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HomeMy WebLinkAboutMINUTES - 03211995 - 1.67 1.65 thru 1.67 THE BOARD OF SUPERVISORS OF CONTRA COSTA COUNTY, CALIFORNIA Adopted this Order on March 21,1995, by the following vote: AYES: Supervisors Rogers, Smith, DeSaulnier, Torlakson and Bishop NOES: None ABSENT: None ABSTAIN: None SUBJECT: Correspondence Item No. 1.65 LETTERS received March 7, 1995, from Superintendents of the Oakley Union Elementary School District, Byron Union School District, and the Liberty Union High School District requesting that the Board not approve new residential development proposals until agreement has been reached between the Districts, the County, and the building industry on the financing of school facilities. "REFERRED TO DIRECTOR, GROWTH MANAGEMENT AND ECONOMIC DEVELOPMENT AGENCY 1.66 RESOLUTION adopted by the Board of Supervisors, Colusa County,requesting support for a moratorium on the regulatory action of the U. S. Fish and Wildlife Service, pending a Congressional review of the activities of the Agency. "REFERRED TO FISH AND WILDLIFE COMMITTEE 1.67 RESOLUTION adopted by the Governing Board of the John Swett School District, advising that effective May 8, 1995, the school facilities fees for the District will be increased. "REFERRED TO DIRECTOR, BUILDING INSPECTION i hereby certify that this is a true and correct copy of an action taken and entered on the minutes of the Board of Supervisors on thp date shown. ATTESTED: rM AL 1a95 PHIL BATCHELOR, Clerk of the Bocrd of Supervisors and County Administrator By_l�1dLlYL��- —'Deputy CC : Correspondent Director, Growth Management and Economic Development Agency Fish and Wildlife Committee Building Inspection Director 1,47 • U ' t1y�►d00 � O0`d1S®3 Olivos 711��0 �Sl SdCSIna3dflS�O ! ' DATE JOHN SWETT UNIFIED SCHOOL DISTRICT iT%qB 561 6 BOARD OF EDUCATION Resolution(94-95) 16 Increasing School Facilities Fees as Authorized by Government Code Section 65995(b)3 WHEREAS, Statute AB 2926 (Chapter 887/Statutes 1986) authorizes the governing board of any school district to levy a fee, charge, dedication or other form of requirement against any development project for the construction or reconstruction of school facilities; and, WHEREAS, Government Code Section 65995 establishes a maximum amount of fee that may be charged against such development projects and authorizes the maximum amount set forth in said section to be adjusted for inflation every two years as set forth in the state-wide cost index for Class B construction as determined by the State Allocation Board at its January meeting; and, WHEREAS, at its January 21, 1995 meeting, the State Allocation Board increased the maximum fee authorized by Government Code section 53080 to $1.72 per square foot of residential construction described in Government Code Section 65995(a)(1) and $.28 per square foot against commercial and industrial construction described in Government Code Section 65995(a)(2); and, WHEREAS, the purpose of this Resolution is to approve and adopt fees on residential projects in the amount of$1.72 per square foot as authorized by Government Code Section 53080; and, WHEREAS, the purpose of this Resolution is to approve and adopt fees on commercial and industrial development projects in the amount of$.28 per square foot as described in Government Code Section 65995(a)(2). NOW THEREFORE, BE IT HEREBY RESOLVED by the Governing Board of the John Swett Unified School District as follows: 1. Procedure: This Board hereby finds that prior to the adoption of this Resolution, the Board conducted a public hearing at which oral and written presentations were made, as part of the Board's regularly scheduled March 6, 1995, meeting. Notice of the time and place of the meeting, including a general explanation of the matter to be considered, has been published twice in a newspaper in accordance with Government Code section 54994.1, and a notice, including a statement that the data required by Government Code section 54992 was available, was mailed to any interested party who had filed a written request with the District for mailed notice of the meeting on new fees or service charges within the period specified by law. Additionally, at least 10 days prior to the meeting, the District made available to the public, data indicating the amount of the cost, or estimated cost, required to provide the service for which the fee or service charge is to be adjusted pursuant to this Resolution, and the revenue M , _ sources anticipated to provide this service. By way of such public meeting, the Board received oral and written presentations by District staff which are summarized and contained in the District's Developer Fee Implementation Study dated January 24, 1995, (and the District's application and related documents filed with the State Allocation Board pursuant to the State Lease-Purchase Program (only if appropriate) (hereinafter referred to as the "Plan") and which formed the basis for the action taken pursuant to this Resolution. 2. Findings. The Board has reviewed the Plan as it relates to proposed and potential development, the resulting school facilities needs, the cost thereof, and the available sources of revenue including the fees provided by this Resolution, and based thereon and upon all other written and oral presentations to the Board, hereby makes the following findings: A. Enrollment at the District schools presently is at capacity. B. Additional development projects within the District, whether new residential construction or residential, reconstruction involving increases in assessable area greater than 500 square feet, or new commercial or industrial construction will increase the need for school facilities and/or the need for reconstruction of school facilities. C. Without the addition of new school facilities, and/or reconstruction of present school facilities, any further residential development projects or commercial or industrial development projects within the District will result in a significant decrease in the quality of education presently offered by the District; D. Substantial residential development and commercial or industrial development is projected within the District's boundaries and the enrollment produced thereby will exceed the capacity of the schools of the District. As a result, conditions of overcrowding will exist, within the District, which will impair the normal functioning of the District's educational programs; E. The fees proposed in the Plan and the fees implemented pursuant to this Resolution are for the purposes of providing adequate school facilities to maintain the quality of education offered by the District; F. The fees proposed in the Plan and implemented pursuant-to this Resolution will be used for the construction and/or reconstruction of school facilities as identified in the Plan; G. The uses of the fees proposed in the Plan and implemented pursuant to this Resolution are reasonably related to the types of development projects on which the fees are imposed; H. The fees proposed in the Plan and implemented pursuant to this Resolution bear a reasonable relationship to the need for school facilities created by the types of development projects on which the fees are imposed; I. The fees proposed in the Plan and implemented pursuant to this Resolution do not exceed the estimated amount required to provide funding for the construction or reconstruction of school facilities for which the fees are levied; and in making this finding, the Board declares that it has considered the availability of revenue sources anticipated to provide such facilities, including general fund revenues; J. The fees imposed on commercial or industrial development bear a reasonable relationship and are limited to the needs of the community for schools and are reasonably related and limited to the need for school facilities caused by the development; K. The fees will be collected for school facilities for which an account has been established and funds appropriated and for which the district has adopted a construction schedule and/or to reimburse the District for expenditures previously made. 3. Fee. Based upon the foregoing findings, the Board hereby increases the previously levied fee to the amount of$1.72 per square foot for assessable space for new residential construction and for residential reconstruction to the extent of the resulting increase in assessable areas; and to the amount of$.28 per square foot for new commercial or industrial construction. 4. Fee Adjustments and Limitation. The fees adjusted herewith shall be subject to the following: A. The amount of the District's fees as authorized by Government Code section 53080 shall be reviewed every two years to determine if a fee increase according to the adjustment for inflation set forth in the statewide cost index for Class B construction as determined by the State Allocation Board is justified. B. Any development project for which a final map was approved and construction had commenced on or before September 1, 1986, is subject to only the fee, charge, dedication or other form of requirement in existence on that date and applicable to the project. C. The term "development project" as used herein is as defined by section 65928 of the Government Code. 5. Additional Mitigation Methods. The policies set forth in this Resolution are not exclusive and the Board reserves the authority to undertake other or additional methods to finance school facilities including but not limited to the Mello-Roos Community Facilities Act of 1982 (Government Code section 53311, et seq.) and such other funding mechanisms. This Board reserves the authority to substitute the dedication of land or other property or other form of requirement in lieu of the fees levied by way of this Resolution at its discretion, so long as the reasonable value of land to be dedicated does not exceed the maximum fee amounts contained herein or modified pursuant hereto. 6. Implementation. For residential, commercial or industrial projects within the District, the Superintendent, or the Superintendent's designee, is authorized to issue Certificates of Compliance upon the payment of any fee levied under the authority of this Resolution. 7. California Environmental Quality Act. The Board hereby finds that the implementation of Developer Fees is exempt from the California Environmental Quality Act (CEQA). 8. Commencement Date. The effective date of this Resolution shall be May 8, 1995, which is 60 days following its adoption by the Board. 9. Notification of Local Agencies. The Secretary of the Board is hereby directed to forward copies of this Resolution and a Map of the District to the Planning Commission and Board of Supervisors of Contra Costa County and to the Planning Commission and City Council of the City of Hercules. 10. Severability. If any portion of this Resolution is found by a Court of competent jurisdiction to be invalid, such finding shall not affect the validity of the remaining portions of this Resolution. The Board hereby declares its intent to adopt this Resolution irrespective of the fact that one or more of its provisions may be declared invalid subsequent hereto. PASSED AND ADOPTED by the Governing Board of the John Swett Unified School District this sixth day of March, 1995. Ayes: Janet Callaghan, Fred Clerici , Jim Delgadillo, Zoe Lighty Noes: None Absent: Gail Nichols I HEREBY CERTIFY that the foregoing Resolution (94-95)16 was duly introduced, passed and adopted by the Governing Board at a regularly called and conducted meeting held on said date. e Lighty, Cl k John Swett Unified School District SOL AN070e..�-­:- B N11 IIA ti,Vit:l;1�'' tH'} .'''!_\�.:.•y.�•4••, �^Rp�I 'E :r.'•..g(i.�.r. :-i^, it•.. /7�� L. _ ... ,1 •+-• 6 0 . P QSTA PITTSBU G �-'= t'yir,.L • ESARTINEZ C t� •ANTIOCH GAKLEY PIN L �' •I LAYTON 1"'J •CON -; ' SOB ANTE .`-�i'1;PACHECO *CONCORD - ••t..:,.�•�: '�5' :' =SAN PABLO '- ' A 7i itiaq :..:-:-BRENTWOOD 'RICHMOND �dj • w i PLEASANT H1LLra� ; S•.yt�Ari:.•<' a.l•:•i4 a 'i - ,,I _ D�j''..��'.1e11,; it �. -.•..� .., y •i' ,Yo!•.� , ARIN CO •_EL'CERRITO.�q� s-r:u� ^ikl d t= ;r.' - "r. •WALNU CREEK. i+A�Wt�'' t Ps`� <'e�- .+ «}` :.• LAF}1YI:,TTE ,! BERKELEY: 11 ORINDA Nr <r ALAMO ' '. Por MORAGA" q3 DANVILLE •BLACKIIAWK N ;.o,. :�N' -rt:" 4.. •��w t;a .wu' ...i .J .j: 'ti ti. ,�.:•:fr.:' SAN OAKLAND' � :F`k'a*•;v.�. ~<yyFRANCISCO SAN RAMON SAN LEANDRO t ` DUBLIN Hillcrest Elementary School K-5 California and Mahoney Streets Rodeo, CA 94572 (510-799-4431) Carquinez Middle School Grades 6-8 1099 Pomona St . Crockett , CA 94525 (510-787-1081) John Swett High School 1098 Pomona St. Crockett, CA 94525 (510-787-1088) Willow Continuation High School Mail: P. 0. Box 816 1650 Crockett Blvd. Crockett, CA 94525 (510-787-1286) Developer Fee Justification Study y for John Swett Unified School District January 24, 1995 Jon Frank, Superintendent Board of Trustees Jim Delgadillo, President Zoe Lighty, Clerk Janet Callaghan, Member Fred Clerici, Member Gail Nichols, Member ' Prepared bar: Jack Schreder & Associates 2230 K Street Sacramento, CA 95816 916-441-0986 TABLE OF CONTENTS RWe EXECUTIVESUMMARY...............................................................................................1 INTRODUCTION............................................................................................................2 SECTION I: DEVELOPER FEE JUSTIFICATION...............................................4 Reconstruction Needs.................................................................4 Residential Development and Fee Projection.......................5 Commercial/Industrial Fee Projection...................................7 Summary.......................................................................................9 SECTION II: BACKGROUND OF DEVELOPER FEE LEGISLATION..........................................................................10 SECTION III: REQUIREMENTS OF AB 1600......................................................14 SECTION IV: REVENUE SOURCES FOR FUNDING FACILITIES..................................................................17 StateSources...............................................................................17 LocalSources...............................................................................17 r� SECTION V: ESTABLISHING THE COST, BENEFIT AND BURDEN NEXUS...............................................20 SECTION VI: FACILITY FUNDING ALTERNATIVES....................................21 STATEMENT TO IDENTIFY PURPOSE OF FEE.....................................................22 ESTABLISHMENT OF A SPECIAL ACCOUNT......................................................22 RECOMMENDATION..................................................................................................22 SOURCES.........................................................................................................................23 APPENDIXA..................................................................................................................24 LIST OF TABLES Page TABLE 1 RECONSTRUCTION COSTS..........................................................5 TABLE 2 PROJECTED RESIDENTIAL FEE REVENUE...............................6 TABLE 3 COMMERCIAL/INDUSTRIAL GENERATION FACTORS............................................................................................8 EXECUTIVE SUMMARY • Government Code Section 53080 authorizes school districts to levy a fee, charge, dedication or other form of requirement against any development project for the construction or reconstruction of school facilities provided the district can show justification for levying of fees. • This study finds that justification exists for levying fees in the John �I Swett Unified School District at the current maximum rate of $1.72 per square foot for residential construction and $.28 per square. foot for commercial and industrial construction. • The justification is based on the district's current reconstruction need of $3,262,110. • This study finds the amount of developer fees to be collected will not exceed the cost to provide reconstructed school facilities. • Residential development projections show that $1,155,000 will be collected in residential fees in the next ten years. Commercial and industrial development projections show that $5,110 will be collected in commercial/industrial fees over the next ten years. When the total fees to be collected of $1,160,000 is compared to the reconstruction need of $3,262,110, a shortfall of $2,102,000 is shown. Jack Schreder and Associates John Swett Unified School District Developer Fee Study Page 1 INTRODUCTION In September, 1986, the Governor signed into law Assembly Bill 2926 (Chapter 887/Statutes 1986) which granted school district governing boards the authority to impose developer fees. This authority is codified in Government Code Section 53080 which states in part "...the governing board of any school district is authorized to levy a fee, charge, dedication or other form of requirement against any development project for the construction or reconstruction of school facilities." The maximum fee that can be levied is adjusted every two years according to the inflation rate, as listed by the state-wide index for Class B construction set by the State Allocation Board. In January of 1992, the State Allocation Board increased the maximum fee to $1.65 per square foot for residential construction and $.27 per square foot for commercial and industrial construction. Senate Bill 1287 (Chapter 1354/Statutes 1992) effective January 1, 1993, affected the facility mitigation requirements a school district could impose on developers. Senate Bill 1287 allowed school districts to levy an additional $1.00 per square foot of residential construction (Government Code Section 65995.3). The authority to levy the additional $1.00 was rescinded by the failure of Prop. 170 on the November 1993 ballot. In January 1994 the State Office of Local Assistance biennial inflation adjustment changed the fee to $1.72 per square foot for residential construction and $.28 per square foot for commercial/industrial construction. The current fees authorized by Government Code Section 53080 are set at $1.72 per square foot of residential construction and $.28 per square foot of commercial and industrial construction. In order to levy a fee, a district must make a finding that the fee to be paid bears a reasonable relationship and be limited to the needs of the community for elementarY or high school facilities and be reasonably related 1 Jack Schreder and Associates John Swett Unified School District Developer Fee Study Page 2 to the need for schools caused by the development. This study will demonstrate the relationship between residential, commercial and industrial growth and the need for the construction and/or reconstruction of school facilities in the John Swett Unified.School District. r i 1 t. 1 Jack Schreder and Associates John Swett Unified School District Developer Fee Study Page 3 SECTION I: DEVELOPER FEE JUSTIFICATION Developer fee law requires that before fees can be levied a district must find that justification exists for the fee. Justification for the fee can be shown if anticipated residential, commercial and industrial development within a district will impact it with additional students and the district either does not have the facility capacity to house these students and/or the students would have to be housed in existing facilities that are not educational) adequate (i.e., antiquated facilities). In addition, it must also be shown that the amount of developer fees to be collected will not exceed the district's cost for housing students generated by new development. This section of the study will show that justification does exist for levying developer fees in the John Swett Unified School District. Reconstruction Needs Most of the district's schools were constructed prior to 1964 and are in need of significant reconstruction. Facilities over 30 years old are eligible to participate in the State Lease-Purchase Modernization Program. According to the district, 108,737 square feet of school space is over 30 years old and has not been modernized. Based on the State's cost allowance of $30 per square foot for reconstruction, John Swett Unified School District has a current reconstruction need of $3,262,110. Should the district participate in the State Lease-Purchase Program to modernize its schools, the district must provide a local contribution, or "match". The match amount is equal to the amount of developer fees the district collects. Table 1 provides the reconstruction costs for each school. Jack Schreder and Associates John Swett Unified School District Developer Fee Study Page 4 ' Table 1 John Swett Unified School District State Modernization Costs School Square Feet Cost Hillcrest Elementary 48,973 sf $1,469,190 Carquinez Middle 59,764 sf 1,792,920 John Swett High 0 0 Willow High (Continuation) 0 0 Garretson Closed Site 0 Total 108,737 sf $3,262,110 r Residential Develol2ment and Fee Projections To show a reasonable relationship exists between the construction of new housing units and the need for reconstructed school facilities, it will be shown that residential construction will create a school facility cost impact on the John Swett Unified School District greater than the amount of developer fees to be collected. According to the City of Hercules and the Contra Costa County Planning Department, over the next ten years a total of 1,040 additional housing units will be built in the incorporated and unincorporated portions of the district. Table 2 illustrates the potential residential housing proposed in the district. Jack Schreder and Associates John Swett Unified School District Developer Fee Study Page 5 Table 2 John Swett Unified School District Potential Housing Single Multi- Development Family Family Total Units Franklin Canyon 875 0 875 Pointe Crockett 34 90 124 Crockett Village 18 0 18 Crockett Landing 23 0 23 Total Potential 950 90 1,040 Source: john Swett Unified School District, Demographic Study, April 1994. Appendix A contains an anaylsis of the development potential for each development listed in Table 2. According to the development analysis and the low level of building permit activity in the district presented in the district's Demographic Study, April 1994, the district has decided to assume that about 20 single family housing units would be built each year over the 1 next ten years. The average size of residential units to be built in the district will be 1,825 square feet, according to a Demographic Study completed for the district in April of 1994. The amount of residential fees to be collected can be estimated based on the housing unit projections. Table 3 shows the annual and cumulative residential fees to be generated by new residential construction. The amounts ' do not include fees to be generated by residential remodels in excess of 500 square feet. Table 3 shows the district can expect to collect $1,155,000 in residential fees between 1995 and 2005. Jack Schreder and Associates John Swett Unified School District Developer Fee Study Page 6 Table 3 Projected Residential Fee Revenues Based on $1.72 per Square Foot Projected Annual Cumulative Year Units Square Feet Fees Fees 1995 20 36,500 $105,000 $105,000 ' 1996 20 36,500 $105,000 $210,000 1997 20 36,500 $105,000 $315,000 1998 20 36,500 $105,000 $420,000 1999 20 36,500 $105,000 $525,000 2000 20 36,500 $105,000 $630,000 2001 20 36,500 $105,000 $735,000 ' 2002 20 36,500 $105,000 $840,000 2003 20 36,500 $105,000 $945,000 2004 20 36,500 $105,000 $1,050,000 2005 20 36,500 $105,000 $1,155,000 ' Table 3 shows that projected development will generate $1,155,000 in residential fees over the next ten years. When this amount is compared to the reconstruction cost of $3,262,110, a shortfall of $2,107,110 is identified. Because there is a shortfall in fees, the levying of residential developer fees at $1.72 per square foot of development is justified. t t 1 1 t Jack Schreder and Associates John Swett Unified School District Developer Fee Study Page 7 i Commercial/Industrial Development and Fee Projections In order to levy developer fees on commercial and industrial development, Assembly Bill 181 provides that a district "... must determine ' the impact of the increased number of employees anticipated to result from commercial and industrial development upon the cost of providing school facilities within the district. For the purposes of making this determination, the [developer fee justification] study shall utilize employee generation estimates that are based on commercial and industrial factors within the ' district, as calculated on either an individual project or categorical basis". The passage of Assembly Bill AB 530 (Chapter 633/Statutes 1990) modified the requirements of AB 181 by allowing the use of a set of state-wide employee generation factors. Assembly Bill 530 allows the use of the employee generation factors identified in the San Diego Association of Governments report titled, San Diego Traffic Generators. This study which was completed in January of 1990 identifies the number of employees generated for every 1,000 square feet of floor area for several development categories. These generation factors are shown in Table 4. Table 4 indicates the number of employees generated for every 1,000 1 square feet of development and the number of district households generated for every employee in 10 categories of commercial and industrial development. The number of district households is calculated by adjusting the number of employees for the percentage of employees that live in the district and are heads of households. These adjustment factors are based on surveys of commercial and industrial employees in school districts similar to John Swett Unified School District. Jack S hr der and Associates c e John Swett Unified School District Developer Fee Study Page 8 Table 4 ' Commercial and Industrial Generation Factors Type of Employees Per District Households Development 1.000 Sq. Ft.* Per Employe * Medical Offices 4.27 .2 Corporate Offices 2.68 .2 Commercial Offices 4.78 .2 Lodging 1.55 .3 ' Scientific R&D 3.04 .2 Industrial Parks 1.68 .2 Industrial/Business Parks 2.21 .2 Neighborhood Shopping Centers 3.62 .3 Community Shopping Centers 1.09 .3 Banks 2.82 .3 ' Average 2.77 .26 1 * Source: San Diego Association of Governments. ** Source: Jack Schreder and Associates. ' To show that the amount of commercial and industrial fees to be collected will not exceed the cost to provide reconstructed school facilities, a projection of the amount of the commercial and industrial development to be constructed between 1995 and 2005 was made. According to other school districts in the Bay Area currently collecting developer fees, commercial and ' industrial square footage represents about 5% of the residential square footage built in the same period. The residential projections indicate that 365,000 square feet of residential space will be constructed in the next ten years (Table 3). The 5% ratio represents 18,250 square feet of commercial and industrial development. According to the average employee generation factors in Table 4, 18,250 square feet of commercial and industrial development will yield 506 new employees and 131 new district households. The addition of 131 new ' households created by commercial and industrial development will impact John Swett Unified School District with additional students. When the ' maximum commercial and industrial fee of $.28 per square foot is multiplied Jack Schreder and Associates John Swett Unified School District Developer Fee Study Page 9 by the projection of 18,250 square feet of commercial and industrial development, a ten-year fee income of $5,110 is identified. Summary ' A reasonable relationship exists between new residential commercial ' and industrial development in the John Swett Unified School District and the need for reconstructed school facilities. This relationship is based on the finding that the district currently has a reconstruction need of $3,262,110, but Will only collect $1,160,110 in residential, commercial and industrial fees in the next ten years, according to development projections. This represents a fee shortfall of $2,102,000 between 1995 and 2005. ' Because the reconstruction needs of the district exceed the amount of fees to be collected, John Swett Unified School District is justified in levying 1 residential fees at $1.72 per square foot and commercial and industrial fees at $.28 per square foot. Jack Schreder and Associates John Swett Unified School District Developer Fee Study Page 10 r r SECTION II: BACKGROUND OF DEVELOPER FEE LEGISLATION 1 Initially, the maximum allowable developer fee was limited by Government Code Section 65995 to $1.50 per square foot of covered or enclosed space for residential development and $.25 per square foot of covered or enclosed space of commercial or industrial development. The maximum fee that can be levied is adjusted every two years, according to the inflation rate as listed by the state-wide index for Class B construction set by the State Allocation Board. In January of 1994, the State Allocation Board ' increased the maximum fee to $1.72 per square foot for residential construction and $.28 per square foot for commercial and industrial 1 construction. The fees collected are to be used by the school district for the ' construction or reconstruction of school facilities and may be used by the district to pay bonds, notes, loans, leases or other installment agreements for temporary as well as permanent facilities. ' Assembly Bill 3228 (Chapter 1572/Statutes 1990) added Government Code Section 66016 requiring districts adopting or increasing any fee to first hold a public hearing as part of a regularly scheduled meeting and publish ' notice of this meeting twice, with the first notice published at least ten days prior to the meeting. 1 Assembly Bill 3980 (Chapter 418/Statutes 1988) added Government Code Section 66006 to require segregation of school facilities fees into a separate capital facilities account or fund and specifies that those fees and the ' interest earned on those fees can only be expended for the purposes for which they were collected. ' Senate Bill 519 (Chapter 1346/Statutes 1987) added Section 53080.4 to the Government Code. It provides that a school district can charge a fee on manufactured or mobile homes only in compliance with all of the following: ' Jack Schreder and Associates John Swett Unified School District Developer Fee Study Page 11 1 1. The fee may be imposed only as to the initial installation of the manufactured or mobile home in the school district. 2. A manufactured or mobile home must not have been located previously on the pad where the manufactured or mobile home is to be installed. 3. The construction of the pad where the manufactured or mobile home is to be located must have commenced after September 1, 1986. ' Senate Bill 1151 (Chapter 1037/Statutes 1987) concerns agricultural buildings and adds Section 53080.15 to the Government Code. It provides that no school fee may be imposed and collected on a greenhouse or other space covered or enclosed for agricultural purposes unless the school district has made findings supported by substantial evidence as follows: 1. The amount of the fees bears a reasonable relationship and is limited to the needs for school facilities . created by the greenhouse or other space covered or enclosed for agricultural ' purposes. 2. The amount of the fee does not exceed the estimated reasonable costs of the school facilities necessitated by the structures as to ' which the fees are to be collected. 3. In determining the amount of the fees, the school district shall consider the relationship between the proposed .increase in the number of employees, if any, the size and specific use of the ' structure, as well as the cost of construction. ' In order to levy developer fees, a study is required to assess the impact of new growth and the ability of the local school district to accommodate that growth. The need for new school construction and reconstruction must be determined along with the costs involved. The sources of revenue need to be ' Sc e Jack hr der and Associates a John Swett Unified School District Developer Fee Study Page 12 evaluated to determine if the district can fund the new construction and reconstruction. Finally, a relationship between needs and funding raised by ' the fee must be quantified. Assembly Bill 181 (Chapter 1209/Statutes 1989) which became effective October 2, 1989, was enacted to clarify several areas of developer fee law. ' Assembly Bill 181 provisions include the following: 1. Exempts residential remodels of less than 500 square feet from fees. ' 2. Prohibits the use of developer fee revenue for routine maintenance and repair, most asbestos work, and deferred maintenance. 3. Allows the fees to be used to pay for the cost of performing developer fee justification studies. ' 4. States that fees are to be collected at the time of occupancy, unless the district can justify earlier collection. The fees can be collected ' at the time the building permit is issued if the district has established a developer fee account and funds have been appropriated for which the district has adopted a proposed construction schedule or plan prior to the issuance of the ' certificate of occupancy. ' 5. Clarifies that the establishment or increase of fees is not subject to the California Environmental Quality Act. 6. Clarifies that the impact of commercial and industrial development may be analyzed by categories of development as ' well as an individual project by project basis. An appeal process for individual projects would be required if analysis was done by categories. Jack Schreder and Associates John Swett Unified School District Developer Fee Study Page 13 7. Changes the frequency of the annual inflation adjustment on the maximum fee to every two years. 1 8. Exempts from fees, development used exclusively for religious ' purposes, private schools, and government-owned development. ' 9. Expands the definition of senior housing which is limited to the commercial/industrial fee cap and requires the conversion from senior housing to be approved by the city/county after notification of the school district. 10. Extends the commercial/industrial fee cap to mobile-home parks limited to older persons. Jack Schroder and Associates John Swett Unified School District Developer Fee Study Page 14 SECTION III: REQUIREMENTS OF AB 1600 ' Assembly Bill 1600 (Chapter 927/Statutes 1987) adds Section 66000 ' through 66003 to the Government Code: Section 66000 defines various terms used in AB 1600: "Fee" is defined as monetary exaction (except a tax or a special ' assessment) which is charged by a local agency to the applicant in connection with the approval of a development project for the purpose of defraying all or a portion of the costs of public facilities related to the development project. ' "Development project" is defined broadly to mean any project undertaken for purposes of development. This would include residential, commercial, or industrial projects. "Public facilities" is defined to include public improvements, public ' services, and community amenities. Section 66001(a) sets forth the requirements for establishing, increasing or imposing fees. Local agencies are required to do the following: 1. IdentifY the purpose of the fee. 2. Identify the use to which the fee is to be put. ' 3. Determine how there is a reasonable relationship between the fee's use and the type of development project on which the fee is ' imposed. 4. Determine how there is a reasonable relationship between the need for the public facility and the type of development project on which the fee is imposed. Jack Schreder and Associates John Swett Unified School District Developer Fee Study Page 15 Section 66001(c) requires that any fee subject to AB 1600 be deposited in an account established pursuant to Government Code Section 66006. Section ' 66006 requires that development fees be deposited in a capital facilities account or fund. To avoid any commingling of the fees with other revenues ' and funds of the local agency the fees can only be expended for the purpose for which they were collected. Any income earned on the fees should be ' deposited in the account and expended only for the purposes for which the fee was collected. Section 66001(d) provides that relative to any portion of the fees remaining unexpended or uncommitted in the account established pursuant to Section 66006 five or more years after deposit, that the local agency is required to make findings once each fiscal year to identify the purpose to which the fee is to be put and to demonstrate a reasonable relationship between the fee and the purpose for which it was charged. In other words, the agency is required to demonstrate that it needs to retain the fees. Section 66001(e) provides that the local agency shall refund to the current record owners of the development project or projects on a prorated basis the unexpended or uncommitted portion of the fees and any accrued ' interest for which the local agency is unable to make the findings required by Section 66001(d) that it still needs the fees. ' Section 66002Y agency P rovides that an local which levies a development fee subject to Section 66001 may adopt a capital improvement plan which shall be updated annually and which shall indicate the approximate location, size, time of availability and estimates of cost for all ' facilities or improvements to be financed by the fees. Jack Schreder and Associates ' John Swett Unified School District Developer Fee Study Page 16 1 1 Assembly Bill 1600 as Related to the Justification for Levying or-v Developer Fees Effective January 1, 1989, Assembly Bill 1600 requires that any school district which establishes, increases or imposes a fee as a condition of ' approval of development shall make specific findings as follows: 1. A cost nexus must be established. A cost nexus means that the amount of the fee cannot exceed the cost of providing adequate school facilities for students generated by development. Essentially,. it prohibits a school district from charging a fee greater than their cost to construct or reconstruct facilities for use by students generated by development. 2. A benefit nexus must be established. A benefit nexus is established if the fee is used to construct or reconstruct school facilities benefiting students to be generated from development projects. 3. A burden nexus must be established. A burden nexus is established if a project, by the generation of students, creates a ' need for additional facilities or a need to reconstruct existing facilities. 1 1 ' Jack Schreder and Associates John Swett Unified School District Developer Fee Study Page 17 1 ' SECTION IV: REVENUE SOURCES FOR FUNDING FACILITIES ' Two general sources exist for funding facility construction and reconstruction - state sources and local sources. The district has considered ' the following available sources: State Sources State School Building Lease-Purchase Program In order to participate in the State School Building Lease-Purchase Program, school districts are required to contribute to a "local match." With certain exceptions, the local match is based on "the applicable maximum fee" set forth in the school facility developer fee legislation. Levying the school facility developer fees would allow the district to raise the "local match" and the district would be able to participate in the State Building Lease-Purchase Program. Currently, the State Building Lease-Purchase Program is an unreliable funding source due to the lack of state money in the program. ' Local Sources Mello-Roos Community Facilities Act ' The Mello-Roos Community Facilities Act of 1982 allows school districts to establish a community facilities district in order to impose a special tax to raise funds to finance the construction of school facilities. At the present time, this alternative does not seem to be workable for the following reasons: 1. The voter approved tax levy requires a two-thirds vote by the voters of the proposed Mello-Roos district. It is not likely that two-thirds of the district would vote to impose such a special tax. 2. If a Mello-Roos district is established in an area in which fewer than twelve registered voters reside, the property owners may elect to establish a Mello-Roos district. Currently the owners of Jack Schreder and Associates John Swett Unified School District Developer Fee Study Page 18 major developments have not elected to establish a Mello-Roos district. 3. Should a Mello-Roos district be formed subsequent to the ' levying of developer fees, the Mello-Roos district may be exempt from such fees. The Board may levy developer fees and provide flexibility for establishment of a Mello-Roos district in the future. School District General Funds The district's general funds are needed by the district to provide for the operation of its instructional program. There are no unencumbered funds that could be used to construct new facilities or reconstruct existing facilities. General Obligation Bonds t General obligation (GO) bonds may be issued by any school district for the purposes of purchasing real property or constructing or purchasing buildings or equipment "of a permanent nature." Because GO bonds are ' secured by an ad valorem tax levied on all taxable property in the district, their issuance is subject to two-thirds voter approval in an election. School ' districts are obligated, in the event of delinquent payments on the part of the property owners, to raise the amount of tax levied against the non-delinquent properties to a level sufficient to pay the principal and interest coming due on 1 the bonds. Expenditure of Lottery Funds Government Code Section 8880.5 states: "It is the intent of this chapter that all funds allocated from the California State Lottery Education Fund shall be used exclusively for the education of pupils and students and no funds Jack Schreder and Associates John Swett Unified School District Developer Fee Study Page 19 ' shall be spent for acquisition of real property, construction of facilities, financing research, or any other non-instructional purpose." i 1 1 1 1 t Jack Schreder and Associates John Swett Unified School District Developer Fee Study Page 20 ' SECTION V: ESTABLISHING THE COST, BENEFIT AND BURDEN NEXUS Establishment of a Cost Nexus The John Swett Unified School District chooses to reconstruct its school facilities. The cost for providing reconstructed facilities exceeds the amount of developer fees to be collected. Establishment of a Benefit Nexus Students generated by new residential, commercial and industrial 1 development will be attending district schools. Housing district students in reconstructed facilities will directly benefit those students. Establishment of a Burden Nexus The generation of students by development will create a need for reconstructed school facilities. The district must provide reconstructed school facilities to adequately house these students. Jack Schreder and Associates John Swett Unified School District Developer Fee Study Page 21 SECTION VI: FACILITY FUNDING ALTERNATIVES ' The district does not currently have funds to provide for the shortfall in housing costs. We suggest the following possible funding alternatives. 1. Participate in the Leroy Greene Lease-Purchase Program. ' Developer fees may go to the State while the district is in the program. 2. Utilize temporary housing if the site will accommodate such ' housing. 3. Explore a possible new site in cooperation with developers for the possibility of establishing a Mello-Roos community facility district. r 4. Explore possible local land exchange in combination with State Building program. 5. Explore voter approved Mello-Roos or General Obligation Bond election. Jack Schreder and Associates John Swett Unified School District Developer Fee Study Page 22 ' STATEMENT TO IDENTIFY PURPOSE OF FEE ' It is a requirement of AB 1600 that the district identify the purpose of the fee. The purpose of fees being levied shall be used for the construction and/or reconstruction of school facilities. The district will provide for the reconstruction of school facilities, in part, with developer fees. ' ESTABLISHMENT OF A SPECIAL ACCOUNT ' Pursuant to Government Code section 66006, the district will establish a special account in which fees for capital facilities are deposited. The fees ' collected in this account will be expended only for the purpose for which they were collected. Any interest income earned on the fees that are deposited in such an account will be expended only for the purpose for which the fee was collected. Any fees remaining unexpended or uncommitted in the account established under Government Code section 66006 five years or more after Ideposit will be returned in accordance with Government Code section 66006. ' CONCLUSION It is clear that developer fees are justified and necessary to partially mitigate the need for student housing. While the district must meet immediate housing needs, long range planning should be continued in ' addition to the collection of developer fees. RECOMMENDATION Based on the shortfall between developer fees collected and facility costs provided in this report, it is recommended John Swett Unified School ' District levy residential development fees at $1.72 per square foot and commercial/industrial development fees at $.28 per square foot. ' Jack Schreder and Associates John Swett Unified School District Developer Fee Study Page 23 1 SOURCES ' California Basic Educational Data System. California State Department of Education. October Enrollments, 1990-1994. ' California State Allocation Board, Applicant Handbook, Leroy F. Greene State School Building Lease Purchase Law of 1976, 1986 revised. ' California State Department of Education. California Public School Directory, 1994. California State Department of Finance. Population Research Division. ' California State Department of Finance. Population and Housing Estimates for California Cities and Counties. Report E-8090 City. Collard, Gary. Lead Housing Analyst for Southern California. California State Department of Housing and Community Development. ICristy, Jonathan. Attorney. Kronick, Moskowitz, Tiedemann and Girard Attorneys at Law. Frank, Jon. Superintendent, John Swett Unified School District. ' John Swett Unified School District. Demographic Study,, April 1994. San Diego Association of Governments. Traffic Generators, January 1990. iSchreder, Jack and Associates. Developer Fee Justification Study, John Swett Unified School District, November 1990. ' Schreder, Jack and Associates. Original research. Steentofte, Karen. Executive Director, Schools Legal Defense Association. Jack Schreder and Associates John Swett Unified School District Developer Fee Study Page 24 ,£ Billi z i to .F� ��._..�,,,.._,t..�-...�:mw.F..::.2«.xr,:w..,,.�„_saw.,xa�;z,�za�.�cz.::,*;a,...�..,..w:......�,. ...K.u,.,�..«t�.�.�..,..�.�.,....�e..<�x�....,..��::,:.:z�.,w,......,.w,,:.,::._„w.w,�. ��c�,...x,.,«ds�a,,.�.x�• D. RESIDENTIAL DEVELOPMENT POTENTIAL The residential development potential of the John Swett Unified School District was determined from planning data obtained for the City of Hercules and the unincorporated areas of the County. Data is summarized below by planned development. ' Pointe r k •c et The proposed Pointe Crockett project consists of 330 acres of land in the western part of Crockett,of which 27.6 acres is planned for residential development, consisting of 34 single family homes and 90 townhomes. Refer to the illustration on the follo%iing page for project location. According to a Draft EIR dated June 1993, the project would generate approximately 105 K-12 students. These students would be assigned to the existing schools of the district. ' Franklin Canyon The proposed Franklin Canyon project, located south of Highway 4 in the extreme western part of the John Swett Unified School District,has the greatest potential for impacting the district. The project site has been annexed by the City of Hercules and therefore falls under the jurisdiction of their planning department. Refer to the attached map for a graphical description of the proposed project. According to preliminary information, up to 875 housing units are proposed for development. Assuming a yield rate of 1.0 K-12 students per household, up to 875 K-12 ' students would therefore be generated. (_according to the Rest Contra Costa School District, the Hercules area has a current K-12 yield rate of 1.17.) A project of this magnitude would have a major impact on the John Swett District, and would require a new elementary school ' site to serve the student population. According to the Hercules Planning Department, there is no established timetable for the Franklin Canyon project, and preliminary plans have not yet been submitted to the City for review. The project is therefore considered to be too preliminary to incorporate into ten year enrollment projections. After preliminary plans are submitted, a realistic development timetable could be prepared, with the enrollment projections being revised accordingly. ' Crockett Village This subdivision consists of 18 single family homes on 4.6 acres, located north of San ' Pablo Avenue east of Dowrelio Road. -so- l Crockett Landine ' This subdivision consists of 23 single family homes on 10.96 acres, located west of Merchant Street south of San Pablo Avenue. 1 Commercial/Industrial Development A number of commercial/industrial firms in the area may add workers to their operations, which would have an indirect impaction school enrollments by bringing new residents to the area. Some of the possible expansions include the following: C & H Co-Generation Plant 400 Workers Unical Expansion 200 Construction Workers Pacific Refinery, Hercules 150-200 Construction Workers ' (Converting to clean fuel.) i 1 i 1 1 i 1 1 i -51- 1 t _ a ' Z • • t c� p u 0 P64 tn r • r :�N..- •+�`` , C5 d e O N 3 N '3 �• it a a 1J ' w f 1 1 t i .tat K ` a � P ♦ ' i • 'l . ♦1ri�� t� � l WO .-.A po • � .,, '1. is w 1 ;� .. ( o�,y •.jE4�� 1� i . 4L . v Ii��l i •il lfa !`Y'u f . � `~ti, �, ,tel f .fir. ..., 'l ���;� ' �i - � • ' ` �9�.1wj`lS�l\' f +•+" . . moi(."�' � —53— .