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HomeMy WebLinkAbout2023-10-04; Planning Commission; ; Introduction to the Multimodal Transportation Impact Fee Program Meeting Date: Oct. 4, 2023 Item 3 To: Planning Commission Staff Contact: Nathan Schmidt, Transportation Planning and Mobility Manager Nathan.schmidt@carlsbadca.gov, 442-339-2734 Subject: Introduction to the Multimodal Transportation Impact Fee Program District: All Recommended Action Receive an overview on the on the update of the City’s Traffic Impact Fee program and provide feedback to staff. Executive Summary This item will provide the Planning Commission with an introduction to the update of the city’s current Traffic Impact Fee (TIF) program which was adopted by City Council in April 2008 and provided in Exhibit 1. This fee update process reflects a shift in the city’s priorities related to transportation improvements. While the existing TIF has been focused on infrastructure to accommodate new automobile traffic, the city is focused on a broader range of transportation improvements to support all the ways that people get around such as transit, biking and walking. The update will include a change to the name of the fee, from Traffic Impact Fee to Multimodal Transportation Impact Fee (MTIF). This will be the first of several presentations to the Planning Commission regarding the MTIF. Subsequent items will include the review of the draft fee and then final adoption of the fee program prior to City Council review. The Frequently Asked Questions (FAQ) document provided in Exhibit 2 includes a more detailed overview of the MTIF development process, best practices related to developing a program, and how the MTIF will relate to California Environmental Quality Act (CEQA) Transportation Mitigation. Explanation & Analysis Implementation Plan for the Sustainable Mobility Plan The basis for the updated TIF will be established from the transportation projects that are identified in the Sustainable Mobility Plan (SMP). The City Council adopted the SMP in Jan. 2021 a. The plan provides a broad range of improvements for reducing vehicle miles traveled in the city, mitigating the impacts of growth and development, and accommodating all the ways people get around the city, not just cars and single-occupied private automobiles. The plan serves as a master document that incorporates important prior planning work in the city including: • The General Plan’s Mobility Element PLANNING COMMISSION Oct 4, 2023 Item #3 Page 1 of 14 • Growth Management Plan • Bicycle and pedestrian master plans • Village & Barrio Master Plan • Carlsbad Active Transportation Strategy • Climate Action Plan • Establishing the Transportation Demand Ordinance to reduce single occupancy travel Growth Management Plan Citizens Committee Report The City Council formed a resident led advisory committee to initiate work on the update of the City’s Growth Management Plan (GMP). The committee's primary objective was to propose updates to the current GMP aimed at accommodating future growth while upholding an exceptional quality of life and adhering to state regulations. The citizen’s committee was a first step of a multi-year process to create a new approach to managing future growth in Carlsbad. On July 18, 2023, the City Council officially accepted the committee's comprehensive report. The citizen’s committee voted to recommend that the Mobility Standard remain unchanged. This standard requires that Carlsbad must sustain a Level of Service (LOS) D or higher for all modes of transportation, as outlined in Table 3-1 of the General Plan Mobility Element, except for LOS- exempt streets approved by the City Council. Furthermore, the committee advocated for the use of the Multimodal Transportation Impact Fee to fund implementation of future multimodal transportation projects that would provide the greatest benefit for the community. This includes the development of standards and a fee structure for private development to provide a fair share to partially fund the buildout of the city’s multimodal transportation network. Sustainable Mobility Plan Implementation Plan The first task in the implementation process is to develop a strategic plan for completing the projects in the SMP which will serve as a blueprint for getting the projects completed. This strategy will include an engineering feasibility analysis of the plan’s top-priority projects and programs, covering the preliminary cost estimates, conceptual improvement plans, roadway cross-sections and funding sources. Traffic Impact Fee vs Multimodal Transportation Impact Fee Part of this process also includes creating realistic funding strategies for the design and construction of the recommended projects. One way of funding these projects is to update the city’s current Traffic Impact Fee and develop a new approach to funding transportation infrastructure through something called the Multimodal Transportation Impact Fee or MTIF. The city’s current traffic impact fee is assessed on developers based on the impact their projects will have on city streets. It was designed to fund needed circulation improvements within the city, primarily based on cars. The genesis of the program was the city’s General Plan, which requires that the city ensure the provision of adequate circulation infrastructure to serve its projected population. One of the objectives listed in General Plan Mobility Element Policy 3-P.5 states the city should, “require developers to construct or pay their fair share toward improvements for all travel modes consistent with this Mobility Element, the Growth Oct 4, 2023 Item #3 Page 2 of 14 Management Plan, and specific impact associated with their development.” The current fee was adopted by the City Council in April 2008. The MTIF will replace the city’s current traffic impact fee program based on a nexus study and the final adoption of an ordinance by City Council. This study will provide a mechanism to modernize the city’s current fee program to collect funds for the construction of the improvements identified and prioritized in the Sustainable Mobility Plan and Capital Improvement Program. This new fee would be collected from developers so they’d pay for the impacts their projects will have on the city’s transportation network. Instead of charging developers a fee based on cars, the city would be able to collect development fees to help fund improvements in all the ways people travel around the city, like bike infrastructure and wider sidewalks. The MTIF program will be prepared in compliance with the Mitigation Fee Act, which authorizes a city to impose fees on specific development projects to defray the cost of new or additional public facilities needed to serve those developments. Developers would pay a fee based on the effect their projects would have on the city’s transportation infrastructure. The proceeds would be used for projects intended to reduce vehicle miles traveled. The methodology used to determine the amount individual fees and the efforts to reduce vehicle miles traveled (VMT) and provide a multimodal network to accommodate future land use growth. The goals to reduce VMT and increase access to multimodal travel options is aligned with the city’s General Plan. In addition, providing access to multimodal travel options is consistent with State of California goals and policies to reduce greenhouse gas emissions and to reduce VMT, for example, the transportation projects funded by the MTIF would assist with VMT reduction required by Senate Bill 743, which took effect in 2020, that changed the way local governments analyze CEQA transportation impacts from development projects and how they identify mitigation measures to reduce those impacts.1 The fee program methodology will also need to align with the requirements in the county’s TransNet Extension Ordinance, which generates funding for regional transportation projects, for the city to remain eligible to receive its share of TransNet’s sales tax revenue. Vehicle Miles Traveled (VMT) Mitigation The projects funded by the MTIF will reduce citywide VMT. The amount of VMT reduction expected as a result of the MTIF will be identified in the nexus study. For land use projects that are subject to CEQA, the VMT reduction can be accounted for the in the project’s CEQA analysis. In some cases, the amount of VMT reduction attributable to the MTIF may result in a project having a less-than-significant transportation CEQA impact. 1 The previous practice of evaluating traffic transportation impacts used road congestion and delay or level of service. SB 743 requires the amount of driving and length of trips – as measured by vehicle miles traveled or VMT – to be used to assess transportation impacts on the environment when projects are reviewed for compliance with the California Environmental Quality Act. Oct 4, 2023 Item #3 Page 3 of 14 Community Engagement The MTIF program will be guided by feedback provided by developer stakeholders, the Traffic and Mobility Commission, the Planning Commission and City Council. On August 24, 2023, City staff provided an introduction of the MTIF to a developer focused stakeholder group organized in collaboration with the Building Industry Association (BIA) of San Diego. The stakeholder group provided the following comments for consideration by the city in the development of the MTIF: • Consider how the fee could be reduced for affordable housing units in order to avoid discouraging affordable housing in Carlsbad • Consider how transportation improvements required as part of the discretionary permit process will be factored in as a potential credit for the fee. If a project is constructing a project identified in the SMP, the project should somehow get credit for this improvement versus paying the TIF. • Minimize the risk of developers having to pay redundant fees. • Consider if the fee should be applied citywide or if the fee should vary throughout the city. • Provide examples of VMT based fee programs from other agencies throughout California in order to provide a comparison to the future MTIF amount. Future community engagement events will be conducted over the next year with a focus on policy makers and the most interested and affected stakeholder groups, such as mobility advocates, private developers, and environmental groups. Community members will be kept informed about this project and will have several opportunities to provide input if desired through public meetings and other community input channels. Next Steps Staff will utilize comments provided by the Planning Commission to guide the development of the MTIF program. The next steps for the MTIF process are to determine the infrastructure projects to be funded by the MTIF from the SMP, perform cost estimates for the infrastructure projects, and determine the maximum funding contribution from the MTIF based on future land development growth. This analysis will be conducted over the next six months. Staff will then return to the Planning Commission with the proposed draft fee amount for review and recommendation. Environmental Evaluation This informational item does not constitute a project within the meaning of the California Environmental Quality Act under Public Resources Code section 21065 in that it has no potential to cause either a direct physical change in the environment or a reasonably foreseeable indirect physical change in the environment and therefore does not require environmental review. The future program update will be evaluated under CEQA for appropriate environmental review and documentation. Exhibits 1. April 8, 2008 Traffic Impact Fee (TIF) program (on file in the Office of the City Clerk) 2. Frequently Asked Questions (FAQ) Guidelines to the City of Carlsbad Multimodal Transportation Impact Fee. Oct 4, 2023 Item #3 Page 4 of 14 Exhibit 1 April 8, 2008 Traffic Impact Fee (TIF) program (On file in the Office of the City Clerk.) Oct 4, 2023 Item #3 Page 5 of 14 Date: June 15, 2023 Authored by: Katy Cole, Fehr & Peers; Julie Cooper, EPS The purpose of this document is to provide information about transportation fee programs and best practices related to developing a program. The document is structured as a frequently asked questions format and is organized into the following sections: •General Fee Program Information •Considerations for the Carlsbad Multimodal Transportation Impact Fee (MTIF)•How will the MTIF Relate to CEQA Transportation Mitigation General Fee Program Information What is a development impact fee and who pays it? A development impact fee is a one-time charge on new development and redevelopment imposed by local jurisdictions. It is designed to reflect the cost of new public infrastructure and capital facilities that are needed to provide municipal services (e.g., transportation, public safety, parks, libraries, etc.) to new populations of residents and workers generated by real estate development. It is authorized under the California Mitigation Fee Act, also known as AB 1600, with additional requirements mandated by Assembly Bill (AB) 602. Impact fees are generally paid by builders and/or developers of private sector buildings (e.g., new or redeveloped office, retail, industrial and/or residential projects). Public sector projects are exempt from development impact fees (e.g., city, county and state projects). Cities may also choose to exempt other types of projects, such as those being pursued by non-profit entities (e.g., affordable housing, public service organizations, religious institutions, etc.), see FAQ: Are any types of land development projects exempt from the MTIF?. Payment of the fee is mandatory for all new non-exempt development projects as a condition of development approval. However, the city may allow a project to petition for a fee waiver or reduction, particularly if the project plans include construction of improvements that align with the goals of the fee program’s capital improvement plan. What is a Transportation Impact Fee? A Transportation Impact Fee (TIF) is a development impact fee specifically meant to address the impacts of new populations utilizing transportation-related infrastructure, such as roads, intersections, bridges, as well as facilities that serve transit, pedestrians and/or non-motorized vehicles (e.g., bus shelters, bike Exhibit 2 Oct 4, 2023 Item #3 Page 6 of 14 Page 2 of 9 lanes or sidewalks, etc.). The fee is established such that new development and redevelopment projects will pay their “fair share” toward new and updated transportation infrastructure and facilities that mitigate those additional impacts. The City of Carlsbad is seeking to update the current Transportation Impact Fee program to transition the impact fee calculation from a “vehicle capacity road-based” fee to a Multimodal Transportation Impact Fee (MTIF), incorporating all the ways people get around, by driving, taking transit, biking and walking. What is VMT and why are we discussing it related to the MTIF program? VMT, or Vehicle Miles Traveled, is a measure of how much and how far we drive. Think of it as the odometer in your car. VMT can be summarized in various ways: total VMT per year (which is equivalent to your annual odometer reading), VMT per person, VMT per household, average VMT per day, etc. These various methods for summarizing VMT are used in a wide range of applications and to measure performance. Commonly, VMT is used to calculate how much greenhouse gas (GHG) is emitted by cars, the cumulative distance that we drive is directly responsible for the amount of GHG our car emits. VMT is also used to determine if we have access to goods and services near our home and work. Lower VMT generally means that we can get to the goods and services that we need easily and close by our homes or workplaces. It can also mean that we work close to our home. High VMT typically means that we live or work in a more remote location and don’t have close access to our daily needs. The MTIF will fund roadway improvements necessary to accommodate development in the City of Carlsbad. Land development increases the demand for roadways by all users and increases VMT. Improving roadways is necessary to accommodate all modes of transportation created by development and to offset the increase in VMT from new development. We are discussing VMT related to the MTIF because the improvements that are funded through the MTIF will reduce VMT, offsetting the VMT produced by development. VMT is a common “nexus” for transportation impact fee programs. What is the difference between a VMT-based fee and a trips-based fee? Traditionally, transportation impact fees are “trips-based”, meaning that the impacts that any particular development project has on transportation infrastructure in the city, and the associated fee owed, is determined based on the number of new vehicle trips it is projected to generate. Carlsbad’s existing TIF is structured this way, with projects charged a fee per the projected Average Daily Trip (ADT) generated. For example, a single-family dwelling unit generates 10 vehicle trips per day. The current TIF is $345.00 per average daily trip for single family homes inside of CFD 1. Therefore, the fee for one single family home is $3,450.00 (10 trips x $345.00 per trip = $3,450.00). Given the shift in focus to VMT generated, rather than trips, some cities are now structuring their transportation impact fee programs to be VMT-based, such that the fee on new development projects is charged based on the number of new VMT generated. In such a structure, the impacts of a project could be associated not just with its size (i.e., the number of new residents/workers it generates) but also its Oct 4, 2023 Item #3 Page 7 of 14 Page 3 of 9 location (i.e., distances the new population have to travel). One way that a fee program reflects this nuance is to charge different fee levels on projects depending on their location within the city. For example, projects built in more densely developed areas (such as a downtown) would be charged a lower fee than those built in more peripheral areas, reflecting that the new population would not have to travel as far for their daily needs. Note that charging the fee based on VMT is unrelated to CEQA analysis related to VMT. How is the maximum fee that the city can charge calculated? The maximum allowable TIF amount is determined based on a detailed Nexus Study prepared in accordance with the legal requirements of the State Mitigation Fee Act (described in more detail below). The study determines the nexus, or relationship, between the impacts of new development in the city (typically vehicle trip generation or vehicle miles traveled are the nexus for transportation impact fees) and the associated need for new transportation infrastructure. In particular, the nexus study will determine what proportion of future city population (residential and employment) at the end of the planning horizon timeline will be attributable to new growth. Once the nexus is established, it is possible to calculate the maximum fee per trip or per VMT. The fee is equal to the cost of improvements necessitated by new populations, divided by the trips or VMT that the new populations are estimated to generate. Many cities levy their fees on a per residential unit or per square foot basis, a structure that provides more certainty for developers than a program where the city calculates fees on a case-by-case basis for each project based on its estimated trips or VMT generation. Using this approach requires the city to establish the average trips or VMT generated by a particular land use. As of July 2022, per AB 602, newly adopted impact fees levied on residential development must be calculated such that they are proportional to the square footage of the new units. This is a departure from the more common approach, where the fee is levied per residential unit, often differentiated by building type (e.g., single-family, multifamily/apartment, etc.). If the nexus study can provide an explanation for why square footage is not an appropriate metric for calculating/levying fee amounts, it may be possible to avoid this requirement. The nexus study process will include crafting an appropriate approach to meeting this requirement. An option that some cities have implemented is charging the fees based on service population (residential population plus employment growth). The average number of people for residential uses can be scaled based on residential square footage. Oct 4, 2023 Item #3 Page 8 of 14 Page 4 of 9 Is the fee going to be fair/equitable? Will it impact the City of Carlsbad’s economic growth? The nexus study will establish the maximum fee that could be charged. The fee is equal to the cost of improvements necessitated by new populations, divided by the trips or VMT that the new populations are estimated to generate. The fee will reflect the maximum charge based on the fair share of the improvements needed to accommodate future growth. The City Council has discretion to set the fee at any amount at or below the maximum fee established by the nexus study and can consider factors such as economic conditions, recognizing the trade-off of potentially underfunding the transportation improvements in the program if a reduced fee is charged. Information about the cost of development in the city and compared to neighboring cities will be provided. In addition, the public, development community, and other stakeholders will have opportunities to provide comments on the draft nexus study. Can an impact fee be charged to development in a neighboring city? A jurisdiction cannot charge a fee on development projects outside of its boundaries, unless there is an agreement with the jurisdiction in which the development is located to charge the fee. There are many examples of multi-jurisdictional impact fees, but these are typically charged on a regional level and administered by a regional entity, such as a Council of Governments or transportation agency. Any such multi-jurisdictional fee requires the approval of all affected municipalities. What is the process for transitioning to a new fee program? The process for transitioning from the current TIF program to the proposed MTIF program is the same as if the city was adopting a brand-new fee from scratch. This includes the requirement for a nexus study and the adoption of an ordinance or resolution by the City Council. As part of the process, the city will specify in the resolution or ordinance the date when the existing TIF will no longer be charged, and what criteria will determine if a development project will be charged the TIF or the MTIF. Typically, these criteria will relate to where the project is in the development process. What is the SANDAG RTCIP fee? RTCIP stands for, “Regional Transportation Congestion Improvement Program” and funds improvements necessary to accommodate new housing on the “Regional Arterial System.” As outlined in the TransNet Extension ordinance, RCTIP revenue is collected by the 18 local cities and the County of San Diego as an exaction from the private sector for each new housing unit constructed in that jurisdiction. The RTCIP helps ensure future development contributes a proportional share of funding needed to pay for related transportation improvements. The RTCIP is monitored by the TransNet Independent Taxpayer Oversight Committee (ITOC) and implemented by each of 19 local jurisdictions. To remain eligible for TransNet local streets and road Oct 4, 2023 Item #3 Page 9 of 14 Page 5 of 9 funding, jurisdictions must maintain their RTCIP funding programs and comply with specific administrative requirements. The RTCIP and each local agency’s funding program is subject to an annual review and audit carried out by the ITOC. The MTIF will comply with the RTCIP requirements. What are the requirements of the Nexus Study? In establishing, increasing, or imposing a fee as a condition for the approval of a development project, Government Code 66001(a) and (b) of the Mitigation Fee Act requires a local agency to: 1. Identify the purpose of the fee. 2. Identify how the fee is to be used. 3. Determine how a reasonable relationship exists between the fee use and the type of development project for which the fee is being used. 4. Determine how the need for the public facility relates to the type of development project for which the fee is imposed. 5. Show the relationship between the amount of the fee and the cost of the public facility. In September 2021, the State of California adopted Assembly Bill (AB) 602, which includes several new requirements related to the development and implementation of impact fee programs. These requirements include: 1. Fee Reporting: Cities must post a written fee schedule or a link directly to the written fee schedule on their internet website. 2. Capital Improvement Plan: Cities must adopt a capital improvement plan to be supported by the fee program as part of the nexus study process. This adoption can occur at the same time as the fee ordinance adoption. 3. Timing of Fee Collection: City can request the total amount of fees and exactions associated with a project upon the issuance of a certificate of occupancy or the final inspection, whichever occurs last, and it must post this information on its internet website, as specified. 4. Explanation of “Level of Service” and Fee Increase: The nexus study must provide explanations if the fee calculation is based on a change in existing “levels of service”, and/or if the new fee represents an increase over existing fee levels. 5. Proportionality of Fee Levels: Impact fees levied on residential development must be calculated such that they are proportional to the square footage of the proposed units, or the nexus study must explain why square footage is not an appropriate metric for calculating fee amounts. Oct 4, 2023 Item #3 Page 10 of 14 Page 6 of 9 Considerations for the Carlsbad Multimodal Transportation Impact Fee (MTIF) Why is the city updating the current fee? Impact fee programs are intended to address capital improvement needs over a fixed time period—often 5-10 years—and it is best practice for cities to regularly update their development impact fees in order to ensure they align with the most up-to-date growth projections, capital improvement goals, and capital improvement costs. As of 2021, new State legislation (AB 602) requires cities to update their fees at least every eight years. Carlsbad adopted its existing TIF on May 12, 2009. The fee update process underway for Carlsbad reflects a shift in the city’s priorities related to transportation improvements. While the existing TIF has been focused on infrastructure to accommodate new automobile traffic, the city is focused on a broader range of transportation improvements to support all the ways that people get around such as transit, biking and walking. The update will include a change to the name of the fee, from Traffic Impact Fee to Multimodal Transportation Impact Fee (MTIF). What types of improvements will the MTIF pay for? Impact fees are used to fund capital improvements needed to accommodate new development. For a “traditional” traffic impact fee, these typically include street and sidewalk improvements and new traffic signals. The MTIF capital improvement plan will include capital improvements serving a range of transportation modes, including bicycle and pedestrian facilities and transit facilities. The infrastructure projects to be funded by the MTIF will be identified as part of the implementation of the Sustainable Mobility Plan (SMP). The SMP presents a comprehensive look at current active travel and transit conditions, as well as previous planning efforts to consolidate findings and recommendations into one master document including infrastructure recommendations. By law, an impact fee cannot be used to pay for ongoing operating and maintenance costs. This restriction excludes the use of impact fees for some programmatic costs that may be associated with transportation demand management (TDM) strategies. The city will have to develop a capital improvement plan as part of the fee update process that details the improvements that the fee will help fund and their estimated cost. How will the MTIF apply to redevelopment projects vs. new projects? Legally, impact fees apply to the net new impact of a project. For example, if a single-family unit is demolished to develop a duplex, the fee should be based on a net increase of one unit. Or if a 100K square foot office building is replaced by a 100K square foot retail the fee should be difference in the fee rate for these two uses (assuming it is positive). However, there is wide variation in the way cities address this requirement in their impact fee ordinances and define what is considered the net new impact. The most common approach is to specify the number of years in which the pre-existing land use has been vacant, with five years being the norm (some cities specify shorter periods). In other words, if the existing Oct 4, 2023 Item #3 Page 11 of 14 Page 7 of 9 use that is being demolished has been vacant for more than five (5) years, then the existing use would not be considered in the fee calculation. The fee would be calculated as if the proposed project was being constructed on a vacant parcel. Details on how the MTIF will address redevelopment projects will be determined as the fee program is developed. Are any types of land development projects exempt from the MTIF? There is flexibility in developing exemptions for development impact fees. Typically, cities create exemptions for certain types of land use or location of land use to incentivize that type of development based on policy considerations. For example, many cities offer exemptions for affordable housing. Or a city may exempt development near transit to incentivize building in that location. Due to statewide mandate, accessory dwelling units (ADUs) under 750 square feet are currently exempt from all development impact fees, and there are limitations on the amounts that can be levied on ADUs larger than 750 square feet. Note that this mandate is subject to change/sunsetting in the next several years. Details on how the MTIF will address exemptions will be determined as the fee program is developed. How could this program support a flexible fleet/on-demand transit to help support our TDM program? Impact fees are used to fund capital improvements such as physical infrastructure or vehicles. Infrastructure or vehicles needed to support a flexible fleet/on-demand transit system could be included in the project list since they would contribute to mode shift (encouraging people to walk, bike, and take transit instead of driving a personal automobile). Since ongoing operating and maintenance costs are not eligible for MTIF funding, they would not be included in the program. How does the city’s Sustainable Mobility Plan relate to the fee update? The Sustainable Mobility Plan identifies the multimodal transportation infrastructure needs in the city. A portion of the infrastructure needs are related to land development/growth in the city and will be funded through the MTIF. The portion of the infrastructure included in the program will be determined as part of the nexus study to ensure that development is being charged a fair share. Will the MTIF revenues pay for all the transportation improvements in the Sustainable Mobility Plan? Impact fees typically do not fully cover the costs of all improvements in a capital improvement plan. Conceptually, they are only intended to cover the proportion of the improvements that are needed to serve new residents and workers generated by new development, and not the proportion that will be Oct 4, 2023 Item #3 Page 12 of 14 Page 8 of 9 serving existing residents and workers. This is reflected in the fee calculation. Depending on the city’s adopted multimodal level of service and the level of bicycle/pedestrian facilities available to current residents/employees, it is possible that 100 percent of the need, and therefore the cost, for a particular improvement can be attributed to the impacts only of new development. However, it is typical that the fee is calculated based on a portion of the overall improvement cost. Therefore, the city will identify other funding sources to cover the remaining improvement costs. These may include regional, state, or federal grants; special assessments; and allocations from the city’s General Fund. How will the MTIF be adopted? The MTIF must be approved by the City Council. A vote by the public or affected property owners is not required for approval. Given that the city has an existing TIF, it may be possible to adopt the new fee by resolution; however, given the significant change in the focus on the fee, adoption by ordinance may be required. One of the most important decisions for city staff and elected officials is whether to charge the fee at the maximum level, or at some level below it. This decision is often informed by considering the impact that the fee will have on the economics of new development in the city and to what extent it might render some projects financially infeasible. Cities also often look to set a fee level that is aligned with those charged in neighboring jurisdictions and that represents a cost burden on new development that is financially sustainable. To provide this context, a comparison of the transportation and other impacts fees charged in several of Carlsbad’s “peer” jurisdictions will be conducted as part of this study effort. How will the MTIF Relate to CEQA Transportation Mitigation Is the MTIF a VMT mitigation program for CEQA Impacts? No. The MTIF is a development impact fee that is not part of the project’s CEQA assessment. A project would pay the fee regardless of the CEQA impact assessment outcome. How can the new MTIF address VMT mitigation? Given the shift in city priorities toward infrastructure that supports multimodal modes of transportation, it is assumed that the capital improvement plan underlying the fee calculation will include a significant number of improvements that will serve to reduce overall citywide VMT. As has been achieved in other cities, it is possible for a capital improvement plan to include a mix of improvements that are VMT- inducing (such as road widening) and VMT-reducing (such as bike lanes), and to also show an overall VMT- reducing impact citywide when all the improvements are built. In this case, it is possible to structure the fee program such that payment of the fee would allow an applicant paying the fee to take credit for a small amount of VMT being reduced due to implementation of projects funded through the MTIF. Oct 4, 2023 Item #3 Page 13 of 14 Page 9 of 9 The amount of fees collected and timing of the collection is uncertain – we never know what development will move forward and when it will move forward. While we know that once the transportation improvements are made, VMT will be reduced, we don’t have certainty about the timing of the transportation improvements. Therefore, for CEQA purposes, a project could potentially take some credit for the VMT reductions and characterize it as helping reduce a project’s VMT in cumulative conditions, but it should not be included in project level VMT analysis. Can you provide an example of how the MTIF will be charged and how it would be referenced in the project’s CEQA document? For illustrative purposes let’s consider an office building development. The project would be required to pay their MTIF, regardless of CEQA findings. Hypothetically, we will assume that once all the MTIF transportation improvement projects are implemented, citywide VMT will reduce by 5%. In the project’s CEQA document, they would report the project level VMT/employee for the project and determine project level VMT impacts with NO consideration of reductions from the fee program, since the MTIF projects won’t yet be implemented. For cumulative plus project analysis purposes, the project’s VMT analysis could include the 5% VMT reduction (as part of the project, as a project feature, not as mitigation), then the resulting VMT/employee would be compared to the significance threshold to determine if there is a significant cumulative impact. If there is a significant impact, mitigation measures would be identified to reduce the impact. What are the next steps and schedule for the MITF process? The next steps in the MTIF process are to determine the infrastructure projects to be funding by the MTIP from the SMP, perform cost estimates for the infrastructure projects, and determine the maximum funding contribution from the MTIF based on future land development growth. This analysis will be conducted over the next six months. Oct 4, 2023 Item #3 Page 14 of 14 Introduction to the Multimodal Transportation Impact Fee Program Nathan Schmidt, Transportation Planning and Mobility Manager October 4, 2023 RECOMMENDED ACTION Receive an overview on the update of the City’s Traffic Impact Fee program and provide feedback to staff. ITEM 3: INTRODUCTION TO THE MTIF 3 TODAY’S PRESENTATION •Implementation of the Sustainable Mobility Plan •Sustainable Mobility Plan and Multimodal Transportation Impact Fee •MTIF program and fee update process •Q&A ITEM 3: INTRODUCTION TO THE MTIF All Modes of Travel SUSTAINABLE MOBILITY PLAN 5 ITEM 3: INTRODUCTION TO THE MTIF 6 SMP IMPLEMENTATION •Build upon the SMP to implement multi-modal projects •Engineering feasibility and cost estimates •Conceptual design for high priority projects •Prioritize projects based on feasibility analysis •Identify funding sources ITEM 3: INTRODUCTION TO THE MTIF 7 GROWTH MANAGEMENT PLAN CITIZENS COMMITTEE •Advocated for use of the MTIF to fund implementation of multimodal infrastructure to accommodate future growth ITEM 3: INTRODUCTION TO THE MTIF 8 HOW WILL THE SMP RELATE TO THE MTIF? •Existing TIF is focused on road capacity/autos •City priority is complete streets and multimodal travel options •MTIF will fund multimodal projects such as bicycle, pedestrian, and transit infrastructure ITEM 3: INTRODUCTION TO THE MTIF 9 City Apartment Condo Single Family Comm/ Indust. Carlsbad $2,070-$2,430/unit*$2,760-$3,240/unit*$3,450-$4,050/unit*$2.50-$26.00/sq. ft.* San Marcos $5,971/unit $5,971/unit $9,951/unit $79,606-$185,168/ac. Oceanside $2,689-$2,893/unit $2,689-$2,893/unit $2,689-$4,339/unit $0.90/sq. ft. Solana Beach $11,713/unit $11,713/unit $16,424/unit $3.23-$17.85/sq. ft. Encinitas $2,635/unit $2,635/unit $2,635/unit $8.54-$77.48/sq. ft. Vista $5,189/unit $5,189/unit $6,486/unit $5.90-$17.90/sq. ft. Escondido $2,095/unit $2,095/unit $4,192/unit $2.42-$48.37/sq. ft. *Carlsbad’s current TIF is charged per ADT; the per unit estimates shown above are based on typical trip rates for different residential types. CURRENT TRANSPORTATION IMPACT FEE COMPARISON ITEM 3: INTRODUCTION TO THE MTIF 10 MTIF PROGRAM Replaces existing TIF Fees are paid by new development/ re-development Fees are used: to build facilities to support new growth Fees can not: fund operations and maintenance costs. ITEM 3: INTRODUCTION TO THE MTIF 11 FEE UPDATE PROCESS LEGALLY DEFENSIBLE AND CONFORM WITH MITIGATION FEE ACT NEXUS STUDY IS REQUIRED: SETS FEE PURPOSE AND ESTABLISHES MAX FEE ADOPTED BY ORDINANCE AND RESOLUTION OF CITY COUNCIL ITEM 3: INTRODUCTION TO THE MTIF 12 HOW WILL THE FEE BE CALCULATED Cost of Capital Improvements Attributable to New Service Population* Projected Growth from City Buildout through Horizon Year Max. Fee Per New Trip or New VMT *The cost of capital improvements will be allocated proportionally between the existing and future service population. ITEM 3: INTRODUCTION TO THE MTIF 13 FEES BASED ON VMT VS. TRIPS VMT based fee programs: Location affects fee amount. House A: Trips: 10 per day VMT: 55 VMT day (Bressi Ranch Area) House B: Trips: 10 per day VMT: 45 VMT day (Carlsbad Village) House A has a higher fee than House B using a VMT based program. ITEM 3: INTRODUCTION TO THE MTIF 14 WILL THE FEE FULLY MITIGATE VMT IMPACTS? •No, the fee program is separate from the CEQA process •VMT reduced due to the multimodal projects can be accounted for in VMT analysis if applicable ITEM 3: INTRODUCTION TO THE MTIF 15 MTIF’S RELATIONSHIP TO FRONTAGE IMPROVEMENTS •Frontage improvements will still be required. •Typically, frontage improvements are small scale projects such as a sidewalk gap closure or curb ramp improvements. ITEM 3: INTRODUCTION TO THE MTIF 16 HOW IS THE FEE SPENT? •On projects in the existing Capital Improvement Program and Sustainable Mobility Plan, as referenced in the nexus study •$ will accrue over time •Use of funds does not need to be equally spread across all multimodal projects ITEM 3: INTRODUCTION TO THE MTIF 17 NEXT STEPS/TIMELINE Today: Oct 2023 Dec/Jan 2024 Nexus Study and Draft Fee Mar/Apr 2024 Draft Fee to Council Jan/Feb 2024 Share preliminary fees with stakeholders August 2024 Final Fee to Council for Adoption ITEM 3: INTRODUCTION TO THE MTIF RECOMMENDED ACTION Receive an overview on the update of the City’s Traffic Impact Fee program and provide feedback to staff. ITEM 3: INTRODUCTION TO THE MTIF 19 QUESTIONS & COMMENTS •What’s important for the city to consider as we move forward with creating the MTIF? •What questions do you have? •What are your biggest concerns and why? ITEM 3: INTRODUCTION TO THE MTIF