REPORT TO THE CITY COUNCIL
October 23, 2014
FROM: SCOTT L. MOZIER, PE, Director
Public Works Department
BY: ANDREW J. BENELLI, PE, City Engineer/Assistant Director
Public Works Department, Traffic and Engineering Services Division
SUBJECT
Title
Actions related to updating the Nexus Studies for Citywide Development Impact Fees (Citywide)
1. Approve a professional services agreement with Economic & Planning Systems, Inc., (EPS) to update the Development Impact Fee Nexus Study
2. *** RESOLUTION - 21st amendment to the Annual Appropriation Resolution (AAR) No. 2014-95 appropriating $227,700 for Citywide Impact Fee Study consulting and administrative costs in FY 2015 (Requires 5 affirmative votes)
Body
RECOMMENDATIONS
Staff recommends that the Council approve an agreement with EPS to update the Development Impact Fee Nexus Study, authorize the Public Works Director or designee to execute the agreement, and adopt the AAR amendment to appropriate the necessary funds for consultant and City staff costs to complete the update.
EXECUTIVE SUMMARY
The City collects Development Impact Fees from all new development projects to defray all or a portion of the cost of public facilities related to such projects. State law requires that a Nexus Study be prepared to show that there is a reasonable relationship between the amount of the fee and cost of the public facility attributable to development. State law also requires that nexus studies be updated every five years.
The City issued a Request for Proposals on May 23, 2014 for the preparation of a Development Impact Fee Study update. Six proposals were received. All six firms were interviewed on July 16, 2014. The interview panel determined that EPS was the best qualified firm to prepare the Nexus Study update. Their fee for preparing the nexus study for the citywide police, fire, parks, traffic signals and major street impact fees will be $149,200.
BACKGROUND
The City requires that all new development pay Development Impact Fees for fire, park, police facilities, regional street improvements, new growth area major street construction and improvements, traffic signal installation and improvements. Although the City charges new development water connection fees and sewer connection fees, those programs are not being reviewed under this agreement and will be handled separately by the Department of Public Utilities.
State law requires that a Nexus Study be prepared to show a reasonable relationship between the amount of the fees and the cost of the planned public improvements. The law also requires that the reports are updated every five years. It has been five years since the fees were evaluated and some of the facility costs have changed. The updated Nexus Study will consider improvements that have been completed since the last update and any changes that will result from the adoption of the 2035 General Plan. The study will consider methods to provide reduced fees for infill development and developments that generate significant new employment. The scope of the work to be performed by EPS will include a comparison of Fresno's impact fees with comparable cities in California.
A stakeholder group is being formed to help staff and EPS review the existing fee program and recommend changes to improve the system. In September, staff reviewed the scope of services for the impact fee update with a broad range of commercial, industrial and residential developers, including the Building Industry Association (BIA), so as to ensure the development community is well informed and an integral part of the process to review and update the fee programs. The fees need to be reasonable and comparable to other surrounding communities but still adequate to fund the infrastructure necessary to serve new development. EPS has indicated that it can complete the Nexus Study in approximately six months, but the overall time frame to return to Council with updated fees is also dependent on the stakeholder engagement process and working through any issues that may arise.
ENVIRONMENTAL FINDINGS
By the definition provided in the California Environmental Quality Act Guidelines Section 15378 the Nexus Report does not qualify as a project and is therefore exempt from the California Environmental Quality Act requirements.
LOCAL PREFERENCE
Not applicable because this is not a competitive bid. State law requires that professional firms are selected based on their qualifications and experience.
FISCAL IMPACT
Approval of the attached agreement will have no impact on the General Fund. All costs are being allocated from available impact fees. The consultant fee to prepare the Nexus Study will be $149,200. Staff is recommending approval of an AAR that allocates $227,700 which also covers City staff time and administrative costs.
Attachments: 21st Amendment to Annual Appropriation Resolution No.2014-95
Consultant Services Agreement