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CDC - Item 4B - Development Impact Fee Justification Study• • ROSEMEAD COMMUNITY DEVELOPMENT COMMISSION STAFF REPORT TO: THE HONORABLE CHAIRMAN AND COMMISSIONERS FROM: OLIVER CHI, EXECUTIVE DIRECTOR PL DATE: AUGUST 26, 2008 SUBJECT: DEVELOPMENT IMPACT FEE JUSTIFICATION STUDY SUMMARY In 1987, the California Legislature adopted Assembly Bill 1600, or the Mitigation Fee Act, that established a uniform process for formulating, adopting, imposing, collecting, accounting for, and protesting developer impact fees. Impact fees are charges assessed by local governments against new development projects that attempt to recover the cost incurred by govemment in providing the public facilities required to serve the new development. Impact fees are only used to fund facilities, such as roads, schools, and parks, that are directly associated with the new development. They may be used to pay the proportionate share of the cost of public facilities that benefit the new development; however, impact fees cannot be used to correct existing deficiencies in public facilities. Given that the City is in the process of updating its General Plan, proposals were solicited for a Development Impact Fee Study in the interest of establishing a development impact fee program for streets and transportation, general government, law enforcement, libraries, parks, wastewater treatment, and public art in the City of Rosemead. In completing such a study, all projects and needs must be identified and a methodology developed with a nexus justifying the fees that are established in compliance with AB 1600. Staff Recommendation Staff recommends that the City Council authorize the City Manager to enter into a professional services agreement with Willdan Financial Services to provide a Development Impact Fee Study for the City of Rosemead, in accordance with the requirements of the Mitigation Fee Act (California Government Code sections 66000 to 66025) in the amount of $50,860. ANALYSIS Development impact fees are charges assessed to new development projects to help offset the costs of providing the necessary public services to serve the new development, i.e., streets and transportation, general government, law enforcement, libraries, parks, wastewater treatment, and public art. APPROVED FOR CITY COUNCIL AGENDA: 15 . • • Community Development Commission August 26, 2008 Page 2 of 2 Staff solicited proposals from seven (7) firms who, at one time, specialized in development impact fee justification studies. Those firms were: 1. GRC 2. Urban Futures 3. Bureau Veritas 4. Keyser Marston Associates 5. Willdan Financial Services 6. HR&A 7. Revenue Cost Specialists, LLC Willdan was the only company who continues to offer this type of service and was willing to submit a proposal. Willdan Financial Services is one of California's leading firms for development impact fee programs. Willdan's staff has been key participants in providing impact fee analyses for over 50 public agencies across California, including experience with numerous public agencies in Los Angeles County and the San Gabriel Valley. The cost to have this study prepared is $50,860. FISCAL ANALYSIS Because many of the proposed projects are directly in or near the City's redevelopment project areas, it is being proposed that the cost for this study be split equally between the Community Development Commission ($25,430) and the General Fund ($25,430). Funds were budgeted in the FY 2008-09 General City and CDC budgets to pay for this study. PUBLIC NOTICE PROCESS This item has been noticed through the regular agenda notification process. Prepared by: Michelle G. Ramirez Economic Development Administrator Suiai BriAssistant City Manager Attachment A - Willdan Financial Services Proposal