TITLE
Recommendation to adopt resolution approving the Annual and Five-Year Reports for the Transportation Improvement Fee, Parks and Recreation Facilities Fee, the Fire Facilities Impact Fee, and the Police Facilities Impact Fee. (Citywide)
DISCUSSION
New development affects the level of services provided through the City's facilities, infrastructure, land, and equipment. To accommodate the needs of the new residents and businesses, the City imposes impact fees to expand these resources as follows:
· Transportation Improvement Fee
· Parks and Recreation Facilities Fee
· Fire Facilities Impact Fee
· Police Facilities Impact Fee
The purpose of the Annual and Five-Year Reports is to provide information to the City Council and the public and to fulfill State Government Code and Municipal Code mandated reporting and disclosure requirements. In February 2011, the Department of Financial Management absorbed the centralized management of the reporting process. Since that time, Financial Management and the departments involved worked together to standardize the report format with the goal of making the information more accessible and transparent to the City Council and the public. In 2012, the Department of Technology Services initiated the design and development of a database to improve program management and reporting by consolidating the information into one location that can be shared by multiple departments. These changes resulted in the consolidation of all the required reporting into a single City Council action with the attached Resolution containing the four departments' reports as Exhibits.
Annual Reports
The California Government Code requires that local agencies that impose fees in connection with the approval of development projects make certain information available to the public on an annual basis. The Long Beach Municipal Code (LBMC) adds other elements to these requirements. Essentially, the reports provide what the fees are, the fund balance of each fund and how the money was spent in the prior fiscal year.
Five-Year Reports
Section 66001 of the Government Code mandates additional disclosure with respect to any fees collected and remaining unexpended in the fifth year after collection. In order to ensure that the City Council is fully informed of the status of unexpended funds, five-year reports will be submitted annually.
This matter was reviewed by Deputy City Attorney Gary Anderson on March 4, 2013 and Budget and Performance Management Bureau Manager Dennis Strachota on February 26, 2013.
Transportation Improvement Fee Report (Exhibit A to Resolution)
The Transportation Improvement Fee Report summarizes the status of implementation of the citywide Traffic Mitigation Program (TMP). The TMP is the City's program for implementing the transportation improvements needed to meet increased traffic resulting from economic growth using a combination of public funds, such as Gas Tax and Federal grants, and impact fees from new development. The TMP was designed as the mechanism by which the City could implement its basic access strategy to support economic growth and maintain mobility.
In FY 12, the City issued permits for 209,070 gross square feet of residential units and 281,217 gross square feet of commercial development, which will generate an estimated 1,190 evening peak hour trips each day. These figures do not include the Douglas Park development, which is under a separate development agreement. A total of $195,872 in Transportation Improvement Fund fees were collected in FY 12, with $3,297,853 in expenditures and reimbursements, leaving a fund balance of $4,381,511. These funds may only be used to provide transportation improvements needed to serve new development. A summary of projects funded using transportation improvement fee revenues is included in Exhibit A.
Parks and Recreation Facilities Fee Report (Exhibit B to Resolution)
In February 1989, the City Council established the Parks and Recreation Facilities Fee (PRFF), a fee on new development designed to maintain the existing level of service for existing and new residents. New residential development increases the population of the City by providing more places to live. This adversely impacts parks and recreational resources through crowding and overuse, lowering the quality of life for all existing and new residents.
In FY 12, $279,906 was received from PRFF fees, including interest. During FY 12, $512,939 in prior year PRFF revenue was expended in the Capital Improvement Budget, leaving a fund balance of $752,430 to be spent in future years. Specific FY 12 projects are listed in Exhibit B of this Report.
Fire Facilities Fee Report (Exhibit C to Resolution)
In April 2007, City Council established the Fire Facilities Impact Fee, a fee imposed on new development to mitigate the impact of new development on fire facilities. New development increases the demand for public safety facilities and impact fees help defray the costs for these facilities. In FY 12, a total of $43,511 in Fire Facilities Impact Fees was collected with no expenditures, leaving a fund balance of $210,288. The Fire Department has not spent any of these funds through September 30, 2012. However, it is anticipated that funds may be used to support a portion of the cost of furnishing and equipping Fire Station 12. This new fire station, built with former Redevelopment Agency funds, will include a disaster resource building and a community meeting room and will offer increased capacity to the North Long Beach community, as well as the entire City.
Police Facilities Fee Report (Exhibit D to Resolution)
In April 2007, the City Council also established the Police Facilities Impact Fee to mitigate the impact of new development on police facilities. New development increases the demand for public safety facilities and impact fees help defray the costs for these facilities. Funds collected from the Police Facilities Impact Fee can be used to fund the acquisition of additional property for law enforcement facilities; construction of new buildings for law enforcement services; furnishing of new buildings or facilities for law enforcement services; purchasing of equipment and vehicles for law enforcement services; funding of a master plan to identify capital facilities to serve new Police Department Development; and, the cost of financing.
In FY 12, the fund had a beginning balance of $265,073. During FY 12, $70,706 was received from fees with no expenses or refunds, resulting in an ending fund balance of $335,780. It is anticipated that fund balance will be used to provide new facilities for the Police Department's Youth Services Section.
TIMING CONSIDERATIONS
City Council action on this item is requested on March 19, 2013 as State Law requires the information contained in these reports to be made available to the public within 180 days after the last day of the fiscal year, or March 31, 2013.
FISCAL IMPACT
The amount of impact fees collected each year is dependent on the amount and type of new development and its relationship to the purpose of the fee. The impact fee revenue for the fiscal year ended September 30, 2012 (FY 12) was $589,996. Impact Fee expenditures in FY 12 totaled $3,810,792. The City was able to spend more on projects than it collected in FY 12 by drawing down fund balance built up over multiple years of collecting Impact Fees. As of September 30, 2012, the City has a remaining fund balance of $5,680,008 across all Impact Fees. These fees can only be used on projects and expenses to offset the impact of the new development. The five-year reports provide information on revenue unexpended in the various impact fee funds during (FY 08 - FY 12).
SUGGESTED ACTION
Approve recommendation.
BODY
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LONG BEACH ADOPTING THE CITY OF LONG BEACH TRANSPORTATION IMPROVEMENT FEE, PARKS AND RECREATION FACILITIES FEE, FIRE AND POLICE FACILITIES IMPACT FEE REPORTS FOR FISCAL YEAR 2012; AND MAKE FINDINGS RELATIVE THERETO IN ACCORDANCE WITH LONG BEACH MUNICIPAL CODE CHAPTERS 18.17, 18.18, 18.22 and 18.23 AND GOVERNMENT CODE SECTIONS 66001 AND 66006
Respectfully Submitted,
JOHN GROSS
DIRECTOR OF FINANCIAL MANAGEMENT
APPROVED:
PATRICK H. WEST
CITY MANAGER