public the following information regarding each of its Development Fee funds:
• A brief description of the type of Development Fee in the fund. • The amount of the Development Fee.
• The beginning and ending fund balance for the fiscal year. • The amount of Development Fees collected and interest earned. • An identification of each public improvement on which Development Fees were expended together with the amount of such expenditures. • Information regarding the schedule for commencement of certain public improvements to be funded with Development Fees.
• A description of any inter-fund transfers or loans made from the fund. • The amount of any refunds made.
To comply with these requirements, staff has prepared the attached Mitigation Fee Act Annual Report of Development Fees. Pursuant to the requirements of the Mitigation Fee Act, this report is being presented to the City Council for review at a regularly scheduled public meeting not less than 15 days after the information was made available to the public. The 2022-2023 report was filed with the City Clerk’s office and made available for public review on December 21, 2023.
In addition, notice of the time and place of this meeting must be mailed at least 15 days prior to the meeting to all interested parties who filed a written request for such a notice. The City has received no such requests for notice.
Findings Regarding Unexpended Fees
For the fifth fiscal year following the first deposit into the fund, and every five years thereafter, the City is required to make certain findings with respect to that portion of the fund remaining unexpended, whether committed or uncommitted. Gov. Code § 66001(d)(1). The findings are:
• The purpose to which the Development Fee is to be put. • There is a reasonable relationship between the Development Fee and the purpose for Pacifica City Council 3
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which it is charged.
• Identify all sources and amounts of funding anticipated to complete financing in incomplete improvements to be funded by the Development Fee. • Designate the approximate date on which the financing of the incomplete improvements will be complete.
Staff prepared a five-year analysis of the development fees. Staff finds that the purpose for each Development Fee is sufficiently described in the attached report. In addition, the original nexus study creating or amending the fee establishes the reasonable relationship between the Development Fee and the purpose for which it was created, the other sources and amounts of funding anticipated to complete the financing of the projects where the Development Fee are part of the funding and the approximate dates on which the financing of the incomplete improvements will be completed are outlined in the City’s CIP budget each year.
ALTERNATIVE ACTION:
No alternative action has been identified for the approval of the 2022-2023 Mitigation Fee Act Annual Report of Development Fees.
RELATION TO CITY COUNCIL GOALS AND WORK PLAN:
Approval of the 2022-2023 Annual and Five-Year Impact Fee Report for the Fiscal Year Ending June 30, 2023 is consistent with the following Council adopted Goals:
• Enhance organizational and fiscal stability: the mitigation fees provide vital financing mechanism for City infrastructure.
• Improve and steward City infrastructure, streets and facilities: The mitigation fees assist in the development and improvement of City infrastructure.
FISCAL IMPACT:
There is no fiscal impact associated with this item. All development impact fees collected to date have been committed or expended and are not subject to refund.
ORIGINATED BY:
Public Works
ATTACHMENT LIST:
2022-2023 Annual and Five-Year Impact Fee Report For the Fiscal Year Ending June 30, 2023 (PDF)
Pacifica City Council 4
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RESOLUTION NO. __-2024
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PACIFICA APPROVING THE 2022-2023 ANNUAL AND FIVE-YEAR IMPACT FEE REPORT FOR THE FISCAL YEAR ENDING JUNE 30, 2023
WHEREAS, pursuant to Government Code Section 66000 et seq., the City of Pacifica is required to prepare an annual report regarding development impact fees within 180 days after the close of each fiscal year; and
WHEREAS, Staff has prepared the 2022-2023 Annual and Five-Year Impact Fee Report For the Fiscal Year Ending June 30, 2023, a copy of which is attached hereto as Exhibit A (“Impact Fee Report”), and incorporated by reference, which satisfies the reporting requirements stated in the Mitigation Fee Act; and
WHEREAS, pursuant to Government Code section 66006(b)(2), the Impact Fee Report has been available for public review at the Clerk’s office since December 21, 2023; and WHEREAS, the City imposes development fees that are subject to the Mitigation Fee Act (Gov. Code §§ 66000 et seq.): the Traffic Impact Mitigation Improvement Fees for Highway One Improvements, the Traffic Impact Mitigation Fees for the Improvement of the Manor Drive/Palmetto Avenue/Oceana Boulevard Intersection, the Planned Drainage Facilities Fees, the Capital Projects Fees, the In-Lieu Parking Facilities Fee, the Park Facilities Impact Fee, the Sewer Connection Charges, the Street Improvement Fee, the Housing In-Lieu Fee, and the Tree In-Lieu Fee; and
WHEREAS, Government Code Section 66001(d) requires a local agency to make findings with respect to any unexpended funds for the fifth fiscal year following the first deposit into the account or fund; and
WHEREAS, staff prepared a five-year analysis of the development fees. Staff finds that the purpose for each Development Fee is sufficiently described in the attached report. In addition, the original nexus study creating or amending the fee establishes the reasonable relationship between the Development Fee and the purpose for which it was created, the other sources and amounts of funding anticipated to complete the financing of the projects where the Development Fee are part of the funding and the approximate dates on which the financing of the incomplete improvements will be completed are outlined in the City’s CIP budget each year.
NOW THEREFORE, BE IT RESOLVED, by the City Council of the City of Pacifica as follows:
1. The foregoing recitals are true and correct.
2. The Council hereby approves, accepts, and adopts 2022-2023 Annual and Five-Year Impact Fee Report For the Fiscal Year Ending June 30, 2023, attached hereto as Exhibit A, and makes the findings set forth in this resolution.
BE IT FURTHER RESOLVED, that the City Council of the City of Pacifica finds as follows:
Pacifica City Council 5
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1. In accordance with Government Code Section 66000 et seq., the City has conducted an annual and five-year review of its development impact fees and the Council has reviewed the Impact Fee Report for the Fiscal Year 2022-2023.
2. The funds have been and shall be used for the purposes stated in said report and are necessary to mitigate impacts resulting from development in the City and there is a reasonable relationship between the use of the fees and the type of development project upon which the fee is imposed.
• • • • •
PASSED AND ADOPTED at a regular meeting of the City Council of the City of Pacifica, California, held on the 8th day of January, 2024, by the following vote:
AYES, Councilmembers:
NOES, Councilmembers:
ABSENT, Councilmembers:
ABSTAIN, Councilmembers:
Sue Vaterlaus, Mayor
ATTEST: APPROVED AS TO FORM:
______________________________ ______________________________ Sarah Coffey, City Clerk Michelle Kenyon, City Attorney