Staff Report
PREPARED BY: Matt Morley
Parks and Public Works Director
Reviewed by: Town Manager, Assistant Town Manager, Town Attorney, and Finance Director
110 E. Main Street Los Gatos, CA 95030 ● (408) 354-6832
www.losgatosca.gov
TOWN OF LOS GATOS
COUNCIL AGENDA REPORT
MEETING DATE: 12/03/2019
ITEM NO: 7
DATE: November 25, 2019
TO: Mayor and Town Council
FROM: Laurel Prevetti, Town Manager
SUBJECT: Adopt a Resolution Approving the Council Policy Committee
Recommendations for the Modification of the Traffic Impact Policy
RECOMMENDATION:
Adopt a resolution approving the Council Policy Committee recommendations for the
modification of the Traffic Impact Policy (Attachment 1).
BACKGROUND:
The Traffic Impact Mitigation fee was established in 1991 and first revised by Council in 2014.
Since then, the Policy Committee has reviewed the Traffic Impact Policy on two occasions
(11/17/16 and 2/16/17) and recommended changes to the Town Council. In both cases the
changes were adopted by the Town Council to provide a more streamlined and cost-effective
process for changes of use in existing commercial spaces.
The modifications adopted in December 2016 reflect the application of the Policy in the C-2
zoning district/downtown, essentially applying the shopping center rate to downtown. This
allows for a change of use without the assessment of the traffic impact fee unless new square
footage is added. It is important to note that new square footage in both the downtown and
outside of downtown are still assessed a traffic impact fee.
The modifications adopted by the Council on March 21, 2017 affected the application of traffic
impact fees to properties that have been vacant longer than five years.
These changes have provided a streamlined and less expensive opportunity for businesses and
property owners, and have provided the Town the opportunity to continue to attract new
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SUBJECT: Adopt a Resolution Approving the Council Policy Committee Recommendations
for the Modification of the Traffic Impact Policy
DATE: November 25, 2019
BACKGROUND (Continued):
businesses that may have historically chosen a neighboring jurisdiction because of the high
traffic impact fee assessed for a change of use.
Traffic impact fees are based on a study that identified the Town’s traffic improvement needs
related to growth and the expected cost per vehicle trip necessary to mitigate the growth. The
vehicle trips associated with individual uses are most often identified through data provided by
the Institute of Traffic Engineers (ITE). The Town’s current Traffic Impact Policy is provided for
reference as Attachment 2.
On October 22, 2019 the Policy Committee reviewed the Traffic Impact Policy for the purpose
of considering broader modifications to the Policy. The Policy Committee is recommending
modifications such that the Policy applies Town-wide to new square footage only, thus a
change of use without additional square footage being added in any space would not require
payment of traffic impact fees. The Policy Committee also considered an option of a more
limited expansion adjacent to the downtown to include the area between University and North
Santa Cruz from Highway 9 to Blossom Hill Road but did not recommend this option. Proposed
changes to the current Traffic Impact Policy are provided in redline format as Attachment 3.
DISCUSSION:
As staff continues to work with business and property owners, there have been a few instances
where businesses have moved on from considering Los Gatos as a potential new location
because they are interested in a standalone building outside of the C -2/downtown. The
potential businesses have cited the fees associated with a standalone building outside of the C-
2/downtown as one of the reasons for not opening in Los Gatos.
Given that the Town Council has a strategic priority that encourages community vitality and
supports streamlining efforts for business processes, staff brought this question to the Policy
Committee for its consideration. Staff understands that traffic continues to be a serious
concern for many stakeholders, as well as creating an inviting environment for new businesses.
In the proposed revision, a change of use, regardless of the intensification of use, would not be
subject to Traffic Impact Fees. Where structure square footage is expanded or new structures
are added, the additional square footage would still be required to pay the traffic impact fee at
the ITE rate for the proposed use, for the new square footage only.
Changes to the Policy would likely reduce traffic impact fees. As these fees are intended to help
offset the cost from the impact of the intensified use, addressing traffic impacts would fall to
other sources of funds, likely the general fund. The Council may find that this is a fair tradeoff
among priorities.
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SUBJECT: Adopt a Resolution Approving the Council Policy Committee Recommendations
for the Modification of the Traffic Impact Policy
DATE: November 25, 2019
DISCUSSION (continued):
During its review of this topic, the Policy Committee asked staff to follow up on two items. The
first is the lost revenue from traffic impact fees in the C-2 Zone since the last change. In
reviewing this request, there is no simple means for assembling that data – the process would
be manual and labor intensive across multiple Departments. Given that additional workload,
staff has not undertaken that effort.
The other item the Policy Committee asked for was how the traffic impact fees and Policy
would function as the Town explores Vehicle Miles Travelled (VMT). This discussion will be the
subject of a future Council presentation and discussion on its own. However, VMT is a regional
look at traffic and does not inform local jurisdictions on the needs and function of local roads.
Staff anticipates recommending a continued assessment of the impact of development on local
road functionality through the retention of the Traffic Impact Policy.
CONCLUSION:
Staff recommends that the Town Council adopt a Resolution approving the Council Policy
Committee recommendations for the modification of the Traffic Impact Policy (Attachment 1).
COORDINATION:
This report was prepared in coordination with the Economic Vitality Manager and the
Community Development Department.
FISCAL IMPACT:
Action on this item does not affect the proposed budget ; however, it may decrease potential
fees collected. A reduction in fees may reduce the Town’s ability to mitigate traffic impacts
from the intensification of use. The reduction of fees may also encourage increased changes to
more sustainable uses with a corresponding increase in sales tax revenue.
ENVIRONMENTAL ASSESSMENT:
This is not a project defined under CEQA, and no further action is required.
Attachments:
1. Draft Resolution with proposed Traffic Impact Policy
2. Existing Traffic Impact Policy
3. Redlined Traffic Impact Policy Changes