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Pleasanton General Plan Fiscal Impact Analysis Final Report 01/16/14 • Not estimated. Some budget items were not estimated because certain City revenues and expenditures are either not directly related to growth and development and/or generated on a cost-recovery basis. This analysis also determines how fiscal impacts vary by land use type with land uses designations described in Chapter 3. It is understood that some new growth will combine these uses in a mixed-use development format (i.e., residential multifamily over ground story retail). Key Demographic and Market Assumptions As described above, population and employment are key factors that are expected to drive changes in the City's General Fund costs and revenues. As shown in Table 8, Pleasanton has a population of 73,000 residents and roughly 53,000 jobs with a service population of 108,000. Pleasanton has 26,200 housing units with an average household size of 2.8. Market assumptions in this analysis are based on Economic and Fiscal Impact Analysis for East Pleasanton Specific Plan prepared by EPS in November 2012 as well as other supplemental research presented in the Appendix. Key market assumptions are summarized in Table 9 and described below: • This analysis assumes that a 10 percent premium will be applied to existing values or rents to reflect a level of new construction going forward for most uses. For multifamily, the premium is assumed at 20 percent, reflecting a likely difference between transit-oriented new uses relative to existing garden apartments. While neighborhoods within the City vary in character, generally, location does not play a critical role in home prices and property values are relatively even within the City. • Market-rate residential unit value assumptions range from $345,000 per unit for multifamily based on capitalized rent to $880,000 per unit for single-family uses. Housing prices will vary over time. Affordable housing values and supporting estimates are provided in the Appendix. • The City's affordable housing fee has been considered for an update and may change some of the existing policies. Currently, the City has a 15 percent inclusionary requirement for rental uses and a 20 percent requirement for for-sale uses on residential projects with more than 15 units. Historically, the market has delivered limited inclusionary housing supply as development feasibility for many product types, especially at the lower end of affordability levels, has been challenged. As a result, many developers chose to pay inclusionary housing development impact fees. This analysis assumes that a limited share of inclusionary housing will be provided on-site. In aggregate, 5 percent of single-family and 15 percent of condo townhomes are assumed to deliver an affordable housing component. For multifamily, the 15 percent threshold is assumed to be met with affordable housing likely provided off-site.5 • The 15 percent affordable housing component for multifamily and 10 percent of elderly attached units are assumed to be not-for-profit and exempt from the tax roll. 5 The City's current inclusionary housing policy for rentals is currently inconsistent with the Palmer case that states that affordable requirement may not be enforced on rental projects; future legislation may change these findings. Economic&Planning Systems, Inc. 21 P:\121000\121062Pleasanton\Report\121062Report_FINAL.doc