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Board approves modest inflationary hike to developer fees; staff warns of revenue drop from ADUs
Summary
Trustees approved a biennial inflationary increase in Level 1 developer fees — residential from $1.48 to $1.54 per sq ft and commercial from $0.24 to $0.25 — and staff reported collections have fallen from about $2 million to roughly $500,000 due in part to an increase in ADUs that do not trigger fees.
The board approved a routine inflation adjustment to Level 1 developer fees at its April 14 meeting, updating residential fees from $1.48 to $1.54 per square foot (district share, a 6¢ increase) and commercial/industrial fees from $0.24 to $0.25 per square foot (1¢ increase). The new fees take effect 60 days after approval.
Miss Ortiz explained that the state allocation board approved the increase in January and staff bring forward the adjustment every two years. She cautioned that the district has seen a significant decline in fee collections because many new units are accessory dwelling units (ADUs) under the threshold that generates developer fees: "We used to be somewhere around $2,000,000 a couple years ago per year. And just this last year, it was about $500,000." Trustees asked whether fees keep pace with costs; staff said current collections are lower than prior years due to prevailing ADU activity.
