1. 1 Transportation Impact Fees and Street Maintenance Fees Presented to the City Council by the Planning and Development Department January 21, 2010

2. 2 Purpose of Today’s Meeting Refresh the City Council on the recommendations from the City Manager’s Committee on Infrastructure Funding Receive feedback on City Council policy options

3. 3 Underlying Principles of Study Maintenance of economic competitiveness – Avoid the “tipping point” Equity – Apportion costs among beneficiaries of the infrastructure Efficiency – Funding mechanism that allows efficient delivery of projects

4. 4 Key Findings Property Tax & Debt Financing –Per capita property tax rates and expenditures high –Share of tax allocated to debt much lower Development Costs: At or below the median of comparable cities Occupancy Costs: –Residential costs near the median of comparable cities –Non-residential costs higher than most comparable cities Economic impacts –Transportation investments generate net benefits to the local economy under all scenarios

5. 5 I. Transportation Impact Fees 36% 27% 50% 0% 20% 40% 60% 80% 100% Existing Proposed Residential Commercial & Industrial All

6. 6 Grace Periods Granted to all building permits associated with a plat that was filed before the impact fee effective date –One year from the effective date of the ordinance or –Two years from plat approval, whichever is longer. Resulted in an impact fee exemption on 97.8% of all building permits since July 1, 2008.

7. 7 Smoothing Recommend 50% smoothed rate for North, West, and South ($3,005 single- family equivalent) Recommend retaining $2,000 single-family equivalency rate for East

8. 8 Scenarios (North, South, and West except AA and W) Current50% Single-Family (per unit) $2,000$3,005 Apartment (per unit) $1,228$1,845 Day Care (per 1,000 sf) $6,851$13,725 Sit-Down Restaurant (per 1,000 sf) $2,485$4,978 Drive-Thru Fast Food (per 1,000 sf) $10,267$20,568 Grocery Store (per 1,000 sf) $5,324$10,666 Drug Store (per 1,000 sf) $3,502$7,016 General Office (per 1,000 sf) $2,015$4,036

9. 9 Discount for Locating on Existing Arterials (North, South, and West except AA and W) 27%/36% Collect. 15% Disc. 50% Collect. 50% Disc. Single-Family (per unit) $ 2,000$1,700$ 3,005$ 1,502 Apartment (per unit) $ 1,228$1,044$ 1,845$ 922 Day Care (1,000 sf) $ 6,851$5,824$13,725$ 6,862 Restaurant (1,000 sf) $ 2,485$2,112$ 4,978$ 2,489 Drive-Thru Rest. (1,000 sf) $10,267$8,727$20,568$10,284 Grocery Store (1,000 sf) $ 5,324$4,526$10,666$ 5,333 Drug Store (1,000 sf) $ 3,502$2,977$ 7,016$ 3,508 General Office (1,000 sf) $ 2,015$1,713$ 4,036$ 2,018

10. 10 Sample Fees – General Office Current: 27% collection rate: $60,540 15% discounted rate: $51,390 Proposed: 50% collection rate: $121,080 50% discounted rate: $60,540 Typical area: 30,000 sf

11. 11 Sample Fees – Drive-Thru Fast Food Current: 27% collection rate: $30,801 15% discounted rate: $26,181 Proposed: 50% collection rate: $61,704 50% discounted rate: $30,852 Typical area: 3,000 sf

12. 12 Sample Fees - Daycare Current: 27% collection rate: $27,404 15% discounted rate: $23,296 Proposed: 50% collection rate: $54,900 50% discounted rate: $27,448 Typical area: 4,000 sf

13. 13 Sample Fees – Grocery Store 27% collection rate: $319,440 15% discounted rate: $271,560 50% collection rate: $639,960 50% discounted rate: $319,980 Typical area: 60,000 sf

14. 14 Discounts for Extraordinary Investment Discount rate of 15-50% Minimum capital investment of $15 million –Fort Worth Chamber and Housing and Economic Development suggest reducing this threshold to $10 million Creation of 100 jobs –Minimum salary of twice minimum wage, plus benefits Other tools: –Tax abatements –Tax Increment Finance Districts –Triple Freeport

15. 15 II. Transportation Utility Create Transportation Utility with monthly fee assessed on all land uses that generate trips on the road infrastructure Use proceeds to supplement General Fund commitment to street maintenance and to provide for existing capacity deficiencies Assumes impact fee revenue and increasing taxes from growing tax base funding new capacity needs

16. 16 Sample Collection Rates Single-family residence $5.50 Multi-family residence $3.38 Office / 1,000 sf$7.39 Retail / 1,000 sf$10.33 Industrial / 1,000 sf$4.46 Annual Revenue for Street Maintenance $31M

17. 17 Relative Cost of Street Maintenance Fee

18. 18 Development Costs - Existing Fort Worth Percent of Median Single Family (n = 4) Multi- Family (n = 4) Retail (n = 5) Office Central (n = 12) Office Outer (n = 12) Indus- trial (n = 12) Infrastruc- ture & Fees 104%91%100%85%111%83% Infrastruc- ture, Fees & Bldg Costs 101%100%99%97%98%97% Occupancy Costs 98%106%120%181%177%117%

19. 19 Development Costs With Revenue Options Fort Worth Percent of Median Single Family (n = 4) Multi- Family (n = 4) Retail (n = 5) Office Central (n = 12) Office Outer (n = 12) Indus- trial (n = 12) Infrastruc- ture & Fees 105%103%146%85%154%86% Infrastruc- ture, Fees & Bldg Costs 101% 102%97%99%97% Occupancy Costs 101%103%123%183%174%126%

20. 20 Revenue Estimates for Recommendations 10-yr. revenue Unfunded Transportation Infrastructure ($1,311 million) Increase Impact Fee to 50% of Maximum $ 83 million Debt Capacity – Increase Share to 90%$ 104 million Transportation User Fee$ 494 million Public Improvement DistrictsN/A Deferred Improvements and Maintenance ($ 630 million) Funds 52% of the gap

21. 21 10-Year Transportation Improvements Plan With Revenue Options 0 500 1000 1500 2000 2500 Infrastructure Needs Projected Revenues $ Million Impact Fee - Increase Transportation User Fee Debt Capacity - Incr. Share Unfunded Existing Sources Ongoing Maintenance New Development Needs Capacity Deficiencies Deferred Maintenance Projected Cost Revenues

22. 22 Next Steps Respond to questions regarding the policy options Complete studies and develop ordinances related to impact fees and transportation utility Continue dialogue with Development Advisory Committee for technical assistance Public hearings as specific ordinances considered as early as October