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  Richmond Impact Fees Behind the Times?
July 10, 2005
 
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The subject of impact fees in Richmond versus other cities comes up from time to time, and it came up again today in the following story, which appeared in the July 10, 2005, West County Times, indicating that Richmond’s impact fees for parks are less than they should be.

Richmond's park fees low
Posted on Sun, Jul. 10, 2005

CONTRA COSTA TIMES

Faced with a pocket park but no play structure, mothers in Richmond's El Sobrante Hills area have been piling their preschoolers in the car and driving to parks in Martinez, Benicia and Emeryville.

"There's a cement tunnel thing that's got to be 20 years old, but not a modern play structure," said Eleanor Loynd. "You can't take your kids to a school to play during school hours."

The area has been filling up with new homes -- and young families.

It costs money to create the kinds of services that make a subdivision a community -- parks, for instance. If rows of new homes plait the Richmond hilltop without the relief of green spaces or play space, critics, like Loynd, say that is because the city has been grossly undercharging developers for park "in-lieu" fees.

Increasingly, areas with rapid growth are charging developers to offset the costs of new parks, recreation programs and play structures. But Richmond hasn't raised its park fees in many years and is lagging behind neighboring communities by hundreds of dollars per home.

Exact figures were not available from the city, but Fred Clement, chief building official, confirmed that homebuilders pay a basic fee of $432 per house or housing unit in Richmond. He could not supply a more detailed breakdown.

Across the border in the unincorporated area, Contra Costa County charges them 10 times that amount.

The upshot: A new, 40-home development in the El Sobrante Hills area or Richmond is collecting $18,000 for parks that will serve the new residents.

If the subdivision were a few miles away, even using the county's old fees of $2,000 per home, it would have netted $80,000 -- ample for a desperately needed play structure, said Loynd

"You look at Richmond, and here we are again, not tending to business and not getting the value we should be getting," Loynd said.

Richmond studied its total impact fees two years ago, but because the study was flawed -- it did not include the impacts of new residents on transportation -- the council never adopted its recommendations, interim City Attorney Everett Jenkins said. "If you look at the totality of our fees, you'll find they are well below what other cities are charging."

Supporters of Richmond's green spaces say planning officials have promised in numerous meetings to increase the park tithe, but it has remained flat "for years and years and years," Contra Costa County Supervisor John Gioia said.

The state's Quimby Act allows cities to charge developers "in-lieu" fees to offset the increased demand for parks and other resources. But each city assesses for itself what that fee must be.

"Richmond should have increased its park fees a long, long time ago," Gioia said. "The need for parks is great, and the city has the ability to implement an increase today."

Critics are taking the in-lieu fee out of context, said Clement. The city also levies a "public facility fee" that feeds open space acquisition and aquatics programs in addition to other public resources, he said. The amount varies, Clement said, but he was not able to provide percentages or ballpark figures.

Richmond has some 265 acres of park, but the number is misleading, said interim Planning Director Richard Mitchell, since East Bay Regional Parks provide thousands more at Point Isabel, Point Pinole and Miller-Knox Regional Shoreline.

"So the acreage of parks in and around the city is really quite substantial," he said.

In Walnut Creek, the 47-unit Citrus Walk, a housing development on the northeastern part of the city, landed the city's parks $314,000, planner Scott Harriman said.

And in Livermore, the 110-unit Station Square, still in the planning stages, is expected to bring in close to $1 million.

"It costs a lot of money to develop a park," said Richmond parks and recreation commissioner Myrtle Braxton-Ellington. "I had the feeling we're charging a lot less than other cities, and we're building homes like crazy."

California, one of the first states to pass laws clearing the way for impact fees, has some of the highest fees in the nation. For instance, a three-bedroom home on a 10,000-square-foot lot commands more than $12,000 in Livermore but nets just $2,134 in Boulder, Colo.

The national average fee for a single-family home is $1,862, according to a 2005 survey by public policy consultants Duncan Associates of Austin, Texas.

Some say high fees will chase developers away. With cities and counties also billing for added pressures on existing sewers, water, roads and schools, the total package can skyrocket. But without the fees, a local government cannot expand or develop new resources. And that, according to a report by the Brookings Institution, discourages homebuilders from planning new projects in the area.

"I don't get the impression our fees are prompting developers to flee from us," Jenkins said.

The city's budget crisis in 2004 took attention away from numerous issues, Jenkins said. Although its financial recovery is well on the way, the city still needs stable, permanent executives to establish a realistic schedule of fees.

"The planning department needs to be integrally involved," he said. "We need to be able to map out exactly what we are paying for."

Reach Rebecca Rosen Lum at 510-262-2713 or rrosenlum@cctimes.com.

IN-LIEU PARK FEES

CONTRA COSTA COUNTY (applied in unincorporated areas): Fees range from $2,142 per unit for a multifamily structure to $4,489 for a single-family home. Park impact fees, paid by developers of apartment buildings or single units built on single parcels range from $3,919 per unit for a multifamily complex to $6,788 for a single-family home.

CONCORD: Fees range from $1,713 for an infill unit in the city's downtown area to $3,791 for a single-family home in a low-density subdivision.

LIVERMORE: Livermore's sliding scale for multifamily complexes ranges from $6,565 for a studio to $10,775 for a three-bedroom unit. Single-family homes are assessed at $12,384.

PLEASANTON: $9,707 for a single-family home and $7,969 per unit for multifamily developments.

RICHMOND: $432 for single-family homes.

WALNUT CREEK: Uses a formula to calculate the charges, multiplying the population of a new subdivision by acres of parkland per resident by fair market value of an acre. A developer will pay roughly $100,000 for a 50-unit complex, or $2,000 per unit.

The story quoted Everett Jenkins:

Richmond studied its total impact fees two years ago, but because the study was flawed -- it did not include the impacts of new residents on transportation -- the council never adopted its recommendations, interim City Attorney Everett Jenkins said. "If you look at the totality of our fees, you'll find they are well below what other cities are charging."

This did not sound right to me, so I did a little research. DMG-Maximus, a consulting firm in Sacramento, completed a Development Impact Fee Study for Richmond dated May 6, 2002. The recommendations of the study were adopted by the City Council as a resolution on December 17, 2002, as well as the enabling legislation, Richmond Municipal Code Chapter 12.65. The Minutes read as follows:

A proposed ordinance adding Chapter 12.65 to the Richmond Municipal Code establishing a City-wide Public Facilities Impact fee Program. Anna Vega, Assistant City Manager, Finance Director requested the Council to take two actions – adopt the ordinance and a resolution. Malcolm Hunter, City Attorney, requested the Council to add the resolution in connection with this matter to the agenda which is an integral part of the process. He explained that as a matter of protocol a vote by the Council to add the matter to the meeting agenda. On motion of Councilmember Bell, seconded by Councilmember Penn added a proposed resolution in connection therewith to the meeting agenda by the unanimous vote of the Council. Vice Mayor Butt gave comments regarding his concern that the fees are many years out of date and the City has lost many years of fees. Rachael Dragulovich, Assistant City Attorney, state the DMG Maximus’ study indicated that a traffic study will be conducted after DMG Maximus is once again under contract and a further analysis of their recommendations would be done, Councilmember Viramontes noted for the record that a confidential memorandum was received by the City Attorney’s office regarding the impact fees and the discussion should be limited. Barry Cromartie, Planning Manager, stated that several large projects that are now in the pipeline will be subject to the new fees which are 90% up to date. Following discussion, on motion of Councilmember Bates, seconded by Councilmember Rogers, adopted Resolution No. 184-02 and Ordinance No. 34-02 N.S., adding Chapter 12.65 to the Richmond Municipal Code establishing a City-wide Public Facilities Impact fee Program by the unanimous vote of the Council.

The West County Times story stated that the Richmond fees for parks are $432 for single-family homes. But the recommendations adopted by Resolution 184-02 are $3,926.11 for single family homes and $3,225.02 for multi-family homes on platted lots and $4,299.53 for single family homes and $3,531.75 for multi-family homes in new subdivisions. See the tables below excerpted from the DMG-Maximus study.  

Table S.1

Summary of Impact Fees per Unit of Development by Development Type

Development Type

Dev Units[1]

Parks/Open Space[2]

Community/Aquatic Ctrs[3]

Police Facilities[4]

Fire Facilities[5]

Total Impact Fees

Residential – Single Family

DU

$3,926.11

$942.01

$221.98

$268.91

$5,359.01

Residential – Multi-Family

DU

$3,225.02

$773.80

$118.29

$100.84

$4,217.95

Commercial/Office

AC

$0.00

$0.00

$1,855.52

$1,613.44

$3,468.97

Industrial

AC

$0.00

$0.00

$979.96

$1,613.44

$2,593.40

 

Table 3.14

Total Fees Per Development Unit for Parks and Recreation Facilities

Development Type

Dev Units[6]

Fees per Unit – Existing Parcels[7]

Fees per Unit – New Subdivisions[8]

Residential – Single Family

DU

$3,926.11

$4,299.53

Residential – Multi-Family

DU

$3,225.02

$3,531.75

The park fees charged by Richmond are comparable to three of the five jurisdictions shown in the West County Times article, but they are substantially below Pleasanton and Livermore. However, the DMG-Maximus study purports to have been conducted in accordance with statutory requirements, the Quimby Act (California Government Code Section 66477) and includes detailed analyses of existing facilities and calculation of quantities and costs of required new facilities. There are some flaws, however, that need to be corrected. For example, the study concludes Richmond has two aquatic facilities, when in fact, one of them – The Plunge – is non-existent.

Regarding park acreage, the DMG Maximus study reports that Richmond has 237.68 acres of parks, including 23.00 acres owned by the WCCUSD and maintained by the City. To that is added 107.22 acres of “public landscapes and open space,” such as Civic Center Plaza and 253.00 acres of “open space” such as Hilltop Lake Park.

The level of service standard for parks in the Growth Management Element of the General Plan adopted in 1994 is 3.0 acres per thousand residents. The existing City-owned park land is only 2.11 acres per thousand residents, a shortfall intended to be covered by the impact fees.

The fee structure should be updated annually and indexed to inflation to comply with California Government Code Sections 66000, et seq. Annual updates have to be made by action of the City Council under Government Code Section 66016(b).


[1] DU = dwelling unit; AC = net acre

[2] See Table 3.14. Amount shown is for development not involving a residential subdivision. For development in subdivisions, See Table 3.14

[3] See Table 4.7

[4] See Table 5.5

[5] See Table 6.3

[6] DU = Dwelling Unit

[7] Total of Fees from Tables 3.9, 3.10, 3,12 and 3.13

[8] Total of Fees from Tables 3.9, 3.10, 3,12 and 3.13

 

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