CITY COUNCIL REGULAR MEETING AGENDA PACKET

Page 3 of 17 1. Development Impact Fees, which include the City’s Capital Facilities Fee (CFF) and Transportation Impact Fee (TIF), and which offset the cost of new and expanded public facilities and infrastructure to meet the demands of new residents and employees associated with new development. 2. A Commercial Linkage Fee with respect to housing, which is intended to offset or capture the impact of new commercial development on the demand for affordable housing, in the form of contributing new employees and related housing demand. 3. An Affordable Housing Fee, also known as an “inclusionary in-lieu fee,” is levied for residential projects that are not required to build on-site affordable housing units, or that may be permitted by the City to pay fees “in-lieu” of constructing units on-site. Capital Facilities and Transportation Impact Fees The study outlines the methodology, assumptions and other input used to calculate the CFF and DIF, including the following basic steps: • Estimates of projected future population and employment growth, amounting to a future estimated “service population” of residents and employees of approximately 128,510, an increase of approximately 29,167 over today’s service population (99,343). This increase in service population represents 22.7% of the service population total at the time of buildout. • Evaluation of the necessary infrastructure and capital improvements to serve the future service population, exclusive of water and sewer improvements that are part of a separate fee study (see below). • Cost estimates of these infrastructure and capital improvements, based on information provided by City staff and other research. • The allocation of costs between existing and future development, and between residential and commercial uses to derive a cost per resident and per employee. • Multiplication of those costs per resident or employee, by the future service population. With respect to capital facilities and infrastructure, the study uses a “service level” approach that determines facility improvements primarily by calculating the City’s existing service levels and extrapolating the future needs based on the available facilities today. Certain specialized facilities, such as the aquatic center and cemetery have unique characteristics that mean the service level model works less well; those facilities costs are called out separately. The study also accounts for those facilities planned or included in the City’s 5-year CIP, as well as various infrastructure master plans and similar documents. It is noted that AB 602 requires jurisdictions to adopt a "capital improvement plan" as part of the nexus study process. As outlined in the nexus study, the report includes the “Pleasanton DIF Long-Term Capital Improvement Plan (Pleasanton DIF CIP)”, which is included in the report as Appendix Table A- 1. The Pleasanton DIF CIP is specific to the nexus study, and correlates with, but does not supersede, the City’s 5-Year Capital Improvement Plan (5-Year CIP) Rather than listing every project that may be funded by fees, the nexus study identifies a set of facility categories, within which eligible projects must fit. This approach provides the City with the most adaptability to deploy impact fees based on its priorities and needs over coming years, while providing enough definition to guide the legal use of those fees pursuant to AB Page 209 of 893