Title
Status Update on the Progress of the 2019 Impact Fee Update
Summary
COUNCIL GOAL: Operational Excellence
(2B: Balance Available Resources to Accommodate the Growth and Maintenance Needs of the City)
MEETING DATE: January 21, 2020
DEPARTMENT: Planning Department
CONTACT: Aaron Bloxham, Planning Manager
Mitchell Corona, Planner I
STAFF RECOMMENDATION: Receive an update on the project progress of potential amendments to impact fees as part of the 2019 Impact Fee Update process.
ITEM SUMMARY:
• Staff and the consultant team are presenting information on the status of the 2019 Impact Fee Update. The presentation will include brief summaries of the draft capital improvements plans, the draft calculations for maximum assessable impact fees, neighboring city fee comparisons, and the anticipated remaining schedule for the update process.
Status of the Roadway Impact Fees:
• Kimley-Horn and Associates, serving as consulting transportation engineers on this project, has completed a preliminary draft of the Capital Improvements Plan for Roadway Impact Fees (more commonly referred to as the Roadway Improvements Plan or RIP). The draft RIP identifies the transportation infrastructure needed to accommodate projected growth over the next ten years and the probable costs associated with each infrastructure project. Only projects listed in the RIP are eligible for the assessment of impact fees.
• Kimley-Horn has also completed a draft Roadway Impact Fee Update Report, which includes the draft RIP as well as considerable technical analyses, a detailed discussion of the computation of the maximum calculated impact fees, and a presentation of the data that establishes the maximum assessable roadway fee. Once finalized, this report will become a supporting document for the updated Roadway Impact Fee Ordinance.
• The maximum assessable fees included in the Roadway Impact Fee Update Report establish the maximum roadway impact fees per service unit and service area allowed by state law. This serves as a useful tool when City Council begins to consider the actual fee amounts to charge and who should bear the burden of paying for necessary roadway infrastructure.
• In anticipation of upcoming fee-setting discussions, Staff has included a comparison of roadway impact fees for neighboring cities as well as some overall fee-setting considerations.
Status of the Utility (Water and Wastewater) Impact Fees:
• On a parallel track, the consulting utility engineers (Birkhoff, Hendricks & Carter, LLP) have completed preliminary drafts of the Capital Improvements Plans for Water and Wastewater (more commonly referred to as the Water Improvements Plan and Wastewater Improvements Plan). The draft Plans identify the utility infrastructure needed to accommodate projected growth for the next ten years, the probable costs associated with each infrastructure project, and the existing oversized facilities for which excess capacity is available.
• The utility consultant team has also completed a draft Water and Wastewater Impact Fee Update Report, which includes the draft Utility Improvements Plans as well as considerable technical analyses, a detailed discussion of the computation of the maximum calculated impact fees, and a presentation of the data that establishes the maximum assessable water and wastewater fees. Once finalized, this report will become a supporting document for the updated Utility Impact Fee Ordinance.
• The maximum assessable fees included in the Utility Impact Fee Report establish the maximum utility impacts fees allowed by state law. This serves as a useful tool when City Council begins to consider the actual fee amounts to charge and who should bear the burden of paying for necessary utility infrastructure.
• In anticipation of upcoming fee-setting discussions, Staff has included a comparison of utility impact fees for neighboring cities as well as some overall fee-setting considerations.
Next Steps:
• At the February 11, 2020 CIAC meeting, the committee will discuss the updated Roadway and Utility impact fee reports for the Impact Fee Update.
• At the February 25, 2020 CIAC meeting, the committee will discuss fee setting for the 2019 Impact Fee Update.
• At a Council Work Session in March, Staff will provide City Council with recommendations regarding changes to the impact fee ordinance and look to council for direction on city policies and setting the collection rates for impact fees.
• In April and May, Staff will be scheduling a couple of public hearings to consider and discuss the Amendments to the Capital Improvement Plans and the proposed amendments to the Impact Fee ordinance as part of the 2019 Impact Fee Update.
BACKGROUND INFORMATION:
• Chapter 395 of the Texas Local Government Code mandates that impact fees be reviewed and updated at least every 5 years. The City of McKinney last updated impact fees in 2013. Accordingly, Staff initiated the 2019 Impact Fee Update in Winter 2018.
• Updating Impact Fees involves 3 parts (as required by state law):
• Land Use Assumptions
The Land Use Assumptions contain growth projections on which an Impact Fee Ordinance is based. Projections for residential units and square footage of non-residential uses determine the infrastructure needed over the next ten years.
The updated Land Use Assumptions were considered by Capital Improvements Advisory Committee on August 27, 2019 and were approved by the City Council at the September 17, 2019 meeting.
• Capital Improvements Planning
Capital Improvement Plans for Impact Fees identify the infrastructure that will need to be constructed or expanded to accommodate the additional demand generated by development over the next ten years.
Staff has posted the draft Capital Improvements Plans on the City of McKinney’s website.
• Fee Setting / Adopting the Amended Ordinance
The final phase of the process includes the majority of policy discussion as the City Council considers the actual fee amounts to charge, the phase-in of any fee increases, improvements to the administration of the Ordinances, and how credits should be calculated.