The city council may establish development impact fees on the issuance of all building permits for development within the city to finance the cost of additional public facilities necessary to mitigate the impacts upon existing public facilities caused by new development in the city.

The city council shall from time to time adopt, after a noticed public hearing, the resolution establishing specific development impact fees. In adopting the resolution, the city council shall:

Unless otherwise provided in the resolution imposing the fee, on January 1st of each year after the enactment of each fee, the fee shall be automatically adjusted in accordance with the change in the Engineering Construction Cost Index, as most recently published by Engineering News-Record, for the previous calendar year. The city council may, by resolution, retroactively or prospectively postpone the application of this annual increase for a period of up to three years for projects subject to SB 330 (2019).

Residential Developments. Except as specified in MMC § 10.05.3130, the fee shall be charged for each new dwelling unit.

Nonresidential Developments. Except as specified in MMC § 10.05.3130, the fee shall be charged on a per square foot basis for all new gross floor area, including additions where floor area is increased.

Hotel. Notwithstanding subsection B of this section, the fee shall be charged for each separately rentable hotel room.

The community development director may set a fee consistent with the Mitigation Fee Act and the criteria set forth in the resolution imposing the fee for projects that do not squarely fit within the development categories listed in this section.

Notwithstanding MMC § 10.05.3125, the following projects are exempted from payment of the development impact fee:

Any claim of exemption from the imposition of the development impact fee must be made no later than the time for application for fee refunds as set forth in MMC § 10.05.1855(A).

The development impact fee established pursuant to this article must be paid for each approved nonresidential development project at the time of the issuance of the first required building permit. No city official may issue a building permit for a nonresidential development project until the development impact fee with respect to any such development required by this article has been paid.

All fees imposed on a residential development project with one unit must be collected prior to the date of the final inspection, or the date the certificate of occupancy is issued, whichever occurs first. For residential developments containing more than one unit, all fees must be paid when the first unit in the development receives its final inspection or certificate of occupancy, whichever occurs first.

Notwithstanding any other provision of this article, the community development director may specify an earlier date for payment of fees imposed pursuant to this article where permissible under Section 66007 of the Government Code.

Upon issuance of a building permit for a residential development project that has not yet paid all fees imposed pursuant to this article, the community development director may require the applicant for the building permit to enter into a contract to pay the fees within the time period specified in this section, which will constitute a lien on the property as further detailed in Section 66007 of the Government Code.

In no event may a city official issue a certificate of occupancy, or certify a final inspection, as the case may be, for a development which has not paid a required development impact fee.

Applicant Construction of Facilities.

Appeal of Determinations of Community Development Director. Determinations made by the community development director or designee pursuant to the provisions of this section may be appealed to the city council by filing a written request with the city manager within ten days of the determination of the community development director or designee, together with the applicable fee established by resolution of the city council.

An applicant for a development project may file a written appeal regarding the imposition and/or calculation of the fee pursuant to the procedures set forth in MMC § 10.05.1850. Unless expressly specified by the city council, the applicability of the decision in any appeal is limited to the project at issue.

An applicant for a development project may request a refund of a fee paid pursuant to the procedures set forth in MMC § 10.05.1855.

Revenues collected from development impact fees shall be used for the purpose of (1) paying the actual or estimated costs of constructing and/or improving the facilities specified in the resolution imposing the fee, including any required acquisition of land or rights-of-way therefor; (2) reimbursing the city for the development project's share of those facilities specified in the resolution imposing the fee already constructed by the city or to reimburse the city for costs advanced, including, without limitation, administrative costs and costs of financing incurred to construct specific facilities; (3) reimbursing other developers who have constructed facilities specified in the resolution imposing the fee in lieu of payment of impact fees, where the scope of those facilities exceeded that needed to mitigate the impact of the applicant's development project; or (4) paying costs required for the administration of this article, including, without limitation, reasonable costs of outside consultant studies related thereto, costs of program development, and legal costs.

The city shall deposit, invest, account for, and expend the revenues from the development impact fees in accordance with the Mitigation Fee Act.

For each fee imposed pursuant to this article, no later than one hundred eighty days following the end of the city's fiscal year, the city manager must prepare a report to the city council ("report") at a regularly scheduled public meeting, in a form compliant with the Mitigation Fee Act, which must include the total amount of fees collected, the facilities constructed, and the facilities to be constructed.

Every fifth fiscal year following the first deposit of fees collected pursuant to this article, the city council shall do the following based on the report with respect to any fees remaining unexpended, whether committed or uncommitted: (1) identify the purpose to which the fee is to be put; (2) demonstrate a reasonable relationship between the fee and the purpose for which it was charged; (3) identify all sources and amounts of funding anticipated to complete financing the facilities; and (4) designate the approximate dates on which such funding is expected to be deposited into the appropriate fund. The unexpended portion of the fee, and any interest accrued thereon, for which need cannot be demonstrated pursuant to this section shall be refunded to the then current record owner or owners of lots or units of the development project on a prorated basis where required by the Mitigation Fee Act.

Authorization and Purpose. For each specific plan or amendment to an existing specific plan, the city council may impose fees on subsequent applicants for governmental approvals under that specific plan or amendment, in accordance with the procedures set forth in Sections 66016-19 and 65456 of the Government Code. The purpose of the fee is to ensure that persons who benefit from the specific plan share in the costs of developing and administering the specific plan, which result in savings to them by reducing the cost of documenting environmental consequences and advocating changed land uses which may be authorized pursuant to the specific plan, and to reimburse the city for its costs incurred in the preparation, adoption, amendment, and administration of the specific plan.

Amount of Fee. The reimbursement fees must be based on documented, city-approved costs incurred in the preparation, adoption, amendment, and administration of a specific plan, including the preliminary application and costs incurred to achieve compliance with the California Environmental Quality Act. The city council may establish and amend the amount of the fees by resolution from time to time to account for the ongoing costs of administering the plan.

Fee Schedule. The reimbursement fees imposed on each applicant must be a prorated amount in accordance with the applicant's relative benefit derived from the specific plan for which the fee is imposed, as nearly as can be estimated, unless otherwise stated in Government Code Section 65456, as may be amended from time to time.

Payment of Fee. Unless otherwise stated in the adopting resolution, reimbursement fees are levied on a per parcel basis with the entire reimbursement fee for a particular parcel due prior to the approval of the first governmental approvals required to be consistent with the specific plan on the parcel for which the fee is imposed. The reimbursement fee for a given specific plan or amendment is applicable only once to any particular parcel.

Use of Funds. All reimbursement fees collected for a particular plan, and any interest accrued thereon, must be placed in a separate fund and may only be used for the purpose of the fee. Parties who previously paid for the costs of preparation, adoption, amendment, and administration of a specific plan, including the preliminary application and costs incurred to achieve compliance with the California Environmental Quality Act, will be reimbursed for the fair share of their costs. The adopting resolution will determine the method for the allocation of the fee.

Appeals. An applicant for a development project may file a written appeal regarding the imposition and/or calculation of the fee pursuant to the procedures set forth in MMC § 10.05.1850. Unless expressly specified by the city council, the applicability of the decision in any appeal is limited to the project at issue.

Refunds. No applicant is entitled to a refund of the fee collected if, for any reason, the development on the parcel subject to the fee does not proceed.

Statute of Limitations. Except as provided in Government Code Section 66020 or in the adopting resolution, any judicial action or proceeding to attack, review, set aside, void or annul a fee adopted pursuant to this section must be commenced within one hundred twenty days of the adoption of the adopting resolution.