City staff said they rebuilt the city’s system development charge (SDC) model, will update the SDC schedule every two years starting in 2026 and have exempted properly licensed childcare facilities from SDCs, staff said during a briefing.

The change matters because SDCs — fees charged to developers to pay for infrastructure — affect project costs for housing developers, childcare operators and other commercial builders, city staff said. Staff described the redesign as an effort to bring the data and calculations in-house so the city can maintain the model and answer developer questions more precisely.

Staff said the city previously relied on an outside engineering firm’s SDC tables and inflation adjustments such as the CPI West, which left the city without direct control of the model. According to the staff member, the new approach “lets us own the system and be able to maintain it from then on,” and “we can give developers and business owners a more honest answer” when asked about charges.

Under the revised schedule, staff reported that overall SDC rates decreased slightly while the water component of the SDC rose to reflect planned water infrastructure needs. Staff said they plan to revise the SDC table again in 2026 and then every two years thereafter.

Staff described two programs that emerged from the redesign: an exemption for properly licensed childcare facilities, which staff said “don’t pay any SDCs at all,” and a steep discount for home builders who construct efficiency units of 1,000 square feet or less. Staff said the discounts are intended to encourage smaller units and that the city is negotiating with the Collina development to include some of those smaller units in the project’s second year.

The discussion was presented as a staff briefing and informational overview; no motions or votes were reported in the transcript. Staff noted the rebuild required substantial work but said in-house ownership of the SDC model will improve transparency and responsiveness to developers and business owners. The next formal update to the SDC table is scheduled for 2026, according to staff.