Council introduces ordinance cutting some development impact fees; staff directed to report on recent payments

The Lompoc City Council on Tuesday introduced an ordinance that revises the city’s development impact fee schedule after a review and public comment, and it directed staff to prepare a follow‑up analysis of recent fee payments.

City Attorney (on behalf of staff) said the draft ordinance updates last‑decade rules, adds an administrative appeal process and was changed from a resolution to an ordinance so that the fee schedule would be adopted via ordinance rather than a less‑durable resolution. “The first one is this has been changed from a resolution to an ordinance,” the City Attorney told the council.

The changes substantially reduce some impact fees for new residential development when compared with the prior schedule shown in the earlier Nexus study and staff materials. During public comment, local resident and former planning commissioner Nick Gonzales urged the council to approve the reductions to encourage housing supply: “If you really wanna spur housing, I think that some of these cuts to these impact fees are gonna make a substantial difference,” he said.

Council action and additions: Council introduced the ordinance (first reading) and amended the staff proposal to include a three‑year moratorium on automatic inflationary increases (the ordinance uses the Engineering News‑Record construction index as its adjustment measure). Council also asked staff to return within 30 days with an analysis of developers who have paid recent impact fees and whether refunds or adjustments should be made for projects that have not reached certificate of occupancy. Staff noted that refunding would require locating funds already collected and, if funds have been expended, possibly identifying a source for refunds.

Appeals process and grandfathering: The ordinance adds a specific administrative appeal route (new section 15) that allows a project applicant to contest a fee on nexus grounds. Council also discussed how to treat pending applications and projects; staff explained that applicants have the option to pay the fees in force when they filed or the new schedule, but the council modified the language so projects that have not reached certificate of occupancy may be adjusted under the new schedule and staff will prepare a formal approach to any refunds or credits.

Why it matters: Impact fees help cities pay for capital projects tied to growth — parks, roads, water/wastewater and public safety — but have become a focus for cities seeking to accelerate housing development in response to state housing targets. Council members framed the changes as a way to remove a cost barrier for builders and stimulate housing activity.

Vote: The motion to introduce the ordinance and direct follow‑up reporting passed 5‑0.

Ending: Because an ordinance requires two readings, the council’s action introduced the changes and scheduled the matter for final adoption following the required second reading procedures. Staff will return with a 30‑day report on recent fee payments and the mechanics for any adjustments.