EXHIBIT 2
P
roposal for the City of Santa Ana, CA
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Proposal for the City of Santa Ana
Development Impact Fee Study
1519 E Chapman Ave
Suite C
Fullerton, CA 92831
(714) 992-9020
www.revenuecost.com
EXHIBIT 1
Proposal for the City of Santa Ana, CA
TABLE OF CONTENTS September 25, 2023
Table of Contents ......................................................................................................................................................... 2
Transmittal Letter ...................................................................................................................................................... 3
Organization Qualifications ................................................................................................................................. 5
Project Manager .......................................................................................................................................................... 7
Scope of Work ............................................................................................................................................................. 11
Project Schedule ....................................................................................................................................................... 14
References .................................................................................................................................................................... 15
Proposed Budget ...................................................................................................................................................... 19
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Proposal for the City of Santa Ana, CA
September 25, 2023
City of Santa Ana
Attn: Ehab Elias, Associate Engineer
20 Civic Center Plaza, M-93
Santa Ana, CA 92701
Proposal for City of Santa Ana – Development Impact Fee Study
Revenue & Cost Specialists, LLC (RCS) appreciates the opportunity to provide you with this Development Impact Fee Study proposal . RCS has provided such studies and other fee- costing services since 1980, making us the first and foremost authority in costing services for California. O ur combined 100 years of experience and knowledge in this industry will ensure a successful project that’s on time and under budget.
Our impact fee study process is straightforward, imposes minimal impact on staff, and provides proper information, allowing staff, City Council, and other stakeholders to make the best policy decisions for Santa Ana. We strive to ensure confidence in the information and recommendations of the final Report.
The results of our study will allow the City to identify and recover, with certainty, the maximum financial impact from future development. The terms of this prop osal will be honored for 90 calendar days from the date of submission. Please contact Scott at (714) 992- 9026 or [email protected]
with any questions.
Sincerely,
GREGORY BROWN SCOTT THORPE
Vice President Principal
Proposal for the City of Santa Ana, CA
RCS Contacts
Revenue & Cost Specialists
1519 E Chapman Ave, Ste C
Fullerton, CA 92831
www.revenuecost.com
Scott Thorpe
Principal
714-992-9026
[email protected]
Gregory Brown
Vice President
714-992-9022
[email protected]
Proposal for the City of Santa Ana, CA
ORGANIZATION QUALIFICATIONS
ABOUT RCS
RCS (Taxpayer ID No. 330787781) was founded in 1980 by
two former City Managers and a Finance Director who, after the passage of Propositions 13 and 4, discovered that user fees were a legal option to recover lost municipal revenues.
Forty-two years later, Revenue & Cost Specialists continues its focus on cost allocation and user fee calculation services.
After the passage of AB 1600 in 1988, our company added impact fee calculation services to help municipalities finance public facility expansion.
In 2000, RCS created Government Software Systems to develop robust costing software tha t serves fee calculation needs better than spreadsheets. Our company has provided additional services to municipalities, including long-range financial planning, accounting procedures, and utility rate studies.
To this day, RCS continues to thrive through repeat business, referrals, and references. As a small business, RCS takes only a handful of new clients each year, allowing us to dedicate the appropriate number of resources to them. What’s unique about RCS is the work longevity of our team members. Client cities from 20 years ago still call and speak with the RCS Partner about their project back then.
For 2023, RCS is celebrating our 43
rd year in business and looking forward to another 40-
plus years of partnering with municipalities.
QUALIFICATIONS
RCS’s five principals comprise the Limited Liability Company. RCS principals have over 100 years of combined experience in cost allocation plans and fee studies and served over 250 municipalities. We have provided these services to a wide array of public agencies, from the smallest special district to larger and more complex cities and counties. While based in Orange County, we engage in projects throughout the State of California.
RCS principals are municipal cost and revenue consultants specializing in the following:
• User Fee Studies
• Cost Allocation Plans
• Development Impact Fee Studies
• Special studies and reports supporting municipal financing management
Proposal for the City of Santa Ana, CA
These specializations allow RCS to focus on every aspect of municipal fees and be the best at what we do. We are confident in our project time estimates and do not respond to RFPs when the project workload exceeds our capacity. We have suggested new fees that are not common practice throughout the state and have challenged and removed municipal fees that were not defensible. We have assisted municipalities in streamlining their fee-based processes.
All RCS principals are knowledgeable in fund accounting, department structures , and municipal services. We stay current on pending financial and legal issues that challenge municipalities. All principals are comfortable speaking with city staff at all levels, drafting reports and resolutions, and presenting to the public, stakeholders , and City Council members.
RCS principals perform all studies in a professional and expedient manner and do not rely on junior staff to perform these vital tasks with our clients. We also don’t rely on status memos because we will often be at City Hall to tell you how the project is going in person.
Rick Kermer, a Partner, was one of the founders of RCS. Rick used his CPA and audit experience to build cost allocation, user fee spreadsheets, and software that passes rigorous analysis and reporting accounting standards. Rick’s work is the foundation of all the fee study work offered today. He is now semi-retired, taking only a handful of projects each year.
Eric Johnson, the President, has streamlined and perfected the process of CAP and User Fee Study engagements. With over 30 years and hundreds of completed studies, Eric has created a superior process that demands little city staff time while obtaining maximum results. Eric quickly understands complex city services and how to calculate fees for them. He relates well with elected officials because he responds with candor and brevity. If you speak to any of Eric’s prior or current clients, they will tell you how easy the process was.
Scott Thorpe, a Principal, joined RCS in 1985. Before that, he spent 13 years in the cities of Chula Vista, Covina, Anaheim , and Brea, serving in various roles within the city manager’s offices. Scott performed user fee studies for several years, transitioning to development impact fees when AB 1600 was enacted. He has written articles laying out the fundamentals of impact fees, and his work has generated tens of millions in fee revenues for cities.
Chu Thai, Vice President, joined RCS after 22 years of municipal experience. As a budget manager and finance director, Chu has successfully coordinated user fee increases, impact fee increases, utility rate increases , and tax ballot measures. His experience helps clients avoid the unseen perils that jeopardize municipal projects. After project completion, Chu leaves behind well -documented reports and spreadsheets for City staff. His career has focused on improving cities’ financial stability and implementing operational effectiveness and efficiencies in local government.
Gregory Brown, a Vice President, is the newest team member of RCS . However, he has already performed development impact fee studies for a dozen different cities and districts.
Gregory spent 20 years working in small business before joining the RCS team. He was
Proposal for the City of Santa Ana, CA
trained by Scott Thorpe in development impact fee and applies the same methodology Scott Thorpe developed over 35 years while also incorporating his experience in managing small businesses with a focus on efficiency.
RCS PROJECT MANAGER FOR SANTA ANA
Scott Thorpe , Principal , and Greg Brown, Vice President, will work together on the Development Impact Fee Study.
RCS may assign additional specialists to the project to help maintain the proposed schedule and ensure product quality. We thoroughly understand and will be involved in every phase of the impact fee study, advising City staff when necessary. Resumes for the RCS project team are included in this proposal on the following pages.
Proposal for the City of Santa Ana, CA
EDUCATION
Bachelor of Arts in Public
Administration – San Diego
State University
Master of Public
Administration - California
State University Fullerton
AFFILIATIONS
California Society of
Municipal Finance Officers
Government Finance Officers
Association
Scott Ian Thorpe
Principal
Mr. Thorpe has been with RCS since 1985 and built his career and reputation on the proper establishment of development impact fees. His early publications helped shape the
foundation of calculating and implementing impact fees. Scott has produced studies for projects ranging fr om small, single- use developments to large, master -planned communities throughout California. He is actively involved in all aspects of the projects, from kick- off, through Council adoption and beyond fee collection and reporting.
Municipal Experience
City of Brea – Management & Budget Manager
Developed budget preparation and management information reporting systems. Established personal computer
operations, including acquisition, placement, and
maintenance of all equipment to initial and ongoing employee training. Created a comprehensive legislative program for reviewing all federal, state and local legislation.
City of Anaheim – Budget Analyst/Management
Operations Auditor
Assisted in the preparation of a $350,000,000 annual budget.
Provided centralized management support and assistance of line departments with a variety of services including work measurement and management techniques program
development, productivity improvement, internal
management audits, budget review/analysis, revenue
forecasting and auditing, and data processing systems
development. Specialized in management assistance to public safety, stadium, convention center and golf operations.
Responsible for fiscal, work-unit measurement and
management training sessions required of all city
management staff.
City of Covina – Administrative Assistant to the City
Manager
Performed general program development with significant
emphasis on the improvement of the budget process,
legislative, public information, and agenda process systems.
Conducted a major annexation study and effort.
Proposal for the City of Santa Ana, CA
Scott Ian Thorpe
Principal
Municipal Experience
(continued)
City of Chula Vista – Administrative Aide
Entry level job which involved completion of a City-wide Policy and Procedure Manual, operation reviews of long-term fire vehicle equipment purchases and of the municipal bus system stop locations.
Publications
"Financing Capital Improvements", Journal American Water Works Association, August, 1991, pages 50-52
"Impact Fees: Practical Guide for Calculation and
Implementation", Journal of Urban Planning and
Development, Vol. 18, No. 3, September, 1992, pages 106- 118
“The Missing Ingredient in State-Mandated General Plans”, Public Management, International City Management
Association”, March 2014. Pages 21-22.
Other Accomplishments
Charter Oak Unified School District Facility Closure
Committee-Board Appointee
Guest Lecturer on various municipal
government/management topics at two universities
Proposal for the City of Santa Ana, CA
EDUCATION
Bachelor of Arts in History –
Cal Poly Pomona
Gregory Ross Brown
Vice President
Professional Experience
Revenue & Cost Specialists – Vice President
(2022- Present) Assisting in meetings, gathering data,
building fee structures, analyzing, and writing reports.
Revenue & Cost Specialists – Associate
(2020 – 2022) Assist in working meetings, data gathering, analysis, and input. Write and/or edit text for completed Development Impact Fee cost calculations.
Simple Health Acupuncture and Wellness Center Inc.
Long Beach, CA – Clinic Director
(2012 – 2022) Oversaw all operations of a continuing
multiple-modality health clinic involving seventeen
employees.
Project Experience
Development Impact Fees
Apple Valley Fire Protection District, CA
City of Highland, CA
City of Shafter, CA (In Progress)
City of Gardena, CA (In Progress)
City of West Covina, CA (In Progress)
City of Hercules, CA (In Progress)
City of Corning, CA (In Progress)
City of El Segundo, CA
City of Farmersville, CA
City of Livingston, CA
City of Loma Linda, CA
City of Morro Bay, CA
City of Hawthorne, CA (In Progress)
Cost of Services Studies
City of Hawthorne, CA
City of Laguna Beach, CA
City of Santa Maria, CA
Proposal for the City of Santa Ana, CA
SCOPE OF WORK
DEVELOPMENT IMPACT FEE
To make certain the City of Santa Ana continues to provide basic municipal services as the City grows, RCS proposes to undertake the calculation and textual support of a new Development Impact Fee Calculation and Nexus Report. RCS staff will perform the following to complete the Development Impact Fee (DIF) calculation and quantify the costs generated by new development in terms of an Impact Fee Schedule for city land uses.
Based on our preliminary review of the reports and documentation available by the City, we propose development impact fees for the following infrastructures.
1. Law Enforcement, Vehicles, and Equipment
2. Fire Suppression/Medic Facilities, Vehicles and Equipment
3. Transportation System Improvement Area
4. Transit Zoning Code Traffic Impact Mitigation Fair Share
5. Harbor Specific Plan Mitigation Fair Share
6. Drainage Assessment Fee
7. Park Acquisition and Development Fee
8. Sewer Connection Fee
9. Water Connection Fee
10. Library Fee
11. General Facilities Development Fee
12. Community Centers Development Fee
RCS has the experience and determination to research and identify the maximum financial impact of future developments in Santa Ana. With this information, staff can realize the city's best funding and implementation policies.
We plan to use a series of direct, focused meetings between RCS experts and knowledgeable City staff to produce an accurate, logical, and defensible final product. RCS' objective is to ensure that City staff feels confident about the data and the report and, therefore, confident in supporting the results at public hearings.
The fee recommendations included in RCS' final Development Impact Fee Calculation and Nexus Report will be legally defensible, easy to understand, and supported by City staff. Our years of experience in impact fees and working with local government finance officers ensures this project will be completed successfully and on time.
To provide the basis for the Development Impact Fees, the following steps would be taken by the Revenue & Cost Specialist staff, working with City staff and other consultants where necessary and appropriate:
Proposal for the City of Santa Ana, CA
Task 1: Preliminary Research
Prior to any meetings, RCS will perform a field "windshield" survey to become acquainted with the physical characteristics and general improvement needs and standards of the City. We will request and review all City maps, land -use documents, and available master plans, especially the Comprehensive General Plan, before the kick-off meeting. We will review the City's history of impact fee schedules, resolutions, ordinances, and Annual and Five- Year Reports per Government Code Sections 66006 and 66001. RCS wil l review recent Operating Budgets, CIP Budgets, Comprehensive Annual Financial Reports, and fixed asset reports.
RCS will meet and discuss the City’s planning, capital financing process , and community development standards with the City Engineer, City Planner, and other executive staff to determine the improvements that most likely will evolve from the project planning documents and be needed to support and give validity to the City's Comprehensive General Plan.
Task 2: Series of Working Meetings
RCS will meet with City staff responsible for each infrastructure to help identify all projects needed through theoretical build -out via the use of master plans, specific plans, and other service requirement studies. The more supporting documents we can find, th e better the Study will be. The greatest support would be an engineer - prepared Master Plan. RCS will endeavor to increase the validity of available information if such a document is unavailable. RCS will request from the City all reports, master plans, specific plans , and other related reports identifying needed infrastructure. If needed, RCS can assist the City with developing project lists and supporting data. RCS will review project cost estimates and textual explanations f or accuracy and completeness.
RCS will identify and analyze the demand drivers specific to each infrastructure or service area. The drivers are the factors of nexus demand related to each land use and would be based on the project plans or City productivity records. These demand drivers will help determine the distribution of the benefits of nexus for, and impact of each group of projects on each of the above categories of land use. The proportional analysis is necessary to identify what burdens would be placed upon the existing and future infrastructure would be undertaken.
Task 3: Draft Development Impact Fee Calculation and Nexus Report
Since the Report is based on information and estimates provided by City staff, it is important that all participants are comfortable with the methodology and data
Proposal for the City of Santa Ana, CA
presented. RCS will prepare a draft report consisting of the fee structures and the necessary relevant nexus text and report with recommended fees. This meeting will include discussions on policy issues, imp lementation strategies , and revenue collection procedures. RCS will provide the draft report for staff consideration and distribution.
Task 4: Presentation of Proposed Development Impact Fee Calculation and Nexus Report to the City Council
RCS will a ttend the City Council meeting to discuss the report methodology and present findings, provide a formal presentation, and answer questions about those findings. RCS will have the necessary supporting documentation for the meeting and will be the primary contact to answer all questions, following up with any City Council direction with the assistance of City staff.
CLIENT INPUT
RCS will make every effort to advise, seek input from and, in general, explain the work as it is being performed. We depend on dedicated and engaged staff participation for a project to be completed successfully. Most of the staff participation is to attend working meetings with RCS.
The City should also designate a Project Coordinator for the fee study who will:
1) Identify key City staff and coordinate the kick-off meeting(s) 2) Assist in obtaining the requested information
3) Coordinate the review of draft reports, and
4) Provide project direction if needed
ONSITE MEETINGS AND VIDEO CONFERENCING MEETINGS
For the project kick-off and working meetings on the same day, the City may choose to have RCS onsite or conduct the meetings through a video conferencing account.
All working meetings will be through our Zoom account or a video conferencing software of the City’s choice. Our experience has determined that video conferencing is more flexible in scheduling meetings, lets City staff quickly access reports and files on their computers, and allows everyone to view and discuss the same documents at the same time.
RCS plans to participate in the City Council meetings onsite at the City of Santa Ana.
Proposal for the City of Santa Ana, CA
PROJECT SCHEDULE
RCS’ references will attest that our timelines are ideal for impact fee studies. This schedule, of course, will require the cooperative participation of City staff. We will be having meetings with staff every two to three weeks and provide them with updates. Department meetings will be 30 minutes to two hours each.
RCS will comply with local, county, and state protocols for safely conducting meetings as the COVID-19 pandemic evolves.
Development Impact Fee Study Nov
2023
Dec
2023
Jan
2024
Feb
2024
Mar
2024
Apr
2024
Land-use Database Compilation
Determine Infrastructure LOS
Discuss Desired Projects w. Staff
Review Project Costs & Descriptions
Review Demand Drivers (Nexus)
Apply Nexus Distribution Factors
Review Draft DIF Report with Staff
Prepare Final DIF Report
Present DIF Study to Council
Proposal for the City of Santa Ana, CA
PROPOSED BUDGET
Revenue & Cost Specialists proposes the following project costs, which will NOT TO EXCEED AMOUNT OF $115,150.
Development Impact Fee
Preliminary Research 7 8 13,650
Identify Land-Use Build Out Land Use Database 100 17,500 Identify Current/Future Needs Schedule of Capital Costs 150 26,250 Mathematical Nexus Calculation Spreadsheets of Calculations 175 30,625 Textual Nexus Draft & Final DIF Reports 130 22,750
Public Meetings Presentations (2) 25 4,375
TOTAL PROJECT COST 658 $115,150
The above costs are based on a charge of $175 per hour. The billing rate for any additional work not covered by this proposal would be $ 200 per hour. Our proposal covers all costs except for the following additional costs that the City may incur:
• Report reproduction beyond one physical master copy of the final Report. • Excessive public meeting attendance.
• Excessive revisions to the report once the draft report has been approved by City staff.