REPORT TO THE CITY COUNCIL
FROM: JENNIFER K. CLARK, AICP, Director
Planning and Development Department
BY: SOPHIA PAGOULATOS, Planning Manager
Planning and Development Department
SUBJECT
Title
HEARING to Consider adoption of the Vehicle Miles Traveled Reduction Program and Nexus Study and Vehicle Miles Traveled Mitigation Fee; and related Environmental Impact Report SCH No. 2024091129.
1. RESOLUTION - Certifying Environmental Impact Report SCH No. 2024091129, adopting Findings of Fact as required by Public Resources Code Section 21081(A) and CEQA Guidelines, Section 15091, Approving a Mitigation Monitoring and Reporting Program as Required by Public Resources Code Section 21081.6 and CEQA Guidelines Section 15097, Adopting the Findings of Fact and Statement of Overriding Considerations as Required by Public Resources Code Section 21081(B) and CEQA Guidelines Section 15093, as Related to the Adoption of the Vehicle Miles Traveled Reduction Program and Nexus Study.
a. ADOPT the Findings of Fact and Statement of Overriding Considerations pursuant to CEQA Guidelines Section 15091; and
b. ADOPT the Mitigation Monitoring and Reporting Program (MMRP) pursuant to CEQA Guidelines Section 15097; and
2. ***RESOLUTION - Adopting a Vehicle Miles Traveled Nexus Study, Reduction Program, and Capital Improvement Plan as described in the Vehicle Miles Traveled Reduction Program and Nexus Study document dated September 2025, prepared pursuant to the requirements of California Public Resources Code Section 21099, CEQA Guidelines Sections 15064.3(B), 15064.7, and 15126.4, and the Mitigation Fee Act (Subject to Mayor’s Veto)
a. ADOPT the Nexus Study based on the Council’s determination that the Vehicle Miles Reduction Program and Nexus Study was prepared in compliance with the Mitigation Fee Act and meets all requirements for a nexus study
b. ADOPT the Capital Improvement Plan (CIP) based on the Council’s determination that the CIP was prepared pursuant to the requirements of the Mitigation Fee Act.
c. ADOPT the Program inclusive of the VMT Mitigation Fee based on the Council’s determination that the public facilities, services, and amenities contemplated are individually and collectively necessary to contribute to the reduction of VMT Citywide, and that the VMT Mitigation Fee is in compliance with the Mitigation Fee Act and is supported by the Nexus Study.
3. BILL (for introduction) - Adding Article 4.17 to Chapter 12 of the Fresno Municipal Code, relating to the Vehicle Miles Traveled Mitigation Fee
4. ***RESOLUTION - Adopting the 593rd Amendment to the Master Fee Schedule Resolution No. 80-420 to add a Vehicle Miles Traveled Mitigation Fee in the Planning Section for Planning and Development Department (Subject to Mayor’s Veto)
Body
RECOMMENDATION
Staff recommends certification of the Environmental Impact Report (EIR, Exhibits A-D), adoption of the Mitigation and Monitoring Reporting Program (Exhibit E), adoption of the VMT Nexus Study and the VMT Reduction Program (Exhibits F and H), amendment of the Fresno Municipal Code (FMC) to establish the VMT Mitigation Fee (Exhibit I), and amendment of the Master Fee Schedule to include the VMT Mitigation Fee (Exhibit J).
EXECUTIVE SUMMARY
In August 2021, City Council directed preparation of a VMT Reduction Program that would include analysis of mitigation measures, a nexus study, mitigation fee, and update of the existing Urban Design Calculator (UDC). The proposed Program and Nexus Study has now been completed and includes the legal and administrative framework for the VMT mitigation fee; a project list, cost estimates, and capital improvement plan; fee calculations; and an updated urban design calculator. Approval of the Program will provide mitigation and compliance options for new development projects, including an updated urban design calculator and a new VMT mitigation fee, which can be applied individually or in combination to reduce VMT.
The Program Environmental Impact Report (PEIR) that has been prepared for this effort streamlines CEQA analysis for future development projects with VMT impacts through findings of overriding consideration that will preclude the requirement for individual project-level EIRs for VMT impacts.
The VMT mitigation fee requires an amendment to the Fresno Municipal Code and the Master Fee Schedule. A new Section 12-4.17 is proposed to be added to the FMC to establish the fee, and a resolution is included to amend the Master Fee Schedule. The new fee, which is proposed at $295 per vehicle mile traveled, would become effective 60 calendar days after Council approval.
BACKGROUND
SB 743, enacted in 2013, identified Vehicle Miles Traveled (VMT) as the basis for determining significant transportation impacts under the California Environmental Quality Act (CEQA). VMT measures the number and distance of vehicle trips a new development project might create. Accordingly, City Council adopted CEQA Guidelines for Vehicle Miles Traveled Thresholds for the City of Fresno on June 25, 2020. However, due to the variety of factors that contribute to VMT and evolving data on the outcomes of VMT mitigation, reliance upon project-specific mitigation measures to address VMT has been challenging. In response, it was determined that the City would develop a VMT Reduction Program (Program) to provide certainty and consistency for VMT mitigation under CEQA, while filling funding gaps for active transportation projects in support of the City’s land use, transportation and greenhouse gas reduction goals. On August 19, 2021, City Council approved a professional services agreement with LSA Associates, Inc (LSA) to prepare the program and on June 21, 2023, the Council approved an amendment to the agreement with LSA to provide environmental analysis under CEQA.
Program Framework
The Program is targeted to development projects that do not meet the VMT screening criteria in the City’s CEQA Guidelines for Vehicle Miles Traveled Thresholds. VMT for projects that meet any of the screening criteria is presumed to be below the VMT thresholds, and therefore exempt from mitigation requirements under CEQA. Projects that meet the screening criteria include those located within ½ mile of High-Quality Transit; local-serving retail of less than 50,000 square feet; those with a high level of affordable housing; projects generating average daily trips less than 500; public facilities; and residential and office projects located in low-VMT areas.
All other development projects would be subject to the Program, designed as a flexible, streamlined, and cost-effective approach to mitigating VMT impacts using the Urban Design Calculator (UDC) and a VMT mitigation fee.
The UDC recommends design features that could be incorporated into development projects to reduce VMT. The design features are primarily based on strategies provided in the California Air Pollution Control Officers Association Greenhouse Gas Emissions Reduction Handbook (CAPCOA Handbook, 2021). If a project results in significant VMT impact even after applying design features recommended by the UDC, the Program provides for the remaining mitigation to occur through payment of the VMT mitigation fee.
Development of the VMT mitigation fee included review of local planning documents such as the City’s Active Transportation Plan, the Fresno Area Express (FAX) short-range and long-range transit plans, and the Fresno Council of Government’s Regional Transportation Plan, along with available literature around VMT mitigation strategies. From these plans, a list of proposed active transportation project, transit-related infrastructure, and capital improvement projects was compiled. This list was used to create a “mitigation bank” from which projects were ranked according to specific criteria, including VMT reduction, connectivity, access, equity, safety, cost effectiveness, and feasibility. VMT mitigation fees paid into the Program will help fund implementation of the most effective VMT mitigation projects prioritized based upon these criteria. Based upon anticipated revenue, the top 24 projects can be funded (Exhibit G).
Mitigation Fee Methodology and Nexus
The cost (in dollars) to reduce one vehicle mile traveled was selected as the unit of VMT mitigation bank credit or VMT pricing. In order to determine the cost to reduce one vehicle mile traveled, total costs of all unfunded VMT-reducing projects and the amount of VMT required to be mitigated were estimated. Based on the VMT-reducing project costs and citywide VMT, the cost for reducing one VMT (i.e., the VMT reduction credit) was calculated to be $295. Details of the fee calculation methodology are on page 28 of the VMT Reduction Program and Nexus Study under Program Costs (Exhibit F), and sample cost calculations for development projects are included in Appendix E of the Study.
For VMT mitigation fees to be collected under the Program, there must be an “essential nexus” between the Program and the reduction of VMT impacts associated with development projects, as required by the Mitigation Fee Act (Government Code 66001). A nexus study is included in Exhibit F and key justifications for the nexus are summarized below:
Purpose of the Fee
The purpose of the VMT mitigation fee is to fund costs associated with the implementation of the 24 top-performing VMT mitigation projects identified in Appendix C of the Vehicle Miles Traveled Reduction Program and Nexus Study, and to allocate those costs to development projects that have a significant VMT impact within the city. The VMT mitigation fee does not support any urban design improvements related to VMT mitigation along the development project’s frontage, which will continue to be the responsibility of individual development projects. The VMT mitigation fee will be applicable to all development with a significant VMT impact.
Use of the Fee
The Program relies upon City planning documents to identify transportation demand management projects, active transportation projects, and transit projects that have the potential to provide a quantifiable reduction in VMT. The proposed VMT mitigation fee will be used to fund the top 24 ranking projects, listed in Appendix C of the Program and Nexus Study.
Relationship Between Project Type and Fee Use
Development projects that have demonstrated a VMT impact over the significance thresholds established in the City’s VMT Guidelines will cause an increase to the City’s VMT. The fees collected from these development projects will be used to construct VMT mitigation projects that will serve as an offset to the VMT increases due to those projects. The VMT mitigation fee calculations are based on the 24 most-effective VMT mitigation projects within the mitigation bank.
Relationship Between Project Type and Need for Public Facility
Development projects in areas that cannot be screened out of a detailed VMT analysis and are determined to have a significant VMT impact will cause an increase in citywide VMT. These projects are often located in suburban areas that are still developing and more distant from complementary land uses. Project-specific VMT mitigation measures in these areas often fail to provide sufficient VMT mitigation, or are cost prohibitive. The mitigation projects identified in the Program are citywide and therefore will provide an efficient and cost-effective way to reduce additional VMT resulting from development projects in these areas.
Relationship Between Cost of Public Facility and Fee Collected
The VMT mitigation fee would only be applicable to development projects that have been determined to have a significant VMT impact from a detailed VMT analysis. The VMT mitigation fee collected from development projects with a significant VMT impact will fund only a portion of the VMT mitigation projects’ costs; the majority of the funding is derived from other sources. Therefore, the VMT mitigation fees collected from the development projects will never exceed the cost of the public facility.
Alternative Basis of Fee
Fees imposed on a development project generally need to be proportionate to the size of the development. However, if a jurisdiction can provide an explanation as to why size is not an appropriate metric to calculate fees imposed on a development project, an alternative basis of calculating the fee may be developed. This alternative basis fee should reflect a reasonable relationship between the fee charged and the burden posed by the development. Under SB 743, a project’s requirement to pay a fee would only be triggered when a project has a significant VMT impact and is not able to mitigate its impact by using the urban design calculator. Because the purpose of the fee is to contribute to the reduction of citywide VMT, the most accurate representation of the project’s impact is its VMT beyond the City’s threshold.
The extent of VMT impact is dependent on the project’s geographic location and its proximity to complementary land uses. As such, two similarly-sized projects located in different geographic locations are anticipated to have varying VMT impacts, and the projects would pay a fee based on that impact instead of project size. This alternative basis for calculating the fee establishes the nexus between the project’s impact and payment of fees.
General Plan Consistency
The Program is consistent with several Fresno General Plan policies related to land use, transportation and greenhouse gas emissions:
1. The Program would implement General Plan Policies UF-12-e and UF-14-a by funding transportation infrastructure improvements that facilitate public transit and use of bicycles. These policies call for the implementation of standards that support pedestrian activities, bicycle linkages, and priority transit routes.
2. The Program would implement General Plan Policy MT-2-b, which calls for coordination with private and public partners to implement trip reduction strategies to reduce total vehicle miles traveled and make better use of the transportation system. The project is specifically oriented to reduce vehicle miles traveled citywide and includes components designed to improve the existing transportation system and increase its use.
3. The Program would implement General Plan Policy MT-2-g which calls for implementation of Transportation Demand Management strategies. This project would be a direct implementation of this policy because it would contribute funding to identified Transportation Demand Management projects.
4. The Program would implement General Plan Policy MT-2-j by generating funding to improve the City’s multi-modal transportation system and increase its utilization, which is called for by MT-2-j.
5. The Program would implement General Plan Policies MT-4-c and MT-6-c, which call for providing linkages between bikeways, trails, and paths by generating funding for those facilities and linkages.
6. The Program would implement General Plan Policy MT-5-a, which calls for the development of sidewalks on public streets, by generating funding in support of multi-modal transportation projects that include sidewalk improvements.
7. The Program would support the implementation of General Plan Policy RC-5-a, which calls for the reduction of Greenhouse Gas (GHG) emissions. The Program would fund projects that reduce citywide VMT, thus reducing mobile sources of emissions, which contribute significantly to GHG emissions.
OUTREACH
Input into program development was sought from the Bike/Pedestrian Advisory Committee (BPAC) and the Disability Advisory Committee (DAC), Transportation Subcommittee on December 15, 2021. Suggestions from these groups and staff responses are listed below:
BPAC
• Comment: Consider Southern Blackstone Avenue between Dakota and McKinley as an area in need of bike lanes
o Response: Included in Program
• Comment: This effort is a good opportunity to address gaps in the Active Transportation Plan network
o Response: Several pedestrian/sidewalk gaps identified in the ATP included in Program
• Comment: Consider marketing and e-bike rebates
o Response: Marketing included in Program
DAC Transportation Subcommittee
• Comment: Concern about local business or certain zip codes being disadvantaged and suggestion that they be exempt from the Program
o Response: State law requires use of VMT as a transportation impact metric. New development projects that meet the VMT screening criteria would not be subject to the Program. Only new developments that generate VMT above CEQA thresholds would need to pay fees.
• Comment: Concern about how the Program would affect fixed route transit service
o Response: the Program is helping to fund new transit routes, route extensions and increased route frequency
• Comment: Concern about the Program being a new tax
o Response: The Program would be funded by impact fees on new development and would not constitute a tax.
In addition, on October 21, 2024, a public scoping meeting was held for the EIR for the Program. It was attended by six members of the public. Two comment letters were submitted, suggesting that hydrogen-fueled buses are not a part of the Program. These comments were considered in the EIR analysis.
Public input on the 24 transportation improvements included in the Program occurred through the Long Range Transit Plan (LRTP) development process, conducted by Fresno COG in 2018; and in the Active Transportation Plan (ATP) development process, conducted by the City of Fresno in 2016. The most prevalent concern the LRTP noted for the City of Fresno was a desire for the extension of transit routes to additional destinations in Fresno. The transit projects included in the Program include three new routes on Bullard, Church and Willow, and an extension of Route 45. The concerns expressed in the ATP development process led the ATP to make pedestrian network recommendations, many of which have been incorporated into the Program.
NOTICE AND PUBLIC HEARING
Pursuant to the Mitigation Fee Act (specifically, Gov. Code § 66016), the City provided notice of a public hearing regarding the proposed increases to Citywide impact fees, including publication in The Fresno Bee on September 12, 2025. In addition, written notice was provided to parties requesting such notice 14 days in advance of the hearing.
As described in the notice, at least 10 days before the public hearing, the City made available to the public data indicating the amount of cost, or estimated cost, required to provide the service for which the fee or service charge is levied and the revenue sources anticipated to provide the service, including General Fund revenues.
ENVIRONMENTAL FINDINGS
Environmental Impact Report (EIR) Process
The City, as the lead agency under the CEQA, determined that a program-level EIR was required for the proposed project. Consultant LSA Associates, Inc, prepared the EIR (Exhibits B - E). Review and certification of the EIR involve the following procedural steps: Notice of Preparation; Public Scoping Meeting; Notice of Availability and Public Review Period; Final EIR and Response to Comments; and Certification.
Notice of Preparation (NOP)
Upon the City’s determination that an EIR was required for this project, a NOP was made available to the general public and responsible trustee agencies to solicit input on issues of concern that should be addressed in the EIR. The NOP was issued on September 27, 2024, and included a project description, project location, and a brief overview of the topics to be covered in the EIR. Three comment letters were received from public agencies and community members and were incorporated into the Draft EIR (DEIR).
Public Scoping Meeting
On October 21, 2024, a project scoping meeting was held, to which the Responsible and Trustee agencies as well as interested members of the public were invited, and which had been duly advertised in advance. The meeting, attended by six members of the public, was held at Fresno City Hall. Concerns raised were considered during preparation of the Draft EIR.
Notice of Availability (NOA)
The City published a public NOA for the DEIR on July 2, 2025, inviting comments from the general public, agencies, organizations, and other interested parties. The NOA was filed with the State Clearinghouse (SCH # 2024091129), the County Clerk, and was published in the Fresno Bee pursuant to the public noticing requirements of CEQA.
Comments on DEIR
The DEIR was available for public review and comment from July 2, 2025 through August 15, 2025. Five written comments on the DEIR were submitted to the City of Fresno during the review period. The comments were summarized and addressed in the FEIR. None of these comments contained new information that revealed any potentially new or more significant environmental impacts that could have required recirculation of the DEIR pursuant to CEQA Guidelines Section 15088.5.
Final EIR (FEIR)
In accordance with CEQA Guidelines Section 15088, the Final EIR responds to the written comments received on the Draft EIR. The Final EIR also contains minor edits to the Draft EIR. The FEIR was made available online on September 16, 2025. A hard copy was also available at Fresno City Hall.
Certification of the EIR
The City Council will hold a public hearing to consider the adequacy and completeness of the EIR under CEQA and to certify the EIR and adopt the necessary Findings of Fact and Statement of Overriding Considerations.
Mitigation Monitoring and Reporting Program (MMRP)
The City Council will also consider adopting a program to implement the EIR’s recommended mitigation measures to mitigate, avoid, or substantially lessen the significant impacts of the project. The final MMRP is included in Exhibit E.
Environmental Analysis and Conclusions
The EIR analyzed all resource topic areas required by CEQA and identified impacts to the following environmental areas:
- Biological Resources (Chapter 4.4)
- Cultural Resources and Tribal Cultural Resources (Chapter 4.5)
- Geology and Soil (Chapter 4.7)
- Noise (Chapter 4.13)
- Transportation (Chapter 4.16)
The EIR concluded that of these impact areas, all are less than significant with mitigation incorporated except Transportation. Transportation Impact TRA-2, related to consistency with CEQA Guidelines 15064.3(b) “Criteria for Analyzing Transportation Impacts,” was found to be significant and unavoidable. This is because the proposed VMT Reduction Program may not mitigate VMT at the project level with enough precision or within timeframes required by CEQA. Therefore, the following findings of overriding considerations are proposed to justify certification of the EIR and adoption of the VMT Reduction Program:
Overriding Considerations
1. The project would meet the project objectives established by the City. As demonstrated by the EIR, the Findings, this Statement, and the additional documents and evidence comprising the administrative record, the project meets the following objectives established by the City in the EIR, which are fundamental to the approval of the project:
• Streamline the SB 743 compliance process for development projects by providing feasible mitigation options to reduce potentially significant VMT impacts.
• Generate funding for future transportation demand management (TDM) strategies and VMT-reducing projects within Fresno to help reduce Citywide total VMT.
• Contribute towards making Fresno a pedestrian‐, bicycle‐, and transit‐oriented community with active, healthy, and livable spaces.
2. The project would streamline the SB 743 compliance process for development projects, allowing a range of future projects to continue to meet the needs of the City and its residents while providing applicable mitigation measures to reduce project related impacts to the furthest extent feasible.
3. The project would provide funding for future TDM strategies and VMT-reducing projects to help reduce Citywide VMT, thereby reducing greenhouse gas and criteria pollutant emissions, easing congestion, improving roadway safety, and supporting healthier, more equitable, and walkable communities across the city.
4. The project is consistent with and will contribute to achieving the policies, goals, and objectives established by the City of Fresno General Plan, including policies UF-12e, UF-14a, MT-2-b, MT-2-g, MT-2-j, MT-4-c, MT-5-a MT-6-c and RC-5-a.
LOCAL PREFERENCE
N/A
FISCAL IMPACT
Adoption of the new VMT mitigation fee in the Master Fee Schedule will allow for mitigation of VMT impacts under CEQA and will help fund active transportation projects that will offset the VMT generated by new development.
Attachments:
Exhibit A: Resolution Certifying EIR & Findings of Fact/Statement of Overriding Considerations
Exhibit B: Draft Environmental Impact Report
Exhibit C: EIR Response to Comments
Exhibit D: EIR Public Comment Letters
Exhibit E: Mitigation Monitoring & Reporting Program
Exhibit F: VMT Reduction Program & Nexus Study
Exhibit G: VMT Reduction Program Fee Projects Map
Exhibit H: Resolution Adopting the VMT Reduction Program and Nexus Study
Exhibit I: Ordinance Bill Adding Section 12-417 to the Fresno Municipal Code Resolution
Exhibit J: Resolution Adopting the 593rd Amendment to the Master Fee Schedule
Exhibit K: Presentation