Council adopts traffic impact fee report and a 2.3% fee increase; fund balance at $867,598

The City Council on Jan. 21 adopted the Transportation Impact Fee (TIF) annual report for fiscal year 2023–24 and approved a 2.3 percent fee adjustment, with the resolution to increase the fee set to take effect 60 days after the meeting (March 24, 2025).

Community Development Director Sherry Bermejo told the council the TIF ordinance was adopted in 2019 under California’s Mitigation Fee Act and is intended to fund traffic improvements south of Huntington Drive identified in the ordinance’s nexus study. Bermejo said the fund began FY 2023–24 with a balance of $680,512, collected $157,169 during the year (largely from the Station Square South project), accrued interest, and now has a balance of $867,598. She said the city has not yet expended the TIF funds but plans traffic signal improvements along Myrtle and Magnolia in the next fiscal year.

Bermejo explained that the ordinance authorizes an annual adjustment based on the California construction cost index and that the proposed increase would be implemented through a resolution. "If it is approved, it would go into effect 60 days following tonight's hearing, which is 03/24/2025," she said.

During council discussion, members asked whether fees are collected at certificate of occupancy (staff confirmed they generally are) and whether the fee area could be expanded to encompass more development types; Bermejo said expanding the fee would require reopening the nexus study and additional traffic studies. After a motion, a roll call vote recorded by the clerk showed Belden, Jimenez, Spicer, Mayor Pro Tem Dr. Kelly and Mayor Shevlin voting yes; the motion passed.

What this means: developers that trigger the fee for new PM peak-hour trips will pay the adjusted TIF for projects that reach final inspection or certificate of occupancy after the fee’s effective date. The TIF fund is earmarked for transportation projects and is not part of the city’s general fund.