Title
CONSIDERATION OF ACCEPTING AN UPDATED TRANSPORTATION DEVELOPMENT IMPACT FEE TO MITIGATE TRANSPORTATION IMPACTS WITHIN THE CITY'S EASTERN TERRITORIES AND AMENDING CHAPTER 3.54 OF THE MUNICIPAL CODE TO MODIFY THE EXISTING TRANSPORTATION DEVELOPMENT IMPACT FEE
A. RESOLUTION NO. 2014-221 OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA ACCEPTING A REPORT PREPARED BY STAFF RECOMMENDING AN UPDATED TRANSPORTATION DEVELOPMENT IMPACT FEE TO MITIGATE TRANSPORTATION IMPACTS WITHIN THE CITY'S EASTERN TERRITORIES
B. ORDINANCE OF THE CITY OF CHULA VISTA AMENDING CHULA VISTA MUNICIPAL CODE CHAPTER 3.54, RELATING TO DEVELOPMENT IMPACT FEES TO PAY FOR THE TRANSPORTATION FACILITIES IN THE CITY'S EASTERN TERRITORIES (FIRST READING)
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RECOMMENDED ACTION
Recommended Action
Council conduct the public hearing, adopt the resolution and place the ordinance on first reading.
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SUMMARY
The City's Transportation Development Impact Fee (TDIF) Program was established on January 12, 1988, by Ordinance 2251. Since its inception, the program has been updated several times to reflect new land use approvals, proposed changes to the General Plan, and updated project cost estimates. The TDIF has been updated on August 13, 2002, and May 10, 2005. Staff recommends the approval of the 2014 TDIF update and a change in the current fee from $12,494 to $13,035 per Equivalent Dwelling Unit (EDU). The public hearing has been duly noticed.
ENVIRONMENTAL REVIEW
The Development Services Director has reviewed the proposed activity for compliance with the California Environmental Quality Act (CEQA) and has determined that the activity is not a "Project" as defined under Section 15378(b)(4) of the State CEQA Guidelines because the proposal consists of a governmental fiscal activity which does not involve any commitment to any specific project, which may result in a potentially significant impact on the environment. Therefore, pursuant to Section 15060(c)(3) of the State CEQA Guidelines the activity is not subject to CEQA review. Although environmental review is not required at this time, once the scope of individual projects to be funded through Transportation Development Impact Fees have been defined, environmental review will be required for each project and the appropriate environmental determination will be made.
BOARD/COMMISSION RECOMMENDATION
Not applicable.
DISCUSSION
2014 TDIF Update
New developments place demands on the existing transportation infrastructure, which can be mitigated by upgrading existing and/or constructing new transportation facilities. Chula Vista's TDIF Program functions as a system to distribute the cost of constructing infrastructure facilities in an equitable manner amongst new development in Eastern Chula Vista. The proceeds from the fee are used to construct new transportation improvements or expand existing facilities.
The existing TDIF rate is $12,494 per Equivalent Dwelling Unit (EDU). The 2014 update recommends a TDIF increase of 4.3%, or $541 to $13,035 per EDU. Table 1 below presents the rates for the different land uses.
Basis and Methodology
The basis and methodology used in calculating the fee in this update is consistent with the basis and methodology used in the "Interim Eastern Area Development Impact Fee for Streets" report adopted in January 1988 and also the "Eastern Area Development Impact Fees For Streets" report adopted in January 1990, amended in May 2005 and amended in the September 2014 Eastern Transportation Development Impact Fee (TDIF) Engineer's Report (Attachment 1). One of the primary assumptions in the formulation of the previous fees is that the need for additional public facilities is generated by new development and the cost of the facilities should be borne by that new development.
The first step in this update was to determine which road improvements are required to be constructed in order to maintain an acceptable level of service on the City's circulation system east of I-805. The improvements that are to be constructed will serve the entire benefit area.
The next step was to determine the method upon which the costs for the improvements would be spread. One of the most common tools used to equate benefit impact fees among the different land uses and densities is the "Equivalent Dwelling Unit" or "EDU". There is a clear relationship between the use of transportation facilities and the generation of traffic trips based on the land use and density of a specific parcel. As in previous methodologies, this update relies on the report "San Diego Traffic Generators", published by SANDAG. This report details the traffic trips generated by various classes of land use.
The proposed street improvements are based on an analysis of the circulation system for various levels of development within the entire area of benefit, which is discussed below. All of the proposed street projects included are consistent with the Preferred Plan of the proposed General Plan Update and Specific Plans that have been adopted by the City Council. In addition, the street projects are required by the City's Growth Management Ordinance as a condition to all development within the area of benefit in order to maintain acceptable levels of service on the major roadways.
The absence of contiguity to the proposed street projects is not essential to conferring a benefit to properties. The area of benefit is based on an analysis of impacts on the total circulation system east of I-805 for various stages or increments of cumulative development within the total area of benefit. The circulation system must be viewed as a whole. Each of the proposed street projects will mitigate the adverse traffic impacts generated by new development; because every development will create traffic; which will utilize the entire system to access work, commerce, schools, residences and the other land uses throughout the City. A failure in any part of the system will have a negative impact in other parts of the system and traffic from the development closest to an impacted segment of street will be just as affected as traffic from a more distant development. The analogy of a water system is sometimes used where constrictions or breaks in any part of the system will have significant impacts on the whole system.
Area of Benefit
The TDIF program encompasses most properties within the City's jurisdiction located east of I-805 inclusive of the Bonita Gateway site at Bonita Road/I-805 then south towards Otay Valley Road, excluding the Otay Valley Road Assessment District area and the County landfill site, then east to the easterly city limits. As of October 1, 2013, the proposed Area of Benefit (Attachment 2) contains a total of 19,545 future EDU's.
The TDIF program includes transportation facilities required to serve the proposed University Campus and Innovation District site in the Otay Ranch. It is anticipated that the University, once approved, would be responsible for constructing suitable on-site transportation facilities required to mitigate the university's on site traffic impacts (i.e. access and frontage impacts). The EDUs for the 85-acre Innovation District portion of the University Campus and Innovation District will pay TDIF fees and are in the new TDIF fee calculations. However, the new TDIF fee calculations exclude the EDUs contained within the proposed university portion and no TDIF fees will be paid by the university. The proposed TDIF update does include one facility that passes through the University Campus and Innovation District, Discovery Falls Drive between Hunte Parkway and Street "B" in Village 9. This is a new road added to the Eastern TDIF program, and while it will be constructed on the future university property, construction of the facility is required in order to provide primary project access for Village 10.
Transportation Facilities
Projects completed since 2005, include (TDIF #):
52A. La Media Road from Birch Road/State Street to Santa Luna Street.
55A. Otay Lakes Road from Telegraph Canyon Road to East H Street (Phase II)
55B. Otay Lakes Road from Canyon Drive/Ridgeback Road to East H Street (Phase I).
59B. Proctor Valley Road from Coastal Hills Dr. to Agua Vista Drive/Northwoods Dr.
Projects that have been revised are:
65. Traffic Management Center has been renamed to Traffic Demand Management/Transportation System Management since it also includes arterial equipment besides traffic operations center equipment. Thus, TDIF # 66 Transportation Demand Management has been closed out.
Current projects under construction include;
57. Heritage Road from Olympic Parkway to Main Street. Interim 2-lane facility is completed from Olympic Parkway to Santa Victoria Road. A grading permit will be issued soon for the segment from Santa Victoria Road to Main Street. Completion of the interim improvements to Main Street is expected in FY15/16.
Uncompleted projects include 28 remaining major arterial and system-wide projects including numerous traffic signals (TDIF # 63) within the proposed TDIF program. The cost estimate for constructing these remaining TDIF facilities is $294,011,801, including soft costs.
This update includes all roads in the adopted Circulation Element of the General Plan in addition to capacity enhancement projects. There are several new roadways, traffic signals, a new Main Street bridge across Wolf Canyon (TDIF # 60B), as well as updated costs of completed projects since 2005 and remaining roadways which will be updated as part of the 2014 TDIF Program Update.
At this point in time, the 2014 TDIF update does not include Federal Highway Bridge Program (HBP) funds for one Capital Improvement Program (CIP) bridge, which is pending inclusion into the HBP. The Heritage Road Bridge project (STM-364) (TDIF # 58B), near the amphitheater, may be able to receive approximately $20 million in HBP funds. The federal paperwork has been submitted, but the authorization process is not yet completed. We expect that we will be authorized for HBP funds sometime in mid-FY14/15. What the Federal HBP authorization would mean to the TDIF obligation for this project is that it could reduce the future TDIF program obligation by approximately $20 million (7%). As a comparison, existing grants that have been received on the TDIF eligible projects to date have already saved the TDIF program at least $1,000 per EDU.
New Facilities
With the 2014 TDIF update, the following new facilities are proposed to be included into the TDIF program (TDIF #):
69. Millenia Avenue within the Millennium project from Birch Road to Hunte Parkway.
70. Discovery Falls Drive from Hunte Pkwy south to Street "B" (Village 9).
71. Street "B" (Village 9) from Hunte Pkwy south to Otay Valley Road.
72. Otay Valley Road from east of SR-125 to Village 9 easterly subdivision boundary.
In addition to those projects above, the 2014 TDIF update also includes the SR-125 interchange ramps at Main Street/Hunte Parkway (TDIF #67) and at Otay Valley Road (TDIF #68). These interchange ramps were added to the TDIF program since it is not expected that the region would construct these improvements until sometime around Year 2040. As future updates to the TDIF occur, we will have more current phasing from the region (Caltrans & SANDAG) regarding these two interchanges.
Multiple Species Conservation Plan
The Chula Vista Multiple Species Conservation Plan (MSCP) was approved in 2003. The requirement to create the Preserve Management Endowment Fund (PMEF) is described in our MSCP Subarea Plan and committed through our Implementing Agreement (IA) with the Wildlife Agencies. Both the Chula Vista MSCP Subarea Plan and our IA with the Wildlife Agencies were approved by City Council through Resolution 2003-197 (Attachment 3). Per the funding obligation in our Subarea Plan and IA, the PMEF will create an endowment program of approximately $1.85 million, funded through the following capital improvement programs:
Salt Creek Sewer (including access roads and trails): $1,000,000 (SW-219)-Completed
Wolf Canyon Sewer (including access roads and trails): $500,000
Main Street Bridge at Wolf Canyon: $250,000 (TDIF # 60C)
La Media Road: $100,000 (TDIF # 52B)
Thus, as Main Street is extended east of Heritage Road across Wolf Canyon on a new bridge, an amount of $250,000 will be paid out of the TDIF to create the (PMEF). The Wolf Canyon Bridge is TDIF Project # 60C. Similarly, the southerly extension of La Media Road (TDIF#52B) includes $100,000 in environmental endowment funds.
The PMEF will be used for enhanced management programs within the North City (Rolling Hills Ranch and Bella Lago) and Otay Ranch Preserve Management Areas (PMA). The endowment is anticipated to generate, over time, a perpetual annual budget of $50,000 to over $92,000 (2002 dollars) specifically dedicated to Preserve Management activities as funding becomes available through the PMEF program.
TDIF Credits
There are a number of developers who have constructed TDIF roads in the past and maintain a credit against future TDIF fees in the estimated total amount of $15,304,432. The credits are summarized in Attachment 4.
EDU Rates
Government Code 66000 requires, among other things, that the City establish a reasonable relationship between the projects to be funded and the amount of the fee. The TDIF program uses the Average Daily Trip (ADT), which is converted to the Equivalent Dwelling Unit (EDU) as the tool to equate impact fees among the different land uses. As indicated above, ADT generation rates published by SANDAG are primarily used to determine the impacts of the different land use categories on the transportation system. Each land use category is assigned a specific EDU rate. A single family, detached residential unit is equal to 10 ADT or 1 EDU. Table 2 presents the current rates.
Table 2. EDU Rates
C O N V E R S I O N O F A D T s T O E D U s |
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Land Use Classification |
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EDU's |
Residential (LOW) |
0-6 dwelling units per acre* |
1.0 |
EDU/DU |
Residential (MED) |
6.1-18 dwelling units per acre* |
0.8 |
EDU/DU |
Residential (HIGH) |
>18.1 dwelling units per acre* |
0.6 |
EDU/DU |
Senior Housing |
|
0.4 |
EDU/DU |
Residential Mixed Use** |
>18 dwelling units per acre* |
0.4 |
EDU/DU |
Commercial Mixed Use** |
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|
16.0 |
EDU/20,000 Sq ft |
General Commercial (Acre) |
< five (5) stories in height |
16.0 |
EDU/Acre |
Regional Commercial (Acre) |
> 800,000 sq ft |
|
11.0 |
EDU/Acre |
High Rise Commercial (Acre) |
> five (5) stories in height |
28.0 |
EDU/Acre |
Office (Acre) |
< five (5) stories in height |
9.0 |
EDU/Acre |
Industrial (Acre) |
|
|
9.0 |
EDU/Acre |
Regional Technology Park (Acre) |
|
8.0 |
EDU/Acre |
18-Hole Golf Course |
|
|
70.0 |
EDU/Course |
Medical Center |
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|
65.0 |
EDU/Acre |
*Based on gross acreage |
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**Project is considered commercial mixed use only if qualifying residential mixed use is located on second floor, or higher, above commercial project. |
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As a background, the following is a brief discussion on the EDU rate schedule:
● The SANDAG Report ("San Diego Traffic Generators") identifies several categories of residential land use generating average daily trips (ADTs) ranging from 12 to 4 ADTs. The City historically had refined the SANDAG approach, identifying four categories based on the type of residential structure whether attached, detached, multifamily or senior housing, which also related to the density of the residential development according to the SANDAG Report. Since the 2002 TDIF update, this product-type basis was replaced with system based upon the density of the residential development, as a more accurate reflection of housing development within the Area of Benefit. Following this methodology, the TDIF is also based on the density of the residential development. Staff, therefore, uses the following: 10 ADTs generated from a residential unit with densities ranging on average from 0 to 6 dwelling units per gross acre; 8 ADTs from a residential unit with densities ranging from greater than 6 to 18 dwelling units per gross acre; 6 ADTs from a residential unit with greater than 18 dwelling units per gross acre; and 4 trips from a unit in a senior housing complex or mixed use residential with commercial.
● Commercial Mixed Use generates the equivalent to 16 EDU's for every 20,000 square feet of floor space.
Annual Index Based Adjustment
The TDIF is subject to adjustment each October 1st, based on the one-year change (July to July) in the Los Angeles Construction Cost Index (CCI). The CCI increase from July 2013 to July 2014 supports an October 1, 2014 automatic TDIF increase to $12,864; an increase of $370, or 3%, over the current fee of $12,494 per EDU. Instead of implementing this automatic increase, staff recommends adopting the proposed comprehensive fee update; increasing the fee to $13,035 per EDU, an increase of $541 or 4.3%. If the proposed comprehensive update is approved, the next index based adjustment would go into effect in October 2015 (no index based adjustment in 2014).
Proposed Ordinance
By amending Chapter 3.54 of the Municipal Code, Council will establish a new TDIF rate of $13,035 per EDU and will amend the existing TDIF program to include all the properties and transportation facilities identified in the report.
This ordinance will become effective 60 days after the second reading due to this TDIF update. The next automatic rate adjustment will be deferred until October 1, 2015.
DECISION-MAKER CONFLICT
Staff has reviewed the property holdings of the City Council and has found no property holdings within 500 feet of the boundaries of the property which is the subject of this action. Staff is not independently aware, and has not been informed by any Council member, of any other fact that may constitute a basis for a decision maker conflict of interest in this matter.
LINK TO STRATEGIC GOALS
The City's Strategic Plan has five major goals: Operational Excellence, Economic Vitality, Healthy Community, Strong and Secure Neighborhoods and a Connected Community. The eastern Transportation Development Impact Fee supports the Strong and Secure Neighborhood strategy. The eastern TDIF finances the construction and upgrading of public infrastructure, which is a key City function in providing a safe and efficient roadway system for residents, businesses and visitors
CURRENT YEAR FISCAL IMPACT
Adoption of the proposed ordinance increases the TDIF rate from $12,474 to $13,035 per EDU, an increase of $541 per EDU. This rate increase will generate additional revenue for the TDIF fund of $541 per EDU. Actual fiscal impact to the TDIF fund will vary based on the number of building permits pulled for new development east of Interstate-805. There is no direct impact on the General Fund from approving the new rate. All staff costs associated with preparation of the 2014 update is borne by the administration component of the TDIF.
ONGOING FISCAL IMPACT
The fee increase should allow the City to be able to construct all the new and expanded transportation facilities needed in order to accommodate new development in eastern Chula Vista. The facilities constructed under this fee program will result in routine maintenance. The future program cost of $254,780,493, when spread over the remaining 19,545 EDUs generates the proposed TDIF rate of $13,035 per EDU.
ATTACHMENTS
1. Eastern Transportation Development Impact Fee Program Report dated Sept. 2014
2. Area of Benefit
3. City Council Resolution 2003-197 dated May 13, 2003
4. TDIF credits
Staff Contact: Prepared by Francisco X. Rivera P.E., T.E. Principal Civil Engineer