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Department of Transportation recommending the Board receive and approve the El Dorado Countywide Housing and Employment Projections, 2023 to 2045 Memorandum pertaining to the Major Update of the Traffic Impact Fee (TIF) Program and the Capital Improvement Program (CIP).
FUNDING: TIF Program.
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DISCUSSION / BACKGROUND
The Department of Transportation has begun the Major Update to the TIF Program and the CIP. This is the third workshop to discuss policy items related to the implementation of the TIF Program.
A draft version of the El Dorado Countywide Housing and Employment Projections, 2023-2045 Memorandum (Memorandum) prepared by the County’s consultant, BAE Urban Economics, Inc. (BAE) has previously been provided to the Board of Supervisors (Board) on December 5, 2023 (Item 37, 23-2051) and January 9, 2024 (Item 43, Legistar 23-2241). The information presented in the attached memorandum and presentation is based on the residential and non-residential growth rates of 0.62% adopted by the Board on January 9. The projections in the Memorandum have been updated to incorporate 2023 base year estimates of housing and employment, which were completed subsequent to the January meeting.
Utilizing the adopted growth rates, growth projections were prepared based on the anticipated demand within the individual Community Regions and rural regions on the West Slope. A separate analysis was also prepared to determine the available land capacity within each of the Community Regions before allocating the projected growth to the individual Community Regions and remainder of the West Slope. If a Community Region did not have the available land capacity to accommodate the anticipated housing demand, the excess growth was re-allocated to neighboring Community Regions. BAE has prepared these Sub-County growth allocations, with input from County staff and Kimley-Horn (Attachment A). The highlights of Attachment A are discussed below.
Growth Allocations
BAE summarized the 2010 to 2023 growth patterns documented in Attachment A, Appendix A in Table 3a. As shown in Table 3a, El Dorado Hills captured the vast majority (80.5 percent) of the West Slope’s residential growth, and most (66.4 percent) of the West Slope’s job growth occurred in the areas of the West Slope outside of Community Regions. The concentration of job growth outside of the Community Regions was counter-intuitive, until Kimley-Horn’s examination of the 2010 to 2023 job growth revealed that 936 new jobs were created with the opening of the Red Hawk Casino, which lies just outside the Cameron Park and Shingle Springs Community Regions.
In preparing to allocate El Dorado’s 2023 to 2045 employment and population growth to sub-areas within the West Slope, BAE considered these growth patterns as well as the existing concentrations of housing and jobs. Specifically, because the casino development was an anomaly, BAE adjusted Table 3a to remove the casino jobs and create a job growth pattern that may be considered more typical of the historical pattern in the unincorporated areas of El Dorado County’s West Slope. The adjusted growth pattern is shown in Table 3b, and shows that after removing the casino jobs, a more typical 26.2 percent of the County’s job growth between 2010 and 2023 occurred in the Balance of the West Slope areas, with the other 73.8 percent distributed across the Community Regions.
BAE also considered the existing 2023 distribution of housing units and jobs as also likely to be a strong indicator of how growth may proceed between 2023 and 2045, based on the logic that the relative concentrations of housing and jobs throughout the Community Regions and the Balance of the West Slope are indicative of locational characteristics that will tend to attract more new development to those locations that have historically been attractive for development.
The share of existing housing units and jobs located in each Community Region and the Balance of the West Slope as of 2023 is shown in Table 4, alongside the share of adjusted 2010 to 2023 growth in each of these areas. For jobs growth, BAE considered a third factor, which is the pattern of new residential growth. Job growth and housing growth tend to be closely linked, with new housing following growth in job opportunities, and jobs growing in areas with housing growth due to expanding consumer demand to support commercial activity and the accompanying jobs.
With the overall West Slope housing and job growth projections from Table 2 as the starting point, BAE then used the composite residential and jobs growth shares shown in Table 4 to make an initial sub-county allocation of housing and job growth for the years 2025, 2030, 2035, 2040, and 2045.
BAE cross-checked the initial sub-areas allocations against data regarding the remaining development capacity in each of the sub-areas. The cross-checking indicated that the El Dorado Hills Community Region would run out of residential capacity between 2030 and 2035 based upon the number of units within projects currently approved and entitled in the area. BAE then re-allocated excess demand for this area to Cameron Park based on the assumption that the excess demand would likely spill over to the nearest community region that both has the most substantial growth potential and is closest to the commuting destinations to the west of El Dorado County. With its own housing demand coupled with the re-allocation of excess demand from El Dorado Hills, Cameron Park would be anticipated to run out of residential capacity between 2040 and 2045 (again, based upon currently-approved projects). BAE then re-allocated excess Cameron Park demand to the Shingle Springs Community Region. Cross-checking also identified that the Balance of the West Slope area would run out of capacity to accommodate its initial residential growth allocation in the 2025 to 2030 time period. BAE then re-allocated the excess Balance of West Slope residential growth to the Community Regions with remaining development capacity (i.e., Diamond Springs, Shingle Springs, and Placerville) based on their relative shares of West Slope composite housing demand. The results of these residential sub-area allocations and re-allocations are shown in Table 5.
It is important to point out that this analysis is based on the inventory of currently vacant, residential-zoned parcels. As an example, if in the future a new tentative map were to be approved in the El Dorado Hills Community Region, the available capacity would increase and accommodate more demand than what is currently available. The end result would be less demand moving further east into the adjacent Community Regions, thereby reducing the growth in those more rural areas.
BAE followed a similar procedure in allocating the job growth using the composite growth shares calculated on Table 4 for jobs; however, BAE found that all of the projected job growth could be accommodated within the respective Community Regions and the Balance of the West Slope with no need to re-allocate job growth among areas. In each Community Region and in the Balance of the West Slope, a cursory comparison between the job allocations and the available non-residential land in each respective Community Region and the Balance of West Slope indicated that there is adequate land in each area to accommodate the job allocations.
Table 5 also provides a breakout of the allocated residential unit growth to single-family and multifamily units. This breakout is based on the availability of land for single-family residential development versus multifamily residential development in each Community Region and the Balance of the West Slope, recognizing that El Dorado County generally has a limited supply of multifamily housing units relative to the total housing stock and demand will likely be strong for multifamily units as a more affordable alternative to detached single-family homes for-sale in the coming years.
Next Steps
Staff is recommending the Board approve the El Dorado County 2045 Housing and Employment Projections memorandum prepared by BAE. These projections and allocations will be used in the preparation of an updated Travel Demand Model for the TIF and CIP major updates. The updated Travel Demand Model will be run with the new growth projections and allocations incorporated to identify a list of projects that will be needed to accommodate increased traffic resulting from new development between 2023 and 2045. Staff anticipates presenting the list of deficiency projects to the Board this summer.
ALTERNATIVES
The Board could direct staff to re-allocate excess residential demand to alternate Community Regions with available capacity differently than what is being recommended by staff.
PRIOR BOARD ACTION
On December 5, 2023 (Item 37, Legistar 23-2051), the Board received a presentation and information to assist in determining the appropriate residential and non-residential growth rates that should be used to forecast growth for the TIF Program Major Update through the year 2045. Staff returned to the Board on January 9, 2024 (Item 43, Legistar 23-2241), where the Board formally adopted the growth rates mentioned previously.
OTHER DEPARTMENT / AGENCY INVOLVEMENT
Planning and Building Department
CAO
County Counsel
CAO RECOMMENDATION / COMMENTS
Approve as recommended.
FINANCIAL IMPACT
There is no change to Net County Cost associated with this agenda item.
CLERK OF THE BOARD FOLLOW UP ACTIONS
N/A
STRATEGIC PLAN COMPONENT
TIF funding is a major funding source for the CIP, which is a vital part of the Infrastructure component of the County Strategic Plan. Adequate infrastructure is necessary for the Economic Development component and is a requirement of the County General Plan. Safe roads are a crucial factor in the Public Safety component of the County Strategic Plan.
CONTACT
Rafael Martinez, Director
Department of Transportation