14.A.
City Council Meeting
- Meeting Date:
- 01/07/2014
- From:
- Dan Folke, Planning Director
Information
TITLE:
Public Hearing: On Land Use Assumptions and Infrastructure Improvement Plan in support of updated Public Safety Development Fees (Impact Fees).
RECOMMENDED ACTION:
1) Hold the Public Hearing
2) Schedule February 18, 2014, adoption of Land Use Assumptions and Infrastructure Improvement Plan
2) Schedule February 18, 2014, adoption of Land Use Assumptions and Infrastructure Improvement Plan
Policy Decision or Reason for Action:
The State of Arizona requires the City hold a public hearing on the Land Use Assumptions (LU) and Infrastructure Improvement Plan (IIP), followed by a 30-day period to build consensus and incorporate changes prior to considering adoption of the LU and IIP.
Financial Impact:
Development Fees collected will be used to help fund capital improvements and equipment needed to provide police and fire services to new residential and non-residential projects.
Connection to Council Goal:
1. Retain, expand, and diversify economic base
2. Effective governance
2. Effective governance
Previous Council Decision on This:
The Flagstaff City Council first adopted Development Fees for Police and Fire in October 2008 and amended the program in 2011 to be consistent with State law.
Options and Alternatives:
Hold the public hearing and direct staff to proceed with the LU and IIP as presented
Hold the public hearing and direct staff to make changes to the LU and IIP prior to the February 18, 2014 meeting
Hold the public hearing and discontinue the adoption of Public Safety Impact Fees.
Hold the public hearing and direct staff to make changes to the LU and IIP prior to the February 18, 2014 meeting
Hold the public hearing and discontinue the adoption of Public Safety Impact Fees.
Background/History:
Arizona Revised Statute 9-463.05, adopted during the 2011 legislative session, significantly amended development fee enabling legislation. Commonly knows an SB1525, this legislation called for:
• Amending existing development program changes by January 1, 2012. The City met this condition by adopting the amendment of the existing development program on December 6, 2011; and,
• Abandoning the existing development fee programs by August 1, 2014. To accomplish the abandonment and subsequent adoption by August 1, 2014, the City must follow a prescribed schedule allowing adequate time for public input and Council discussion.
At the December 10, 2013 work session the City consultant TischlerBise provided an overview of the statutory changes and the schedule to move forward. The next step is to hold a public hearing on the Land Use Assumptions (LU) and Infrastructure Improvement Plan (IIP). After receiving public input, Council may direct staff to make changes to the LU and IIP or move forward as presented. After providing direction, staff will present the LU and IIP for adoption on February 18, 2014. Each should be considered as a separate item.
The Land Use Assumptions (LU) are found in Appendix C (page 51) of the November 1, 2013 TischlerBise report. The LU provides demographic estimates and development projections that are used to prepare the Infrastructure Improvement Plan and calculate development fees. Growth and development projections were based on 2010 U.S. Census data for population, housing and employment, supplemented by actual building permit data to establish the 2013 base year. Twenty-year projections were then used from the Flagstaff 2030 Regional Plan. The Regional Plan projected population, housing, employment and land use based on the 2010 U.S. Census and a high growth population model developed by staff. The high growth population model considers peak population which includes NAU students and second homes. This is consistent with the methodology used to prepare the 2007 development fees. The 2030 Regional Plan includes an annual population growth rate of 1.06%. TischlerBise then applied an exponential growth formula based on the 2030 projections of year round population, housing units and jobs to project annual growth. Population, housing units, occupancy and persons per household are all used to provide the population and housing projections for the next 20 years (Figure C51, page 59).
Nonresidential growth is primarily based on employment estimates. The LU uses employment estimates found in the 2030 Regional Plan. In 2010 employment was at approximately 37,100 and the Regional Plan projects 2030 employment will increase to 44,600. TischlerBise calculated a 0.92% annual exponential employment growth rate from these projections. The model assumes a slightly higher rate for industrial jobs than commercial retail and office jobs. Job estimates are then used to calculate nonresidential square footage based on data published by the Institute of Transportation Engineers. The total number of jobs estimated in 2013, broken down into retail, office and industrial, is used to calculate the existing total square footage of nonresidential development, calculated at just under 16 million square feet. The annual growth rate of 0.92% is then used to project jobs and nonresidential square footage annually for the next 10 years (Figure C56, page 63).
The LU assumptions also include average daily trips for each nonresidential land use category in order to calculate demand for public safety services. Nonresidential uses include commercial retail, office and institutional, and industrial. Based on 2013 assumptions for square feet of each land use, nonresidential vehicle trips for 2013 are estimated at 104,610 (Figure C57, page 64).
Finally, the LU assumptions provide an analysis of single family units by bedroom size. The average person per household increases as the number of bedrooms increase, thus increasing the demand for services. This methodology provides a more accurate estimate of the demand generated by single family homes. The current development fee schedule provides one fee for all single family homes. However, the current proposal calculates the single family fee based on the bedroom size. The result is a reduced fee for single family homes with 3 bedrooms or less, while the fee goes up for homes with 4 bedrooms or more (Figure 4, page 8). Current public safety fees for a single family home average $444 for fire and $231 for police or $675 total. The proposed fees for a single family home would average $661, a reduction of $14.
The report also includes the methodology to develop Infrastructure Improvement Plans (IIP) for both Fire and Police services. Each public service for which a fee is collected must have an IIP that considers seven elements found on pages 4-5 and must be prepared by a qualified professional. Each plan identifies public safety services, the demand for services and the level of service delivered. Development fees may be collected for incremental expansion to meet service demand as it increases or as cost recovery to retire debt on previous infrastructure investments. Demand is calculated as a proportional share between residential and nonresidential calls for service.
Fire fees will be used to recover costs for facilities, apparatus, equipment and communications infrastructure, while fees will provide incremental expansion of vehicles and communications equipment. Police fees will provide cost recovery for communications infrastructure, and fund incremental expansion of facilities, vehicles and communications equipment. Demand for specific services are summarized throughout each IIP and a cash flow summary for Fire (Figure 24, page 30) and for Police (Figure 37, page 48) are found in the report.
The remaining schedule for adoption is as follows:
January 7, 2014 – City Council Agenda Item
• Public hearing on LU and IIP
***30 days***
February 18, 2014 – City Council Agenda Item
• Adopt LU and IIP
March 1, 2014
• Provide notice of public hearing on development fees
• Publish draft fee report on municipal website
***30 days***
April 1, 2014 – City Council Agenda Item
• Public hearing on development fees
***30 days***
May 6 and May 13, 2014 – City Council Agenda Item
• Council’s final opportunity to approve or not approve Public Safety Development Impact Fees
***75 days***
August 1, 2014
• Updated Development fees are effective
• Amending existing development program changes by January 1, 2012. The City met this condition by adopting the amendment of the existing development program on December 6, 2011; and,
• Abandoning the existing development fee programs by August 1, 2014. To accomplish the abandonment and subsequent adoption by August 1, 2014, the City must follow a prescribed schedule allowing adequate time for public input and Council discussion.
At the December 10, 2013 work session the City consultant TischlerBise provided an overview of the statutory changes and the schedule to move forward. The next step is to hold a public hearing on the Land Use Assumptions (LU) and Infrastructure Improvement Plan (IIP). After receiving public input, Council may direct staff to make changes to the LU and IIP or move forward as presented. After providing direction, staff will present the LU and IIP for adoption on February 18, 2014. Each should be considered as a separate item.
The Land Use Assumptions (LU) are found in Appendix C (page 51) of the November 1, 2013 TischlerBise report. The LU provides demographic estimates and development projections that are used to prepare the Infrastructure Improvement Plan and calculate development fees. Growth and development projections were based on 2010 U.S. Census data for population, housing and employment, supplemented by actual building permit data to establish the 2013 base year. Twenty-year projections were then used from the Flagstaff 2030 Regional Plan. The Regional Plan projected population, housing, employment and land use based on the 2010 U.S. Census and a high growth population model developed by staff. The high growth population model considers peak population which includes NAU students and second homes. This is consistent with the methodology used to prepare the 2007 development fees. The 2030 Regional Plan includes an annual population growth rate of 1.06%. TischlerBise then applied an exponential growth formula based on the 2030 projections of year round population, housing units and jobs to project annual growth. Population, housing units, occupancy and persons per household are all used to provide the population and housing projections for the next 20 years (Figure C51, page 59).
Nonresidential growth is primarily based on employment estimates. The LU uses employment estimates found in the 2030 Regional Plan. In 2010 employment was at approximately 37,100 and the Regional Plan projects 2030 employment will increase to 44,600. TischlerBise calculated a 0.92% annual exponential employment growth rate from these projections. The model assumes a slightly higher rate for industrial jobs than commercial retail and office jobs. Job estimates are then used to calculate nonresidential square footage based on data published by the Institute of Transportation Engineers. The total number of jobs estimated in 2013, broken down into retail, office and industrial, is used to calculate the existing total square footage of nonresidential development, calculated at just under 16 million square feet. The annual growth rate of 0.92% is then used to project jobs and nonresidential square footage annually for the next 10 years (Figure C56, page 63).
The LU assumptions also include average daily trips for each nonresidential land use category in order to calculate demand for public safety services. Nonresidential uses include commercial retail, office and institutional, and industrial. Based on 2013 assumptions for square feet of each land use, nonresidential vehicle trips for 2013 are estimated at 104,610 (Figure C57, page 64).
Finally, the LU assumptions provide an analysis of single family units by bedroom size. The average person per household increases as the number of bedrooms increase, thus increasing the demand for services. This methodology provides a more accurate estimate of the demand generated by single family homes. The current development fee schedule provides one fee for all single family homes. However, the current proposal calculates the single family fee based on the bedroom size. The result is a reduced fee for single family homes with 3 bedrooms or less, while the fee goes up for homes with 4 bedrooms or more (Figure 4, page 8). Current public safety fees for a single family home average $444 for fire and $231 for police or $675 total. The proposed fees for a single family home would average $661, a reduction of $14.
The report also includes the methodology to develop Infrastructure Improvement Plans (IIP) for both Fire and Police services. Each public service for which a fee is collected must have an IIP that considers seven elements found on pages 4-5 and must be prepared by a qualified professional. Each plan identifies public safety services, the demand for services and the level of service delivered. Development fees may be collected for incremental expansion to meet service demand as it increases or as cost recovery to retire debt on previous infrastructure investments. Demand is calculated as a proportional share between residential and nonresidential calls for service.
Fire fees will be used to recover costs for facilities, apparatus, equipment and communications infrastructure, while fees will provide incremental expansion of vehicles and communications equipment. Police fees will provide cost recovery for communications infrastructure, and fund incremental expansion of facilities, vehicles and communications equipment. Demand for specific services are summarized throughout each IIP and a cash flow summary for Fire (Figure 24, page 30) and for Police (Figure 37, page 48) are found in the report.
The remaining schedule for adoption is as follows:
January 7, 2014 – City Council Agenda Item
• Public hearing on LU and IIP
***30 days***
February 18, 2014 – City Council Agenda Item
• Adopt LU and IIP
March 1, 2014
• Provide notice of public hearing on development fees
• Publish draft fee report on municipal website
***30 days***
April 1, 2014 – City Council Agenda Item
• Public hearing on development fees
***30 days***
May 6 and May 13, 2014 – City Council Agenda Item
• Council’s final opportunity to approve or not approve Public Safety Development Impact Fees
***75 days***
August 1, 2014
• Updated Development fees are effective
Key Considerations:
Impact fees provide a base standard that all developers are aware of and can plan for as they look to propose development in our community. Should impact fees not be assessed, this same type of financial consideration will still need to be attained; however, negotiations with each developer will occur separately which may result in an unequal burden due to the timing of a development.
Expanded Financial Considerations:
The study that is provided to calculate the Public Safety Impact fees covers a 10-year growth horizon. The impact fees themselves, however, are updated every five years to assure the planning and needed services are either confirmed or are updated to match current community needs.
Community Benefits and Considerations:
Impact fees assess new development their fair share of cost for the expanded network of service that will need to be provided.
Community Involvement:
Inform: The attached report was published on the City's website on November 7, 2013, and provides the public the information required by the State of Arizona. It is a very complete report.
Consult: The purpose of the public hearing is to receive public input on the land use report and infrastructure improvement plan. Staff will present the report and proposed fees to the Northern Arizona Building Association at their January government affairs meeting.
Consult: The purpose of the public hearing is to receive public input on the land use report and infrastructure improvement plan. Staff will present the report and proposed fees to the Northern Arizona Building Association at their January government affairs meeting.
Expanded Options and Alternatives:
Hold the public hearing and direct staff to proceed with the LU and IIP as presented
Hold the public hearing and direct staff to make changes to the LU and IIP prior to the February 18, 2014 meeting
Hold the public hearing and discontinue the adoption of Public Safety Impact Fees.
Hold the public hearing and direct staff to make changes to the LU and IIP prior to the February 18, 2014 meeting
Hold the public hearing and discontinue the adoption of Public Safety Impact Fees.