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HomeMy WebLinkAbout11-03-1999spSPECIAL CITY COUNCIL MEETING 2000 BUDGET WORKSHOP NOVEMBER 3, 1999 Aubum City Hall Council Work Arsa Minutes I. Introduction Mayor Booth called the special meeting of the Auburn City Council to order at 4:30 p.m. in the Council Work Arsa of Auburn City Hall. Mayor Booth and the following members of the City Council were present: Pete Lewis, Jeanne Barber, Sue Singer, and Rich Wagner. Councilmember Cerino arrived at 4:41 p.m., Councilmember Poe arrived at 4:45 p.m., and Councilmember Borden arrived at 4:50 p.m. Staff members present included: Traffic Engineer Steve Muilen, Transportation Planner Joe Welsh, Parks and Recreation Director Dick Deal, Personnel Director Brenda Heineman, Fire Chief Bob Johnson, Finance Director Diane L. Supler, Planning and Community Development Director Paul Krauss, City Attorney Michael J. Reynolds, Public Works Director Christine Engler, Police Chief Jim Kelly, and Deputy City Clerk Cathy Richardson. II. 2000 Budget Finance Director Diane Supler explained the impact of the passage of I 695 on surrounding communities. Some communities ars considering layoffs or ars raising utility or property taxes. Transportation is of primary concern for most jurisdictions. Many areas ars losing funding for major transportation projects. There is significant impact on the valley area as a whole related to transportation movement in the south-end of the community. Other cities ars exploring cutting services in addition to layoffs. Ms. Supler stated that most cities, including Auburn, are in satisfactory positions through the year 2000 and into 2001. The City of Auburn will be rs-evaluating services to determine long-term decisions. Special Meeting of the City Council November 3, 1999 Page 2 Ms. Supler reported that King County Executive Ron Sims will be presenting a budget on November 4, 1999 with more detailed information. King County is not anticipating any fee increases. They will be losing $100 million in transit, which is one-third of their operating budget. By February, 2000 the County will be cutting over 200,000 hours in services and another 700,000 by June, 2001. It is estimated that they provide 3,000,000 hours on a monthly basis. The anticipated cuts represent approximately one-third of their services. In response to questions by Councilmember Singer, Ms. Supler stated that King County did not address the issue of the number of vehicles they anticipate the cut in services may put back on the major arterials. At this time, Metro exceeds the required Americans with Disabilities Act (ADA) levels. They will be cutting back their paratransit service levels to the minimum level required by ADA. There will also be a commensurate cut in administration and overhead costs in direct relation to services. There will be no Park and Ride expansions and it is anticipated that the transit level of service will revert to the level provided in the early 1980's. The impact on Sound Transit is unknown. Ms. Supler explained that King County does not anticipate asking local governments to contribute for public health programs. Out of the current expense fund, they have sufficient funds for the first year to fund half of the service level. They are considering cuts in services in most cases, primarily in prevention. There may be reductions in regional services such as special forces provided during unique emergencies, reduced levels of service in unincorporated areas, reduction in mutual aid services, and jail and juvenile jail services. Ms. Supler gave an overview of various cities, projects they will cut in the future, and taxes that may be implemented to enable them to balance their budgets. Ms. Supler summarized that most cities are proceeding with caution and are evaluating those services provided now. Mayor Booth stated that presentations will be given regarding traffic and park impact fees and invited Traffic Engineer Steve Mullen to begin. III. Traffic Impact Fees Mr. Mullen distributed an information packet and explained that this is a summary of information previously presented to Council. Mr. Mullen introduced Transportation Planner Joe Welsh. Mr. Welsh began with the basic criteria 'used for traffic impact fee development. The criteria includes the fees being legally defensible, helping to meet the revenue needs, reasonable rates that are simple to administer, and designed to help avoid adverse impacts on the transportation system. Special Meeting of the City Council November 3, 1999 Page 3 Mr. Welsh stated that an impact fee system provides a more stable source of funding and simplifies the process of identifying impacts. Our present system requires traffic studies, which can be very time consuming. Impact fees represent a more equitable way to recover costs. Our current system is designed to recover fees from the last person who triggers the need for the improvement. Mr. Welsh gave an example of a project at 9th and D Streets in which Auburn Market Place is paying the entire cost of a traffic signal even though other developments have been there for some time. An impact fee system also reduces the risk of litigation as it is based on solid engineering data. The rates are comparable to other jurisdictions' and makes development costs more predictable. An impact fee system would recover fees from all new development. Mr. Welsh explained that the methodology used to develop the impact fee rate included identifying transportation projects in our community that related to added capacity to the transportation system based on growth. The percentage of local new trips versus total new trips and the percentage of project costs for future projects related to the local trips was identified. This allowed the identification of the cost per new local trip of $1,147. Mr. Welsh referred to a detailed impact fee calculation table included in the packet. Mr. Welsh stated that they began with an average cost per new trip of $1,147, which was then adjusted by 50% as the City and other sources will cover the additional costs of capacity improvements. Mr. Welsh referred to comparisons with other jurisdictions that have impact fees in place. The estimated fee for the City of Auburn is calculated at $678 for a single-family residence. Mr. Welsh also shared comparison of three commercial developments that have occurred recently in the city of Auburn. A comparison was made of actual fees and the proposed impact fee and what they might have paid in other jurisdictions. IV. Park Impact Fees Parks and Recreation Director Dick Deal distributed an information packet on park impact fees. Mr. Deal explained that the existing park dedication system is addressed under a subdivision ordinance. It requires park land dedication where a proposed subdivision will result in a substantial increase in demand for park land, or with the creation of lots supporting 50 or more dwelling units. The acceptability of size, configuration and location is determined by the Council. Mr. Deal presented an example of a 70 home development. The current dedication standard is 7.25 acres per 1,000 residents and would result in 1.43 Special Meeting of the City Council November 3, 1999 Page 4 acres for parks. This produces the land, but not the resources to develop it. To develop the site the City can accept less land and negotiate design and construction of the park with the developer, secure grants, or use general fund revenue. Most developers prefer to have finished park sites in their developments as a selling incentive, but it generally reduces the size and scope of the park. Mr. Deal explained that the advantages of the existing park dedication system are that it is in place, developers are accustomed to it, and it has given the City the opportunity to develop new park sites. Some of the disadvantages of the current system are that it is designed to give property only with no funding source for development. Agreement negotiations are time consuming and the developer has to give up property in their inventory. At this time, there is no property dedication for multi-family units or for developments of less than fifty units. The current system results in the development of many neighborhood parks, limiting the opportunity to acquire sites for community parks, trails, open space, or areas of historical significance. Mr. Deal stated that the development of the impact fee was derived from information gathered by consultant Randy Young. The Capital Facilities Plan (CFP) was last updated in July, 1998. At that time Council identified four community park projects they wanted added to the CFP. Those projects totaled $407,000. As there were no other dedicated funds, small projects were selected to match the value of $407,000 and removed from the CFP. Deducting $25,000 in real estate excise tax and $15,000 in general funds left an unfunded capacity of $366,300. This brought the calculations for the proposed impact fee for a single-family dwelling to $588 and $504 for a multi-family unit. Mr. Deal stated that some of the advantages of an impact fee system are that the developer is aware of the costs per unit up front, no time is spent on property negotiations, the City has the ability to purchase property from the developer if desired, and no land from existing inventory is needed. All new developments would pay their fair share. The City would be able to accumulate funds for up to six years giving the City a resource to use as a match for grant funds and could place parks where they are needed. Impact fees provide a dedicated revenue source for improvements. The disadvantage of an impact fee system is that it is a politically sensitive issue. Mr. Deal presented a three-year example of potential revenue that might have been generated if an impact fee system had been in place since 1996. Mr. Deal pointed out that many projects were cut from the CFP due to the lack of an identified funding source for parks. Special Meeting of the City Council November 3, 1999 Page 5 Mr. Deal summarized the results of an impact fee system. With the schools impact fee in place and the proposed transportation and parks impact fees the total for a single-family unit would be $3,766 and $1,944 for a multi-family unit. Discussion followed regarding capacity and non-capacity projects and that portion of real estate excise tax used for funding non-capacity projects. Ms. Supler clarified the six-year CFP regarding parks projects. Only capacity projects, additional new projects to meet the needs of new residents, can be funded through impact fees. In response to questions from Councilmember Wagner, Mr. Deal stated that the impact fees charged by other jurisdictions vary widely. Some cities still use the SEPA process to go through their subdivision requirements. The park and traffic impact fees proposed by the City of Auburn range from average to the lower end of the comparisons. The comparisons provided were from March 1, 1999. In response to questions from Counciimember Poe, Ms. Supler stated that approximately $450,000 to $500,000 is generated from real estate excise tax with $600,000 anticipated for year 2000. Councilmember Lewis requested clarification from District Deputy Superintendent Bob Poldevart on the average size of elementary, middle, and high schools within the Auburn School District and the fees in connection with new construction. Mr. Poldevart stated that an average high school is 109,000 square feet. Mr. Mullen shared information on fees charged by other jurisdictions for the construction of an elementary school. Mr. Mullen explained that the trip generation numbers shown on the comparison chart come from the Trip Generation manual which are companionment studies completed over the last thirty years that look at different land uses and measure what those land uses generate in trips in the PM peak hour. The average trip rate for high schools in the PM peak hour is 1.02 trips per 1,000 square feet. Mr. Krauss stressed that the proposed rates are based on a national standard. There is also a provision in the proposed ordinance that allows the numbers to be modified based on actual experience. If actual experience is provided that peak hour trips are less, a deviation from the standard can be requested. In response to comments from Councilmembers, Mr. Poldevart stated that construction of two elementary schools and one middle school in the Lakeland area is anticipated. It is also assumed they will be within the city of Auburn boundaries. At the current rate it takes 123 multi-family units or 50 single-family Special Meeting of the City Council November .3, 1999 Page 6 units to pay the traffic impact fee for a high school. This is in addition to building the half-street infrastructure. Public Works Director Christine Engler pointed out that if entities are exempted from paying impact fees, then that exempted amount must be put into the impact fee fund account by the City of Auburn. Mr. Mullen stated that if the City wants to exempt, or partially exempt, a land use from paying an impact fee, it must be declared that is has a development activity with broad public interest and those impact fees have to be paid from public funds other than the impact fee revenues. Ms. Engler clarified that if an entity can present evidence that proves their trip rate is less than the published trip rate, then that could result in a lower rate. Under that scenario, funds would not have to be paid into the impact fee account. Mr. Poldevart stated that all infrastructure cost estimates are included in the School District's Capital Facilities Plan. The current system requires bargaining, negotiating, and traffic studies and it is very time consuming and expensive. A systematic approach is beneficial in cost estimation and is more equitable, as schools are often the last entity to begin construction. Councilmembers and staff discussed the merits of the proposed ordinance and the ability of a developer to pay the impact fees so that the process of construction of a project might begin. Under the proposed ordinance, the developer is still able to challenge the amount of the impact fees by submitting the proper evidence. Councilmembers and staff also discussed the conditions under which impact fees might be charged on a commercial remodel project. Mr. Poldevart emphasized that the proposed impact fee system would save a tremendous amount of time and money for the developer. Mayor Booth summarized the purpose of tonight's meeting and confirmed the total amount of the proposed school, traffic,.and park impact fees of $3,756 for a single-family dwelling. Councilmember Poe spoke in opposition to park impact fees and stressed that parks should continue to be funded through grants, donated lands, bond issues from King County, and other available resources. Another option would be to fund the parks program from the general fund or be voted on as a capital improvement. Funding park construction under the current system does not appear to be a tremendous burden on the City. Special Meeting of the City Council November 3, 1999 Page 7 In response to questions from Councilmember Cerino, Mr. Deal stated that property in locations other than the development can be accepted or funds in lieu of land can be negotiated. Most developers want a small park in their development and negotiations can be difficult. Discussion followed regarding possible amendments to the existing park dedication ordinance relating to accepting or requiring funds in lieu of land and the lack of contribution from multi-family unit developments and developments smaller than fifty units and the possibility of future levies for park maintenance. Councilmember Wagner spoke in favor of park impact fees and the need to collect from all development. Councilmember Wagner expressed a desire for lower fees and dissatisfaction of the methodology used and the projects the proposed fee was based on. Mr. Deal clarified that, based on the current conditions, the average price per developed acre of a neighborhood park is approximately $110,000. A community park, which has restrooms, possibly lighted fields, parking, and more expensive amenities, is approximately $165,000 per acre. The projects used to arrive at the proposed park impact fee were not the most expensive projects being developed by the City. The property was already owned by the City and some amenities were already in place. Mr. Deal explained that to continue the standard of the 6.03 developed acres per thousand without grants or real estate excise tax, would require impact fees of approximately $2,200 for single-family and $1,850 for multi-family would be required for impact fees. Councilmember Borden stated that the impact fee would comprise 25% of the amount needed to maintain the current level of service. The remaining 75% would have to come from real estate excise tax, general fund, bond issues, or other resources. Mr. Deal stated that there is undeveloped real estate in the City's inventory that could be developed to keep the 6.03 standard. It would not be necessary to pumhase property at this time. Some of the City's major parks, such as Brannon Park, Game Farm Wilderness Park, and Les Gove Park, are not considered fully developed. City Attorney Michael Reynolds emphasized that the problem with the current park fee system is the discriminatory differentiation between single-family dwellings and multi-family units. The higher demand for the open space land is from multi-family units, yet they are not charged. Mayor Booth conducted an informal poll of Councilmembers on whether they would like to bring the issue of impact fees before City Council on the next Special Meeting of the City Council November 3, 1999 Page 8 regular meeting. Councilmembers agreed that the issues should be brought before the Council prior to January 1, 2000. V. Adjournment There being no further business to come before the Council this evening, the meeting adjourned at 7:22 p.m. Approved on the day of~ 1999. Charles A. Booth, Mayor Danielle Daskam, City Clerk