For City Council Meeting July 25, 2023
TO: Honorable Mayor and City Council
APPROVAL: Arron Brown, Acting City Manager
FROM: Colby Cataldi, Director of Community Development
Title
Request City Council to: (1) Approve a Professional Services Agreement with David Taussig Associates Inc. (DTA) for consulting services for a comprehensive citywide Development Impact Fee Study, User Fee Study and Nexus Study Services; and (2) Authorize the Acting City Manager to Execute All Documents.
(ACTION)
Body
BACKGROUND
Development Impact Fees and User Fees are collected by the City to provide various services to the community. The services range from providing public documents to the public to the review of various land-use development applications, agreements and plans. Rialto Municipal Code Section 3.32 empowers the City to recover costs reasonably borne for providing various services through the imposition of fees and charges.
The last comprehensive User Fee update conducted by the City was in 2004 as part of a larger effort that included establishing the Central Cost Allocation Plan and Fully Burdened Hourly Rate study completed by MuniFinancial. The City Council approved the User Fee update in April 2005. Since this time, the consultant Lynn Merrill has completed various individual fee studies. Additionally, as a supplement to the 2005 study, in December 2011, Development Impact Fees for General Civic, Police, Fire, Park, Storm Drain and Water and Sewer Facilities were also completed.
The State of California, through enactment of the Mitigation Fee Act in Government Code Section 66000 et seq., has authorized cities to establish and impose Development Impact Fees (DIF). The collection of DIF fees is a method that ensures new development bears its proportionate share of the cost of public facilities necessary to accommodate such development, which protects the public health, safety and welfare of the residents of the City.
Nexus Reports will be completed and incorporated with a final document and will demonstrate fees imposed by this chapter are derived from, based upon, and do not exceed the actual costs of providing public facilities necessary to accommodate the impacts attributable to new development in the City. The Nexus Reports also demonstrate the reasonable relationship between the need for those public facilities and the impact of the types of development on which such fees are imposed.
Per Section 3.32.040 (Schedule of fees and services charges), the City administration shall review all fees and service charges on the listed schedule of fees and provide an adjusted fee or charge schedule to the City Council for consideration. Section 3.33.040 (Establishment of development impact fees) states that fees shall be established by the City Council and subsequent resolutions adopted as needed. The code also states DIF fee amounts are to be reviewed and revised every five (5) years and shall be based on the current estimated costs of the proposed public facilities, as required by the Mitigation Fee Act contained in California Government Code Section 66000 et seq.
In order to maintain a competitive fee schedule for new development, fees are compared to local City jurisdictions. This will allow the City to study and identify if Rialto ranks among the highest, lowest, or middle scale with existing fees as compared to other local jurisdictions.
Annual Development Impact Fee Increases
In December 2011, at a regularly scheduled City Council meeting, the City Council adopted an automatic inflationary adjustment to be applied each July 1st. The automatic increase would help ensure City fees will continue to be on par with future yearly inflation. Fees have annually been adjusted based on the percentage change in the California Construction Index (CCCI) for the preceding calendar year. In July 2022, the City Council chose to not adjust fees based on the CCCI
ANALYSIS/DISCUSSION
In accordance with Rialto Municipal Code Section 3.32, a comprehensive development impact fee and user fee study shall be conducted for the City Council’s review and consideration. The departments and divisions fees to be reviewed include the Police Department, Community Development, Parks and Recreation/Community Services, Fire Department, Maintenance and Facilities, Information Technology, Rialto Network, City Clerk, Engineering, and all other applicable departments.
The intent and purpose for the DIF fees is to reasonably impose fees that are related to impacts created by new development on the physical environment and the City’s public facilities, together with funding available from other City revenue sources. This will allow the City to provide the required public facilities to accommodate new growth and fulfill the goals, objectives, and policies of the City’s General Plan.
Throughout the course of the study, staff and the consultant will host meetings with community stakeholders to ensure the public input is incorporated into the process. Upon completion of the consultant’s work, the City’s Executive team will perform their review of the work product and brief City Council of the findings and recommendations contained in the study. The final studies and recommended fee schedule will be presented to City Council as a public hearing item. At time of the fee update adoption, City Council can decide how to impose future fee adjustments to ensure sufficient cost recovery is attained and to prevent future subsidy scenarios. A common way to accomplish this is to have year to year adjustments that would be subject to an industry CCCI method and a yearly public hearing process.
Request for Proposals
On November 22, 2022, a Request for Proposal for a comprehensive Development Impact Fee, User Fee Study and Nexus Study Services was posted on Planet bid to solicit firms to complete the requested work.
In response to RFP 23-023, the City received three (3) proposals from the following firms:
David Taussig Associates Inc.
Willdan Financial Services
FEI Associates Consulting Engineers
The proposals were previously evaluated by Staff in accordance with the criteria established in the RFP, and based on that evaluation, consideration of prior experience, and consideration of pricing, a recommendation was made to select David Taussig Associates Inc.
The scope of services to be completed include the following listed below:
Review existing fee schedule and related documentation.
Conduct meetings with staff to ensure correct stakeholder involvement, establish project schedule and communication strategies.
Meet with Staff on the project scope, purpose, uses and goals of the City’s Development Impact Fee Study to ensure that the study will be both accurate and appropriate to the City’s needs
Presentations to the public and applicable agencies to inform and solicit comment.
Draft Development Impact Study and User Fee Study to include Fee Calculation and Analysis, Impact Fee Nexus Study, report with deliverables and for public review.
Final update for City Council consideration.
Staff recommends David Taussig Associates Inc. to assist in the preparation of Citywide comprehensive Development Impact Fee and User Fee Study Services. The study will evaluate and update all citywide fees to recover costs for services rendered and minimizing any subsidy through loss of revenue from out-of-date, inadequate fees.
A copy of the Professional Service Agreement (PSA) with DTA Inc., is included as Attachment 1.
ENVIRONMENTAL IMPACT
Pursuant to Section 15378(a), a “Project” means the whole of an action, which has a potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment. According of a Professional Service Agreement is an administrative function in accordance with the Rialto Municipal Code and is not a project as defined by the California Environmental Quality Act (CEQA).
GENERAL PLAN CONSISTENCY
The City of Rialto General Plan establishes various guiding principles, goals, and objectives through which the City looks to improve the community and protect the quality of life for our residents. Guiding Principal No. 1 states that Rialto is a family first community and essential services and amenities must meet the needs and desires of our families.
LEGAL REVIEW
The City Attorney has reviewed and supports this staff report.
FINANCIAL IMPACT
Operating Budget Impact
Funding in the amount of $119,225 is available in the FY2022/2023 Non-Departmental General Fund Contract Services Account No. 010-500-0001-2011 to cover the Professional Services Agreement with David Taussig Associates Inc.
LICENSING
Prior to execution of the Professional Service Agreement/Purchase Order/Construction Contract, the vendor shall submit a business license application and pay a Business License tax at the rate of $215.40, as well as Administration and State fees.
RECOMMENDATION
Staff recommends that the City Council:
1. Approve a Professional Services Agreement with David Taussig Associates Inc. (DTA) for consulting services for a comprehensive citywide Development Impact Fee Study, User Fee Study and Nexus Study Services; and,
2. Authorize the Acting City Manager to execute all documents.