Turlock City Council
March 10, 2026

KOSMONT COMPANIES | 44

5. REGIONAL ECON DEV COMPARISONCITY OF TURLOCK – EDSP
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REGIONAL ECONOMIC DEVELOPMENT COMPARISON
Source: Kosmont Companies
To help understand the City’s competitive position, Kosmont has done research on how Modesto and Merced, two keynearby competitive cities treat economic development, how their development impact fees and incentive policies comparewith Turlock.Turlock incentives include:• Turlock Irrigation District has lowest electric rates in the region• City offers reduction in CFF Development Impact Fees for new projects involving demolition of existing uses with no increase in square footage
• City provides a 10% reduction in trip generation for land uses in the Downtown Pedestrian Priority Area • City of Turlock offers fee deferral options for Commercial and Industrial Development - deferred to occupancy 4 year deferment plan5 year deferment plan For more information, visit: www.turlock.ca.us/buildinginturlock/developmentimpactfees/ • City of Turlock offers fee deferral options for Residential Development:

Residential Fee Deferral Agreement (RFA)Development Impact Fees can be deferred to close of escrow. Refer to City Council Resolution 2015-136 For more information, visit: www.turlock.ca.us/buildinginturlock/developmentimpactfees/ DRAFT

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REGIONAL ECONOMIC DEVELOPMENT COMPARISON
Source: Kosmont Companies
• No-Cost Predevelopment Meetings https://www.turlock.ca.us/buildinginturlock/predevelopmentmeetings/• Annual City of Turlock Job Fair (50+ employers participating each year)• City of Turlock Partnership Incentive Program:
$1,000 business grant available to a new Turlock business not part of a franchise or corporate chain.https://ci.turlock.ca.us/doingbusinessinturlock/businessincentiveprogram/ • No-Cost Business Workshops:Through partnerships with business resource organizations, the City of Turlock Economic Development Department provides workshops designed to help small businesses succeed.Topics include: Marketing for Small Businesses, Accounting, Starting Your Business, Social Media Marketing for Small Businesses, E-Commerce for Small Businesses, and more!
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KOSMONT COMPANIES | 47

REGIONAL ECONOMIC DEVELOPMENT COMPARISON
Source: Kosmont Companies
Merced offers the following economic incentives:• Development fee reduction of 50% for construction in infill zone plus fee deferrals• PG&E 5-yr electricity rate reduction for large power users• Recycling zone low interest loans and credits for businesses that use recycled material• Small business revolving loan fund• UC Merced Venture Lab Proof of Concept fund to assist in commercialization of university startupsModesto has significant business attraction and development incentives:• White glove permitting assistance from entitlement thru certificate of occupancy• Incentives for green business by providing financing through the Community Development Financial Institution• Workforce training programs thru Modesto JC and Stanislaus Workforce Development at low or no cost• Expedited entitlement and permitting ( same day tenant improvement permits)• Fee deferrals (5-year installments) and full waiver in special circumstances)• Downtown occupancy incentive (rebate of 1-year City sales and mil tax)• Downtown façade incentives of up to $10,000 matching rebate upon completion of approved projects• Downtown residential development incentives (fee exemptions and free permits)• Shop Greater Modesto free e-commerce portal for local businesses• Modesto Irrigation District incentives for new energy efficient equipment DRAFT

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DEVELOPMENT IMPACT FEES
Source: Kosmont Companies
Most California cities charge development impact fees and special taxes to fund infrastructure and service costs associated with new development and may include the following categories:
• Water Supply • Wastewater Treatment/Recycling
• Stormwater / Drainage • Roads, Bridges and Traffic Signals• Parks• Other Public Facilities (Police / Fire / Library / Other)Fees vary significantly e.g. Residential fees that vary by density per acre / avg home size / population / geographic area Commercial and industrial fees vary by type (e.g., office, neighborhood retail, regional retail, restaurant, industrial warehouse, manufacturing, business park). Fees also vary as different geographic areas have different infrastructure needs (areas with new growth have greater needs)Alternative Financing Options for major infrastructure is often authorized by cities using Mello-Roos CFD bonds secured byspecial taxes or utility pledged facilities charges (PFC’s) to pay debt service for upfront investment needs.

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COMMERCIAL IMPACT FEE COMPARISON
Turlock fees for new retail development are modestly higher than Merced and Modesto. Important to note that Turlock Master Plan fees are additive to the Citywide fees, while Modesto CFD fees are all inclusive for each CFD area.

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INDUSTRIAL IMPACT FEE COMPARISON
Turlock fees for new industrial development within WISP are significantly higher than Merced and Modesto. Turlock Master Plan fees are additive to the Citywide fees, while Modesto CFD fees are all inclusive for each CFD area.

KOSMON
T
C
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MULTI-FAMILY IMPACT FEE COMPARISON
Turlock fees for new multi-family development within Master Plan areas are up to $38,000 per unit, which is almost $1 million per acre, much higher than Merced and Modesto. Important to note that Turlock Master Plan fees are additive to the Citywide fees, while Modesto CFD fees are all inclusive for each CFD area.

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TURLOCK IMPACT FEES
/1 Water Fees are included as rough estimates as they are based on fixtures and meter size/2 Includes Park Fees for Residential Only ($2,100 per unit)/3 Project Total -Low excludes projects in North Area and WISP master plan Fees DRAFT

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6. OPPORTUNITY SITES EVALUATIONCITY OF TURLOCK – EDSP
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Source: ESRI Business Analyst Online (Accessed December 2024) KOSMONT COMPANIES | 54 Geer Rd.

W. Main St.
d
W. Monte Vista Ave.

Fulkerth Rd.

Geer
W. Linwood Ave.

Lander Ave.
1 3 2
City has four major development areas with several thousand acres of privately owned land for industrial, retail, entertainment and blended-use opportunities,They include:1. Hwy 99 Corridor2. Downtown Turlock 3. Westside Industrial Specific Plan4. Federal Opportunity Zones (OZ)The most significant near-term opportunity is the ~30-acre site on the east side of Hwy 99 planned for restaurants, entertainment, retail and hotel uses. The 2025 Tax Law extended Federal OZ tax benefits indefinitely beginning in January 2027. 4 DRAFT

KOSMONT COMPANIES | 55
ƒ Total area size: 371.2 acres with over

1.7 million SF of existing retail space and over ~100 acres of vacant land ƒ Zoning: Planned Development (PD),
Community Commercial (C-C), Thoroughfare Commercial (C-T), Heavy Commercial (C-H) ƒ 30-acre site north of Countryside
Plaza is master planned for high volume food, retail shops and hotel uses.

HIGHWAY 99 RETAIL CORRIDOR
Sources: (Accessed December 2024)
Countryside
Plaza
Monte Vista
Crossings
Monte Vista
Crossings West
Turlock
Crossroads
W. Monte Vista Ave.

W. Christoffersen Pkwy.

W. Tuolumne Rd.

Fulkerth Rd.

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DOWNTOWN TURLOCK
Sources: (Accessed December 2024)
ƒ Total area size: 38.4 acresƒ Zoning: Low-Density Residential (R-L), Transitional Commercial (TC), Office or Residential (OR), Downtown Core (DC), Planned Development (PD) Turlock
City Hall
Turlock
City Hall
Lander Ave.

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WESTSIDE INDUSTRIAL SPECIFIC PLAN
Sources: (Accessed December 2024)
ƒ Total area size: 2,611 acresƒ Zoning: Industrial (I), Industrial Business Park (IBP), Community Commercial (C-C), Office Commercial (C-O), Low Density Residential (R-L), Public/Semi-Public (P-S), Planned Development (PD) With major infrastructure investment, and
city incentives, the northern area can help attract thousands of new industrial jobs, as well as an indoor/outdoor regional sports complex, hotels and regional entertainment uses.

Fulkerth Rd.

W. Main St.

W. Linwood Ave.

S. Walnut Rd.

Fransil Ln.

Amazon
S. Tegner Rd.

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FEDERAL OPPORTUNITY ZONES – 2017 TAX ACT
Sources: (Accessed December 2024)
Estimated total area: 837 acres (within City boundaries) 117 acres in Westside Industrial SP Area: 11 acres in DowntownThe new 2025 Tax Law has extended the timeframe for OZ benefits indefinitely. Effective 1/1/27 OZ investors can defer capital gains for 5 years on other asset sales (if invested in businesses or property in OZ area) and receive a 10% basis stepup. Development of new large commercial, industrial and multi-family apts are the most prevalent OZ investments.

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7. ECONOMIC DEVELOPMENT TOOLSCITY OF TURLOCK – EDSP
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ECONOMIC DEVELOPMENT TOOLS
Kosmont has prepared a summary of various Economic Development tools and a playbook that the City can consider for Value Capture and to facilitate future development:Capture Value from Tax Increment and Special Districts• Enhanced Infrastructure Financing District (“EIFD”) use property tax increment and Community Facility Districts (“CFD”) are tools to fund important local and regional infrastructure.

Capture Value from Zoning (Value Capture Zoning VCZTM)
• Development Opportunity Reserve (D.O.R.)
® allows cities to create a “bank” of new density in zoning / specific plans, allowing them to give the density to projects that deliver community benefits & public amenities.

Capture Value from Real Estate• Cities can use a variety of strategies to capture the value of their properties (sale or long-term lease / Surplus Land Act).

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THE ECONOMIC DEVELOPMENT PLAYBOOK
Special
Districts
al
Districts is
t
ric
t
s -

EIFD, CRIA, FD, CRI F
D, C
RI
CFD
Development Development
Opportunity Opportunity
Reserve Reserve
(D.O.R.)®
Sales Tax Sales Tax
Assessment Assessment
Revenue Revenue R
e
v
e
n
u
e
(STAR*)
®
Other Public O
t
h
e
r
P
u
blic
Money (OPM) Mon
e
-
one
y (OPM)
- ARPA,
Infrastructure
Surplus Land Act
EIFDsCapture Value from Tax Increment
ZoningCreate Value from Zoning & DA NegotiationsOPMCreate Value from New Funding Government Government
Financing
Financing
Create Value through public financing/refinancing
Real Estate Real Estate
Strategies
Source: Kosmont Companies
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SPECIAL DISTRICTS FOR INFRASTRUCTURE FINANCING
ƒ Public agencies can utilize a variety of tax increment financing (TIF) and special district tools to fund infrastructure projects that can help to motivate private investment. This includes Enhanced Infrastructure Financing Districts (EIFDs), community facilities districts (CFDs), and business improvement districts (BIDs). These special districts arenot mutually exclusive, and can work well together to advance goals of motivating private investment. ƒ Enhanced Infrastructure Financing Districts (EIFDs) may be well suited for some of the Region’s opportunity areas that have significant infrastructure needs (roads / connectivity, water / sewer, electricity, telecom / broadband, etc.). ƒ EIFDs utilize property tax revenues from new development to finance public infrastructure projects without introducing new or increased taxes.
ƒ EIFD project areas do not have to be contiguous, allowing them to target specific areas of high development and high infrastructure need.
ƒ The district commitment of revenues toward infrastructure can induce private sector investment, accelerate growth, create jobs, and capture / grow fiscal revenues.

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SPECIAL DISTRICTS FOR INFRASTRUCTURE FINANCINGFUNDAMENTALS OF EIFDSTax Increment Financing Tax increment from new development / assessed value increase used to fund infrastructure projects in approved project areas
Long-term Districts
Up to 45-year districts from first bond issuance; Districts provide long-term, committed revenues in targeted investment areas; Districts can be created in 12-18 months Non-Contiguous Areas
EIFD project areas do not have to be contiguous, allowing them to target specific sites / areas and making them compatible with other zoning / entitlement strategies Eligible Projects Any property with useful life of 15+ years and of communitywide significance; purchase, construction, expansion, improvement, seismic retrofit, rehabilitation, and maintenanceReturn on Investment Private sector investment induced by District commitment accelerates growth of net fiscal revenues, job creation, housing production, essential infrastructure improvements Attract Additional Funds
Allows community to attract tax increment from other entities (cities, special districts), federal / state grants & loans (TOD, water, housing, parks), brownfield funding DRAFT

KOSMONT COMPANIES | 64

EIFD WITH A POTENTIAL CITY/COUNTY PARTNERSHIP
Federal & State Sources
ƒ Cap-and-Trade / HCD grant &
loan programs (AHSC, IIG, TCC)
ƒ Prop 1 bond funds / Prop 68ƒ SB 1 Road fundsƒ SB 2 Transfer Tax fundsƒ Federal DOT / EPA / EDA funding
Other Potential Funding Sources
ƒ Property tax revenue including RPTTFƒ Vehicle license fee (VLF) prop. tax backfill incrementƒ Development Agreement / impact feesƒ Benefit assessments (e.g. contribution from CFD)ƒ Local transportation funding (e.g. Measure M/R)ƒ Private investment TIF Districts which involve a City / County joint effort are more likely to win state grant funding sources. According to the Stanislaus County Auditor-Controller Office, the City gets an average of 7.6% of the baseline property tax and County receives approximately 19% of the baseline tax in the Tax Rate areas within WISP.

Sources: Kosmont Companies Notes: Actual shares vary by tax rate area.

DRAFT

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TAX INCREMENT DISTRICT CASE STUDYPLACENTIA CASE STUDY – FORMED IN 2019 Placentia / Orange County EIFD Partnershipƒ 300+ acres: Old Town Placentia Revitalization Plan, Metrolink Station, TOD Packing House Area
ƒ Infrastructure Financing Plan (IFP) will fund $13 million in public infrastructure improvements for those areas
ƒ Water, sewer, streets, parking, transit connectivityƒ $460M+ expected in new AV from residential, retail, restaurant development
ƒ Net Fiscal Benefit: $22M to City, $15M to County
BEFORE
Implementation AFTER ƒ EIFD feasibility analysis & formation processƒ Led education/outreach meetings with County BOSƒ Developed County EIFD Policy for City/County EIFDƒ Completed first EIFD TIF Court Validation in the stateƒ Working on TIF Bond Sources: Kosmont Companies, City of Placentia
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SPECIAL DISTRICTS FOR INFRASTRUCTURE FINANCINGOTHER DISTRICT TOOLS Property Business Improvement Districts (PBID)
Property Business Improvement Districts are special assessments levied on real property to fund improvements and promote activities the benefit the properties located within the PBID area. This includes capital improvements, parking facilities, street / streetscape improvements, lighting and landscaping, marketing and promotion, and business attraction / retention. The special assessment amount that each property owner pays must be directly proportional to the benefit received.

Community Facilities District (CFD)
Community Facility Districts are a new property assessment or ”special tax” that appears as a separate line item on a tax bill and can be used to fund infrastructure / services that benefit the property. This includes transportation, parking, street / utility improvements, hazardous waste remediation, street lighting / sidewalk, and public services. CFDs are useful because they provide early financing for a variety of critical services and infrastructure. CFDs also pair well with EIFDs as a value capture strategy – with CFDs providing early funding and EIFDs providing funds as projects are constructed, and tax increment grows.

Parking Authority District
Parking Authority Districts can utilize a variety of funding sources – including bonds, ad valorem taxes, user fees, parking meter charges, parking revenues, and City / County contributions – to fund improvements such as parking lots, structures, and alterations to circulatory infrastructure to facilitate ingress and egress.

Climate Resilience District (CRD)
Climate Resilience Districts are a new type of district can fund projects to mitigate climate change. These districts have broad financing powers, and can fund a wide range of eligible projects, including projects that address sea level rise / flooding, extreme weather, wildfire, and drought.

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ZONING AND LAND USE STRATEGIESDEVELOPMENT OPPORTUNITY RESERVE D.O.R. ®
Zoning and entitlements create value. Cities can avoid simply giving that value away, and instead capture that value as currency to support community benefits and public amenities.

Old Playbook:Rezone Areas for New Density and Expect New Development Rezoning gives the value of the new density to current property owners: inflated land values, limited possibility of development.

New Playbook:Bank Density with Development Opportunity Reserve D.O.R. ®
D.O.R.
® allows cities to create a “bank” of new density in zoning / specific plans, allowing them to give the density to projects that deliver community benefits & public amenities.

DRAFT

KOSMONT COMPANIES | 68
ZONING AND LAND USE STRATEGIESDEVELOPMENT OPPORTUNITY RESERVE D.O.R. ®
- PROCESS
Create D.O.R.
®
Step 1Conduct market / economic density analysis to understand development potential. Identify sites and areas within community as areas targeted for new development.

Step 2Use planning process to create a reserve bank of density to use in target areas and create an amenity list of desired community benefits and advance projects.

ImplementD.O.R.
®
Step 3Development Projects apply for density from the DOR in exchange for amenities and community benefits delivered.

Step 4City & Developer sign a Development Agreement, assigning D.O.R. ® density to
project with contractual commitment to deliver amenities or infrastructure.

DRAFT

KOSMONT COMPANIES | 69
D.O.R.® CASE STUDY ILLUSTRATIONS
ƒ Goal: Induce housing development in downtown area
ƒ Benefits & Amenities: public restrooms, off-site
improvements, public parking, parking district, public art, parks, green buildings, other ƒ Incentives: Increase density up to 40 units / acre, increase heights, reduce on-site parking , reduced setbacks, reduced traffic and application fees City of Buellton: Avenue of Flags
Implementation Steps1. Conduct market housing / economic study to match RHNA needs

2. Discuss new density and public amenities
with community

3. Create DOR mechanism as new Zoning /
Specific Plan provision
City of El Monte: Downtown Main St.ƒ Goal: Increase downtown density along with community benefits and public improvements
ƒ Benefits & Amenities: streets, bicycle facilities, parking, open space, beautification, transit, arts / cultural spaces, lot consolidation; developer can either install improvements or make payment into public improvement fund; value based on a portion of residual land value (~75%) ƒ Incentives: Increase density, heights, FAR, dwelling units per acre Sources: Kosmont Companies, City of
DRAFT Buellton, City of El Monte

KOSMONT COMPANIES | 70
CREATE CURRENCY WITH REVENUE REPLACEMENTREPLACING TAX REVENUES VIA DAS & P3S Project would result in a loss in retail sales tax revenuesresulting from nonsales tax generating uses (e.g. industrial) Analyze sales tax revenue loss potential
of opportunity sites & zoning designations to understand scale Create equivalent General Fund revenue through
entitlement document /
development agreement(Tax Equivalency as currency)
STAR* Case Study: Jurupa Valley – Agua Mansa Commerce Park Site • ~280-acre site (originally planned for retail) • Proposed 3.6 million SF industrial development project• STAR analysis estimated annual sales tax in-lieu payment of ~$362,500 Replace Revenue with Sales Tax Assessment Revenue t
h
S
ale
s
T
a
x
A
(STAR*)®
Sources: Kosmont Companies, City of Jurupa Valley
DRAFT

KOSMONT COMPANIES | 71

CAPTURE VALUE WITH CITY PROPERTYREAL ESTATE & LEASING STRATEGIES Cities can use a variety of strategies to better utilize the value of their properties:ƒ Performance-based leases / ground leasesƒ Monetizing assets (such as parking garages)ƒ Selling property to private sector – includes leaseback strategies, continued operation of existing use, redevelopment into new uses
SELLER BEWARE –
Cities must follow Surplus Land Act (SLA)
requirements / procedures
Sources: Kosmont Companies, California Assembly Bill 1486 (2019) DRAFT

KOSMONT COMPANIES | 72

SURPLUS LAND ACT CONSIDERATIONS(FOR PUBLIC AGENCY OWNED PROPERTIES) ƒ The Surplus Land Act (SLA) was passed in response to the housing shortage in California. Public agency owned property cannot be sold or leased until it complies with the SLA, with certain exceptions. ƒ After navigating the SLA for a City-owned site, either an affordable housing project will be ready to come to the site, or the City will have the ability to market the land for a different use.
ƒ SLA requires an up to 150-day (NOA for 60 days + good faith negotiations for 90 days) RFP process to either select or reject an affordable housing project/proposal. City does not have to sell the property for less than fair market value. If rejected, property can be sold to broader market. ƒ After completing the process, any development will be subject to a covenant requiring any residential development with 10 or more units to provide at least 15% of units available to low-income households. ƒ If local agency does not comply with SLA, HCD will impose fine of 30% of final sale price for first violation, 50% of final sale price for second violation. ƒ City should engage real estate and legal counsel to navigate SLA process and conduct appropriate property due diligence.
ƒ Potential exemptions include leases existing prior to 1/1/2019, land dedicated for 75% or more affordable housing or public uses and land not suitable (too small).

SLA Required Disposition Process

1. Declaration of the property as either “surplus” or “exempt surplus.”

2. If declared “surplus,” disseminate a Notice of Availability (NOA) offering the property to other government agencies andaffordable housing developers for a period of 60 days.

3. If the City receives letters of interest from government agencies and/or affordable housing developers, then it must negotiate ingood faith with those interested parties for a period of 90 days.

4. After the 90-day good faith negotiation period, the City must notify the State Department of Housing and CommunityDevelopment (HCD) and provide information that documentscompliance with the process and request a letter of compliance.

5. HCD has 30 days to respond to City with questions/request for more information and, at the conclusion of the 30-day period,must provide a letter stating that the City has complied with theprocess or not.

DRAFT

KOSMONT COMPANIES | 73
CITY OF TURLOCKECONOMIC DEVELOPMENT STRATEGIC PLANAUGUST 2025 2301 Rosecrans Ave., Suite 4140El Segundo, CA 90245TEL: 424-297-1070 | URL: www.kosmont.com DRAFT

2301 Rosecrans Ave., Suite 4140
El Segundo, CA 90245TEL: 424-297-1070 | URL: www.kosmont.com 


















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KOSMONT COMPANIES | 2



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KOSMONT COMPANIES | 3



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The following sections contain detailed supporting information on the following topics1. City general fund financial trends2. Demographic comparison with surrounding communities3. Placer.ai visitation and trade area4. Real estate market data trends a) Retail Marketb) Officec) Industriald) Multi-Family
e) Hotel
DRAFT

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DRAFT

KOSMONT COMPANIES | 13
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Employees who work in the City are coming from Modesto, Ceres, Merced, Delhi CDP, and Atwater

Employed residents living in the City are traveling to Modesto, Ceres, Stockton, San Jose, and Livingston for work













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DRAFT

KOSMONT COMPANIES | 14












To help cities understand the shopping patterns of residents and visitation patterns of regional families, Kosmont utilized Placer.ai, which is a mobility data provider that tracks daily movement of over 30 million people in the United States via anonymized mobile app data. This information reveals visitor and employee travel trends to/from major events, shopping centers, major retailers, and other points of interest – providing insights into store/center trade areas, hourly and daily visitation statistics, and consumer demographic characteristics. A sample of what Placer.ai can provide is described below:

Visitor, Resident, and Inbound Commuter Demographics and Visitation Trends
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Shopping Center Performance
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DRAFT

KOSMONT COMPANIES | 15
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DRAFT

KOSMONT COMPANIES | 19
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DRAFT

KOSMONT COMPANIES | 20










To identify potential retail options for the Site, Placer.ai’sVoid Analysis Tool analyzed the drive time trade area for the neighboring Countryside Plaza retail center and compared it to trade area data for various retail categories, including dining and entertainment. The list on the following slide identifies potential tenants. The list is filtered for chains with positive in-state expansion rates and excludes chains with high cannibalization score. 


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DRAFT

KOSMONT COMPANIES | 21


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DRAFT

KOSMONT COMPANIES | 23
As shown on the adjoining aerial map, Turlock is home to dozens of regional retailers, including big boxes Costco, Wal-Mart, Target, Lowe’s, and Home Depot
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DRAFT

KOSMONT COMPANIES | 24



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Source: CoStar (Accessed October 2024); Note: Market asking rents were observed instead of Triple Net (“NNN”) because NNN data is sourced from actual transactions, which may not be reflective of the whole market. Vacant space refers to all space that is not occupied by a tenant regardless of availability or lease obligation. Available space is the amount of space currently being marketed as available. It includes any space that is vacant, occupied, or available at a future date. Numbers in parentheses and in red indicate a negative number.

DRAFT

KOSMONT COMPANIES | 25
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Source: CoStar (Accessed October 2024); Note: Market asking rents were observed instead of Triple Net (“NNN”) because NNN data is sourced from actual transactions, which may not be reflective of the whole market. Vacant space refers to all space that is not occupied by a tenant regardless of availability or lease obligation. It includes any space that is available at a future date. Numbers in parentheses and in red indicate a negative number.

DRAFT

KOSMONT COMPANIES | 26
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DRAFT

KOSMONT COMPANIES | 27


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DRAFT

KOSMONT COMPANIES | 28



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Source: CoStar (Accessed November 2024); Note: Market asking rents were observed instead of full-service gross rents (“FS”) because FS data is sourced from actual transactions, which may not be reflective of the whole market. Vacant space refers to all space that is not occupied by a tenant regardless of availability or lease obligation. Available space is the amount of space currently vacant, occupied, or available at a future date. Numbers in parentheses and in red indicate a negative number.

DRAFT

KOSMONT COMPANIES | 29
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Source: CoStar (Accessed November 2024); Note: Market asking rents were observed instead of full-service gross rents (“FS”) because FS data is sourced from actual transactions, which may not be reflective of the whole market. Vacant space refers to all space that is not occupied by a tenant regardless of availability or lease obligation. Available space is the amount of space currently being marketed as available for lease or sale in a given time period. It includes any space that is vacant, occupied, or available at a future date. Numbers in parentheses and in red indicate a negative number.

DRAFT

KOSMONT COMPANIES | 30


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DRAFT

KOSMONT COMPANIES | 31

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DRAFT

KOSMONT COMPANIES | 32



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Source: CoStar (Accessed October 2024); Note: Market asking rents were observed instead of Triple Net (“NNN”) because NNN data is sourced from actual transactions, which may not be reflective of the whole market. Vacant space refers to all space that is not occupied by a tenant regardless of availability or lease obligation. Available space is the amount of space currently being marketed as vacant, occupied, or available at a future date. Numbers in parentheses and in red indicate a negative number. Vacancy does not reflect Amazon warehouse.

DRAFT

KOSMONT COMPANIES | 33
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Source: CoStar (Accessed October 2024); Note: Market asking rents were observed instead of Triple Net (“NNN”) because NNN data is sourced from actual transactions, which may not be reflective of the whole market. Vacant space refers to all space that is not occupied by a tenant regardless of availability or lease obligation.

DRAFT

KOSMONT COMPANIES | 34

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DRAFT

KOSMONT COMPANIES | 35
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KOSMONT COMPANIES | 36



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Source: CoStar (Accessed November 2024); Notes: Data represents the average asking rents across all unit types (studio, 1BR, 2BR, etc.).

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DRAFT

KOSMONT COMPANIES | 37
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Source: CoStar (Accessed November 2024); Notes: Data represents the average asking rents across all unit types (studio, 1BR, 2BR, etc.).

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DRAFT

KOSMONT COMPANIES | 38
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DRAFT

KOSMONT COMPANIES | 39
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DRAFT

KOSMONT COMPANIES | 40



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Source: CoStar (Accessed December 2024); Notes: Data represents the average asking rents across all unit types (studio, 1BR, 2BR, etc.). Inventory does not include condos, co-ops, dormitories, or mobile homes and observes units in buildings with 10 or more units. Numbers in parentheses and in red indicate a negative number. Inventory is reflective of just for-rent housing, not condo/townhome buildings.

DRAFT

KOSMONT COMPANIES | 41
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Source: CoStar (Accessed December 2024); Notes: Data represents the average asking rents across all unit types (studio, 1BR, 2BR, etc.). Inventory does not include condos, co-ops, dormitories, and observes units in buildings with 10 or more units. Numbers in parentheses and in red indicate a negative number. Inventory is reflective of just for-rent housing, not condo/townhome buildings. # 


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DRAFT

KOSMONT COMPANIES | 42
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Source: CoStar (Accessed December 2024); Notes: Data represents the average asking rents across all unit types (studio, 1BR, 2BR, etc.) for Class A and B buildings. Inventory does not include condos, co-ops, dormitories, or mobile homes and observes units inbuildings with 10 or more units. Numbers in parentheses and in red indicate a negative number. 
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DRAFT

KOSMONT COMPANIES | 43
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DRAFT

KOSMONT COMPANIES | 44


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DRAFT

KOSMONT COMPANIES | 45


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City Council Staff Report
March 10, 2026
From: Isaac Moreno, Finance Director
Prepared by: Isaac Moreno, Finance Director
Agendized by: Gary Hampton, Interim City Manager

1. ACTION RECOMMENDED:

Resolution: Adopting reduced Capital Facilities Fees from Commercial, Retail, and Industrial development projects and appropriating Five Hundred Thousand ($500,000) from unrestricted reserves in Fund 120 (Tourism)

2. NARRATIVE:

Within the City of Turlock Draft Economic Development Strategic Plan summary, recommendations were provided to create sustainable economic growth. Recommendation #3 states, “establish business incentive program for targeted retail/commercial/industrial businesses." This report further goes on to give examples of incentives which include fee waivers/deferrals in targeted areas. Although fee deferrals are already being utilized by the city, waivers are not.

In an attempt to start discussions on implementation of the strategy, staff is proposing a reduction of Capital Facilities Fees (CFF) by 25% within the following categories:
• Commercial/Retail < 100,000 sq. ft.
• Commercial/Retail ≥ 100,000 sq. ft.
• Gas Station
• Hotel/Motel
• Office
• Medical Office
• Hospital
• Institutional/Assembly
• Industrial <25,000 sq. ft.
• Industrial ≥25,000 sq. ft.
• Warehouse
The proposed new fee amounts are attached as Exhibit A and descriptions of these categories can be found in Exhibit B. All current calculation and escalation factors will remain in effect. Due to increases in sales tax and/or property tax from new businesses, the 25% reduction is estimated to be returned to the city within 3 to 5 years.

CFF’s are a form of impact fees that are collected to construct public facilities. Therefore, staff is requesting an appropriation of Five Hundred Thousand ($500,000) from unrestricted reserves in Fund 120 “Tourism”. These funds will offset the fees waived at permit issuance to ensure the CFF program is not impacted. Also, the use of these reserves will not impact any current city programs or services. Fund 120 "Tourism" was identified because of its

Agenda Staff Report
3/10/2026
funding source of Transient Occupancy Tax (TOT). Currently, TOT is used to fund services in the General Fund, but it is also used for economic development, community events and activities grants, special events, and city park operations. These factors are all core elements to creating sustainable economic growth.

To monitor and provide oversight of the program, the Finance Department will report the balance of funds available in its monthly department report. In addition, once 75% of the allocated funds have been utilized, the Finance Department will come back to Council for discussions about continuing, changing or stopping the program. At any point in time, this program could be stopped with Council action by rescinding the resolution and adjusting the rates back to their full amount.

3. FISCAL IMPACT / BUDGET AMENDMENT:

An appropriation of Five Hundred Thousand ($500,000) from unrestricted reserves in Fund 120 “Tourism” to expense account number 120-10-120.47367 “Economic Development Expenses” is being requested to start this program. During the Fiscal Year 2026-2027 budget review, staff will discuss the success of this program and available funds.

4. ENVIRONMENTAL DETERMINATION:

This action is not subject to the provisions of the California Environmental Quality Act (CEQA) in accordance with Section 15378(b)(5) of the CEQA guidelines. This action consists of “organizational or administrative activities of governments that will not result in direct or indirect physical changes in the environment” and therefore is not considered a project.

5. ALTERNATIVES:

Alternative 1: Categories identified above could be eliminated or expanded based on Exhibit B.

Alternative 2: Identify an alternative funding source.

Alternative 3: Direct staff to develop a different Business Incentive program identified in the City of Turlock Draft Economic Development Strategic Plan.

6. ATTACHMENTS:

1. Draft Business Incentive Program Resolution

2. CFF Reduction Table Exhibit A

3. CFF Category Table Exhibit B

BEFORE THE CITY COUNCIL OF THE CITY OF TURLOCK
IN THE MATTER OF ADOPTING REDUCED } RESOLUTION NO. 2026-XXX CAPITAL FACILITIES FEES FOR }
COMMERCIAL, RETAIL, AND INDUSTRIAL }
DEVELOPMENT PROJECTS AND }
APPROPRIATING FIVE HUNDRED THOUSAND }
($500,000) FROM UNRESTRICTED RESERVE }
IN FUND 120 (TOURISM) }
}
WHEREAS, the Turlock Municipal Code Chapter 8-11 imposes upon all development projects within the City of Turlock (“City”) the requirement to pay a Capital Facility Fee (“Capital Facilities Fee”) to defray all or a portion of the cost of public facilities related to the development project and allows the City Council to establish the amounts of the Capital Facilities Fee by resolution; and
WHEREAS, Section 8-11-03 of the Turlock Municipal Code defines “development” or “development project” as construction, alteration, or addition of any building, structure, or area, or a change of use of any existing building, structure, or area, or any portion thereof; and
WHEREAS, on November 12, 2013, at a regular City Council Meeting, the City Council, in Resolution No. 2013-202, adopted the Capital Facilities Fee Nexus Study (“Nexus Study”) and established Capital Facilities Fees in compliance with the Mitigation Fee Act (Government Code § 66000 et seq.) and all applicable state and federal laws; and
WHEREAS, Theme #3 of the Turlock General Plan, seeks to attract new businesses to create well-paying jobs and maintain a good jobs/housing balance, recognizing that population and economic growth are intertwined, and that new industries boost revenue, competitiveness, new residents, and opportunities for existing ones; and WHEREAS, a lower economic burden on construction of commercial, retail, and industrial projects in the City will strengthen the commercial environment, attract unique retail and industrial businesses that promote tourism and job creation, and create new jobs to bolster the community and economy; and
WHEREAS, more commercial, retail, and industrial development in the City can provide residents with more jobs and more local shopping, dining, recreation and entertainment opportunities; and
WHEREAS, City desires to reduce Capital Facilities Fees below the maximum fee amounts, as justified by the Nexus Study and increased annually by ENR, for commercial, retail, and industrial development projects to further the policies, goals, and programs referenced herein; and
WHEREAS, these reduced fees will apply directly and automatically to eligible projects without a need for application or discretionary approval; and

Resolution No. 2026-

WHEREAS, to ensure that the City has the funds to construct the public facilities needed to serve new development, the City desires to appropriate from unrestricted reserves in Fund 120 “Tourism” to expense account number 120-10-120.47367 “Economic Development Expenses”, for the current fiscal year, for potential transfer to the Capital Facilities Fee Fund, in an amount equal to the revenue lost from the adoption of reduced Capital Facilities Fees for commercial, retail, and industrial projects; and WHEREAS, this Capital Facilities Fees reduction is temporary in nature and will be reviewed annually to confirm that it continues to serve the City's interests and that sufficient financial means exist to fund associated infrastructure needs; and WHEREAS, the Nexus Study justifying the current fee amounts and Resolution No. 2013-202, which adopted the current fee amounts, remain fully valid and unaffected by the City’s adoption of the reduced Capital Facilities Fees, and as such, the City Council may restore the Capital Facilities Fees to their fully justified amounts without conducting a new Nexus Study or adhering to the processes and procedures required for adopting or increasing fees.

NOW, THEREFORE, BE IT RESOLVED AND ORDERED by the City Council of the City of Turlock, California,
Section 1. Findings. The above recitals are true and correct, and incorporated herein, by reference, and each is relied upon independently by the City Council for its adoption of this Resolution.

Section 2. Environmental Findings. This action is not subject to the provisions of the California Environmental Quality Act (CEQA) because this action is not a project within the meaning of the CEQA Guidelines Section 15378 and 15061(b)(3) as it has no potential for physical effects on the environment because it adopts reduced Capital Facilities Fees for certain development but does not commit the City to any specific project, and said fees and/or charges are applicable to future development projects and/or activities, each of which future projects and/or activities will be fully evaluated in full compliance with CEQA when sufficient physical details regarding said projects and/or activities are available to permit meaningful CEQA review (see CEQA Guidelines, Section 15004(b)(1)).

Section 3. Adoption of Reduced Fees. The City Council hereby adopts the reduced Capital Facilities Fees for commercial, retail, and industrial projects in the amounts and according to the schedules as set forth in Exhibit A attached to this resolution and incorporated herein. All other Capital Facilities Fees will remain unchanged. The fees set forth in Exhibit A shall be incorporated into the City’s Master Fee Schedule.

Section 4. Appropriation of Funds. The sum of Five Hundred Thousand ($500,000) is hereby appropriated from unrestricted reserves to Fund 120 “Tourism” to expense account number 120-10-120.47367 “Economic Development Expenses” to be allocated for Fiscal Year 2025-2026 to ensure that the infrastructure funded by Capital Facilities Fees continues to have adequate financing. At the end of the fiscal year, the Finance

Resolution No. 2026-

Director shall determine the amount of revenue lost to the Capital Facilities Fee Fund as a result of the City Council’s adoption of this Resolution and transfer that amount to the Capital Facilities Fee Fund. If the amount of lost revenue exceeds the annual amount for Fiscal Year 2025-2026, then the full amount appropriated shall be transferred.

Section 5. Annual Review. The City Council hereby directs the Finance Director to conduct an annual review of the reduced Capital Facilities Fees adopted by this Resolution to determine: (i) whether it remains desirable for the City’s development objectives to impose reduced Capital Facilities Fees for retail and industrial projects; (ii) whether the City possesses sufficient financial resources to adequately fund its expanding infrastructure needs; and (iii) whether additional General Fund appropriations are necessary.

Section 6. Reservation of Rights. The City reserves the right to increase the Capital Facilities Fees to the maximum justified by the Nexus Study and adopted by Resolution No. 2013-202, as automatically increased pursuant to Turlock Municipal Code section 8- 11-05(c)(1), at any time and for any reason.

Section 7. Effective Date. This resolution is effective immediately upon adoption.

BE IT FURTHER RESOLVED AND ORDERED the City Clerk shall certify the passage and adoption of this resolution and enter it into the book of original resolutions.

PASSED AND ADOPTED at a regular meeting of the City Council of the City of Turlock this 10th day of March, 2026, by the following vote:

AYES:

NOES:

NOT PARTICIPATING:

ABSENT:

ATTEST:
__________________________
Nichole Fiez, City Clerk,
City of Turlock, County of Stanislaus,
State of California

Dates Effective From 27-Jan-26 To 31-Mar-26
Reduction
Charge ENR Index ENR Index Charge 25%

RESIDENTIAL
Single Family Residential[2] Res. 13-202 Per Unit
Downtown/PPA $10,298.97 820.85 1225.28 $15,373.24 No Change Building Permit Master Plan Areas $12,567.03 820.85 1225.28 $18,758.76 No Change Building Permit City Infill $11,233.18 820.85 1225.28 $16,767.73 No Change Building Permit Multifamily Residential[2] Res. 13-202 Per Unit
Downtown/PPA $7,410.85 820.85 1225.28 $11,062.15 No Change Building Permit Master Plan Areas $9,061.94 820.85 1225.28 $13,526.73 No Change Building Permit City Infill $8,062.84 820.85 1225.28 $12,035.37 No Change Building Permit Senior Assisted Living Res. 13-202 Per Unit
Downtown/PPA $2,939.62 820.85 1225.28 $4,387.96 No Change Building Permit Master Plan Areas $3,593.67 820.85 1225.28 $5,364.26 No Change Building Permit City Infill $3,201.24 820.85 1225.28 $4,778.48 No Change Building Permit 2nd Unit/Accessory Unit Res. 13-202 Per Unit
Downtown/PPA $5,722.68 820.85 1225.28 $8,542.22 No Change Building Permit Master Plan Areas $6,931.90 820.85 1225.28 $10,347.22 No Change Building Permit City Infill $6,293.30 820.85 1225.28 $9,393.99 No Change Building Permit Mobile Home Dwelling Res. 13-202 Per Bed
Downtown/PPA $5,456.94 820.85 1225.28 $8,145.56 No Change Building Permit Master Plan Areas $6,664.10 820.85 1225.28 $9,947.48 No Change Building Permit City Infill $5,946.19 820.85 1225.28 $8,875.86 No Change Building Permit NON RESIDENTIAL[3]
Commercial/Retail < 100,000 sq. ft. Per 1,000 sq. ft.

Downtown/PPA $11,091.04 820.85 1225.28 $16,555.56 ($4,138.89) $12,416.67 Building Permit Master Plan Areas $13,366.31 820.85 1225.28 $19,951.85 ($4,987.96) $14,963.89 Building Permit City Infill $12,269.36 820.85 1225.28 $18,314.43 ($4,578.61) $13,735.82 Building Permit Commercial/Retail ≥ 100,000 sq. ft. Per 1,000 sq. ft.

Downtown/PPA $11,044.69 820.85 1225.28 $16,486.37 ($4,121.59) $12,364.78 Building Permit Master Plan Areas $13,304.51 820.85 1225.28 $19,859.60 ($4,964.90) $14,894.70 Building Permit City Infill $12,223.01 820.85 1225.28 $18,245.25 ($4,561.31) $13,683.94 Building Permit Gas Station Per VFP[4]
Downtown/PPA $6,791.82 820.85 1225.28 $10,138.13 ($2,534.53) $7,603.60 Building Permit Master Plan Areas $8,202.92 820.85 1225.28 $12,244.47 ($3,061.12) $9,183.35 Building Permit City Infill $7,498.40 820.85 1225.28 $11,192.84 ($2,798.21) $8,394.63 Building Permit Hotel/Motel Per Room
Downtown/PPA $3,631.78 820.85 1225.28 $5,421.15 ($1,355.29) $4,065.86 Building Permit Master Plan Areas $4,383.68 820.85 1225.28 $6,543.50 ($1,635.88) $4,907.62 Building Permit City Infill $4,010.82 820.85 1225.28 $5,986.94 ($1,496.74) $4,490.20 Building Permit Office Per 1,000 sq. ft.

Downtown/PPA $5,811.26 820.85 1225.28 $8,674.45 ($2,168.61) $6,505.84 Building Permit Master Plan Areas $7,062.71 820.85 1225.28 $10,542.48 ($2,635.62) $7,906.86 Building Permit City Infill $6,375.70 820.85 1225.28 $9,516.99 ($2,379.25) $7,137.74 Building Permit Authority Basis
Original Effective as of 01-Jan-2026
New Rate When Due

CAPITAL FACILITY DEVELOPMENT FEES
Transportation, Police, General Government, & Fire
(Vested Rights After November 12th, 2013 or Vested Rights expired Before November 12th, 2013) CAPITAL FACILITY DEVELOPMENT FEES[1]
Land Use
1

Dates Effective From 27-Jan-26 To 31-Mar-26
Reduction
Charge ENR Index ENR Index Charge 25%
Authority Basis
Original Effective as of 01-Jan-2026
New Rate When Due

CAPITAL FACILITY DEVELOPMENT FEES
Transportation, Police, General Government, & Fire
(Vested Rights After November 12th, 2013 or Vested Rights expired Before November 12th, 2013) CAPITAL FACILITY DEVELOPMENT FEES[1]
Land Use
Medical Office Per 1,000 sq. ft.

Downtown/PPA $9,512.05 820.85 1225.28 $14,198.60 ($3,549.65) $10,648.95 Building Permit Master Plan Areas $11,488.62 820.85 1225.28 $17,149.02 ($4,287.26) $12,861.76 Building Permit City Infill $10,498.79 820.85 1225.28 $15,671.51 ($3,917.88) $11,753.63 Building Permit Hospital Per 1,000 sq. ft.

Downtown/PPA $3,800.70 820.85 1225.28 $5,673.29 ($1,418.32) $4,254.97 Building Permit Master Plan Areas $4,626.76 820.85 1225.28 $6,906.35 ($1,726.59) $5,179.76 Building Permit City Infill $4,162.23 820.85 1225.28 $6,212.95 ($1,553.24) $4,659.71 Building Permit Institutional/Assembly Per 1,000 sq. ft.

Downtown/PPA $2,532.77 820.85 1225.28 $3,780.66 ($945.17) $2,835.49 Building Permit Master Plan Areas $3,074.55 820.85 1225.28 $4,589.37 ($1,147.34) $3,442.03 Building Permit City Infill $2,782.03 820.85 1225.28 $4,152.73 ($1,038.18) $3,114.55 Building Permit Industrial <25,000 sq. ft. Per 1,000 sq. ft.

Downtown/PPA $1,855.03 820.85 1225.28 $2,769.00 ($692.25) $2,076.75 Building Permit Master Plan Areas $2,271.15 820.85 1225.28 $3,390.14 ($847.54) $2,542.60 Building Permit City Infill $2,019.83 820.85 1225.28 $3,014.99 ($753.75) $2,261.24 Building Permit Industrial ≥25,000 sq. ft. Per 1,000 sq. ft.

Downtown/PPA $1,444.06 820.85 1225.28 $2,155.54 ($538.89) $1,616.65 Building Permit Master Plan Areas $1,760.27 820.85 1225.28 $2,627.55 ($656.89) $1,970.66 Building Permit City Infill $1,581.05 820.85 1225.28 $2,360.03 ($590.01) $1,770.02 Building Permit Warehouse Per 1,000 sq. ft.

Downtown/PPA $1,346.21 820.85 1225.28 $2,009.48 ($502.37) $1,507.11 Building Permit Master Plan Areas $1,632.55 820.85 1225.28 $2,436.90 ($609.23) $1,827.67 Building Permit City Infill $1,479.08 820.85 1225.28 $2,207.82 ($551.96) $1,655.86 Building Permit This fee is to pay for the construction of Public Facilities and to purchase capital items to allow for the city services to stay at the existing standards due to growth.

Notes:
[1] Fees vary by area of the City. Fees include 3% administration charge. [2] An age-restricted senior housing discount of 50% will be applied to the transportation component of the fee with legal documentation (e.g., deed restriction). [3] If retail of commercial project includes a drive-through, a fee premium of 25% will be added to the transportation component of the fee. [4] Vehicle fueling position
2