HomeMy WebLinkAbout8.3 TVTC Adjust TVTD Fee CITY CLERK
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AGENDA STATEMENT
CITY COUNCIL MEETING DATE: April 15, 2003
SUBJECT: Approve in Principle a Recommendation by the Th-Valley
Transportation Council (TVTC) To Adjust the Th-Valley
Transportation Development (TVTD) Fee
Report Prepared by: Lee Thompson, Public Works Director
ATTACHMENTS: 1) Report on Status of and Recommendation for an Increase to
the Th-Valley Transportation Council Fee
2) Proposed Addendum to Joint Exercise of Powers Agreement
RECOMMENDATION: ~~' Approve in principle a recommendation by the TVTC to adjust the
'~-3 TVTD Fee as described herein
FINANCIAL STATEMENT: There is no cost to the City associated with this proposed TVTD Fee
Adjustment action. The fee would only be changed after all seven
TVTC member agencies held public hearings and approved the fee
adjustment.
DESCRIPTION: The TVTC has been working for some time now to update the
TVTD fee in order to more fairly distribute the fee burden between land uses and to increase the fee which
has not kept up with the increases in construction costs.
Six of the seven agency representatives have agreed in concept with a method of increasing the fee. The
seventh representative, from Contra Costa County, felt that the increase was not enough and would not
support it. That representative has now left the Contra Costa County Board of Supervisors and the County
has not appointed a replacement for the TVTC.
The remaining six representatives have agreed to take this proposed change, in principal, to their
respective governing Boards to keep the process moving forward as it will ultimately require unanimous
agreement by all seven agencies.
If each of the six agency Boards reach consensus, the TVTC members would then petition Contra Costa
County to concur. Upon the TVTC's unanimous vote, the next step would be for each of the member
agencies to hold public hem'ings to modify the Fee and approve the addendum to the TVTC Joint Exercise
of Powers Agreement (JEPA).
COPIES TO: Millie Greenberg, TVTC Chair
Guy Bjerke, Home Builders Assoc.
~..lrP'rClS£? Updat¢lagst_fee adjust proposal_updated, doc ~! ?.fi~!i~;, ~
REPORT
STATUS OF AND RECOMMENDATION FOR AN INCREASE TO
THE TR1-VALLEY TRANSPORTATION COUNCIL FEE
By Ray Kuzbari, City of Dublin Traffic Engineer
BACKGROUND
The TVTC adopted the TVTD Fee program in 1998 to collect traffic mitigation fees from private
developments within the Th-Valley area to fund a list of regional transportation improvements deemed
necessary to support additional traffic from development projects. A fee nexus study had been
prepared prior to the adoption of the TVTD Fee program that recommended implementing an initial
fee schedule, based on long-term land use and traffic projections, as well as estimated costs to
implement improvement projects. The TVTC elected to adopt an initial fee schedule in 1998 that was
substantially lower than the recommended nexus fee amounts.
For example, the nexus fee for "Single Family Residential" use was $5,421 per dwelling unit, while
the adopted fee was only $1,500 per dwelling unit. Similarly, the adopted fee for "Office" use was
only $1.00 per square foot, compared to $9.74 per square foot recommended by the nexus study. The
TVTC argued at the time that the lower fees would help provide a better jobs/housing balance in the
Tri-Valley area and keep potential residential developments from shifting to more outlying areas to the
east (e.g., San Joaquin County) that could increase cut-through traffic on local Tri-Valley roadways.
The total cost estimate for the improvement projects has increased since 1998 from approximately
$460 million to $763 million, representing a 65% increase. The reasons for this cost increase are that
the original estimates were preliminarily prepared during early stages of project planning, and to five
years of construction inflation. Most of these projects have since become better defined, undergone
environmental analysis and some are nearing construction. Project eost estimates have been updated to
reflect design and construction requirements based on environmental considerations that were not
known at the time when the original cost estimates were prepared.
As part of an ongoing effort since April 2002 to update the TVTC Strategic Expenditure Plan (SEP),
TVTC members have been considering raising the TVTD Fees for various land use categories to
amounts that would better reflect the developers' fair share responsibility of funding regional
transportation improvement projects. The current SEP identifies eleven regional improvement projects
and allocates TVTD Fee funds to the highest priority projects.
Following a series of meeting discussions that were held by the TVTC since April 2002, six of the
seven TVTC members voted during the March 5, 2003, TVTC meeting in favor of a fee adjustment
plan (Exhibit 1). The six members who voted in favor of the plan represented the Cities of Dublin,
Livermore, Pleasanton and San Ramon, the Town of Danville, and Alameda County. Staffs from these
jurisdictions were directed to forward the recommended interim fee adjustment plan to their respective
governing bodies for preliminary approval. No representative from Contra Costa County was present
at that meeting and, hence, the County committee member did not vote on this plan. Contra Costa
County had previously recommended a different plan of action to raise the TVTD Fees by increasing
April 7, 2003
the fees by a substantially higher amount than the recommendation made by the other six members.
The Contra Costa County plan was not agreeable to the other TVTC members.
FUNDING
Outside funding sources, including federal, State and local funds have been secured to fund a $385.2
million portion (or 50%) of the total project cost. As a result of cost estimate increases, TVTC
revenues projected over the next 10 years, based on the current fee schedule, would only cover
approximately 6.7 % of the total project cost, leaving $326.5 million in unfunded cost (Exhibit 2 -
Project Costs and Revenue Sources). Under the current fee schedule and project delivery schedule, the
TVTD Fee program's cash flow is projected to fall into negative territories by fiscal year 2007-2008,
with the deficit possibly peaking in fiscal year 2009-2010 at negative $10.2 million (Exhibit 3 - TVTD
Fee Funding Plan). The present gap between fee revenues and project costs has left some projects
unable to be fully funded, and will likely result in the delayed delivery of these improvements.
PROPOSED ADJUSTMENT
The proposed interim fee adjustment would reduce the fee for "Multi-Family Residential" uses and
raise the fee for "Office" and "Industrial" uses to 27.7% of their corresponding nexus fee. This would
match the percent level of the nexus fee for "Single Family Residential", after a14% inflation
adjustment since 1998 based on the construction cost index (CCI) for the San Francisco Bay Area.
The TVTC JEPA defines "Multi-Family Residential" as "buildings or parts thereof designed and used
exclusively as a dwelling unit among other dwelling units, either on the same parcel (e.g., apartments
and mobile home parks) or under separate ownership (e.g., condominiums, townhomes, duplexes, or
duets)." This proposed fee adjustment would leave the TVTD Fee for "Retail" and "Other" categories
unchanged (see Exhibit 1). The proposed fee structure would provide for a more equitable fee
distribution among the various land use categories without increasing the cost of housing.
Depending on the state of the economy, the proposed fee adjustment could generate up to $23 million
in additional revenue over the next 10 years. If office development projections materialize over the
next few years, the additional revenue could eliminate the negative cash flow projections anticipated in
future years of the TVTD Fee program under the current amounts. The proposed fee adjustment could
also extend the TVTD Fee funding potentials from approximately 6.7% to 9.1% of the total project
cost.
FEE NEXUS STUDY
TVTC members are in agreement that the existing fee nexus study needs to be updated to reflect
current land use projections and transportation improvement needs. The proposed interim fee
adjustment would represent a first-step fee increase designed to capture potential TVTDF revenues
from development that occurs while the fee nexus study is being updated. As part of this interim fee
adjustment proposal, the TVTC is recommending that additional revenues collected from the fee
adjustment remain unallocated until the new fee nexus study is complete, and that $100,000 be
allocated to fund the nexus study.
The TVTC anticipates completing the new nexus study within the next two years following completion
of the General Plan update for the City of Livermore, which will incorporate revised land use decisions
for the North Livermore area. The new nexus study will also provide the basis for maintaining or
April 7, 2003 Page 2 of 3
updating the current list of improvement projects, adopting a revised fee schedule on a more permanent
basis, and allocating funds for projects.
CONTRA COSTA COUNTY BOARD OF SUPERVISORS ACTION
In contrast, the Contra Costa County Board of Supervisors has recently approved a plan to raise the
TVTD Fee schedule in steps to a level that represents 50% of the fee amounts justified by the current
fee nexus study. The plan would also allow for further fee adjustments to be considered after
completion of the new nexus study. The fee increase based on the Contra Costa County plan would be
equivalent to a 174% across-the-board average increase to the current fee rates, as opposed to a 56%
average increase based on the recommendation made by the other six TVTC members.
NEXT STEPS
The other six TVTC members have expressed concerns regarding the Contra Costa County proposal in
that it would impose a drastic increase to the fee and could affect housing prices in the Tri-Valley area.
The recommendation presented by the other six TVTC members would allow for a less drastic first-
step fee increase and would attract more Multi-Family Residential projects to develop within the Tri-
Valley area by lowering the fee rate for this type of use.
The TVTC will reconvene on April 23, 2003, to discuss recent actions taken by local jurisdictions to
approve in principle the interim fee adjustment recommendation presented in this report. The adoption
of any fee increase will require a unanimous vote by the TVTC to approve the new fee plan and
forward the plan to the local jurisdictions for final Public Hearings and unanimous approval. The
following steps will be required to adopt the recommended interim fee adjustment:
1. Local jurisdictions must review the interim fee adjustment recommendation and approve it in
principle;
2. The seven TVTC members must vote unanimously to approve the fee adjustment proposal and
forward the plan to the local jurisdictions for final approval; and
3. The governing bodies of all seven member-jurisdictions must act to approve the plan. Each
. jurisdiction must adopt a resolution or ordinance amending the resolution or ordinance that was
adopted in 1988 establishing the TVTD Fees for traffic mitigation. In addition, each jurisdiction
must approve an addendum to the TVTC JEPA that shall include the revised fee schedule (Staff
Report Attachment 2 - Draft JEPA Addendum).
G:\TVTC\SEP Update\tvtd fee increase report c2.doc
April 7, 2003 Page 3 of 3
PROPOSED INTERIM ADJUSTMENT
TO THE TVTD FEE
(Adjust the Fee Amounts for MF Residential, Office and Industrial Uses to Match
the Percent Level of the Nexus Fee for SF Residential; No New Allocations of
TVTDF Funds)
~rr~i ~ (~i Adj~)o/~ ~,ng~ga:~g (CCi
SF Residential $1,711/unit 27.7% $1,711/unit 27.7%
0.0%
MF Residehfial $1; 198/anit 30~5 % $1'087/unit 27~7%
~9~3%
Office $1.14/s~ 10.3% $3.07/sf 27.7%
+169.3%
Retail $1.14~S~ 80,3%* $ t ;t 4/sf 80.3%
o.o%
~ndust~al $0.86/sf 11.5 % $2.08/s f 27.7%
+141.9%
Other $685~Pe& t~P 34.0%** $685/pe& ~P 34:0%
oo o
Based on the average Retail Fee from the Nexus Study.
Includes an average adjustment factor of 24% to the initial Nexus Fee for "Other" uses that do not fit
into the standard Retail, Office or Industrial categories. This adjustment factor was determined based
on a TVTC review of TVTD Fees in 1999 to make the Fee for "Other" uses more equitable (i.e.,
proportional to the Fee paid by traditional Retail, Office or Industrial uses).
G: t TVTC[SEP UpdatetFee adjustment proposal_Mar03, doc
i PROJECT MEASURE JEPA LOCAL UNFUNDED
FEE FUNDS COST
COST B
$254.0 $70.0 $1.5 $158.5
$92.0 $20.0 $25.6 ~ $5.0
$55.6 ,8.5 $11.5
(Tier 2)
i ~8~ $127.8(3) $80 o.1 ~9~.~
$90.0(7)
~ 8~t-A~
$1.2
$13.5(s) ] ~] ] ]~]]]]]]]]]]]]]]]]]] ] $2.66 $4.34 $1.4
$25.0 S ~ )))~¢ $21.6
:} $763.0 : : $133.4 $11.16 $31.54 $326.5
(1) 2002 dollars
(2) Projected revenue to year 2013 (80% of TVTD revenue)
(3) Does not include an additional $72.7 million for median widening for future BART extension
(4) Other potential funds include STIP ($16.0) and ITIP ($60.0)
(5) $58 million-escalated to mid-point of construction k5~
(6) Includes reimbursements of approximately $1.4 to the Cities of Dublin and Pleasanton for prior contributions C,k~
(7) Includes the cost for southbound HOV lanes to Calaveras Boulevard in Milpitas ,,
(8) Includes the cost of improvements to the northbound on and off ramps
(9) $51.3 without the $5.6 local share for Project 1
G.qT~TC[SEP Update~SEP Table 2_updatedO. doc 4/3/2003
TVTD FEE FUNDING PLAN ¢)
O 9b,,' i99i00 i05i~ 0~/02 02z03 io~zo'4 104ios'lOs~oo'ooz07 07zoo 108/0, 09z~o ~oz~ I~z~2 ~2z~3 TOTAL
REVENUE (80 '/. of TVTDF) $3.301 $4.001 $4.001 $4:00 $4.001 $4.001 $4.001 $4.001 $4.001 $4.001 $3.501 $3.5oI $3.501 $3.501 $3.401 $56.70
PROJECTS (2)
1. 1-580/I-680 Local Share (3) $2.3
Expressway (6) :i:
2b, SR 84 - Isabel Rte 84/
1-580 Interchange ~.,i!!:ii i?I i 'iiiiii! il.; i iil :'i;i:: ', .i !i; ~/;ii $0.0
Contra Costa County i ii;;: :!:i,i~,:i:i:~ $12.0
4. West DPX BART Station'4' i..i; i.!: ;i; i! i:i $4.0 ; !iiii,!i!.. i ,: ;i. -' i; .ii. '~'.- i'ilil :;i; :ii iiii: $4.0
5. 1-580 HOV Lanes ii/!'; :i; i; ii: :-i~: '$~0 $4.0 $8.0
Interchange ,!:';i i'ili i $08 .e
8. I-e80/Alcosta Boulevard ' !.. :$,:6 $1
Interchange
9. c,ow oa,,o ,o d
Improvements
Fee Nexus J: $0i05J $0.05 J.
Update Study I': ;;:1 I ; ,
PROJECTS TOTAL: $3.50 ~!'.~ $0.00 $5.25 $3.70;ii;:~ $12.50 iiii~ $6.40 :':;i';~O?~ $0.00 $56.90
CASH FLOW: (6) $0.50 $8.50 ;~;~ $8.80 ii~:.4~ $9.70 :!i~(~0 -$2.50 -$10.20 !$'~ii;i~ -$3.60
(1) Future Allocations (after 01/02) are in 2002 dollars.
(2) See Table 2 of the SEP 2003 Update for total project costs.
(3) Includes reimbursements of approximately $1.4 to the Cities of Dublin and Pleasanton for Crior contributions
(4) A protion of the BART Station funding commitment could be used to purchase buses
(5) Negative cash flow would result after 2006/07 by keeping the schedules submitted by project sponsors
(The TVTDF revenue estimates should be updated as part of the future fee nexus study for the next SEP update)
(6) Total unfunded cost for the initial phase project is $14.1 4/3/2003
ADDENDUM I
TO
JOINT EXERCISE OF
POWERS AGREEMENT
PERTAINING TO
Tri-Valley Transportation Development
Fees for Traffic Mitigation
BY AND AMONG
The County of Alameda
The County of Contra Costa
The City of Dublin
The City of Livermore
The City of Pleasanton
The City of San Ramon
The Town of Danville
RECITALS
WHEREAS, each of the Th-Valley juhsdictions adopted the Joint Exercise of
Powers Agreement (JEPA) for the Th-Valley Transportation Development Fees
(TVTDF); and
WHEREAS, all TVTC jurisdictions have resolved to cooperatively participate
and adopt uniform TVTD Fee rates; and
WHEREAS, the TVTD Fee applies to new development in all seven-member
jurisdictions within the Tri-Valley area; and
WHEREAS, revenues from the TVTD Fees are used to fund the regional
transportation improvements identified in the Th-Valley Transportation Plan/Action Plan
(TVTP/AP) and the Strategic Expenditure Plan (SEP); and
WHEREAS, the TVTC commissioned a "fee nexus study" in 1996 to establish
the TVTD Fee based on traffic impacts from new development and the costs for the
transportation improvements identified in the TVTP/AP; and
WHEREAS, the adopted fee in 1998 for Office development was only 10.3% of
the resulting fee from the "fee nexus study" for this type of land use; and
WHEREAS, the adopted fee in 1998 for Industrial development was only 11.5%
of the resulting fee from the "fee nexus study" for this type of land use; and
WHEREAS, the 1-580/I-680 h~terchange Improvements project is now complete;
and
WHEREAS, the estimated total cost for the existing ten TVTDF projects has
increased by approximately 65%; and
WHEREAS, the construction cost index for the San Francisco Bay Area has risen
by approximately 14% since the adoption of the TVTD Fee in 1998; and
WHEREAS, an estimated $10.20 million in cash flow deficit is anticipated to
occur by fiscal year 2009-10 based on the current expenditure plan and the scheduling
requirements of TVTDF projects; and
WHEREAS, the gap between fee revenues and regional transportation
improvement costs has left some projects unable to be fully funded, and will likely result
in the delayed delivery of these improvements; and
WHEREAS, Subsection 13.b of the JEPA specifies that for non-automatic
TVTD Fee adjustments agreed upon by the Parties, the amount of the adjustment shall be
Addendum I Page 2 of 5
Joint Exercise of Powers Agreement 4/1/03
TVTD Fees for Traffic Mitigation
included in a written addendum to the JEPA that shall be approved by each Party and in
amendments of each adopted fee resolution or ordinance; and
WHEREAS, each Party adopted a resolution amending the previously adopted
TVTD Fee resolution or ordinance; and
WHEREAS, each Party approved this addendum (Addendum I) to the JEPA;
NOW THEREFORE BE IT RESOLVED THAT the JEPA is mnended as
follows:
Revise Section 9. Tri-Valley Transportation Development Fee Amount of the JEPA
to read as follows:
The initial Th-Valley Transportation Development Fees, effective the date this addendum
is approved by all Parties, shall be as follows:
Land Use Type Fee Per Unit
Single Family Residential $1,711 Dwelling Unit
Multi Family Residential $1,087 Dwelling Unit
Office $3.07 Square foot of gross floor area
Retail $1.14 Square foot of gross floor area
Industrial $2.08 Square foot of gross floor area
Other Uses $685 Average a.m./p.m, peak hour trip*
*Peak-hour trips will be determined from the latest revision to the Institute of
Transportation Engineers' Trip Generation Manual or other rate schedule as agreed to by
the TVTC. Notwithstanding the foregoing, an applicant for a Land Use Entitlement who
is dissatisfied with the number of peak-hour trips, as calculated by the City/County, may
appeal the determination to the Council/Board of Supervisors. If such an appeal is
granted by the Council/Board of Supervisors, and the Council/Board of Supervisors
adjusts the number of peak-hour trips, the City/County shall have such decision ratified
by five members of the TVTC. Absent such ratification, the full amount of the fee must
be paid by the applicant.
Addendum I Page 3 of 5
Joint Exercise of Powers Agreement 4/1/03
TVTD Fees for Traffic Mitigation
Signatures
This Addendum I to the Joint Exercise of Powers Agreement may be signed in
counterparts with the signature pages attached to form a complete document.
APPROVED BY:
COUNTY OFCONTRACOSTA
By: Dated:
Its:
Attest:
Clerk of the Board of Supervisors
COUNTY OF ALAMEDA
By: Dated:
Its:
Attest:
Clerk of the Board of Supervisors
CITY OF SAN RAMON
By: Dated:
Its:
Attest:
City Clerk
Addendum I Page 4 of 5
Joint Exercise of Powers Agreement 4/1/03
TVTD Fees for Traffic Mitigation
TOWN OF DANVILLE
By: Dated:
Its:
Attest:
Town Clerk
CITY OF DUBLIN
By: Dated:
Its:
Attest:
City Clerk
CITY OF LIVERMORE
By: Dated:
Its:
Attest:
City Clerk
CITY OF PLEASANTON
By: Dated:
Its:
Attest:
City Clerk
G: t TVTCISEP UpdatelAddendum I to dEPA-fee adjust.doc
Addendum I Page 5 of 5
Joint Exercise of poWers Agreement 4/1/03
TVTD Fees for Traffic Mitigation