1999 AGN APR 06 I16 - Laserfiche WebLink

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Staff Report — Spikes Fee Page 2 of 3 Spikes parcel at $43,000 back in May 1993. This $43,000 figure is considerably less than the $202,633.15 that is currently being assessed against the Spike development. To facilitate and not delay the development of the Spikes Restaurant, the Building Department, at the urging of the Agency, issued the building permit for Spikes prior to the payment of the traffic impact fee, based upon the understanding and reassurance by the Agency that the fee would be paid or the fee would be waived by the City prior to the Certificate of Occupancy being issued. Discussion: As indicated in previous discussions, the City's current traffic fee, especially for commercial developments, appears to be excessive when compared to similar fees charged by surrounding cities. The amount of the traffic fee when compared to the overall cost of construction appears to be quite excessive at $81.03 per foot, nearly costing as much as the cost of building improvements themselves. Additionally, a recent impact fee study done by Topping Jaquess in November 1997 used a different method in determining traffic fees based upon an Equivalent Dwelling Unit (EDU). (Please refer to excerpt from Jacques -Topping Study, attached hereto as Exhibit "F). Using this EDU method, the traffic fees assessed against a commercial development (C1/C2) such as Spikes would be $1,286 per 1,000 sq. ft. or a total of $3,215 as opposed to the fee of over $200,000 currently charged. If the City established the Topping Jaquess traffic fees, then the Agency's potential liability for payment of the fees would be reduced to zero. The City will be scheduling a study session in August to consider updating the City's current infrastructure fees. -C- Financial Impact: To facilitate the Rancho Mediterrania exit strategy, the Board directed Agency staff to transfer funds from the Cooley Ranch Project Area accounts, as well as other Projects Areas as necessary, to fill the deficit. As a result of these recent budget transfers, the Cooley Ranch Project Area Marketing/Incentives account was reduced from $350,000 to only $25,000. (Please refer to Cooley ,Ranch Project Area Budget document attached hereto as Exhibit "E). The remaining $25,000 is sufficient to satisfy the existing loan commitment to Spikes to pay for the first $25,000 of the traffic fee being assessed. As such, the Agency currently does not have sufficient funds budgeted to pay for the remaining traffic fees payable in the amount of $177,633. A budget transfer would again be necessary to appropriate funding.