The city has approved development proposals in areas where additional supporting facilities will be needed to provide public services. Recognizing that fiscal constraints prevent the city from assuming all of the costs of providing such facilities, the city has imposed conditions on such approvals requiring developer contribution to the costs of acquiring land and installing such facilities. The purpose of this chapter is to provide an orderly method for implementing such conditions. This chapter is adopted pursuant to the authority granted the city under article XI, section 7, of the California Constitution.

(Ord. No. 98-193, §§ 1—4, 10-19-98)

The following words, terms and phrases, when used in this chapter, shall have the meanings ascribed to them in this section, except where the context clearly indicates a different meaning:

Benefit area or area of benefits means an area established by resolution of the city council which will be benefitted by and will have contributed to the need for a facility. Such area shall be determined solely on the basis of need for the facility and contribution of development in the area to the need for the facility. In establishing a benefit area, consideration shall not be given to whether or not fee areas are included.

Building permit means a building permit which would allow construction of any structure which would contribute to the need for a facility for which a fee is required.

Facility means a public facility normally owned and operated by the city, including but not limited to fire stations, libraries and sheriffs stations, appropriate sites, and equipment necessary to the functioning of such facility, payment for a share of the cost of which is required by conditions of approval of some, but not necessarily all, general plan amendments, zone changes, or other development approvals within the area of benefit of such facility.

Fee means the pro rata share of the cost of provision of facilities attributable to a particular parcel of real property and may include provision of specified facilities or dedication of land for such facilities.

Fee area means any area covered by a general plan amendment, zone change, or other development approval which was granted subject to a condition that the developer pay a fee.

Fee program means a program adopted by resolution of the city council which apportions the pro rata share of the costs of a facility to each parcel within a benefit area based on the benefit to be derived by each such parcel and the contribution of the development approved for such parcel to the need for the facility and without regard to whether or not such parcels are within a fee area. The program shall state the estimated cost of the facility, which cost shall be deemed fixed for purposes of the program unless the program is amended pursuant to section 9.94.025, and shall describe the facility, its capacity, its location, and the projected date of its completion. A fee program may include provisions for construction of a facility or provision of land for a facility by a developer and for reimbursement from fees or other appropriate city sources for any costs above the prorated share of the costs attributable to such developer's property. A fee program may provide that the city may advance funds from appropriate sources to fund the cost of constructing the facility and acquiring land therefor and reimburse such sources from fees. A program shall provide that all funds received and any interest derived therefrom shall be used solely for the purpose of constructing or acquiring the facility described therein. Where applicable to the facility, assessment districts or other acceptable methods of financing shall be taken into consideration in establishing fee programs. No fee program shall conflict with any preexisting agreement for provision of facilities between the city and a developer. A fee program may provide for automatic periodic adjustment of fees based on the Real Estate Research Council of Southern California's Office Building Construction Cost Index, without further action of the city council, including but not limited to public notice or hearing. Payment of fees includes payment of money, construction of facilities, commitment to construction of facilities, and dedication of land for facilities.

(Ord. No. 98-193, §§ 1—4, 10-19-98)

Cross reference— Definitions generally, § 1.01.170.

Fee programs and benefit areas shall be established in accordance with the following procedures. Fee programs and benefit areas for the same public facility should ordinarily be established simultaneously by a single resolution.

(1)

The responsible agency or department shall prepare a proposed fee program and/or benefit area to be submitted to the planning commission for its advice and comments. The proposal shall be supported by adequate engineering studies to demonstrate the appropriateness of the proposed benefit area and fee distribution. No public hearing of the planning commission or notice of its consideration of the matter shall be required, provided that the planning commission may receive such testimony as it deems appropriate.

(2)

The responsible agency or department shall revise the proposed fee program and benefit area as it deems appropriate following receipt of the planning commission advice and comments.

(3)

At least 15 calendar days' notice of a public hearing before the city council shall be given by United States mail to each owner of property as shown on the last equalized assessment roll in a fee area located within the proposed benefit area where such property may be subject to a fee. The notice shall contain preliminary information relating to the boundaries of the benefit area, type, capacity and other pertinent information on the facility; estimated cost of the facility; method of fee apportionment; and, if applicable, proposed dedication of land or construction of the facility by a developer. No property shall be included in the fee area unless notice has been given in accordance with this subsection (3).

(4)

At the public hearing, the city council shall review the proposed fee program and benefit area and any advice and comments from the planning commission and receive the testimony of any interested person.

(5)

The city council may, by resolution, adopt the proposed fee program and benefit area as prepared by responsible agency or department or as revised by the city council, may reject the proposed fee program and benefit area, may continue the matter to a time certain for further consideration, or may refer the matter to the responsible agency or department or the planning commission for further study and recommendation. When the matter is referred for further study and recommendation, the hearing shall either be continued to a time certain or shall be renoticed, pursuant to subsection (3). If substantial changes not discussed at the initial hearing are proposed, no such change shall be adopted by the city council until after notice of such change is given in the manner described in subsection (3), and all interested persons have been given an opportunity to be heard with respect to such changes.

(6)

Any property may be a part of more than one benefit area and fee program. Such benefit areas and fee programs need not be adopted at the same time.

(7)

The resolution adopting the fee program shall incorporate the program and a certified copy of such resolution shall be recorded with the county recorder.

(Ord. No. 98-193, §§ 1—4, 10-19-98)

Projects may develop over a period of many years and conditions may change with respect to needed facilities and to costs for facilities. Developers may initiate requests for changes in permitted residential density, street locations, uses, and other matters. The city may change requirements and criteria for facilities needed to support development. Other changes may occur which will alter the need for facilities or the equity of the distribution of costs of such facilities or both. In order to provide the flexibility to accommodate such changes in the most equitable manner possible, fee programs and benefit areas may be modified as set forth below:

(1)

Subsections 9.94.020(1) through (7) shall apply to proposals for modification.

(2)

Modifications to fee programs and benefit areas may include any or all of the following:

a.

Change in the benefit area.

b.

Change in the fee program to reallocate the pro rata shares of the costs of the facility, provided that there shall be no increase in fees imposed on any parcel of property unless the permitted uses have been changed so as to increase the contribution of the property to the need for the facility and the benefits to be derived by the property from the facility.

c.

Change in the location or capacity of the facility.

d.

Change in any provisions that a developer will dedicate land or construct a facility.

e.

Change in the estimated cost of providing the facility, in which case the fee may be increased for those parcels that have not already paid such fees or had been conditioned by a tentative tract map or discretionary permit to pay a specific fee.

(3)

If fees are reduced, any person who has paid such fees shall, upon written demand submitted to the responsible agency or department, be entitled to a refund of any excess paid.

(Ord. No. 98-193, §§ 1—4, 10-19-98)

(a)

No tentative parcel map or tentative tract map proposed in a fee area where a fee program and a benefit area have been established shall be approved unless the map is conditioned to require the subdivider to enter into a secured agreement prior to recordation. The agreement shall require payment of such fees prior to issuance of building permits. The subdivider may pay such fees prior to recordation in lieu of entering into an agreement.

(b)

No tentative parcel map or tentative tract map shall be approved in a fee area where a fee program and benefit area have not been established unless such map is conditioned so as to require payment of such fees as may be established. Such condition shall require that, prior to recordation of the map, the subdivider shall enter into an agreement to pay such fees upon such establishment, or upon issuance of building permits, whichever occurs last, and shall post security therefor.

(Ord. No. 98-193, §§ 1—4, 10-19-98)

(a)

No discretionary permit, as that term is used in section 7-9-150 of the county's zoning ordinance, which would allow development of any project which would contribute to the need for the facility for which a fee is required shall be approved for property located in a fee area where a benefit area and fee program have been established except where a previously approved subdivision map requires payment of fees or a subdivision map will be required prior to development, unless the permit is conditioned to require payment of such fees prior to the issuance of building permits.

(b)

No such discretionary permit shall be approved in a fee area where a fee program and benefit area have not been established unless such permit is conditioned so as to require the applicant to pay such fees as may be established. Such condition shall require that, prior to issuance of building permits, the applicant shall enter into an agreement to pay such fees upon establishment of a program and shall post security therefor.

(Ord. No. 98-193, §§ 1—4, 10-19-98)

No building permit shall be issued in a fee area where a fee program and benefit area have been established unless such fees have been paid.

(Ord. No. 98-193, §§ 1—4, 10-19-98)

Notwithstanding sections 9.94.030, 9.94.035, and 9.94.040, no development fees relating to a residential development projects shall be required to be paid prior to final inspection or issuance of certificates of occupancy, whichever occurs first, unless otherwise permitted by Government Code § 66007.

(Ord. No. 98-193, §§ 1—4, 10-19-98; Ord. No. 08-273, § 2, 11-3-08)

(a)

[Deferral.] Notwithstanding sections 9.94.030, 9.94.035, 9.94.040, and 9.94.045, development fees imposed upon new commercial and residential development projects pursuant to sections 9.94.030, 9.94.035, and 9.94.040 may be deferred upon application by the property owner, or lessee if the lessee's interest appears of record, and approval by the community development director.

(b)

[Preliminary title report.] Prior to the community development director's consideration of an application for deferral of development fees, the owner or lessee shall provide the community development director, at the owner's or lessee's expense, a current preliminary title report on the affected property.

(c)

Deferral of development fees for commercial development. Upon approval of the deferral application by the community development director, the property owner or lessee, as a condition of issuance of the building permit for construction of any portion of a commercial development encumbered thereby, shall execute a contract to pay the fee, or applicable portion thereof, 30 days prior to the date the certificate of occupancy is issued.

(d)

Deferral of development fees for residential development. Upon approval of the deferral application by the community development director, the property owner or lessee, as a condition of issuance of the building permit for construction of any portion of a residential development encumbered thereby, shall execute a contract to pay the fee, or applicable portion thereof, 30 days prior to the date the certificate of occupancy is issued, or upon the close of escrow, whichever occurs first.

(e)

[Obligation to pay fee.] The obligation to pay the fee shall inure to the benefit of, and be enforceable by, the city regardless of whether it is a party to that contract. The contract shall contain the legal description of the property affected, shall be recorded in the Clerk-Recorder Department for the County of Orange and, from the date of recordation shall constitute a lien for the payment of the fee, which shall be enforceable against successors in interest to the property owner or lessee at the time of issuance of the building permit. The lien for payment of the fee shall not be subordinated. A deed of trust and the contract shall be recorded in the grantor-grantee index in the name of the city as grantee and in the name of the property owner or lessee as grantor. The city shall record a release of obligation, containing a legal description of the property, in the event the obligation is paid in full.

(f)

[Notification of opening of escrow.] The contract shall require the property owner or lessee to provide appropriate notification of the opening of any escrow for the sale of the property for which the building permit was issued and to provide in the escrow instructions that the fee be paid to the city from the sale proceeds in escrow prior to disbursing proceeds to the seller.

(g)

[Unpaid fees.] Should the deferred fees not be paid at the time they are due and payable:

(i)

All unpaid fees shall be accelerated and become immediately due and payable;

(ii)

An additional $1,000.00 shall be added to the unpaid balance for the initial administrative costs incurred in processing the fee deferral; and

(iii)

The city may pursue collection through all available legal and administrative means including, but not limited to, judicial or nonjudicial foreclosure of the recorded lien against the affected property and/or civil judgment against the owner or lessee for breach of contract and/or the security provided hereunder.

(h)

[Applicability.] This section and the incentives derived hereunder shall apply only to new commercial development projects that have not obtained building permits from the city at the time this section is adopted by the city council pursuant to Ordinance No. 08-273. This section shall remain in effect until December 18, 2009, and as of that date is repealed unless a city council resolution adopted before December 18, 2009, extends that date for a period not to exceed six (6) months.

(Ord. No. 08-273, § 3, 11-3-08)