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BACKGROUND <br /> Beginning in 1984, public entities were required to provide an annual accounting <br /> concerning the collection and use of all development impact fees. Effective January 1, <br /> 1989, AB 1600 (Government Code Section 66000 et seq.) established new accounting <br /> guidelines regarding the imposition and use of development impact fees. Effective <br /> January 1, 1997, SB 1693 made certain changes to AB 1600 and clarified and <br /> expanded the responsibilities of local agencies. In February 1998, SB 1760 further <br /> clarified the development impact fees that are subject to AB 1600 and excluded water <br /> and sewer connection fees from the requirements to expend these fees within five <br /> years. While not required, water and sewer connection fees are included in this report <br /> in order to provide the information on the receipt and utilization of these funds. <br /> One of the mandated accounting guidelines, as stated in Government Code Section <br /> 66006(a), provides that a local agency shall establish separate capital facility accounts <br /> for each improvement funded by development impact fees. Any interest income earned <br /> by funds in such an account shall also be deposited in that account. Each local agency <br /> is required within 180 days after the financial year is closed (for the City this is <br /> December 31) to make available to the public the following information for each <br /> separate account: (1) the account's beginning and ending balance; (2) the amount of <br /> fees, interest, and other income in the account; (3) the amount of expenditure for each <br /> public facility or improvement made from the account; (4) the total percentage of the <br /> cost of the improvement that was funded with the fees; (5) the date construction will <br /> commence if sufficient funds have been collected; (6) a description of any interfund <br /> transfers or loans made from an account; and (7) the amount of refunds made from the <br /> account. Attachment 2 and 3 provide this information for funds held on June 30, 2017. <br /> Attachment 4 provides the Master Fee Schedule for the development impact fees that <br /> are subject to AB 1600, SB 1693 and SB 1760. <br /> In addition, Government Code 66006 Section (b)(2) requires the report to be included <br /> on the agenda at a public meeting not less than fifteen (15) days after the information <br /> was made available to the interested parties. Staff provided the notice of public meeting <br /> to interested parties who had filed a written request with the City. <br /> DISCUSSION <br /> The City uses Fund Accounting to segregate development impact fees subject to AB <br /> 1600 and SB 1760 from other City funds. Interest income is allocated to each individual <br /> fund based on its own cash balance. <br /> Funds Subject to AB 1600 <br /> The City utilizes the following funds to track development related revenues subject to <br /> AB 1600: <br /> Capital Facilities Fund (Fund 203) — This fund is utilized to account for the Capital <br /> Facilities fee. Facilities projects and equipment required to service new development <br /> are funded from this fee. When a project serves both new and existing development, <br /> only the portion related to new development is charged against this fund. The other <br /> Page 2 of 7 <br />