Staff Reportwe < MEETING DATE: 12/15/15
i ITEM NO:
/pS -A:�OS COUNCIL AGENDA REPORT
DATE: DECEMBER 8, 2015
TO: MAYOR AND TOWN COUNCIL
FROM: LAUREL PREVETTI, TOWN MANAGEIP
SUBJECT: ACCEPT FISCAL YEAR (FY) 2014/15 STATUS REPORT ON RECEIPT AND
USE OF DEVELOPMENT IMPACT FEES
RECOMMENDATION:
Accept Fiscal Year (FY) 2014/15 status report on receipt and use of Development Impact Fees.
BACKGROUND:
To ensure that mitigation fees associated with development are spent in a timely manner and on
projects for which they were being collected, the State Legislature passed a bill known as AB
1600 (the Mitigation Fee Act). This bill applies to developer fees which were increased or
imposed on or after January 1, 1989.
The Mitigation Fee Act (California Government Code, §66000 et seq.) requires local agencies
that impose Development Impact Fees to present an annual, consolidated report showing the
receipt and use of those fees. The Annual Status Report (Attachment 1) must be reviewed by
Council within 180 days after the close of the fiscal year represented.
The Town collects three Development Impact Fees that meet the AB 1600 reporting
requirement: the Traffic Impact Mitigation Fee, Below- Market Priced Housing Program In -Lieu
Fee, and the Construction Activity Impact Fee. Separate balances exist for each of these fees
either as individual accounts or in the case of Traffic Impact Mitigation Fees, separate funds. As
required by AB 1600, as of June 30, 2015, all accounts or funds with unspent balances have been
credited interest revenue at the Town's current interest rate earned on its total investment
portfolio.
PREPARED BY: S'1?EI}) �4CKA Y
Administrative Services and Finance Director
Reviewed by:
Town Manager
WFINANCDAB1600 \AB 16002015 Report.doc
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PAGE
MAYOR AND TOWN COUNCIL
SUBJECT: ACCEPT FY 2014/15 STATUS REPORT ON RECEIPT AND USE OF
DEVELOPMENT IMPACT FEES
DECEMBER 8, 2015
DISCUSSION:
AB 1600 requires that a status report be prepared annually which must include the following:
• A brief description of the fee and the fund into which the fee was deposited;
• The amount of the fee;
• The associated fund's beginning and ending balances for the fiscal year;
• The total amount of fees collected and interest earned;
• Identification of each public improvement on which impact fees were expended and
amount of expenditure on each improvement, including the total percentage of the cost of
the public improvement that was funded with impact fees;
• Identification of approximate date by which construction of a public improvement will
begin;
• Determination that sufficient funds have been collected to complete financing on an
incomplete public improvement;
• Description of each inter -fund transfer or loan made from the account or fund, including
the public improvement on which the loaned funds will be expended, and in the case of
an inter -fund loan, the date on which the loan will be repaid and the rate of interest that
the account or fund will receive on the loan; and
• Amount of any refunds made due to inability to expend impact fees once a determination
is made that sufficient impact fees have been collected to finance a public improvement,
the improvement remains incomplete, and the City has not determined an approximate
date by which construction will begin.
This information is presented in the attached FY 2014 /15 Annual Status Report on Receipt and
Use of Development Impact Fees.
CONCLUSION:
Staff recommends Council receive and file the FY 2014 /15 Annual Status Report on Receipt and
Use of Development Impact Fees as required under the Mitigation Fee Act (AB 1600).
ENVIRONMENTAL ASSESSMENT:
The recommended action is not a project defined under CEQA, and no further action is required.
Attachments:
1. FY 2014/15 Annual Status Report on Receipt and Use of Development Impact Fees.
TOWN OF LOS GATOS
ANNUAL STATUS REPORT ON RECEIPT AND USE OF DEVELOPMENT IMPACT
FEES
JUNE 30, 2015
Traffic Impact Mitigation Fee:
The Traffic Impact Mitigation Fee assures that each new development or expansion of use pays
its fair share of the transportation improvements needed to accommodate the cumulative traffic
impacts. The fee, $879 per new average daily trip generated, is paid in full to the Town Building
Department prior to issuance of the building permit for new development or expansion of use.
The collected fee is held in the Traffic Mitigation Fee Fund. The Traffic Mitigation Fund should
be used solely to fund transportation improvement projects related to mitigating the impacts of
new development. The funds cannot be used for routine repair or maintenance.
TRAFFIC IMPACT MITIGATION FEES FUND
Beginning Cash Balance (07101/2014) $2,920,988
Source of Funds
Fees Collected FY 14/15 296,049
Interest Earned FY 14/15
Total Source of Funds $3,251,157
Use ofFunds
Capital Outlay :
Winchester /Knowles $13,469
Winchester /Lark Intersection 13,448
Highway 9 /University Intersection 34,758
Town Digital Photo Map 16,858
Project Overhead Business Service Charge 5,504
Tom] Use of Funds $84,037
Fading Cash Balance (07/01/2015) Pre -Final AurBt $3,167,120
Designated Future Projects:
Per FY 14115 through 19/20 Capital Improvement Plan:
Winchester Lark Intersection Irrrprovements (FY2015116) 805,571
Los Gatos Boulevard /Shannon Improvements (FY2015116) 20,000
Los Gatos Boulevard /Lark Avenue Improvements (FY2015116) 174,299
Blossom Hill Road /Cherry Avenue Intersection Irnpvts (FY2015116) 500,000
Town Digital Aeiml PhotogmphyTopographic Map (FY2015116) 25,142
Monument Control Network Upgrade (FY2015116) 10,000
Intersection Safety and TraBie Flow Improvements (FY2015116) 40,000
Crosswalk Lighting Upgrade (FY2015116) 50,000
Crosswalk Improvements- Santa Cmz/Blosssom Hill (FY2015116) 50,000
Administration and Program Support (FY2015116 - FY2019120) 50,000
Total CIP and Operating Budget Commitments $1,725,012
Potential Project List (Estimates Only) per Unfunded List
Union Avenue Widening (Future Project -Pending Funding) $3,000,000
Los Gatos Boulevard Widening (Future Project -Pending Funding) 1,400,000
Blossom Hill Road Bridge Widening (Future Project -Pending Funding) 3,500,000
Total Potential Project List $7,900,000
Total Designated and Unfunded Projects $9,625,012
Current Funding Shortfall ($6,457,892)
ATTACHMENT 1
TOWN OF LOS GATOS
ANNUAL STATUS REPORT ON RECEIPT AND USE OF DEVELOPMENT IMPACT
FEES
JUNE 30, 2015
(Continued)
Construction Impact Activity Fee:
Construction Impact Activity Fee is assessed on construction projects based on the square foot
size of the project at a rate of $1.12 per square foot. These fees are intended to recover the
damage caused to Town streets by construction traffic. The collected fee is held in the General
Fund Appropriated Reserves.
CONSTRUCTION IMPACT ACTIVITY FEE
Beginning Cash Balance (07/01/2014)
$0
Source of Funds
Fees Collected FY 14/15
853,946
Interest Famed FY 14/15 (Funds expended upon receipt)
Total Source of Funds
$853,946
Use of Funds
Business services Charge
Capital Outlay :
Street Repairand Resurfacing Project FY 14/15
$13,361
Total Use of Funds
$13,361
Ending Cash Balance (7/0112015) Pre -Final Audit $840,585
Designated Future Projects
Per FY 15/16 through FY 19/20 Capital Improxement Plan:
Street Repairand Resurfacing Project $3,386,241
Total Designated Future Projects $3,386,241
Current Fundina Shortfall
TOWN OF LOS GATOS
ANNUAL STATUS REPORT ON RECEIPT AND USE OF DEVELOPMENT IMPACT
FEES
JUNE 30, 2015
(Continued)
Below- Market Priced (BMP) Housing Program In -Lieu Fee:
BMP In -Lieu Fees are collected from residential development projects with five (5) or more
units when the construction of the BMP unit is impractical or there are unusual circumstances
that make the construction of the unit inconsistent with Town policy. The required in -lieu fee is
to be paid to the Town prior to issuance of the certificate of occupancy. The BMP In -Lieu Fee is
equal to the amount of six (6) percent of the building permit valuation for the entire project. The
collected fees are held in the General Fund BMP Housing liability account and are restricted to
be used solely for BMP Housing Program activities.
BELOW - MARKET PRICED HOUSING PROGRAM IN -LIEU FEES
Beginning Cash Balance (07/01/2014) $2,467,403
Source of Funds
Fees Collected FY 14/15
Rehm hom Escrow on Foreclosed Properties 14/15
Interest Earned FY 14/15
$401,316
169,545
Total Source of Funds $3,068,867
Use of Funds
Rea Lund Property Renovation Priorto Sale $190,118
Total Use of Funds
Ending Cash Balance (7101/2015) Pre -Final Audit $2,840,749
Potential Future Projects
Extreme Low Income Housing Program (Future Project - Pending Funding) $1,100,000
Reacquisition of Distressed /Foreclosed Properties (Future Project - Pending Funding) 600.000
Neighborhood Housing Program services (Future Project - Pending Funding -5 Year Total) 1,200,000
Total Potential Future Projects $2,900,000
Current Funding Shortfall ($59,251)
Other Required Disclosures:
As required by law, no inter -fund (loans /transfers) were made doing the reporting period and no
refund were necessary as all fees collected have a current funding short fall status as presented in
the Annual Status Report.