Adoption of Ordinance No. 2009-29 will result in the potential collection of fees from new developments in the TVTD Area of Benefit to fund regional transportation improvements in the Tri-Valley area. There will be no impact to the General Fund.
1. History of TVTD Fee Program and County Fee Ordinances
The TVTD Fee is a uniform fee on development to fund transportation improvements in the Tri-Valley area, both in Contra Costa County and in Alameda County. The Tri-Valley area consists of the San Ramon Valley, Livermore Valley and Amador Valley. In effect since 1998, the TVTD Fee is a mechanism to collect revenue to be used to construct regional road improvements to serve new residential, office, commercial/retail, and industrial developments. The counties of Contra Costa and Alameda, along with the cities of San Ramon, Pleasanton, Dublin and Livermore, and the Town of Danville, collect the TVTD Fee, pursuant to a 1998 Joint Exercise of Powers Agreement Pertaining to Tri-Valley Transportation Development Fees for Traffic Mitigation (“TVTD JEPA”) entered into by these jurisdictions. Expenditure of the TVTD Fee revenue and project planning is coordinated by the Tri-Valley Transportation Council (TVTC), a committee made up of representatives of governinig boards of each of the above jurisdictions.
The TVTD Fee is imposed by Contra Costa County in the TVTD Area of Benefit, and is referred to herein as the "TVTD Area of Benefit Fee." The County has collected TVTD Area of Benefit Fees since 1998, with the adoption of County Ordinance No. 98-35. In 1999, the TVTC recommended lowering the fee in the "Other" development category, and in 2003, it recommended increased rates for office and industrial developments and a reduced rate for developments in the multi-family residential category. In 2003, the Board followed these recommendations with the adoption of Ordinance No. 2003-21. In 2005, the TVTC commissioned an updated nexus study based on an updated project list, and recommended that the member jurisdictions increase their TVTD Fees consistent with that study. Pursuant to that recommendation, the County adopted Ordinance No. 2008-27 to implement fee adjustments and revise the list of projects to be funded. By its terms, Ordinance No. 2008-27 took effect on July 1, 2009.
Following adoption of Ordinance No. 2008-27, staff learned that one member jurisdiction decided against making the recommended adjustments until the TVTC completed an updated Strategic Expenditure Plan.
2. Current Recommendations of Tri-Valley Transportation Council (TVTC)
Because the majority of the jurisdictions did not implement the recommended adjustment in the TVTD Fees, the TVTC instead decided to pursue other changes (mostly administrative) in the TVTD Fee Program, in advance of full changes to the fees. Specifically, the TVTC put together a number of recommended revisions to the TVTD JEPA, approved a draft Addendum II to the JEPA ("Addendum II") and now recommends that the TVTD jurisdictions approve and execute the document. The changes to the JEPA set forth in Addendum II, which was drafted with the assistance of County staff, includes an adjustment in the fee rate in the "Other" fee rate category to a fee rate that would have been in effect today had it not been decreased based on the TVTC's 1999 recommendations. Addendum II includes an updated fee schedule that shows fee rates that includes the annual automatic adjustments that have been made since the last fee update in 2003. The proposed fee schedule is as follows:
Land Use Category TVTD Fee Rates
| Land Use Category |
TVTD Fee Rates |
| |
|
| Single-Family |
$ 2,181 / DU |
| Multi-Family |
$ 1,387 / DU |
| Office |
$ 3.91 / SF |
| Commercial / Retail |
$ 1.46 / SF |
| Industrial |
$ 2.65 / SF
|
| Other |
$ 2,181 / PHT |
Addendum II would also allow for fee waivers for affordable and inclusionary housing units, fee payment deferrals and permit an additional one-half percent of the TVTD Fees collected to be used to pay TVTC administrative staffing costs, to the extent permitted by law.
3. Discussion of Staff Recommendations
a. Addendum II to the TVTD JEPA
The key provisions of Addendum II to the TVTD JEPA are described in Section 2 of this Board Order. Staff worked with the TVTC staff to develop Addendum II and concurs with these revisions.
With respect to the increase in the fee for developments in the “Other” category, the change would establish a rate that is more consistent with the rates applicable to developments in the remaining land use categories. Originally, the “Other” land use category fee rate was set at the same level as the fee rate for single-family homes. In 1999, however, in response to concerns from some jurisdictions that the “Other” rate was inequitable because it was proportionately higher than the rates for developments in other non-residential development categories, the TVTC determined that the “Other” category fee rate should be reduced. Four years later, the TVTC again reviewed fee rates, this time deciding that rates for multi-family residential developments should be reduced, and that the rates for office and industrial developments should be increased, but leaving the “Other” fee unchanged. Now, the TVTC has determined that the “Other” category fee rate should be increased as well, essentially returning it to what it would have been today without the reduction it approved in 1999.
Staff also concurs with the recommendations in Addendum II regarding the adoption of standards for the approval of fee waivers for affordable and inclusionary housing units, as that is consistent with the Board’s recent practice, as well as a provision in Addendum II that acknowledges each jurisdiction’s discretion to allow deferrals of fee payments subject to an agreement between the jurisdiction and the project developer. While no change in the County’s fee collection practices is recommended now, Public Works staff is evaluating options in that regard. Finally, staff supports the provision in Addendum II to the TVTD JEPA that would reallocate the use of administrative fees by the TVTC because it would better reflect actual costs.
b. CEQA Findings
The activity is covered by the general rule that CEQA applies only to projects that have the potential to cause a significant effect on the environment. It can be seen with certainly that there is no possibility that the activity in question may have a significant effect on the environment, because the implementation and imposition of fees has no associated environmental impacts; therefore, this activity is not subject to CEQA per Section 15061(b)(3) of the CEQA Guidelines. The future implementation of the projects to be funded with these fees, however, may have associated project-specific impacts, and such impacts will be addressed individually as each project is planned and implemented by the responsible member jurisdiction.
c. Resolution No. 2009/502
Pursuant to Government Code section 66484, a resolution must be adopted by the Board that incorporates a description of the boundaries of the area of benefit, the costs, whether actual or estimated, and the method of fee apportionment established at the hearing. Additionally, Government Code section 66001, part of the Mitigation Fee Act, requires the Board to adopt a series of “nexus” findings related to the proposed adjustments in the TVTD Area of Benefit fees. Approval of Resolution No. 2009/502, attached, is recommended because it serves to comply with these legal requirements by adopting and incorporating the facts and findings contained in the 2003 Development Program Report, Addendum I thereto, and the original Tri-Valley Regional Transportation Improvement Fee Program Nexus Analysis submitted to this Board on August 11, 1998.
d. Ordinance No. 2009-29
Proposed Ordinance No. 2009-29 will repeal Ordinance No. 2008-27, re-adopt the 1998 ordinance as amended by the 2003 ordinance, and amend the 1998 ordinance to adjust the “other” fee rate category, as well as include provisions for fee waivers for affordable and inclusionary housing units. Adoption of the ordinance is recommended in order to put the County’s fees in line with the fees charged in the other TVTD jurisdictions, which elected not to revise their TVTD fees in 2008 after the County had done so. The revised TVTD fees adopted by the County included a significant increase in the fee for developments in the “Other” category. While the County was the only jurisdiction to adopt revised TVTD fees in 2008, the practical effect of the County doing so appears to be minimal. The County’s 2008 ordinance did not take effect until July 1, 2009. Staff is advised that no TVTD fees have been collected from developments in the "Other" category for which building permits have been issued since July 1, 2009, and staff is unaware of any developments that are likely to be subject to the fees under the 2008 ordinance before the effective date of proposed Ordinance No. 2009-29.
The revisions made by Ordinance No. 2009-29 are consistent with Addendum II to the TVTD JEPA. Staff anticipates that the Strategic Expenditure Planning process currently underway by TVTC will result in a successful overall program update and further revisions to the TVTD Fees in late 2010.
e. Administrative Fee
In addition to the fees listed above, the County will assess an administrative fee equal to 1% of the program revenue. This additional fee will be used to cover staff time for fee collection, accounting, technical support to the community groups, traffic advisory committees and other administrative tasks.
If Ordinance No. 2009-29 is not approved, the fee rates indicated in Ordinance No. 2008-27 will remain in effect and applicants in Contra Costa County would be subject to a higher rate than developments throughout the greater Tri-Valey area. If Addendum II of the TVTC JEPA is not approved, the proposed changes will not be mutually implemented throughout the Tri-Valley.