Title
HEARING - Department of Transportation recommending the Board consider the following:
1) Adopt and authorize the Chair to sign Resolution 073-2025, which includes the updated Traffic Impact Fee (TIF) Nexus Study, the Adjusted 2025 Update to the Traffic Impact Fee Program, and direction to provide a partial refund to Eligible Applicants who paid the TIF on or after the effective date of Resolution 213-2024 and before the effective date of this Resolution plus interest accrued, as further defined in the Resolution; 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.
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DISCUSSION / BACKGROUND
On December 3, 2024, the Board of Supervisors adopted the 2024 Major Update to the Traffic Impact Fee (TIF) Program via Resolution 213-2024. 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 on 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 last 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.
On May 20, 2025, Transportation staff presented the Board with adjusted analyses reflecting the correction of the discrepancy in the calculation of the baseline for available housing units. These adjusted analyses included the updated El Dorado County 2045 Housing and Employment Projections, Final Memorandum prepared by BAE Urban Economics, dated April 17, 2025, and the 2024 Technical TIF Program Update Study Findings and Summary of Effort, prepared by Kimley-Horn, dated May 8, 2025.
Additionally, Transportation staff presented three scenarios as alternative options for utilizing grant funding to reduce the residential fees in the more rural areas of the County and non-residential fees throughout the West Slope. Ultimately, the Board approved the recommended Scenario 2, and the final fee schedule includes offsets as follows:
Zone A Offset: 45% Residential, 75% Non-Residential
Zone B Offset: 0% Residential, 25% Non-Residential
Zone C Offset: 0% Residential, 35% Non-Residential
At that time, the Board directed staff to return on June 10, 2025, with the appropriate resolution for adoption of the Adjusted 2025 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 Adjusted El Dorado County General Plan Traffic Impact Fee (TIF) Program and 2025 TIF Program Fee 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, various policies, fee structures, and nexus technical studies were performed and presented 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 Equivalent Dwelling Units (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 of 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. These findings were included in Resolution 213-2024, and remain unchanged in the proposed resolution.
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 fees for the construction of public transportation facilities that are appropriated via a capital improvement program (CIP). 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. These findings were included in Resolution 213-2024, and remain unchanged in the proposed resolution.
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. The proposed Resolution adopts the 2025 Update to the TIF Program and, as such, rescinds Resolution 213-2024 and supersedes it in its entirety. Upon the Board’s approval, the fees, which have decreased, will go into effect immediately, as reflected in Exhibit A-1 to the Resolution. The Hwy 50 portion of the fee for residential permits increases in the new nexus, so a second fee schedule, as reflected in Exhibit A-2 to the Resolution, will go into effect 60 days after adoption on August 9, 2025, to ensure compliance with Govt Code 66019. While the Hwy 50 portion of the fee increases, that increase is offset by a decrease in the Local Roads portion of the fee and still reflects an overall fee decrease from the fees currently in effect for residential permits in Zone B.
Because the adjustments to the TIF Program and its analyses have resulted in decreased fees, the proposed resolution finds that it serves a valid public purpose of promoting the public trust by ensuring that the TIF does not exceed the amount necessary to offset and mitigate the impact of new development by providing a partial refund to Eligible Applicants, as described below, and avoiding any potential legal challenge. The proposed resolution directs the Department of Transportation and the Chief Administrative Office, Community Development Finance & Administration Division, to refund to an Eligible Applicant, as defined, the difference between the amount of the 2024 TIF Major Update Fee the Eligible Applicant paid, and the amount that the Eligible Applicant would have paid had this proposed resolution been in effect at the time the Eligible Applicant paid the TIF, plus interest, as defined. Attachment H to this item includes a list of permits affected as of the date of that report. If an Eligible Applicant pays TIF after the report in Attachment H was generated and before the proposed Resolution is adopted, that Eligible Applicant will also be eligible for a refund calculated in the same manner. Refunds will be processed within 30 (thirty) days of adoption of the resolution.
Transportation staff will reach out proactively to any permit applicants who may be affected by the fee schedule change. Furthermore, Transportation staff will update the TIF Program Administrative Manual to reflect the changes made in this 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 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, 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.
On December 3, 2024 (Legistar file 24-1686), the Board adopted Resolution 213-2024, adopting the 2024 Major Update to the TIF Program.
On May 20, 2025 (Legistar file 25-0181), the Board received the adjusted El Dorado Countywide 2045 Housing and Employment Projections Memorandum, dated April 17, 2025, and information on revisions to the list of roadway deficiency projects. The Board adjusted the residential and non-residential offset percentages to the proposed Traffic Impact Fees using Scenario 2 to utilize assumed grant funding.
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
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. Refunds to be issued to permit applicants represent an overcollection of fees as a result of the adjustments made to the TIF Program, and do not represent a cost to that program; the estimated total refunds, including actual interest accrued, can be found on the last page of Attachment H to this item.
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