DEVELOPMENT IMPACT FEE ADVISORY COMMITTEE Wednesday, Meeting Station Boise Train Depot MINUTES I. Call to Order Committee Chair, Brian Wewers, called the meeting to order at 12:12 p.m. II. III. Attendance: Development Impact Fee Advisory Committee Members: Naomi Savin, Bryan Wewers, Amber Van Ocker, Tim Day, and David Yorgason were present. Staff: Cheyne Weston, Tonya Wallace, Pat Riceci, and Kristine Smith were present. Approval of Meeting Minutes October 9, 2013 ACTION: A. VAN OCKER MOVED THAT THE DEVELOPMENT IMPACT FEE ADVISORY COMMITTEE APPROVE THE OCTOBER 9, 2013 MEETING MINUTES. SECONDED BY T. DAY. THE MOTION CARRIED UNANIMOUSLY. IV. Discussion Items A. DIFAC Membership and the Two Vacant Seats B. Wewers explained that Boise City Code allows the Committee to have up to nine members. City Code specifies that at least two members should be active in development, building, or real estate multiple members qualified for the requirement including T. Day, A. Van Ocker, D. Yorgason, M. Holden, and J. Giese. N. Savin filled the position for one member being under 21 years of age at the time of appointment. There are two open seats on the Committee, but it is not required that they be filled. C. Weston explained that Boise City Code requires that nine meetings be held each year by the Committee. Having a quorum at each meeting and scheduling has been difficult in the past. Filling either one or both seats may be helpful in reaching a quorum at the scheduled meetings. T. Wallace informed the Committee that the Capital Plan will be reviewed with a twenty-year update of the Capital Improvement Plan (CIP) scheduled for 2016. If the seats were filled, the new members would serve for a minimum of a three-year term and would be a part of the updating process. I:\Planning\Impact Fees\IFMinutes\2013\IFACMin111313
Page 2 N. Savin questioned the number of Committee members needed to have quorum. B. Wewers responded that four voting members were needed for quorum. He suggested that it would be beneficial for the Committee to have representation outside of the business of development. P. Riceci informed the Committee that a possibility to help achieve quorum is to request that Boise City Code be updated to require a majority for quorum instead of four voting Committee members. B. Wewers questioned if the Chairman would still count as a voting member. P. Riceci responded that the Chairman would qualify as a voting member. B. Wewers questioned if there had been any interest from the community to join the Committee. T. Wallace explained that the Mayor s Office and the Boise City Human Resources could work to have a search published to open the application process to the public. B. Wewers suggested that consideration for geography be made in effort to have representation of all the different planning areas of Boise on the Committee, with ideal candidates residing in the Central and West Bench Planning Areas. V. Action Items A. Confirmation of membership Information ACTION: N. SAVIN MOVED THAT THE DEVELOPMENT IMPACT FEE ADVISORY COMMITTEE RECOMMEND FILLING THE TWO VACANT SEATS WITH CONSIDERATION FOR MEMBERS OUTSIDE OF THE DEVELOPMENT COMMUNITY AND IN THE DIFFERENT PLANNING AREAS AS WELL AS RECOMMEND CONSIDERATION FOR THE CHANGING OF QUORUM FROM FOUR COMMITTEE MEMBERS TO THE MAJORITY. SECONDED BY T. DAY. THE MOTION CARRIED UNANIMOUSLY. IV. Discussion Items B. Proposed Impact Fee Code Changes T. Wallace provided the members with two versions of the proposed changes to sections of the Development Impact Fee chapters in Boise City Code. The first version showed the complete mark-up of all of the proposed changes, while the second version showed how the chapters would read if the proposed changes were adopted. Various city of Boise departments assisted with developing the proposed changes, including the Finance and Administration, Planning Development Services
Page 3 (PDS), Parks and Recreation, the Information Technology, and Legal Departments providing insight and perspective to the permitting process. T. Wallace reviewed the proposed changes to Section 4-12-04, explaining that many of the changes were minimal and largely included the regrouping of information. B. Wewers questioned the meaning of section 4-12-04-I. P. Riceci explained that an example of the intent of the section is if a developer builds a large subdivision, the City may purchase and develop a park which would serve the subdivision. The City may use the development impact fees which were collected but it does not grant the developer any rights to the park and the park will be available for use by the public. The fees are not invalid because other surrounding developers benefit from the park. T. Wallace explained that the changes made to Section 4-12-06 were to clarify the meaning of the text and to make the section consistent with the other departments. One clarification made was where it previously said expansion of use was changed to expansion of a structure. Section 4-12-06 changed the timeline for fee assessments on building permits for non-residential structures that would be built where intentionally demolished or removed structure previously existed. Previously, code allowed the difference of the assessed fees on the new structure from the previously existing structure to be paid when a building permit was applied for within twelve months of the removal/demolition of the previous structure. The proposed change to the section would allow the difference in fees to be paid when a building permit is applied for within ten years of the structure removal/demolition. The proposed change would be consistent with the timeline followed by making it consistent with the Department of Public Works. T. Wallace questioned if the Committee supported the ten-year window for fee payers. B. Wewers responded that he felt the timeframe was fair, but questioned if there would be enough documentation to determine the original development impact fee assessment of the previous structure. C. Weston explained that typically records from power and utility companies can be pulled to demonstrate that there was a utility there before. B. Wewers questioned if a developer demolished a multi-family establishment and then built a single-family structure if they would be eligible for a refund of development impact fees. C. Weston responded that the project would not be eligible for a refund of development impact fees. B. Wewers questioned if Section 4-12-16 I b. was redundant as the beginning of the section explained that prior to the issuance of a building permit the
Page 4 development impact fees must be paid. P. Riceci explained that the section was meant to address rare cases where the City may defer collecting development impact fees in an effort to encourage construction. In the event that a building permit is issued without the development impact fees being paid, the item is listed to provide leverage after the building is complete. It could also be used for leverage if a building permit was mistakenly issued prior to development impact fees being paid. T. Wallace explained Section 4-12-07 previously indicated that the current property owner or the fee payer could receive a refund State Code only defines the property owner as eligible for a refund. There was concern that the property owner and the fee payer could both request a refund of development impact fees resulting in a legal conflict if both entities attempted to claim the refund. To avoid a legal conflict the proposed change is to issue the refund to the current property owner. B. Wewers explained that he understood the reasoning for limiting the refund to only allow one individual, however, the refund should be issued to the fee payer rather than the property owner. D. Yorgason responded that in general, the fee payer would be the builder rather than the developer. The question is if builders pass on the cost of the fees to the homeowner. Generally, homeowners don t absorb the development impact fee cost very often as they pay the home s market value. The builder builds into their cost the development impact fees. An agreement with the property owner should be made so that if a refund is issued it would go back to the builder. B. Wewers explained that Idaho Power Company issues the refunds to the fee payer. It is a legal matter that could create future issues by choosing the property owner over the fee payer. T. Day questioned what would happen if there were second or third owners on a property when a refund is issued, he supported that the refund should go to the original fee payer. A. Van Ocker explained that a building permit issued to builders requires an affidavit from the property owner. Most of the time it will be the builder who applies for a building permit for the property owner, the refund should be tied to the legal piece and issued to the property owner. P. Riceci looked up State Code and explained that State Code is inconsistent and used both terms. State Code lists conditions for which a refund could be provided at the request of a property owner, one of the conditions is if the fee payer pays the fee under protest and a subsequent review of the protest reveals that the fee was in excess.
Page 5 T. Wallace explained that if a residential builder who paid the development impact fees protests that they were excessively charged a resolution of the protest could take multiple years. By that time the property could have already been turned over and the cost would have been passed on to the current property owner. B. Wewers explained that if the builder or contractor turned the property over when the economy was down, it is likely that they would have taken a loss on the property the property owner would have received the property at a great price and would also receive a refund on the property. T. Wallace questioned if it would be helpful to have a disclosure in the application so the fee payer is aware that refunds will be issued to the property owner so arrangements can be made. A. Van Ocker supported having a disclaimer. T. Wallace explained that staff can research the possibility of having it in a disclosure with PDS. B. Wewers would like the concern to be taken back to City Council for a decision to be made. T. Wallace explained that Section 4-12-08 was broken into two areas in an effort to make the system as automated as possible. One area which staff had to make many adjustments to was for additions to structures as it is largely dependent on the plan for the addition in general, if there is not an additional dwelling unit, then development impact fees are not required. If there is an exemption and more information is required, the individual applying for the permit will be required to check off the type of exemption they qualify for. The builder must claim the exemption when they apply for the building permit. There will be an opportunity to review the assessed fees and to check for accuracy before the fees are paid if corrections need to be made then the permit can be reopened. After all of the fees are paid and the building permit is issued, changes can no longer be made. Homelessness and low income housing will be reviewed by legal. They are the only two categories where an exemption is not automated and might occur. According to State Code, the other types of exemptions were guaranteed. For an exemption to occur, there must be another funding source. While the developer may be exempt, the activity is not. The developer may apply for a grant or some type of funding to replace the fees or City Council may choose to cover the fees. D. Yorgason questioned why there was an extensive list of criteria for affordable low income housing, but not for providing shelter to the homeless, and who would decide if a project was eligible for a development impact fee replacement. T. Wallace explained that the requests for exemption that are not directly stated would
Page 6 be reviewed by the Development Impact Fee Administrator. The Administrator will review the applications and the Committee will receive the reports. P. Riceci added that because low income housing is federally controlled State and City Code contains the listed criteria. While there may be federal funding for shelters for the homeless, there are not as many requirements for a builder because the meaning of homelessness is straight forward when compared to low income. T. Wallace explained that there were not many changes made to Section 4-12-09. Most changes were made to clarify what a credit was versus a refund or exemption. The most significant change under Section 4-12-10 was some clean-up and the listing of increased involvement from the Committee. The fee administrator would be responsible for reviewing information for land dedication and they would present the information to the Committee. The Committee will then make a recommendation which will be forwarded to City Council for a decision. Under Section 4-12-11 clarifications to the annual financial report were made. Previously City Code listed that an annual financial report would be provided, however, the criteria for what should be in the report was not listed. In the past, a report did not exist and a summary of all of the financial findings and recommendations would be provided at the end of the year. The greatest change made to Section 4-12-12 was relocating information on the timeframe to spend the collected development impact fees. Information about spending the fees falls under the City s responsibility of timing the expense appropriately to use the funds. C. Weston included that the fees must be expended, not just appropriated, prior to the deadline for the fee hold time. VII. Informational Items B. Capital Planning T. Wallace presented the Committee with a proposed schedule to provide a long range view of the information which would be presented over the next year. As 2013 would be the City s first year closing with Lawson, it was anticipated to be a lengthy process. Therefore, she suggested the December meeting be canceled and that the year end reports be reviewed in January. At the January meeting, the annual financial report will be presented with the criteria as listed in State Code as well as a quarterly financial report and a Fees At- Risk report. Staff will also work to institute a project progress report. The February, March, and April meetings were scheduled to focus on Capital Planning and to review project priorities. By April, it is expected that the Committee and the Commission will have decided what the project priorities are. The annual
Page 7 park tour of development impact fee funded projects will be scheduled to take place in May. Boise City Council and the budget workshops will take place in June. Staff will present the proposed projects to be funded for the next fiscal year in June. August s meeting is proposed to be canceled. In September, the review of the Committee s goals as well as development of a work plan will occur. C. Weston explained that elections will take place in January, and A. Van Ocker will be up for reappointment to the Committee. V. Action Items B. Support/Amend Proposed Impact Fee Code Changes ACTION: D. YORGASON MOVED THAT THE DEVELOPMENT IMPACT FEE ADVISORY COMMITTEE RECOMMEND APPROVAL OF THE PROPOSED CHANGES TO THE BOISE CITY DEVELOPMENT IMPACT FEE CODE, RECOGNIZING CLARIFICATION FOR THE REFUND SECTION OF WHETHER THE REFUND SHOULD BE ISSUED TO THE FEE PAYER OR THE CURRENT OWNER OF RECORD. SECONDED BY A. VAN OCKER. THE MOTION CARRIED UNANIMOUSLY. N. SAVIN WAS NOT PRESENT FOR THE VOTE. T. Wallace explained that the Development Impact Fee Advisory Committee was the ordinance committee and the recommendation would be presented to the Boise City Council for review. A final report will be drafted explaining that the proposed changes were recommended by the Committee as well as staff. IX IN THE MATTER OF ADJOURNMENT: There being no further business to come before the Committee at this time, the meeting was adjourned at 1:39 p.m.