Transportation impact fees delayed

The transportation impact fees for Ramona and Fallbrook which were expected to be implemented in January were instead delayed due to concerns from other portions of the county about the expansion of the program to a countywide impact fee.

A 4-1 San Diego County Board of Supervisors vote January 12 granted the continuance requested by South Bay speakers, allowing the community input process which took place in Fallbrook and Ramona to be brought to the other communities affected by the countywide fee.

“I agree that this probably needs to come back to us,” said Supervisor Bill Horn. “I think they need at least 90 to 120 days.”

Horn, whose district includes Fallbrook, supported the continuance. Dianne Jacob, whose district includes Ramona, was the sole vote against the continuance. “There’s a whole long list of mom and pop kind of projects that have been stuck,” Jacob said. “These are not major developers. These are the little guys.”

The transportation impact fee is actually supported by much of the development community. Recent changes in the California Environmental Quality Act require the identification and mitigation of cumulative traffic impacts, and a single fair-share check saves small developers the process of identifying cumulative impacts for their individual projects.

“We will have a traffic impact fee; I don’t think there’s any question,” said Supervisor Greg Cox, who represents the South Bay. “It’s just a question of coming up with the fairest and most equitable way to allocate that.”

Concerns from South Bay speakers focused on fears that the fee schedule presented would make the unincorporated area uncompetitive with incorporated cities. “We need to have good paying jobs in South County,” Cox said. “The next 90 days will afford an opportunity to sit down with interested parties.”

The additional time will also allow the issue of annexation of unincorporated territory by cities to be addressed, since a difference in impact fees could lead to commercial areas being annexed by incorporated cities with the support of developers. “I want to make sure that what we are charging is appropriate,” Horn said.

In September 2003 the supervisors received a report on the feasibility of using development transportation impact fees for funding future road improvements necessitated by development in Ramona. The report concluded that establishing impact fees was feasible but that issues needed to be considered when developing a program. The supervisors directed county staff to work with the Ramona Community Planning Group and other stakeholders to develop basic details of an impact fee.

Those details were brought to the supervisors in February 2004, but at the request of the Ramona Community Planning Group the agenda item was continued for 60 days to provide additional information. The Fallbrook Community Planning Group had requested a similar program, and Horn used the continuance to add an amendment to the motion which directed county staff to work with the Fallbrook planning group on details for a Fallbrook impact fee program.

The supervisors authorized development of the Fallbrook and Ramona programs on May 5, 2004, commencing a process which was expected to take eight months. The eight-month timeframe was accurate, and the estimated cost for future transportation needs of Fallbrook and Ramona were calculated along with the estimated future growth. Fees of $9,937 per Fallbrook equivalent dwelling unit (based on a single-family house equating to 1.0 equivalent dwelling units with EDUs for other uses based on trip generation) and $7,980 per Ramona EDU were determined to constitute the fair-share payment for future transportation growth.

Although the Ramona and Fallbrook programs were anticipated to be pilot programs, other communities also expressed interest in impact fees. During development of the Fallbrook and Ramona programs it also became evident that certain roads crossing those two towns function as regional in nature and offer transportation benefits beyond the boundaries of individual community plan areas. Since limiting the cost allocation of those regional roads to development within individual communities would disproportionately burden those communities, as the nature of regional and local road networks were further analyzed county staff felt that a countywide impact fee program could offer a solution to communities other than Ramona and Fallbrook.

Thus the biggest controversy switched from whether or not to include the North Bypass in Ramona’s future road costs to whether or not the commercial fees were appropriate.

“My concern is this will halt development in East Otay,” said David Wick, who told the supervisors that outside of Fallbrook and Ramona the fee structure was not well designed.

Jeff Phair is a small commercial developer with two full-time employees other than his family. “This ordinance will kill my company,” said Phair, who lives in Bonita. “The bottom line is, it’s unfair to the small commercial developer.”

Phair works on a 15 percent profit margin, which will not cover the 30 percent cost increase the fees would create. “This fee does not work. It’s going to drive a lot of small developers out of business,” he said.

Phair added that those who contract with developers such as plumbers and architects would also be impacted by an uncompetitive fee. Phair also told the supervisors that without retail development, residential occupants have nowhere to go within their communities. “They’re going to get in their car and drive someplace else.”

George Calvert of Bonita’s Episcopal Church of the Good Shepherd noted that his church’s plans for a preschool with 60 students and a small sanctuary would cost $106,000 in fees. Attorney Robin Munro also spoke on behalf of Good Shepherd, which has approximately 300 parishioners. “One hundred six thousand for most developers is not as much,” Munro said. “Something needs to be done about these non-profit organizations that are providing community benefits.”

The equivalent dwelling units are based on trip generation; a single-family residence is considered to generate 12 trips per day and each multi-family dwelling unit contributes an estimated eight trips per day for the basis of the fee schedule. Commercial development was set at 400 trips per acre, industrial development was determined to be 150 trips per acre for the fee purposes, office development was assessed at 300 trips per acre, parks were considered to have an impact of five trips per acre, and schools were assigned an impact of 50 trips per acre. Jerry Livingston of the Building Industry Association told the supervisors that the additional fees would equate to an additional $9,000 rent per 50,000 square feet.

“We support a uniform fee, but we want to remain competitive with the City of San Diego,” said John Dillard, who owns land in Otay Mesa.

Even opponents of the specific commercial rates supported the single-check fee which will relieve small developers of the new CEQA cumulative impact study. “The last thing I want to do is hold up some other people’s subdivisions. I know what it feels like,” Dillard said.

“There are a lot of residential developments, though, that have been waiting a long time for this to go forward,” said Greg Garratt, an attorney for several development projects.

Garratt expressed concerns about the commercial rates but supported the adoption of a program. “I think this is a kind of fee that has been needed for a long time,” he said. “It does respond to some environmental issues and the difficulty of cumulative impacts.”

Attorney William Schwartz, who represents the Peppertree Park development in Fallbrook, requested a change in the eligible area of Peppertree Lane so that the project’s mitigation work on that portion could be credited, but he was supportive of the fee. “We believe it will be beneficial and it will cure issues of cumulative impacts which are holding up a number of projects,” he said.

The study indicated that facilities eligible for the Fallbrook fee total $157.4 million, which equates to $72.4 million for local facilities and $85 million for regional facilities. Fallbrook’s $9,931 fee per EDU covers $5,200 for local roads and $4,731 for the share of regional or multi-community roads.

Ironically, the fees in Otay include $44 per square foot for a community shopping center but only $14 per square foot for a regional shopping center. “The numbers are not sustainable,” said Supervisor Ron Roberts.

“A community or neighborhood shopping center largely gets trips that are coming off the existing road system,” Roberts said. “They don’t generate trips. They take advantage of trips that are within the system.”

Roberts noted that the highest traffic counts are at gas stations. “Gas stations generate very little new traffic in any community,” he said.

Roberts added that neighborhood markets also reduce total travel. “There’s a reason why they’ve referred to some of these as convenience stores or convenience centers,” he said.

Roberts also pointed out that a portion of the sales taxes generated by the retail businesses are used for local roads. “We don’t give these guys a credit for what they’re going to generate in other revenues,” he said. “They’re bringing some other things to the table.”

If approved, the fees could be appealed to the director of the county’s Department of Public Works, and the appeal process could also reach the Planning Commission and the Board of Supervisors if the project applicant desires. An applicant could also provide a traffic study to obtain a customized fee calculated on the exact traffic to be generated.