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SR 01-24-2017 3J Ci ty Council Report City Council Meeting : January 24, 2017 Agenda Item: 3.J 1 of 12 To: Mayor and City Council From: Gigi Decavalles -Hughes, Director , Finance Department, Financial Operations Subject: Annual Reporting of Developer Impact Fees Recommended Action Staff recommends that the City Council review the FY 2015 -2016 Mitigation F ee Act Report. Executive Summary This report transmits required information for the City’s development impact fees that qualify under Government Code 66000 -66025, also known as the Mitigation Fee Act. Pursuant to the Mitigation Fee Act, reporting is requ ired for the following five (5) fees: Childcare Linkage Fee, Transportation Impact Fee, Parks and Recreation Impact Fee, Affordable Housing Commercial Linkage Fee, and Water Demand Mitigation Fee. These fees have been authorized by the City Council to add ress funding of some of the highest priority long -term needs of the community – childcare, transportation, parks, and affordable housing – that have been directly impacted by the new development. However, these mitigation fees are only one way that Santa Monica addresses each of these priorities. It can take a number of years to accumulate sufficient funds to implement the relatively high cost of the projects they are eligible to fund. Staff carefully monito r s the balance of funds and works to use the fu nds to complete eligible projects. Following is a brief summary of each fee, the current balance, and the plans for spending the funds: 1. Childcare Linkage Fee – This fee is collected to address the increased demand for childcare triggered by the developme nt of commercial projects. As of June 30, 2016, the balance on hand for this fee totaled $2.5 million. Council has approved usage of Childcare Linkage Fee funds and General Fund dollars towards the construction of the Early Childhood Lab School (ECLS), f ormerly the Early Child hood Education Center (ECEC). 2. Transportation Impact Fee – This fee is collected on new development and intensified land uses and is used to fund transportation improvements, such as new sidewalks, crosswalks, traffic signal upgrades , transit, and bicycle facilities. As of June 30, 2016, the balance on hand for this fee totaled $3.5 million. Over $1 million in funds have been budgeted to complete potential public improvements. Staff closely monitors proposed development projects an d 2 of 12 available resources and incorporates these costly projects into the CIP process. 3. Parks and Recreation Impact Fee – This fee is collected from new residential and commercial development for the upgrade and/or expansion of parks and recreation facilities needed to accommodate additional occupants. As of June 30, 2016, the balance on hand for this fee totaled $0.3 million. Staff anticipates utilizing the fund balance in FY 2018 -19 as a partial funding source for construction of the Air port Park Expansion project. 4. Affordable Housing Commercial Linkage Fee – This fee is designed to contribute to the creation of affordable housing production or preservation to offset additional need for affordable housing generated by new commercial development. As of June 30, 2016, the balance on hand for this fee totaled $0.6 million. Currently, insufficient funds have been collected to complete potential public improvements. Staff will continue to closely monitor proposed development projects and available resources. 5. Wa ter Demand Mitigation Fee – This fee is collected from new development to mitigate the total daily water consumption rate projected for the development. As of June 30, 2016, the balance on hand for this fee totaled $3.7 million. Staff has identified seve ral projects that will utilize the available fund balance, including the retrofitting of restroom facilities at both public buildings and multi -family properties, exploratory boring and well construction, public landscape projects, such as improvements to irrigation systems, the purchase of smart controllers and water efficient equipment, and turf removal projects, and the planning and design of water efficient landscaping and an irrigation system for the San Vicente Blvd medians. The information presented in this financial report is provided in compliance with State law requirements and staff continues to monitor development projects and revenue collected to ensure that fees are accounted for and expended in accordance with the purposes for which they were collected as required by law . Background In 1987, the California Legislation passed Assembly Bill 1600 (AB1600), also known as the California Mitigation Fee Act, to codify the legal and procedural parameters for charging development impact fees as set fo rth in Government Code 66000 -66025. A development impact fee is a monetary exaction other than a tax or special assessment that is charged by a local government agency to an applicant in connection with approval of a development project for the purposes o f defraying all or a portion of the costs of the public facilities related to the development project. The Mitigation Fee Act defines “public facilities” broadly to include public improvements, public services, and community amenities. 3 of 12 At the time that a Mitigation Fee is established, the purpose of the fee and the use to which the fee will be put must be clearly identified. Per Government Code 66006, collection of these fees requires separate funds or accounts to avoid commingling and requires that th e following information is reported within 180 days from year -end: 1. A brief description of the type of fee 2. The amount of the fee 3. The beginning and ending balances of the account or fund 4. The amount of the fees collected and interest earned 5. Identification of each public improvement on which the fees were expended and the amount of the expenditures on each improvement, including the total percentage of the cost of the public improvement that was funded with fees. 6. An approximate date by which the constructi on of the public improvement will begin if the City determines that sufficient funds have been collected to complete financing on an incomplete public improvement 7. A description of any interfund loan or transfer made from the account or fund and the public improvement on which the transferred funds will be expended and in the case of an interfund 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. 8. The amount of any refunds made and an y allocations of unexpended fees that are not refunded. Per Government Code 66001, the City must report the following on unexpended and expended fee amounts, whether committed or uncommitted, for the fifth fiscal year following the first deposit and every five years thereafter: 1. Identify the purpose to which the fee is to be put 2. Demonstrate a reasonable relationship between the fee and the purpose for which it was charged 3. Identify all sources and amounts of funding anticipated to complete financing in inc omplete improvements 4. Designate the approximate dates on which the funding is expected to be deposited into the appropriate account or fund 4 of 12 Discussion The City publicly posted information required by AB1600 on December 27 th for the following fees: Child care Linkage Fee, Transportation Impact Fee, Parks and Recreation Impact Fee, Affordable Housing Commercial Linkage Fee, and Water Demand Mitigation Fee. Additional reporting information was also provided for the Childcare Linkage Fee and the Water Demand Mitigation Fee. An analysis of eligible projects resulted in revisions to the Water Demand Mitigation Fee information and an errata sheet was publicly posted on January 9, 2017. Child Care Linkage Fee On December 5, 2006 Council adopted ordinance Chapter 9.65 of the Santa Monica Municipal Code (SMMC) to establish a child care linkage fee program. This fee is intended to address the increased demand for chi ldcare triggered by the development of commercial projects adding floor area of at least 7,500 square feet or multi -family residential projects. Developers can satisfy the ordinance requirements by either paying a fee or by agreeing to participate in th e construction or establishment of one or more child care facilities. Fees are computed annually on July 1, increasing by a percentage equal to the Construction Cost Index as published by Engineering News Record. Child care linkage fees shall be paid by the final inspection date and prior to the issuance of the Certificate of Occupancy. The schedule of the fees for FY 2015 -16 were: Project Fee Residential $142.39 per unit Office $6.76 per square foot Retail $4.84 per square foot 5 of 12 Hotel $3.39 per squ are foot Following adoption of the ordinance, the City established a Child Care Linkage Fee Reserve Account for the collection of fees to be used to create new child care spaces. The ordinance requires an annual report to City Council within 180 days af ter the last day of each fiscal year. Since adoption of the ordinance in 2006, Council has received an annual update on Child Care Linkage Fee Program revenues with the first actual receipts realized in FY 2012 -13 as reported to Council on December 10, 2013. In FY 2015 -16, $1,740,158.96 in revenues were collected and i nterest totaling $10,537.42 was deposited into the Child Care Special Revenue Source Fund A ccount 4.365203. The revenues collected in FY 2015 -16 were added to the prior year Special Revenue Source Fund Account 4.365203 balance of $730,897.74. The ending balance as of June 30, 2016 for the Special Revenue Source Fund Account 4.365203 totaled $2 ,481,594.12. No expenditures were made during the fiscal year. Section 9.65.070 of the ordinance specifies that funds collected in the Child Care Linkage Fee Reserve Account shall be restricted to costs related to property acquisition, development, and c onstruction of child care facilities within the City of Santa Monica in addition to any administrative costs incurred by the City to manage the reserve account. Eligible expenditures shall not include ongoing operating expenses and general maintenance of child care facilities. To date, Council has approved $1,098,598 in available Childcare Linkage Fee funds and $5,563,000 of General Funds for use in the construction of the Early Childhood Lab School (ECLS), formerly the Early Childhood Education Center (E CEC). The Early Childhood Lab School (EC LS ), a joint Capital Improvement Project (CIP) of the City of Santa Monica and Santa Monica College (SMC), will provide child care and early education services for up to 110 young children, and is scheduled to break ground in the Civic Center by s ummer 2017 following permit issuance by the Department of 6 of 12 State Architecture and bidding and award of the construction contract by the college. Staff has identified the EC LS as the kind of candidate project that would be el igible for the disbursement of funds from the Child Care Linkage Reserve Account. City staff is working with the City Attorney’s Office on administrative guidelines for usage of additional Childcare Linkage Fees and will continue to closely monitor propose d development projects and revenue collection. Transportation Impact Fee The City Council adopted ordinance Chapter 9.66 of the Santa Monica Municipal Code on March 12, 2013 to establish a Transportation Impact Fee for new development and intensified land uses that will fund transportation improvements such as new sidewalks, crosswalks, traffic signal upgrades, transit, and bicycle facilities that are necessitated by the new trips associated with land use change. The fees are based on residential units or commercial square footage. The fee is charged prior to issuance on building permits, unless State law requires the City to accept later fee payment. The Transportation Impact Fee reflects the costs associated with transportation improvements and the amo unt of new auto trips that can be attributed to land use changes. The schedule of the fees for the FY 2015 -16 were: Project Fee Residential (dwelling unit) Single Family, Area 1 $8,231.11 per unit Single Family, Area 2 $8,447.72 per unit Multi -Family, Area 1 $2,815.91 per unit Multi -Family, Area 2 $3,574.04 per unit Multi -Family, Area 3 $2,815.91 per unit Non -Residential (sq ft) Retail, Area 1 $22.74 per square foot Retail, Area 2 $32.60 per square foot Office, Area 1 $10.51 per square foot Offi ce, Area 2 $11.70 per square foot 7 of 12 Medical Office, Area 1 $30.43 per square foot Medical Office, Area 2 $32.27 per square foot Hospital, Area 1 $0 per square foot Hospital, Area 2 $15.92 per square foot Lodging, Area 1 $3.90 per square foot Lodging, A rea 2 $3.90 per square foot Industrial, Area 1 $1.30 per square foot Industrial, Area 2 $1.41 per square foot Auto Sales and Display Areas, Area 1 $1.30 per square foot Auto Sales and Display Areas, Area 2 $1.41 per square foot In FY 2015 -16, $2,890,960.62 in revenues were collected and deposited into the Transportation Impact Fee Special Revenue Source Fund Account 4.370332. The revenues collected in FY 2015 -16 were added to the prior year Special Revenue Source Fund Account 4.370332 balance of $564 ,263.54. The ending balance as of June 30, 2016 for Special Revenue Source Fund Account 4.370332 totaled $3,455,224.16. No expenditures were made during the fiscal year. Funds totaling $1,009,250 have been budgeted to help fund capital projects associa ted with Safe Routes to Schools and bicycle connection s , most visible will be physical changes anticipated next year near four schools to make it easier for students to walk and bike. The funds may be spent on capital projects and staff to administer the fee; the projects are individually expensive and additional resources to assist with the expenditures have not been allocated. The Transportation Impact Fees supplement the wide ranging transportation projects that the City implements to improve transpo rtation. Efforts have recently included completing physical improvements at Expo stations, completing the first year of Breeze bike share service, opening the Colorado Esplanade, a new California Incline structure 8 of 12 with dedicated space for pedestrians and cyclists, organizing Coast as the community’s first open streets event, creation of the transportation management organization and promoting all things transportati on through the GoSaMo campaign. Staff continues to actively pursue funding though outside s ources, including competitive grants. Maintaining a balance in the account ensures that a local match will be available for grants and then can be allocated once grants are received. Staff will continue to closely monitor proposed development projects an d revenue collection , and budget revenues during the 2018 -2020 CIP process to help advance capital projects to make it easier for people to walk, bike, and take transit in Santa Monica. Parks and Recreation Development Impact Fee The City Council adopted ordinance Chapter 9.67 of the Santa Monica Municipal Code on October 14, 2014 to establish a Parks and Recreation Development Impact Fee to provide a direct funding source from new residential and commercial development for the upgrade and/or expansion of parks and recreation facilities needed to accommodate additional occupants of the new developments. The schedule of the fees for FY 2015 -16 were: In FY 2015 -16, $305,285.19 in revenues were collected and deposited into the Parks and Recreation Development Impact Fee Project Fee Single Family Residential $7,809.34 per unit Multi -Family Residential - Studio/1 Bedroom $4,231.93 per unit Multi -Family Residential - 2+ Bedrooms $6,816.30 per unit Retail $1.52 per square foot Office $2.36 per squ are foot Medical Office $1.29 per square foot Lodging $3.18 per square foot Industrial $1.33 per square foot 9 of 12 Special Reve nue Source Fund Account 4.370334. The revenues collected in FY 2015 - 16 were added to the prior year Special Revenue Source Fund Account 4.370334 balance of $8,276.00. The ending balance as of June 30, 2016 for Special Revenue Source Fund Account 4.370334 totaled $313,561.19. No expenditures were made during the fiscal year. Staff anticipates utilizing the fund balance in FY 2018 -19 as a partial funding source for construction of the Airport Park Expansion project. Affordable Housing Commercial Linkage F ee The City Council adopted ordinance Chapter 9.68 of the Santa Monica Municipal Code on June 23, 2015 to establish the Affordable Housing Commercial Linkage Fee to contribute to the creation of affordable housing production or preservation to offset additional need for affordable housing generated by new commercial development. The schedule of the fees for FY 2015 -16 were: Project Fee Retail $9.97 per square foot Office $11.46 per square foot Hotel/Lodging $3.14 per square foot Hospital $6.28 per square foot Industrial $7.70 per square foot Creative Office $9.81 per square foot Medical Office $7.05 per square foot Institutional $10.46 per square foot In FY 2015 -16, $567,289.43 in revenues were collected and interest totaling $776.10 were deposited into the Affordable Housing Commercial Linkage Fee Special Revenue Source Fund Account 4.365112. The revenues collected in FY 2015 -16 were added to the prio r year Special Revenue Source Fund Account 4.365112 balance of $21,051.91. The ending balance as of June 30, 2016 for Special Revenue Source Fund Account 4.365112 totaled $589,117.44. No expenditures were made during the fiscal year. As of June 30, 2016, sufficient Affordable Housing Commercial Linkage Fee funds have not 10 of 12 been accumulated to complete construction of eligible public improvements. Staff will continue to closely monitor proposed development projects and revenue collection. Water Demand Miti gation Fee The City Council adopted ordinance Chapter 7.16.050 of the Santa Monica Municipal Code on March 19, 1991 to establish the Water Demand Mitigation Fee. The Water Demand Mitigation Fee is a one -time fee the City charges new development to mitigate the total daily water consumption rate projected for the development. The total daily water demand for the project is calculated using standard water demand factors which have been developed by City staff. The Water Demand Mitigation Fee is set at $3.00 for each gallon of daily water demand that must be mitigated. The fee is required whenever a new single -family residence is constructed or addition of 50% or more to existing square footage; for construction of a new multi -family building or addition of new units; for construction of a new non -residential building or whenever there is a change of use, change or addition to new plumbing fixtures, addition of restaurant seating, or addition of square footage. The schedule of the fees for FY 2015 -16 were: In FY 2015 -16, $433,427.65 in revenues were collected and deposited into the fund Project Fee Single -Family $990.00 Multi -Family (condominium fees same as apartments): Studio/Single Apartment: $315.00 1 Bedroom Apartment: $375.00 2 Bedroom Apartment: $570.00 3 Bedroom Apartment: $750.00 Duplex (2 Apartments): $900.00 Non -Residential: To be determined by the Civil Engineering Plan Checker 11 of 12 balance account reserved for Water Demand Mitigation Fee revenues 25.335018. The revenues c ollected in FY 2015 -16 were added to the prior year account 25.335018 balance of $3,638,839.00 . In FY 2015 -16, $301,375.00 was spent on the Irrigation Controller Replacement project. The purchase of Calsense smart irrigation controllers replaced old irrig ation technology at various park and landscape locations citywide. The Calsense smart irrigation controllers, including component parts, were purchased to help increase the City’s water delivery efficiency and staff’s ability to monitor irrigation performa nce, make adjustments remotely and create real time reports related to water use. Additionally, $59,240 was spent on City landscape and irrigation supplies ($45K) and plumbing fixture retrofits at City facilities ($14K). The ending balance as of June 30, 2016 for account 25.335018 totaled $3,711,651.65 . Staff has identified several projects that will utilize the ending fund balance amount at June 30, 2016.  Several facility upgrades, including retrofitting restrooms at City Hall and replacing faucets in the Public Safety Facility building, are scheduled for FY 2016 -17 with an estimated cost of $30,308.  In October 2016, in support of meeting Living Building Challenge requirements, an exploratory boring and well construction project was completed on the we st side of City Hall to supply the new City Services Building with potable water at a cost of $284,591.  On September 8, 2015, Council awarded Southwest Environmental a $1,999,000 contract to retrofit 4,312 toilets as part of the toilet direct installation program for multi -family properties. Of that total amount, $857,303 will be paid with Water Demand Mitigation funds and the remainder from Bay Saver Fee funds. On September 13, 2016, Council authorized $849,000 for water audits and retrofits at Santa Moni ca Malibu Unified School District sites within the city.  Public landscape projects include improvements to the irrigation system at Woodlawn Cemetery, to be bid in FY2016 -17 with an estimated cost of $60,561 . Other landscape projects include the purchas e of additional Calsense smart controllers and water efficient rotary nozzles in the amount of $238,326 , and a n additional $449,052 for landscape and irrigation conversions. The latter represents the second phase of conversions. On June 14, 2016, Council a warded a $700,000 contract to Clean Cut Landscape, Inc. to furnish material and labor for the first phase of the landscape and irrigation conversion project at 39 sites citywide. The project will remove 33,627 estimated square feet (.8 acres) of turf and r educe water use at these 39 sites by roughly 2.4 million gallons a 12 of 12 year. Work began in September 2016. In total, the two phases of landscape and irrigation conversions is estimated to cost $1,149,052.  Finally, staff would like to initiate the planning and design of water efficient landscaping and an irrigation system for the San Vicente Blvd. medians, and $242,511 is available to commit to that project. Financial Impacts and Budget Actions There is no immediate financial impact or budget action necessary as a result of the recommended action. Prepared By: Stephanie Manglaras, Accounting Manager Approved Forwarded to Council Attachments: A. AB1600 Reporting - Affordable Housing Commercial Linkage Fee B. AB1600 Reporting - Childcare Linkage C. AB1600 Report ing - Parks and Rec D. AB1600 Reporting - Transportation Impact Fee E. AB1600 Reporting - Water Demand Mitigation Fee F. AB1600 Reporting - Water Demand Mitigation Errata Sheet City of Santa Monica AB1600 Report Fiscal Year Ended June 30, 2016 (A) A brief description of the type of fee in the account or fund. (B) The amount of the fee. Project Fee Retail $9.97 per square foot Office $11.46 per square foot Hotel/Lodging $3.14 per square foot Hospital $6.28 per square foot Industrial $7.70 per square foot Creative Office $9.81 per square foot Medical Office $7.05 per square foot Institutional $10.46 per square foot (C) The beginning and ending balance of the account or fund and (D) The amount of the fees collected and the interest earned. FISCAL YEAR BEGINNING FUND BALANCE FEES COLLECTED INTEREST EARNED EXPENDITURES TOTAL FUND BALANCE FY2015-2016 21,051.91 567,289.43 776.10 589,117.44 No expenditures were made during the fiscal year. No interfund transfers or loans were made during the fiscal year from this fund. No refunds were made during the fiscal year. (G) A description of each interfund transfer or loan made from the account or fund, including the public improvement on which the transferred or loaned fees will be expended, and, in the case of an interfund 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. (H) The amount of refunds made pursuant to subdivision (e) of Section 66001 and any allocation pursuant to subdivision (f) of Section 66001. No construction of public improvements have been identified. The City has not determined sufficient funds have been collected. Affordable Housing Commercial Linkage Fee For the purpose of compliance with Government Code subsection 66006(b)(1), the following information regarding AB 1600 fees is presented: For each separate account or fund established pursuant to subdivision (a), the local agency shall, within 180 days after the last day of each fiscal year, make available to the public the following information for the fiscal year: (E) Identification of each public improvement on which fees were expended and the amount of the expenditures on each improvement, including the total percentage of the cost of the public improvement that was funded with fees. F) An approximate date by which the construction of the public improvement will commence if the local agency determines that sufficient funds have been collected to complete financing on an incomplete public improvement, as identified in paragraph (2) of subdivision (a) of Section 66001, and the public improvement remains incomplete. Affordable Housing Commercial Linkage Fee - A fee paid to the City by an applicant for approval of certain development projects, to contribute to the creation of affordable housing production or preservation to offset additional need for affordable housing generated by new commercial development. City of Santa Monica AB1600 Report Fiscal Year Ended June 30, 2016 (A) A brief description of the type of fee in the account or fund. (B) The amount of the fee. Project Fee Residential $142.39 per unit Hotel $3.39 per square foot Retail $4.84 per square foot Office $6.76 per square foot (C) The beginning and ending balance of the account or fund and (D) The amount of the fees collected and the interest earned. FISCAL YEAR BEGINNING FUND BALANCE FEES COLLECTED INTEREST EARNED EXPENDITURES ENDING FUND BALANCE FY2015-2016 730,897.74 1,740,158.96 10,537.42 2,481,594.12 No expenditures were made during the fiscal year. No interfund transfers or loans were made during the fiscal year from this fund. No refunds were made during the fiscal year. F) An approximate date by which the construction of the public improvement will commence if the local agency determines that sufficient funds have been collected to complete financing on an incomplete public improvement, as identified in paragraph (2) of subdivision (a) of Section 66001, and the public improvement remains incomplete. (G) A description of each interfund transfer or loan made from the account or fund, including the public improvement on which the transferred or loaned fees will be expended, and, in the case of an interfund 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. (H) The amount of refunds made pursuant to subdivision (e) of Section 66001 and any allocation pursuant to subdivision (f) of Section 66001. We expect construction of the Early Childhood Education Center (ECEC) will begin in Summer 2017. Child Care Linkage Fee For the purpose of compliance with Government Code subsection 66006(b)(1), the following information regarding AB 1600 fees is presented: For each separate account or fund established pursuant to subdivision (a), the local agency shall, within 180 days after the last day of each fiscal year, make available to the public the following information for the fiscal year: Child Care Linkage Fee - The purpose of the Child Care Linkage Fee imposed and collected on development of commercial projects adding floor area of at least 7,500 square feet or multi-family residential projects development within the City since fiscal year 2011/2012 is to fund property acquisition, development, and construction of child care facilities in order to create new child care spaces. (E) Identification of each public improvement on which fees were expended and the amount of the expenditures on each improvement, including the total percentage of the cost of the public improvement that was funded with fees. City of Santa Monica AB1600 Report Fiscal Year Ended June 30, 2016 Additional Information is being provided regarding this fee: (1) Identification of the purpose to which the reportable fees are to be put. (2) Demonstration of a reasonable relationship between the reportable fees and the purposes for which they are charged. (3) Identification of all City sources and amounts of funding to complete financing of the projects as identified by the City. (4) Identification of the approximate dates on which the funding referred to in item C is expected to be deposited into the appropriate account or fund. There is a reasonable relationship between new development upon which the Child Care Linkage Fees are charged and the need to address the increased demand for childcare within the City. In November 2005, Keyser Marston Associates, Inc., prepared a study that analyzed the linkages between child care demand and new development. The study focused on the relationships between the construction of new buildings and resulting job growth, new employees with children age 5 or under needing child care that can be met at or near the workplace, the demand for child care spaces with the per square foot building area of new construction, and the costs to build child care facilities prorated in proportion to the demand generated by new construction type. The study found that new development which does not include or contribute toward the cost of child care facilities will only serve to further exacerbate a shortage of child care spaces. Furthermore, the Child Care Linkage Fees charged will be used to fund eligible projects. Project Child Care Linkage Fees The purpose of the Child Care Linkage Fee imposed and collected on development of commercial projects adding floor area of at least 7,500 square feet or multi-family residential projects development within the City since fiscal year 2011/2012 is to fund property acquisition, development, and construction of child care facilities in order to create new child care spaces. Funds Available and Authorized by Council Funds Available and Authorized by Council 4062 - Early Childhood Education Center (ECEC) Local Funds $5,563,000 $1,098,598 4062 - Early Childhood Education Center (ECEC) Project Child Care Linkage Fees Local Funds City of Santa Monica AB1600 Report Fiscal Year Ended June 30, 2016 (A) A brief description of the type of fee in the account or fund. (B) The amount of the fee. Project Fee Single Family Residential $7,809.34 per unit Multi-Family Residential - Studio/1 Bedroom $4,231.93 per unit Multi-Family Residential - 2+ Bedrooms $6,816.30 per unit Retail $1.52 per square foot Office $2.36 per square foot Medical Office $1.29 per square foot Lodging $3.18 per square foot Industrial $1.33 per square foot (C) The beginning and ending balance of the account or fund and (D) The amount of the fees collected and the interest earned. FISCAL YEAR BEGINNING FUND BALANCE FEES COLLECTED INTEREST EARNED EXPENDITURES TOTAL FUND BALANCE FY2015-2016 8,276.00 305,285.19 313,561.19 No expenditures were made during the fiscal year. No interfund transfers or loans were made during the fiscal year from this fund. No refunds were made during the fiscal year. (G) A description of each interfund transfer or loan made from the account or fund, including the public improvement on which the transferred or loaned fees will be expended, and, in the case of an interfund 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. (H) The amount of refunds made pursuant to subdivision (e) of Section 66001 and any allocation pursuant to subdivision (f) of Section 66001. No construction of public improvements have been identified. The City has not determined sufficient funds have been collected. Parks and Recreation Development Impact Fee For the purpose of compliance with Government Code subsection 66006(b)(1), the following information regarding AB 1600 fees is presented: For each separate account or fund established pursuant to subdivision (a), the local agency shall, within 180 days after the last day of each fiscal year, make available to the public the following information for the fiscal year: (E) Identification of each public improvement on which fees were expended and the amount of the expenditures on each improvement, including the total percentage of the cost of the public improvement that was funded with fees. F) An approximate date by which the construction of the public improvement will commence if the local agency determines that sufficient funds have been collected to complete financing on an incomplete public improvement, as identified in paragraph (2) of subdivision (a) of Section 66001, and the public improvement remains incomplete. Parks and Recreation Development Impact Fee - The purpose of the fee, is to provide a direct funding source from new residential and commercial development to be used solely for the acquisition and development of open space, parkland, and recreation facilities to meet demand generated by occupants and users of the new development. City of Santa Monica AB1600 Report Fiscal Year Ended June 30, 2016 (A) A brief description of the type of fee in the account or fund. (B) The amount of the fee. Project Fee Single Family, Area 1 $8,231.11 per unit Single Family, Area 2 $8,447.72 per unit Multi-Family, Area 1 $2,815.91 per unit Multi-Family, Area 2 $3,574.04 per unit Multi-Family, Area 3 $2,815.91 per unit Retail, Area 1 $22.74 per square foot Retail, Area 2 $32.60 per square foot Office, Area 1 $10.51 per square foot Office, Area 2 $11.70 per square foot Medical Office, Area 1 $30.43 per square foot Medical Office, Area 2 $32.27 per square foot Hospital, Area 1 $0 per square foot Hospital, Area 2 $15.92 per square foot Lodging, Area 1 $3.90 per square foot Lodging, Area 2 $3.90 per square foot Industrial, Area 1 $1.30 per square foot Industrial, Area 2 $1.41 per square foot Auto Sales and Display Areas, Area 1 $1.30 per square foot Auto Sales and Display Areas, Area 2 $1.41 per square foot (C) The beginning and ending balance of the account or fund and (D) The amount of the fees collected and the interest earned. FISCAL YEAR BEGINNING FUND BALANCE FEES COLLECTED INTEREST EARNED EXPENDITURES TOTAL FUND BALANCE FY2015-2016 564,263.54 2,890,960.62 3,455,224.16 No expenditures were made during the fiscal year. No interfund transfers or loans were made during the fiscal year from this fund. No refunds were made during the fiscal year. (G) A description of each interfund transfer or loan made from the account or fund, including the public improvement on which the transferred or loaned fees will be expended, and, in the case of an interfund 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. (H) The amount of refunds made pursuant to subdivision (e) of Section 66001 and any allocation pursuant to subdivision (f) of Section 66001. No construction of public improvements have been identified. The City has not determined sufficient funds have been collected. Transportation Impact Fee For the purpose of compliance with Government Code subsection 66006(b)(1), the following information regarding AB 1600 fees is presented: For each separate account or fund established pursuant to subdivision (a), the local agency shall, within 180 days after the last day of each fiscal year, make available to the public the following information for the fiscal year: (E) Identification of each public improvement on which fees were expended and the amount of the expenditures on each improvement, including the total percentage of the cost of the public improvement that was funded with fees. F) An approximate date by which the construction of the public improvement will commence if the local agency determines that sufficient funds have been collected to complete financing on an incomplete public improvement, as identified in paragraph (2) of subdivision (a) of Section 66001, and the public improvement remains incomplete. Non-Residential (sq. ft.) Residential (dwelling unit) Transportation Impact Fee - The City Council adopted an ordinance on February 26, 2013 which established a Transportation Impact Fee for new development and intensified land uses that will fund transportation improvements such as new sidewalks, crosswalks, traffic signal upgrades, transit, and bicycle facilities that are necessitated by the new trips associated with land use change. The fees are based on residential units or commercial square footage. The fee is charged prior to issuance of building permits, unless state law requires the City to accept later fee payment. The Transportation Impact Fee reflects the costs associated with transportation improvements and the amount of new auto trips that can be attributed to land use changes. City of Santa Monica AB1600 Report Fiscal Year Ended June 30, 2016 (A) A brief description of the type of fee in the account or fund. (B) The amount of the fee. Project Fee Single-Family $990.00 Studio/Single Apartment:$315.00 1 Bedroom Apartment:$375.00 2 Bedroom Apartment:$570.00 3 Bedroom Apartment:$750.00 Duplex (2 Apartments):$900.00 Non-Residential: To be determined by the Civil Engineering Plan Checker (C) The beginning and ending balance of the account or fund and (D) The amount of the fees collected and the interest earned. FISCAL YEAR BEGINNING FUND BALANCE FEES COLLECTED INTEREST EARNED EXPENDITURES TOTAL FUND BALANCE FY2015-2016 4,722,547.35 433,427.65 304,875.00 4,851,100.00 No interfund transfers or loans were made during the fiscal year from this fund. No refunds were made during the fiscal year. The turf and irrigation improvement project is scheduled to begin in September 2016. City facility upgrades and the purchase of additional smart irrigation controllers are scheduled for fiscal year 16-17. The San Vicente median landscape renovation and irrigation retrofit project is scheduled to begin July 2017. Water Demand Mitigation Fee For the purpose of compliance with Government Code subsection 66006(b)(1), the following information regarding AB 1600 fees is presented: For each separate account or fund established pursuant to subdivision (a), the local agency shall, within 180 days after the last day of each fiscal year, make available to the public the following information for the fiscal year: (E) Identification of each public improvement on which fees were expended and the amount of the expenditures on each improvement, including the total percentage of the cost of the public improvement that was funded with fees. F) An approximate date by which the construction of the public improvement will commence if the local agency determines that sufficient funds have been collected to complete financing on an incomplete public improvement, as identified in paragraph (2) of subdivision (a) of Section 66001, and the public improvement remains incomplete. The Water Demand Mitigation Fee is a one-time fee the City charges new development to mitigate the total daily water consumption rate projected for the development. The total daily water demand for the project is calculated using standard water demand factors which have been developed by City staff. The water demand mitigation fee is set at $3.00 for each gallon of daily water demand which must be mitigated. This fee is required when: • Single-Family Residence -- for construction of a new residence or whenever adding 50% or greater to the square footage. • Multi-Family -- for construction of a new building or whenever new units are added. • Non-Residential -- for construction of a new building or whenever there is a change of use, changing or adding plumbing fixtures, or adding restaurant seats or square footage. Multi-Family (condominium fees same as apartments): Public Landscape purchased Calsense smart irrigation controllers for City facilities. 100% of the irrigation controllers were funded with water demand mitigation fees. (G) A description of each interfund transfer or loan made from the account or fund, including the public improvement on which the transferred or loaned fees will be expended, and, in the case of an interfund 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. (H) The amount of refunds made pursuant to subdivision (e) of Section 66001 and any allocation pursuant to subdivision (f) of Section 66001. City of Santa Monica AB1600 Report Fiscal Year Ended June 30, 2016 Additional Information is being provided regarding this fee: (1) Identification of the purpose to which the reportable fees are to be put. (2) Demonstration of a reasonable relationship between the reportable fees and the purposes for which they are charged. (3) Identification of all City sources and amounts of funding to complete financing of the projects as identified by the City. (4) Identification of the approximate dates on which the funding referred to in item C is expected to be deposited into the appropriate account or fund. San Vicente Median Funds Available Fiscal Year 2016-2017 Smart Irrigation Controllers Funds Available NA Landscape and Irrigation Conversion Funds Available NA City Facility Upgrades Funds Available NA Public Landscape Funds Available NA San Vicente Median $3,989,531 $6,010,469 Project Water Demand Mitigation Fees Local Funds $28,625 $0 Landscape and Irrigation Conversion $700,000 $0 The Water Demand Mitigation Fee is a one-time fee the City charges new development to mitigate the total daily water consumption rate projected for the development. The City intends to use the reportable fees for various City facility upgrades, public landscaping and irrigation controllers, and the San Vicente median landscape renovation and irrigation retrofit, which covers approximately 7.5 acres of open space. There is a reasonable relationship between new development upon which the Water Demand Mitigation Fees are charged and the need to address the increased demand for water within the City. New Single-Family, Multi-Family, or other Non-Residential development in the City results in a higher demand for water and leads to an increase in the total water consumption rate for the City. The Water Demand Mitigation Fee collected from these types of development is used to fund facility upgrades, installation of low water demand landscape and water efficient irrigation systems to offset this increased usage by reducing daily water consumption for the City. Project Water Demand Mitigation Fees Local Funds (Approx.) City Facility Upgrades $30,308 $0 Public Landscape $102,636 $0 Smart Irrigation Controllers City of Santa Monica AB1600 Report Fiscal Year Ended June 30, 2016 (A) A brief description of the type of fee in the account or fund. (B) The amount of the fee. Project Fee Single-Family $990.00 Studio/Single Apartment:$315.00 1 Bedroom Apartment:$375.00 2 Bedroom Apartment:$570.00 3 Bedroom Apartment:$750.00 Duplex (2 Apartments):$900.00 Non-Residential: To be determined by the Civil Engineering Plan Checker (C) The beginning and ending balance of the account or fund and (D) The amount of the fees collected and the interest earned. FISCAL YEAR BEGINNING FUND BALANCE FEES COLLECTED INTEREST EARNED EXPENDITURES TOTAL FUND BALANCE FY2015-2016 3,638,839.00 433,427.65 360,615.00 3,711,651.65 No interfund transfers or loans were made during the fiscal year from this fund. No refunds were made during the fiscal year. Water Demand Mitigation Fee ERRATA SHEET For the purpose of compliance with Government Code subsection 66006(b)(1), the following information regarding AB 1600 fees is presented: For each separate account or fund established pursuant to subdivision (a), the local agency shall, within 180 days after the last day of each fiscal year, make available to the public the following information for the fiscal year: The Water Demand Mitigation Fee is a one-time fee the City charges new development to mitigate the total daily water consumption rate projected for the development. The total daily water demand for the project is calculated using standard water demand factors which have been developed by City staff. The water demand mitigation fee is set at $3.00 for each gallon of daily water demand which must be mitigated. This fee is required when: • Single-Family Residence -- for construction of a new residence or whenever adding 50% or greater to the square footage. • Multi-Family -- for construction of a new building or whenever new units are added. • Non-Residential -- for construction of a new building or whenever there is a change of use, changing or adding plumbing fixtures, or adding restaurant seats or square footage. Multi-Family (condominium fees same as apartments): (E) Identification of each public improvement on which fees were expended and the amount of the expenditures on each improvement, including the total percentage of the cost of the public improvement that was funded with fees. Public Landscape purchased Calsense smart irrigation controllers for City facilities. 100% of the irrigation controllers were funded with water demand mitigation fees. F) An approximate date by which the construction of the public improvement will commence if the local agency determines that sufficient funds have been collected to complete financing on an incomplete public improvement, as identified in paragraph (2) of subdivision (a) of Section 66001, and the public improvement remains incomplete. City facility upgrades, Woodlawn Cemetery Irrigation Retrofit, Smart Irrigation Controllers installation, Landscape and Irrigation Conversions, Rotary Nozzle Retrofits, Toilet Direct Installation Project, SMMUSD Audits and Retrofits, and the City Services Building Production Well are scheduled for fiscal year 16-17. The San Vicente Medians Landscape Plan/Design for Water Efficient Landscape and Irrigation System project is scheduled to begin July 2017. (G) A description of each interfund transfer or loan made from the account or fund, including the public improvement on which the transferred or loaned fees will be expended, and, in the case of an interfund 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. (H) The amount of refunds made pursuant to subdivision (e) of Section 66001 and any allocation pursuant to subdivision (f) of Section 66001. Revisions were made upon further review to the following sections of the Water Demand Mitigation Fee AB1600 Report that was posted on December 27, 2016. Fields containing revisions are highlighted yellow. City of Santa Monica AB1600 Report Fiscal Year Ended June 30, 2016 Additional Information is being provided regarding this fee: (1) Identification of the purpose to which the reportable fees are to be put. (2) Demonstration of a reasonable relationship between the reportable fees and the purposes for which they are charged. (3) Identification of all City sources and amounts of funding to complete financing of the projects as identified by the City. (4) Identification of the approximate dates on which the funding referred to in item C is expected to be deposited into the appropriate account or fund. The Water Demand Mitigation Fee is a one-time fee the City charges new development to mitigate the total daily water consumption rate projected for the development. The City intends to use the reportable fees for various water conservation public projects including City facility upgrades, Woodlawn Cemetery Irrigation upgrades, public landscaping and irrigation controllers, toilet direct installation program, audits and retrofits at Santa Monica Malibu Unified School District and the San Vicente Medians Landscape Plan/Design for Water Efficient Landscape and Irrigation System project, which covers approximately 7.5 acres of open space. There is a reasonable relationship between new development upon which the Water Demand Mitigation Fees are charged and the need to address the increased demand for water within the City. New Single-Family, Multi-Family, or other Non-Residential development in the City results in a higher demand for water and leads to an increase in the total water consumption rate for the City. The Water Demand Mitigation Fee collected from these types of development is used to fund public projects including plumbing fixture retrofits, installation of low water demand landscape and water efficient irrigation systems, rainwater/stormwater and water production equipment to offset this increased usage by reducing daily water consumption for the City and its impact on the City's water production facilities. Project Water Demand Mitigation Fees Local Funds (Approx.) City Facility Upgrades $30,308 $0 Woodlawn Cemetery Irrigation Retrofit $60,561 $0 Smart Irrigation Controllers and Nozzles $238,326 $0 Landscape and Irrigation Conversion $1,149,052 $0 San Vicente Medians Landscape Plan/Design for Water Efficient Landscape and Irrigation System $242,511 $0 Toilet Direct Installation Project $857,303 $0 SMMUSD Audits and Retrofits $849,000 $0 City Services Building Production Well $284,591 $0 Total $3,711,652 $0 Project Water Demand Mitigation Fees Local Funds City Facility Upgrades Funds Available NA Woodlawn Cemetery Irrigation Retrofit Funds Available NA Smart Irrigation Controllers and Nozzles Funds Available NA City Services Building Production Well Funds Available NA Toilet Direct Installation Project Funds Available NA SMMUSD Audits and Retrofits Funds Available NA Landscape and Irrigation Conversion Funds Available NA San Vicente Medians Landscape Plan/Design for Water Efficient Landscape and Irrigation System Funds Available NA