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Department of Transportation recommending the Board consider the following pertaining to the revision of the Major Update of the Traffic Impact Fee (TIF) Program and the Capital Improvement Program (CIP) and consider the following:
1) Receive the adjusted El Dorado Countywide 2045 Housing and Employment Projections Memorandum, dated April 17, 2025;
2) Receive information on revisions to the list of roadway deficiency projects resulting from approved growth rates, adjusted growth allocations, and corresponding revisions to the Travel Demand Model;
3) Direct staff to adjust the residential and non-residential offset percentages to the proposed Traffic Impact Fees using the proposed Scenario 2; and
4) Direct staff to return on June 10, 2025, with the appropriate resolution for adoption of the Revised TIF Update, and to incorporate the changes to the CIP.
FUNDING: Traffic Impact Fee Program.
This item is being moved from a 3:30 P.M. Time Allocation to a 1:00 P.M. Time Allocation
Body
DISCUSSION / BACKGROUND
Reallocation of Projected Growth
The Board of Supervisors adopted the 2024 Major Update to the Traffic Impact Fee (TIF) Program on December 3, 2024. During review of the adopted Nexus Study and updated annual building permit data as preparation for the 2025 Annual Update required by General Plan Implementation Measure TC-B, Transportation staff identified a discrepancy between updated permit data and the baseline growth analysis prepared by the County’s consultants for the Major Update. In short, the updated baseline for available housing units in the West Slope is calculated based upon the number of units (building permits) constructed since the previous baseline analysis and the number of new/approved developable parcels and/or units created since the previous baseline analysis. While the number of units constructed between the previous baseline year of 2018 and the new baseline year of 2023 was correctly subtracted from the prior baseline, the number of newly-approved but unbuilt units was further subtracted from this total instead of added. This resulted in the 2023 housing baseline being lower than it should have been, which allowed for less capacity for growth on the West Slope, particularly within the El Dorado Hills Community Region (CR). Upon discovering the discrepancy, staff has worked to correct it, and today’s Item is the next step in that correction process.
The adjusted El Dorado County 2045 Housing and Employment Projections memorandum is included as Attachment C to this item.
List of Projects for Inclusion in the Revised 2024 Major Update to the TIF Program
The discrepancy that was discovered also impacted the list of projects to be included in and financed by the TIF Program. The County’s consultant Kimley-Horn and Associates (Kimley-Horn) has used the County’s Travel Demand Model (TDM) and the latest update to the Highway Capacity Manual (HCM) to determine the revised list of projects to be included in the Revised Major Update to the TIF Program. The TDM has been updated to reflect the revised growth projections and allocations, the latest road improvements, and the growth that has occurred since the last major update. The methodology and assumptions of the analysis are documented in an updated technical memorandum (Attachment D).
The projects for which fees will be collected following the Revised Major Update are listed below:
1) Bass Lake Road Widening - U.S. Hwy 50 to North of Relocated Country Club Drive
2) Cameron Park Drive Widening - Palmer Drive to Toronto Road, including a traffic signal at Hacienda Road
3) Country Club Drive - El Dorado Hills Blvd. to Silva Valley Parkway
4) Country Club Drive - Silva Valley Parkway to Tong Road
5) Country Club Drive - Tong Road to Bass Lake Road
6) Diamond Springs Parkway 1B - Missouri Flat Road to S.R. 49
7) Green Valley Road Widening - Francisco Drive to East of Silva Valley Parkway
8) Latrobe Connection - White Rock Road to Golden Foothill Parkway
9) Latrobe Road Widening - Golden Foothill Parkway (N) to White Rock Road
10) Saratoga Way Phase 2 - Wilson Blvd. to El Dorado Hills Blvd.
11) White Rock Road Widening - Post Street to South of Silva Valley Parkway
12) U.S. 50 Auxiliary Lane Westbound - El Dorado Hills Boulevard IC to Sacramento County Line
13) U.S. 50 Interchange - El Dorado Hills Blvd. / Latrobe Road Phase 2B
14) U.S. 50 Interchange - Silva Valley Parkway Phase 2
15) U.S. 50 Interchange - Bass Lake Road Phase 1
16) U.S. 50 Interchange - Cambridge Road Phase 1
17) U.S. 50 Interchange - Cameron Park Drive Phase 1
18) U.S. 50 Interchange - Ponderosa Road Phase 1 & 2
19) U.S. 50 Interchange - El Dorado Road Phase 1
Intersection improvements (traffic signals and match funds for safety projects), administration costs, bridges and transit are still included in the fee program. The Intersection Improvements line item has been updated to include the Intelligent Transportation Systems (ITS) Program and has identified the intersections of El Dorado Hills Blvd. / Saratoga Way / Park Drive, Cameron Park Drive / Hacienda Road, Green Valley Road at Loch Way, Forni Road at Pleasant Valley Road, Hollow Oak Drive at Bass Lake Road, and Robert J. Mathews Drive at Golden Foothill Parkway as projects for improvement. The Cameron Park Drive/Hacienda Road signalization will be included in the Cameron Park Drive widening project. Administration costs include the cost for annual updates and major updates to the TIF Program.
During preparation of the 2024 Major Update, the following projects were previously removed, and remain removed with this revision, as there is no longer a projected level of service (LOS) deficiency by 2045:
1) Missouri Flat Road Widening - China Garden to S.R. 49
2) White Rock Road Widening - County Line to Windfield Way
A future deficiency was previously identified during the 2024 Major Update that resulted in adding the Latrobe Road Widening - Investment Boulevard to Golden Foothill Parkway project into the TIF Program. However, based on the revised growth allocations, this project is no longer projected to be needed by 2045, and is no longer being included at this time.
Additionally, and unrelated to the error in projected growth, the Headington Road Extension project was recently removed from the Transportation and Circulation Element of the General Plan at the Board of Supervisors April 29, 2025, meeting as part of the approval of The Crossings - El Dorado Resort and Campground project (Legistar file 25-0678). As such, it has been removed from the Nexus.
The updated 2024 Technical TIF Program Update memorandum that utilizes the revised growth allocations and includes the list of projects to be included in the TIF Program is included as Attachment D to this item.
Grant Funding Offsets
Within the TIF Program, projected grant funds cover the costs of three separate items: 1) the costs associated with external trips (vehicle trips that affect level of service (LOS) on County roads but that do not originate, or end, within the unincorporated west slope of the County), 2) the affordable housing TIF offset program, which equates to $20 million over the 20-year planning horizon of the TIF Program, and 3) alternative funding sources for projects within the TIF Program. During previous updates, prior Boards have directed staff to utilize these alternative funding sources (i.e., state and federal grants) to offset the high cost of residential and non-residential fees in certain zones.
As a result of the revised growth allocations, the residential and non-residential fees in all three zones are changing considerably. With this understanding, staff is seeking Board direction to reconsider the level of offsets applied to residential and non-residential uses in Zones A, B, and C. Currently, the nexus adopted with the 2024 Major Update on December 3, 2024, has offsets applied as follows:
Zone A Offset: 55% Residential, 50% Non-Residential
Zone B Offset: 0% Residential, 5% Non-Residential
Zone C Offset: 0% Residential, 40% Non-Residential
To provide the Board with information and alternatives, Staff has developed three offset alternatives from which the Board may select. The fee schedules without any offsets applied, and with each of the scenarios described below are provided as Attachment E to this item. The current fee schedule that is based on the Nexus Model from the 2024 Major Update in also included for reference as Attachment F.
Scenario 1 leaves the offsets unchanged from what was used in adoption of the 2024 Major Update.
Scenario 1:
Zone A Offset: 55% Residential, 50% Non-Residential
Zone B Offset: 0% Residential, 5% Non-Residential
Zone C Offset: 0% Residential, 40% Non-Residential
Scenario 2 follows a similar approach to how offsets have historically been applied to the fee zones. It focuses on reducing the residential fees in the more rural areas throughout the West Slope, and on reducing fees for non-residential uses so as to not stifle economic growth. This scenario achieves significant reductions from the current fee schedule and is more fiscally conservative that Scenario 3 because it keeps a larger percentage of assumed grant funding in reserves for project cost increases and future inflationary adjustments.
Scenario 2:
Zone A Offset: 45% Residential, 75% Non-Residential
Zone B Offset: 0% Residential, 25% Non-Residential
Zone C Offset: 0% Residential, 35% Non-Residential
Scenario 3 applies offsets to reduce the fees to levels similar to what they were prior to adoption of the 2024 Major Update Fee Schedule. This approach utilizes the most assumed grant funding of the three scenarios, leaving less in reserves for future project cost increases and inflationary adjustments.
Scenario 3:
Zone A Offset: 50% Residential, 80% Non-Residential
Zone B Offset: 0% Residential, 30% Non-Residential
Zone C Offset: 0% Residential, 40% Non-Residential
Based on the information and analysis provided, staff is recommending that Scenario 2 be applied within the Revised TIF Program Nexus Study to reduce the overall fees, as shown above. This will continue to reduce the overall fees in the more rural areas of the West Slope, while also reducing non-residential fees in all three zones to lessen the impacts experienced by businesses coming into the County. In addition, any increase in fees would take effect 60 days after the increase, while a decrease in fees would take effect immediately. If the Board chose Scenario 1, then staff would have to present two fee schedules in June, one that takes effect immediately that includes all the fee reductions and another that takes effect in 60 days that includes the fee increases. If, instead, the Board chose Scenario 2 or 3, there would be no increases in the fees which means that the Board could later adopt one fee schedule that takes effect immediately. However, Zone B Highway 50 fees do increase slightly, while the Zone B Local Roads fees decrease (the combined total is a net decrease). As a result, two fee schedules will be presented to the Board in June for all three scenarios: one that would take effect immediately and would include the decreased fees, and a second that would take effect 60 days after adoption.
After receiving direction from the Board, staff will generate the updated TIF fee schedule. Transportation will return on June 10, 2025, with the appropriate resolution for adoption of the Revised 2024 Major Update to the TIF Program, including the updated fee schedule. Changes to the projects included in the TIF Program will be incorporated into the Capital Improvement Program (CIP) with updates to the CIP Book in Summer 2025.
ALTERNATIVES
The Board could select one of the other two scenarios presented here, or direct staff not to apply any residential and/or non-residential offsets for the purpose of calculating the revised TIF Program Fee Schedule to be brought back to the Board on June 10 for final adoption.
PRIOR BOARD ACTION
On December 5, 2023 (Legistar file 23-2051), the Board received the El Dorado Countywide Housing and Employment Projections, 2018-2045 memorandum and presentation pertaining to the Major Update to the TIF Program.
On January 9, 2024 (Legistar file 23-2241), the Board adopted an annual residential growth rate of 0.62% and an annual employment growth rate of 0.62% through 2045.
On April 2, 2024 (Legistar file 24-0548) the Board received and approved the El Dorado Countywide Housing and Employment Projections, 2023 to 2034 Memorandum pertaining, including growth allocations, pertaining to the Major Update of the TIF Program.
On August 13, 2024 (Legistar file 24-1412), the Board provided direction on the percentage of local-serving jobs (61%) for use in calculating the fee schedule, received information from staff on potential grant funding scenarios, selected a 25% reduction to the federal grant programs to assume approximately $57 million in available grant funding, and received information on the results of the deficiency analysis prepared with the updated Travel Demand Model.
On October 22, 2024 (Legistar file 24-1457), the Board adjusted the residential and non-residential offset percentages to the proposed Traffic Impact Fees using a modified Scenario 2 to account for the reduction in assumed grant funding.
On December 3, 2024 (Legistar file 24-1686), the Board adopted Resolution 213-2024, adopting the 2024 Major Update to the TIF Program.
OTHER DEPARTMENT / AGENCY INVOLVEMENT
Planning and Building Department, Long Range Planning Division
Chief Administrative Office, Community Development Finance & Administration Division
County Counsel
CAO RECOMMENDATION / COMMENTS
Receive corrected information and direct staff as recommended.
FINANCIAL IMPACT
There is no change to Net County Cost associated with this agenda item. The costs related to updating and administering the TIF Program are included in the fees collected. Reducing the fees collected may affect TIF Program account pro-formas, which may have an impact on the timing of future improvements due to available funds. Any affected projects will be noted in the forthcoming 2025 CIP Book and its change table.
CLERK OF THE BOARD FOLLOW UP ACTIONS
N/A
STRATEGIC PLAN COMPONENT
Priority: Enhance communication about funding and resources for transportation-related capital improvement plans (CIP)
Action Items: Complete a needs assessment, project cost update, prioritization and funding needs; New project determination / evaluation
CONTACT
Rafael Martinez, Director
Department of Transportation