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3. PROJECTIONS OF FUTURE GROWTH This chapter provides the overview of the City's growth projections based on the recently adopted General Plan and Housing Element. Land Use Forecasting Methodology and Projections Categorization The City's General Plan update was based on the development forecast through buildout of various land use categories developed for the City's traffic model that informed the General Plan update. This forecast was based on the maximum development capacity with relevant land use categories consisting of residential, hospitality, commercial, and recreation uses, as shown in Table 4. A forecast of new development and other economic changes is critical for conducting the fiscal impact analysis, though not all land use categories are relevant. For the purpose of this analysis, EPS retained the relevant land use categories based on the following criteria: a) Projected to experience new growth through buildout b) Likely to have significant local fiscal and economic implications Each land use excluded from the fiscal impact analysis is briefly described below: • Mobile Homes: These units comprise 1.5 percent of the overall housing base. The projected increase of 1 percent (by 4 mobile homes) in this category is not likely to have any substantial fiscal implications for the City's ongoing operation. • Hospitals: The City currently has one major hospital and other medical offices. Kaiser is the City's largest employer3, and Valley Care Medical is the fifth largest, combining for nearly 4,800 jobs. Hospital space is projected to nearly double through buildout. Fiscal impacts of hospitals vary widely depending on a range of factors, such as location, market orientation, size, programming, and relationship to the broader community, as well as degree of integration into the local economy. Given hospitals' nonprofit status in California, they are generally exempted from property taxes, with the exception of for-profit subsidiaries. However, they do generate franchise fees, sales and use taxes and possessory interest taxes for subleasing activity to for-profit operators (i.e., medical offices). Hospitals on their own typically fall short of breaking even, but overall programs often include a for-profit component that generates property taxes and makes the overall impact less conclusive. Another consideration is whether new hospital development replaces an existing property tax-generating use or is built on a site that was not generating any substantial property tax revenues. The precise nature of the hospital impact could vary 3 Kaiser operates its IT division in Pleasanton. Economic&Planning Systems, Inc. 12 P:\121000\121062Pleasanton\Report\121062Report_FINAL.doc