Developer Impact
Fees - Background
Developer Impact Fees
Why This is Before Council
Tonight: direction on the Nexus Study, not the adoption of fees. 2024
FAC review of potential revenue
sources led to Council approval of
a Nexus Study on September 3.
2025-2026
Willdan selected in November
2025; initial evaluation completed
June 30, 2026.
Developer Impact Fees
Why This is Before Council
Tonight: direction on the Nexus Study, not adoption of fees.
August 2026 FAC
FAC recommended deferral, 3-2, citing
the City’s limited development potential,
uncertain revenue, restricted use of DIF
funds, and ongoing administrative
requirements.
August 2026 Financial
Sustainability Council
The Subcommittee supported continuing
the evaluation to prepare for potential
future development and determine
whether future development should
contribute its proportionate share toward
eligible infrastructure needs.
What are
Development Impact
Fees (DIF)?
Developer Impact Fees
Summary
Developer Impact Fees (DIFs) are one-time fees on new development for eligible capital improvements. A Nexus Study is required to determine legally supportable fees.
New Development → Added Facility Demand → Proportionate Fee May Fund
• New or expanded capital
facilities.
• Only the growth-related,
proportionate share.
May Not Fund
Operations, routine
maintenance, rehabilitation or
existing deficiencies.
Willdan Initial
Evaluation
Developer Impact Fees
What the Initial Evaluation Does
A preliminary evaluation, not a Nexus Study or proposed fee schedule.
Projected population: 40,599 in 2026 → 42,162 in 2050
Fee Context
Illustrative fee levels
from five jurisdictions,
not a strict peer-city
comparison.
Growth Inputs
California Department
of Finance data and
the City’s Housing
Element.
Planning Result
Initial revenue
estimates and
program
requirements, not
actual City fees.
Developer Impact Fees
Revenue by Development Type
Illustrative only. Not proposed RPV fees or guaranteed collections.
Development
Type
Assumed growth
2026–2050 Illustrative Fee PotentialTotal
Single-family
(Single Family and ADUs)
540 units $12,309/unit $6.7 million
Multi-family
(2 or more dwelling units, apartments,
condominiums)
107 units $11,349/unit $1.2 million
Commercial
(Retail stores, restaurants) 69,000 sq. ft. $9,245/1,000 sq. ft. $0.6 million
Office
(Administrative and professional offices) 43,000 sq. ft. $7,965/1,000 sq. ft. $0.3 million
Total $8.8 million
Illustrative only. Not proposed RPV fees or guaranteed collections.
Developer Impact Fees
Revenue by Fee Category
Potential Fee Category 2026–2050 Total Illustrative Annual Average
General Government $1.7 million $67,718
Public Safety $1.1 million $43,637
Recreation and Parks $4.2 million $167,835
Transportation $1.9 million $74,471
Total $8.8 million $353,662
Annual amounts are averages, not recurring revenue forecasts.
Developer Impact Fees
Revenue Depends on Development
Less fee-eligible development would mean lower collections.
Share of Assumed
Development 2026–2050 total Illustrative AnnualAverage
100% (Willdan estimate) $8.8 million $353,662
75% $6.7 million $265,250
50% $4.4 million $176,800
30% $2.7 million $106,100
Sensitivity examples only, not forecasts or a revised Willdan evaluation.
Developer Impact Fees
Recent RPV Development Activity
Local permit activity would help refine fee-eligible growth assumptions.
Permit activity reported by staff
Year Permits
issued
Over 750
sq. ft.
2024 11 2
2025 15 3
2026 7 1
ADU Size and Fee Eligibility
- ADU sizes: 270 to 1,000 sf
- State law generally exempts ADUs
that are 750 sf or less from DIFs.
- Larger ADUs may be subject to
proportional fees
Developer Impact Fees
Existing Costs and Recent Permit Activity
RPV Permit Fee Examples
• 33 ADU permits issued
(6 were over 750 sf)
• 19 single-family/rebuild
permits issued
(10 new homes, 9 teardown/rebuilds)
Project Combined City fees
ADU $4,000-$7,300
Home addition $5,200-$10,300
Second-story project $24,000-$31,000
New single-family
home $35,000-$60,000
Recent Residential Permit
Activity (2024-2026)
Developer Impact Fees
Other-City Fee Context
Selected Single-Family Residential Examples
Different categories and methods. Not a like-for-like comparison or RPV fee proposal.
City Fee example Program context
Rolling Hills Estates $28,729/unit
+ $0.73/sq. ft.
Multiple facility-related
fee components
Laguna Beach $200/unit Library impact fee
Malibu $5,636/unit Parkland development fee
La Cañada Flintridge No citywide DIF
identified
Staff review of current
master fee materials
FAC and Financial
Sustainability
Committee Review
Developer Impact Fees
FAC Recommendation and Considerations
August 13, 2026: FAC recommended deferring the Nexus Study, 3-2.
Potential Benefits
• Growth-related capital funding
• Fees in place before development
• Less reliance on other City funds
Potential Considerations
• Study cost before revenue is known
• Limited growth; restricted revenue
• Ongoing administration and
updates
Developer Impact Fees
FAC Recommendation and Considerations
Program Administration
A fee program would require ongoing staff time and coordination.
Track Funds
Separate accounts by
category; track
collections, spending
and capital projects.
Administer Fees
Public reports; credits,
exemptions, waivers
and appeals, as
applicable.
Review and Update
Revisit assumptions
and costs; update the
Nexus Study at least
every eight years.
Illustrative 1%-2% administrative charge: about $3,500-$7,000 per year.
Developer Impact Fees
Subcommittee Considerations
August 28, 2026 | Councilmembers Bradley and Lewis
Acknowledged FAC concerns while considering preparation for potential future development.
Impacts
Type and intensity of
future development
Proportionate Fees
Residential categories
and project-size
questions
Eligible Projects
Growth-related needs
and the attributable
share
Any fee structure would require Willdan and City Attorney review.
Next Steps if
Approved to Proceed
Developer Impact Fees
Study Cost and Authorization
Any fee structure would require Willdan and City Attorney review.
Study authorization would not adopt fees or authorize fee collection. $50,000
Maximum
agreement amount
$60,000
FY 2026-27
budgeted amount;
no additional
appropriation
6-12 Months
Estimated study
duration in the
report’s Fiscal
Impact section
Developer Impact Fees
Capital Needs to Evaluate
Any fee structure would require Willdan and City Attorney review.
Staff and Willdan: scope, costs and the growth-related share. 1 Hesse Park IT capacity or service improvements
2 Public Safety Additional office space
3 Eastview Park Restrooms and permanent office space
4 PV Drive South Traffic improvements
5 Sewer and storm drains Capacity-expanding improvements Examples for study only. Eligibility and growth-related shares are not established. 65 Ken Dyda Civic Center Capacity-expanding improvements Developer Impact Fees
Refining Assumptions and Fee Options
Any fee structure would require Willdan and City Attorney review.
The study would establish maximum supportable fees, not mandate adoption.
Local Assumptions
Historical activity,
future development,
eligible capital
projects and costs.
Fee Methodologies
Development
categories, square
footage and
proportionate cost
allocation.
Policy Options
Fee levels,
exemptions or
waivers, and
possible graduated
approaches.
Developer Impact Fees
Outreach and a separate decision
Any fee structure would require Willdan and City Attorney review. 1 Prepare the Study City-specific analysis; stakeholder outreach as appropriate
2 Obtain FAC Feedback Review the study and potential fee structure
3 Return to Council Council determines whether to proceed with establishing a DIF program
4 If Council Directs Staff
to Proceed
Conduct required public notice and hearing
process for potential adoption
Council may adopt, modify within supported limits, or decline a DIF program.
Developer Impact Fees
Recommended Council Actions
Any fee structure would require Willdan and City Attorney review. 1 2
3 Receive and file Willdan Financial Services’ (Willdan) Initial Impact Fee Evaluation regarding the potential establishment of DIFs.
Provide Staff direction regarding preparation of a Nexus Study for the potential establishment of DIFs, including:
Consider the Finance Advisory Committee’s (FAC) recommendation to defer preparation of the Nexus Study based on the City being largely built out, budget considerations, uncertain revenue potential, and ongoing administrative and funding requirements; or
Consider whether to proceed with the Nexus Study to position the City for potential future development, and if so, authorize the City Manage to execute a professional services agreement (PSA) with Willdan, in a form approved by the City Attorney, in an amount not to exceed $50,000
If authorized to proceed, direct Staff to work with Willdan and City Department to identify potentially eligible capital improvements, refine development assumptions and fee categories, and return to the City Council with the completed Nexus Study and proposed DIFs for consideration a.
b.