CSAC Bulletin Article

Development Fee Bills Have Mixed Success

May 31, 2018

Two major bills on the topic of development impact fees were held on suspense in the appropriations committees last week, while two others continue to move forward.

CSAC opposed AB 3147 (Caballero), which would have limited the circumstances when fees imposed on housing projects could be increased during the development process. The bill was held on the Assembly Appropriations Committee suspense file. Although it included language providing exceptions for fee schedules with cost-of-living adjustments, fees and exactions needed to mitigate impacts identified pursuant to the California Environmental Quality Act, and exactions related to health and safety issues, the bill was still unworkably broad for counties.

In the Senate, another fee-related bill was held on suspense. SB 1296 (Glazer) would have required local government reporting on development fees, as well as the creation of a statewide local fee database within the Department of Housing and Community Development (HCD).

SB 1202 (Stone), was recently amended. Current law allows any person to request an audit of a mitigation fee act program. Under SB 1202, if a local agency is not in compliance with the Act’s reporting requirements, the local agency must pay for the audit and may not require a deposit from the individual. CSAC is interested in county feedback on this bill, which is now pending referral in the Assembly.

CSAC is opposing SB 831 (Wieckowski), which, among other provisions, would preclude the imposition of development impact fees on accessory dwelling units (ADUs). While the bill includes narrow exemptions for utility-related fees and places a cap on school impact fees, local fees supporting infrastructure such as roads, parks and other public facilities could not be imposed. While many ADUs are small and likely to have minimal impacts, many county ordinances allow large ADUs that will put additional pressure on public infrastructure. The bill passed the Senate Appropriations Committee and as of this writing is pending on the Senate Floor.

Broader issues surrounding development impacts fees, including how fees are set, when applicable fees can be changed for an approved or proposed project that has yet to be constructed, and broad transparency and reporting requirements, are all likely to be part of a significant policy debate next year. As counties recall, AB 879 (Grayson, 2017) requires HCD to complete a study of the Mitigation Fee Act, with an eye towards reducing impact fees. That report will be due to the Legislature in 2019.

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