Title
HEARING - Department of Transportation recommending the Board consider the following:
1) Adopt and authorize the Chair to sign Resolution 213-2024, which includes the updated Traffic Impact Fee (TIF) Nexus Study, and completes the 2024 Major Update to the Traffic Impact Fee Program; and
2) Find that adoption of the resolution is not a Project for purposes of the California Environmental Quality Act (CEQA) because it is a government funding mechanism or other government funding activity within the meaning of CEQA Guidelines Section 15378(b)(4).
FUNDING: Traffic Impact Fee Program.
Body
DISCUSSION / BACKGROUND
The Department of Transportation has been working on the Major Update to the Traffic Impact Fee (TIF) Program and the Capital Improvement Program (CIP) since the fall of 2023. This is the sixth and final Board meeting in the process. This final adoption is the culmination of the analyses performed and policy issues addressed.
The County’s TIF Program allocates the cost of roadway improvements based on the number of new vehicle trips generated in the PM peak hour for various land use types. Residential development includes new single-family and multi-family homes, as well as age-restricted single- or multi-family homes. For non-residential development, current land use categories include general commercial, hotel/motel/B&B, church, office/medical, and industrial/warehouse.
Most non-residential development generally falls into one of these above-listed categories, although a “per trip” fee may be charged when the County determines that use of the categories is not appropriate. This may be due to an uncommon land use or any other factors that, at the County’s sole discretion, render the category unrepresentative of the expected trip generation of the proposed land use. The alternate “per trip” method utilizes trip rates from the latest edition of the Institute of Transportation Engineers (ITE) Trip Generation Manual to create a more appropriate equivalent dwelling unit (EDU) factor. This process and its calculation steps are described in more detail in the latest version of the TIF Program Administrative Manual.
On October 22, 2024, Transportation staff conducted the final workshop of the Major Update process, presenting the results of the analysis of potential offset scenarios utilizing the reduced grant funding assumptions directed by the Board on August 13, 2024. Based upon the Board’s recommendation, the final fee schedule includes offsets 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
At that time, the Board directed staff to return on December 3, 2024, with the appropriate resolution for adoption of the 2024 Major Update to the TIF Program.
Staff has prepared the proposed resolution (Attachment B) for the Board to consider, adopt and authorize the Chair to sign, adopting the 2024 TIF Schedule. The El Dorado County Traffic Impact Fee (TIF) Program Update Nexus & Funding Model (see Attachment C) has been updated to reflect the direction of the Board. Throughout the development of the proposed El Dorado TIF Update fee schedule, staff performed various policy, fee structure, and nexus technical studies and presented them to the County Board of Supervisors for consideration. Based on direction from the Board of Supervisors, these analyses established the building blocks for the TIF update and helped inform the proposed updated fee schedule. The Nexus Study, found as Attachment C to this item as well as Exhibit C to the proposed Resolution, includes related technical studies and memoranda as appendices thereto: Appendix A - Memorandum on 2023 to 2045 West Slope Growth Projections; Appendix B - Deficiency Analysis Technical Memorandum; Appendix C - Analysis of Local-Serving Share of Nonresidential Employment; Appendix D - Fee Rates by Size of Single-Family Unit Technical Memorandum; and Appendix E - TIF Program Update Nexus & Funding Model.
Additionally, the Nexus Study includes justification for the TIF Program to collect impact fees for multi-family housing and age-restricted housing as a flat fee. Under the Mitigation Fee Act (Government Code Sections 66016 et seq), any nexus study adopted after July 1, 2022, must be applied to new development based on the square footage of the units, unless another method of apportionment is found more appropriate. The TIF Program apportions fees for new single-family dwellings as a portion of EDUs, between 0.82 EDUs for homes under 1,000 sqft and 1.10 EDUs for homes over 4,000 sqft. The resolution also includes findings that this method of apportionment multi-family homes and age-restricted homes is not appropriate, but that applying a per-unit fee is a more satisfactory method of applying fees for new development.
The resolution also includes findings required under the Mitigation Fee Act regarding the purpose of the TIF; the uses to which the fees will be put; and the relationships between the types of development on which the fee is imposed and the fee’s use and the need for public facilities.
On September 19, 2024, the State of California amended the Mitigation Fee Act with Senate Bill (SB) 937, which requires the deferral of impact fees from the issuance of a building permit to the certificate of occupancy effective January 1, 2025. The bill includes exceptions to this delayed fee collection, including exceptions for fees that are for the construction of public transportation facilities, which are appropriated via a capital improvement program. Because the TIF Program funds the construction of public transportation facilities and funds are appropriated via the County’s CIP, the TIF Program is not subject to the required fee collection deferral, and TIF will continue to be collected at the time of building permit issuance.
For purposes of the California Environmental Quality Act (CEQA), the adoption of the proposed Resolution is not a Project because it is a government funding mechanism or other government funding activity within the meaning of CEQA Guidelines Section 15378(b)(4).
Department of Transportation recommends the Board adopt and authorize the Chair to sign the resolution to adopt the updated TIF Program Nexus Study, completing the 2024 Major Update to the Traffic Impact Fee Program. Upon the Board’s approval, the new fee schedule would go into effect on February 1, 2025. Transportation staff will reach out proactively to all permit applicants who may be affected by the fee schedule change. Further, Transportation staff will update the TIF Program Administration Manual to reflect the changes made in this Major Update, and will incorporate the list of project changes into the 2025 CIP.
ALTERNATIVES
N/A
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 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, and selected a 25% reduction to the federal grant programs and assumes approximately $57 million (an 18% reduction from the previous major update), 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.
OTHER DEPARTMENT / AGENCY INVOLVEMENT
Planning and Building Department
CAO, Admin & Finance Division
County Counsel
CAO RECOMMENDATION / COMMENTS
Approve 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.
CLERK OF THE BOARD FOLLOW UP ACTIONS
1) The Clerk of the Board will obtain the Chair’s signature on the resolution.
2) The Clerk of the Board will provide a copy of the executed resolution to Transportation, attention Lindsay Tallman.
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