May 2018
Chico Builders Association continues to work with city staff
CBA hired a consultant who joined CBA leadership as we met with city staff.  We are working together to find the compromises that keep Development Impact Fees from reaching $30,000 per house.  Between the detailed knowledge of our CBA leadership about development in Chico, the statewide legal knowledge and experience of our consultant, and the good-faith efforts of Chico staff, we believe a fair resolution can be reached.
The city has committed to get us the information they want to bring to Council in time for CBA to review it.  We are expecting to see the recommendations May 22 for a June 5 City Council meeting.
Thank you members of Chico Builders Association for helping make this happen.
2/21/18
City Council
The new "Final Report" for the Development Impact Fees Program (almost 300 pages) was released Thursday, the 15th (right before the 3-day weekend) for City Council to approve at its meeting on the 20th.
We submitted a letter to Council on the 20th with our concerns - at least those that we could identify in such a short time frame.
Council agreed to continue discussion to another meeting - with hope that the Development Community and City Staff can get on the same page and the City Attorney will review legal issues brought up in other letters to Council.
12/19/17
City Council
It was a unique meeting to say the least.  Council approved some of the remaining fees for the Nexus Program related to sewer fees.  The 2 fees currently in question are the Urbanization Fee and the Street Facilities Fee.  Council was asked by City Council to not make a decision on these until he had time to discuss with Council in a closed session due to a letter received by the City from an attorney claiming certain aspects were not legal and that the City would be open to litigation, should they proceed.  Public comment was heard and Council members discussed.  A motions was made to postpone action on these fees until after a closed door meeting with Council.  This failed as did a motion to wait another month to discuss.  So, by default the fees will be presented again at a future meeting.  Most likely 2nd meeting in January or 1st in Feb.
11/29/17
City of Chico Finance Committee approves Nexus to City Council
On November 29, 2017, the City of Chico Finance Committee reviewed the Staff's changes and recommendations for 2 fees in the Nexus Program (Development Impact Fees.) The City Council approved all but the Urbanization Fee and the Street Facilities Fee at a City Council meeting in August. These fees were pushed back to the Finance Committee in an effort to clarify some legality to the Urbanization Fee and to investigate the idea of having a tiered fee structure for the Street Facilities Fee based on size of unit.
City Staff worked to create a tiered structure for residential development - both Multi-Family and Single-Family. But without more studies to support the statistics around impacts of smaller units vs. larger units, the structure didn't work. The Finance Committee decided to proceed with previous proposal.
The Urbanization Fee is a bit more complicated as State Law requires a Nexus Program to clearly define the relationship of a fee to the development. The Fee is to improve existing streets of which new Development has yet to impact. With this in mind, City Staff removed 3 streets from the Program.
These Fees and the complete Nexus Program will likely be presented to City Council in December. The total increases are quite significant and will play a large part in compounding affordability in Chico for both residential and commercial development.
11/27/17
We return to the City Finance Committee this Wednesday 11/29/27
This 416 page report released 11/25/17 allows us 4 days (2 business days) to review and prepare for for the meeting Wednesday morning.
For discussion:
1.  City Attorney analysis of the Urbanization Fee
2. Options proposed for variable rates for multi-family and single-family residential units based on number of bedrooms.
3. Cost distribution for Street Facilities Fee
 11/14/17
As of now, this is how the commercial proposed fees look like:
 proposed fees
City Finance Committee Meeting 10/25/17
Committee discussed creating a "tiered" structure for fees for Multi-Family projects. The methodology not yet agreed upon, this was an open discussion. Most of the public comment was in favor indicating that it allowed for more feasible construction of smaller units. Some comments included points that these reduced fees for smaller units should not increase fees for larger units. Also, the question was raised should this be carried over to Single Family Residential as well?
More discussion needs to be had around methodology and understanding traffic studies, as well as ensuring this idea is set up in such a way that it does not create any legal issues for the City.
The Committee briefly discussed the Street Facilities Fee. The Nexus uses a traffic study conducted by BCAG which shows 12% of trips originate from outside the City (or are seen as "other" than residential or commercial.)
Discussion around how this 12% should be factored in to the Nexus has been debated. Public Comment included pushing for the General Fund to cover the 12% - perhaps through some sort of "Community Broad Based Funding."
In the end, it seems the Committee agreed with Staff that the proposed Nexus was adequate.
As far as the Nexus goes, we still need to discuss the Urbanization Fee at City Finance Committee as well as Sewer Fees. Once Urbanization has been discussed at City Finance Committee, the remaining fees will be pushed to City Council (although Sewer may not be complete & may be finalized at a later date.)

 

October 24, 2017

Tomorrow the City of Chico Finance Committee will review the 2 fees referred to them from City Council:

Urbanization - clarification on legality of this fee

Street Facilities - clarification on costs associated with projects

SEE THE AGENDA PACKET HERE

 

August 16, 2017

After a long and arduous process, the City of Chico presented the proposed updated Nexus Program (New Development Impact Fees.)  The City Council addressed and voted on each of the fees individually with these results:

APPROVED                                               New Fee  (per unit: Single-Family)

#1 Population and Land Use Increment

#2 Administrative Building Fee                                 $    60.42

#3 Fire Facilities Fee                                                    $   378.42

#4 Animal Shelter Fee                                                 $     82.55

#5 Police Facilities Fee                                                $  404.92

#6 Sewer Trunk Line &                                               $1,930.48

Water Pollution Control Plan Fees                           $1,609.08

#7 Bikeway Improvement Fee                                  $    668.84

#8 Greenways Impact Fee                                         $    415.52

#9 Park Impact Fee – Neighborhood                       $ 3,995.14

Park Impact Fee – Community (Scenario #1)

Park Impact Fee – Bidwell Park

#10 Street Maintenance Fee (Alternative #2)        $    156.87

Total Approved Fees                                                 $9,702.04

SENT BACK TO CITY FINANCE COMMITTEE FOR FURTHER REVIEW

#11 Urbanization Street Fee                                       $   675.62

#12 Street Facilities Fee                                               $9,564.43

Total Proposed Fees                                                    $19,942.29

 

We were pleased to see some decisions made to keep the fees down.  It is the opinion of CBA that street maintenance in Chico should be funded through other sources.  New Development Impact fees simply isn’t a sustainable way to do fund this program.  If and when construction slows or stops, roads will still be driven on and continue to deteriorate.  So there needs to be another source of funding.  It is the hope of the City that SB1 will help with some of this.

In the meantime, we’ll go to the Finance Committee (8/23) on a few of the fees: Urbanization – ensuring that this is a legal option for the City to require new homeowners to pay for streets that are currently below standard level of service.  Nexus estimates population is expected to grow by almost 40,000 people – these people have not driven on a single street yet.

With Street Facilities, we are seeking more detail and clarity around the projects proposed in the fee.  CBA and the Building Community believe firmly that Impact Fees help New Development pay their fair share but determining what that is and what is the responsibility of the Community is a complex issue.

ChicoER article

 

 

August 15, 2017

City Council Meeting - Nexus Program to be discussed

Original Agenda Packet/ Staff Report

ChicoER article

 

June 29, 2017

CBA has been working with Brendan Ottoboni, Public Works Director - Engineering, who has been part of the team revising the Nexus Program as well as Steve Borroum, consultant for the City.  In these meetings, CBA has gained a better understanding of some of the fees and rationale behind each.  While there is much to still be discussed and worked through, it has been helpful to share insights from both sides of the table to help make this program more equitable and realistic.

CBA is very aware that every fee increase effects house pricing, rent prices, costs to build commercial buildings, which in turn effects costs to do business in Chico.  We are very dedicated to keeping an eye on every policy or regulation that impacts development and the people of Chico.

June 21, 2017

Because of a very full agenda, the Nexus Program was pushed until the August 1st City Council meeting.  The plan is to discuss each fee, describe the fee to the Council, take public comment, and ask Council to provide direction to Staff.  The entire document will be approved at a later meeting.

June 19, 2017

Nexus Program moves forward to City Council for potential approval at June 20th meeting. Any fee increases add more costs associated with building and compounds the problem of affordable housing in Chico. Some of these fees need to be closely examined and Council needs to come up with a better solution to solving the City's problems. New Development can not shoulder the expenses of street maintenance. Can any of these programs be funded through SB1?

Chico Enterprise Record Article

 

May 24, 2017

The City of Chico Finance Committee approved the updated Nexus (Development Impact Fee) Program to move forward to City Council for further discussion and action.  The fee categories to be discussed are:

  • Administrative Building
  • Fire
  • Animal Shelter
  • Police
  • Sewer-Trunkline
  • Sewer - Water Pollution Control Plant
  • Bikeways
  • Greenways
  • Parks-Neighborhood
  • Parks - Community
  • Bidwell Park
  • Street Maintenance
  • Urbanization
  • Street Facilities

February 22, 2017

This morning the City of Chico Finance Committee met to discuss the proposed Update of the Nexus Program 2016-2040. With the length of the Nexus, and need to discuss each specific fee individually, only a few of the specific fees were discussed at today's meeting due to time constraints.

Here is a link to the Agenda packet

Addressed today were:
*  Bikeways
*  Sewer Trunk Lines
*  Sewer Treatment Plant
*  Street Facility
*  Street Maintenance

Additional fees to be discussed in future meetings:

* Street Urbanization
* Parks
* Greenways
* Police
* Fire
* Animal Shelter
* Administration

Essentially, the City of Chico has proposed an increase to new development fees. What is proposed in this packet is an increase of a minimum of 3 times the current fees for residential development.

Concern was expressed at the meeting whether New Development should carry 100% of costs (Street Facility and Maintenance) for these programs as population growth is estimated at under 40% through the year 2040. New development should pay their "fair share," but that should not be 100%. Street Facility and Maintenance should be a shared expense with the City as asking new home buyers to pay for these programs is not sustainable. Should there be another recession or dip in the market, fees would decline and streets projects and maintenance would not be financed.
In addition, Government Code 66000 requires that the fees incurred upon development need to show a clear relationship between the purpose of the fee and the impact of the project.

Increasing fees equates to higher costs to new homebuyers, raising home prices throughout Chico.

Further discussion is needed to work through the City's need to fund these programs and the fair responsibility of New Development.