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Home My WebLink AboutCOUNCIL - AGENDA ITEM - 10/03/2017 - FIRST READING OF ORDINANCE NO. 132, 2017, AMENDINGAgenda Item 5 Item # 5 Page 1 AGENDA ITEM SUMMARY October 3, 2017 City Council STAFF Tom Leeson, Director, Comm Dev & Neighborhood Svrs Brad Yatabe, Legal SUBJECT First Reading of Ordinance No. 132, 2017, Amending Chapter 7.5 of the Code of the City of Fort Collins Regarding the Imposition of Capital Expansion Fees Adopted in Ordinance No. 049, 2017. EXECUTIVE SUMMARY The purpose of this item is to amend Sec. 7.5-19 of the City Code related to the Imposition, Computation and Collection of fees for development projects that had an approved Project Development Plan prior to the adoption date of Ordinance No. 049, 2017. STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on First Reading. BACKGROUND / DISCUSSION On June 6, 2017, City Council adopted Ordinance No. 049, 2017, amending Chapters 7.5, 8 and 24 of the Code of the City of Fort Collins concerning revisions to terminology and decreases and phased increases of the Capital Expansion Fees and amending Section 3.3.2(G) of the Land Use Code to revise related Terminology (Attachment 1). Sec. 7.5-19 of the City Code requires "Payment of the fees imposed under the provisions of this Article shall be required as a condition of approval of all development in the City for which a building permit is required. . . The fees due for such development shall be payable by the feepayer to the Building Official prior to or at the time of issuance of the first building permit for the property to be developed, except to the extent that an agreement deferring all or any portion of such payment has been executed by the City providing for a different time of payment approved by the City Council by resolution." Furthermore, Ordinance No. 049, 2017, had an effective date beginning October 1, 2017, meaning all applicable building permits issued after October 1, 2017, would be subject to the new Capital Expansion Fee schedule. It should be noted that in many cases, bank financing for development projects are contingent upon and/or approved at the time of approval of the City's entitlement process, and for the City of Fort Collins that is upon approval of the Project Development Plan (PDP). Subsequent to the adoption of Ordinance No. 049, 2017, staff was contacted by developers that had their PDPs approved prior to the adoption date of Ordinance No. 049, 2017, and indicated that due to the complexity of these projects, such developers would not meet the October 1, 2017, deadline for the issuance of a building permit, and; therefore, would be subject to the new Capital Expansion Fee schedule. For these projects, the fee increase as a result of the new Capital Expansion Fee schedule was in the hundreds of thousands of dollars and was significantly impacting the financial feasibility of their projects. Agenda Item 5 Item # 5 Page 2 In an effort to acknowledge projects that had an approved PDP prior to the adoption of the new Capital Expansion Fee schedule and in light of the typical timing of bank financing for development projects, staff is recommending exempting from the new Capital Expansion Fee schedule, any development project that had an approved PDP prior to the adoption date of Ordinance No. 049, 2017, which was June 6, 2017. CITY FINANCIAL IMPACTS There are two development projects that were approved prior to adoption date of Ordinance No. 049, 2017 and the combined difference in Capital Expansion Fees (difference between old fee schedule and new fee schedule) for the two projects is $1,102,711.51. ATTACHMENTS 1. Agenda Item Summary, June 6, 2017 (PDF) 2. Ordinance No. 049, 2017 (PDF) Agenda Item 20 Item # 20 Page 1 AGENDA ITEM SUMMARY June 6, 2017 City Council STAFF Tiana Smith, Revenue and Project Manager SUBJECT Items Relating to Capital Expansion Fees and the Electric Capacity Fee. EXECUTIVE SUMMARY A. Second Reading of Ordinance No. 049, 2017, Amending Chapters 7.5, 8 and 24 of the Code of the City of Fort Collins Concerning Revisions to Terminology and Decreases and Phased Increases of the Capital Expansion Fees and Amending Section 3.3.2(G) of the Land Use Code to Revise Related Terminology. B. Second Reading of Ordinance No. 068, 2017, Amending Chapter 26 of the Code of the City of Fort Collins Regarding Calculation and Collection of Development Fees Imposed for the Construction of New or Modified Electric Service Connections. These Ordinances, unanimously adopted on first reading on May 16, 2017, adopt fee recommendations for capital expansion and transportation expansion fees and electric capacity fees effective beginning October 1, 2017. On first reading, Alternative 2 of Ordinance No. 049, 2017 was adopted, which provides for fee increases without any phasing in amounts less than what is recommended in the studies for the Capital Expansion Fees and the Transportation Expansion Fee for the lesser amount recommended in those studies. Alternative 3 will be presented to Council as requested. It provides funding for transportation improvements. A new Section 30 has been added to the Ordinance to direct the City Manager to appoint a working group of citizens and City staff to further study the issue of capital expansion and transportation expansion fees. This includes the appointment of a member of Council to act as a communications liaison between the Council and the City Manager and his working group. Discussion arose during First Reading of the Ordinance about how the new fees would apply to projects that are currently in the entitlement pipeline. Two suggested alternatives have been provided for Council consideration. STAFF RECOMMENDATION Staff recommends adoption of the Ordinances on Second Reading. BACKGROUND/DISCUSSION Alternative 3 is shown on Attachment 4, as requested by the City Council at First Reading. This alternative provides for fee increases as adopted on First Reading for Capital Expansion Fees and for “Option A” as described in the Transportation Capital Expansion Fee Study to fund the costs of the full Capital Improvement Program for transportation facilities. As currently provided in the Code, projects that have submitted a development application but have not yet been approved, or have been approved but have not yet been issued a building permit would be subject to the new fee schedule. It was suggested that the fees be based upon the rate at the time of submission of a ATTACHMENT 1 Agenda Item 20 Item # 20 Page 2 completed development application, so that development projects in the entitlement pipeline are not subject to the new fees. If Council chooses to make this change, it is recommended that one of the two sentences below be added by motion to Code Section 7.5-16 (in Section 3 of the Ordinance, on page 2). This will add language expressly stating when the new fee schedule is applicable to development projects. The two are options are as follows: 1. Said fees shall be determined based upon the rate applicable either at the time of submission of a completed development application, if any, or if no development application is submitted, at the time of submission of a completed building permit application; OR 2. Said fees shall be determined based upon the rate applicable at the time of submission of a completed building permit application. ATTACHMENTS 1. First Reading Agenda Item Summary May 16, 2017 (w/o attachments) (PDF) 2. Impact Fee Working Team Project Definition (PDF) 3. Public Outreach Summary (PDF) 4. Alternative 3 (PDF) 5. Powerpoint presentation (PDF) ATTACHMENT 2 -1- ORDINANCE NO. 132, 2017 OF THE COUNCIL OF THE CITY OF FORT COLLINS AMENDING CHAPTER 7.5 OF THE CODE OF THE CITY OF FORT COLLINS REGARDING THE IMPOSITION OF THE CAPITAL EXPANSION FEES ADOPTED IN ORDINANCE NO. 049, 2017 WHEREAS, on June 6, 2017, Council adopted Ordinance No. 049, 2017; and WHEREAS, Ordinance No. 049, 2017, addressed changes to the City Code provisions contained in Chapter 7.5, 8, and 24 regarding capital expansion fees; and WHEREAS, the City Code changes to the capital expansion fee amounts set forth in Ordinance No. 049, 2017, became effective on October 1, 2017; and WHEREAS, prior to October 1, 2017, City staff was informed by the developers of certain projects that had Project Development Plans (“PDP” or “PDPs”) approved by the City prior to the adoption date of Ordinance No. 049, 2017, that the capital expansion fee changes would substantially increase such fees and significantly affect the financial feasibility of such projects; and WHEREAS, in recognition of the reliance of developers of projects that had PDPs approved prior to the adoption date of Ordinance No. 049, 2017, on the capital expansion fee schedules in effect at the time of PDP approval for purposes of determining the financial feasibility of such projects, Council finds that it is in the best interest of the City and its citizens to allow such projects to pay the capital expansion fees in effect as of June 6, 2017. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That the City Council hereby makes any and all determinations and findings contained in the recitals set forth above. Section 2. That Section 7.5-19 of the Code of the City of Fort Collins is amended by the addition of a new subsection (c) as follows: (c) Notwithstanding any language to the contrary contained in this Article, development projects for which final approval of the associated Project Development Plan, as such terms are defined and described in the Land Use Code, had been received prior to June 6, 2017, shall be required to pay the capital expansion fees at the rates in effect prior to June 6, 2017. -2- Introduced, considered favorably on first reading, and ordered published this 3rd day of October, A.D. 2017, and to be presented for final passage on the 17th day of October, A.D. 2017. __________________________________ Mayor ATTEST: _______________________________ City Clerk Passed and adopted on final reading on the 17th day of October, A.D. 2017. __________________________________ Mayor ATTEST: _______________________________ City Clerk