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Home My WebLink AboutNB 4 PARK DEDICATION 12-15-80NEW BUSINESS December 15, 1980 Honorable Mayor and City Council Members Community Development Department Parkland Dedication Fees (1370 San Juan - Tract 11282) TO: FROH: SUBJECT: The attached letter, memoranda and staff studies indicate to us that use of the formula results in a wide disparity in fees charged due to assessment practices or effective date of sale of property. Only four other surveyed Orange County cities use a similar fee formula. However, one of those uses a static land value of $60,000/acre; another (Irvine) deals primarily in land dedication; and the others, similar to Tustin, have a low level of residential activity. The majority of cities use a static amount per type of unit or number of bedrooms. In 1979 the fees received by Tustin from two major developments (Village Homes and Tustin Gardens) averaged $455.88/unit. Adding an inflation factor of 1 1/2% per month would produce a 28.5% increase or a fee of approximately $585.80. If we assume that land value increased at a somewhat higher rate, 22% according to Goodkin Research, a rate of 34.84% would result or a fee of $630.94/unit. This would compare favorably with either the median fee of $653.76/unit for multiples, or $671.33 for condos for cities with fixed, identifiable fees in our survey. Our survey of R-3 assessed values shows significant savings in estimated FMV for similar properties even within the same base year for purpose of Proposition 13. Inadvertently, a commercial piece was included from base year 1980 which had a land value of only 25% of the subject R-3 property in 1979. We have come up with no explanation for such c~rcumstances. The owner in escrow has contacted the Assessor's Office and they are taking this matter under advisement and appear to concur that something is amiss. Staff, after review of the data, believes that time has come for ordinance modification. RECOMMENDATION: A. Staff be directed to amend 'Code Section 9376 and develop a fixed fee mechanism similar to other Orange County cities, and That, based on the previous direction to staff, a fee of $675.00 per unit be assessed against all additional units to be developed on the subject property, based on the survey by staff. MWB: rmm LAND DEVELOPMENT/iNVESTMENTS 695 TOWN CENTER DRIVE PHIL SWAILS SUITE 800 Staff Engineer COSTA MESA, CA. 92626 (714) 557-7201 December 5, 1980 City Council Tustin, California I represent a special interest group that proposes to develop nine (9) condominiums in the city of Tustin. The Park Land Dedication Fees are exorbitant due to the very high accessed valuation which itself does not show a fair market value. A complaint to the accessor's office brought a confused reply, in that there was every indication of'an error it would take a couple months to correct due to the low priority of the problem. _The property in question is 0.33 acres with a seventy- six (76) year old structure on the premises. The present tax fees are counter productive and will inhibit future growth in the community. We wish to resolve this problem quickly so we are not so completely committed as to lose all payments and fees. Civil Engineer DATE: TO: FROH: SUB.I~'CT: December 3, 1980 l teF-Com Jim Rourke, City Attorney Mike Brotemarkle, Community Development Director Park Land Dedication Fees - blunicipal Code Section 9376, 9-unit condominium, 1370 San Juan (Tract 11282) Last week the developer requested ~e amount of fees involved for the proposed project. Staff indicated that would take calculation based on a formula and would contact him; however, fees normally ran between $400 and $600 per unit. Had the project been an apartment project rather than a condominium, the fee based on S.9376f. would have been S1,350.00 to S1,800.00, depending on final bedroom cotmt. The most recent asessor's roll indicated a FMV for the property of $245,12& (!and) and 514,728 (structures) for a total of $259,852. for the 14,381 sq.ft, site. Giving :he owner credit for the existing unit, the fee was cal- culated for 8 units as provided in S.9376e as follows: (No. of dwelling units) x (Parkland area x (Full cash value of = fee. per d.u ) land/acre) 8 x .0076 x 245,124 x 43,560 (sq. ft./ac) =.0608 x 17.04/sq.ft.x 14,381 sq.ft. 45,128.OO The developer suffered a minor stroke upon learning the fee would be over $5,O00.O0 per unit. We agree that $17.00/~q. ft. seems an extremely high' value for R-3 property. After discussion we obtained a copy of his escrow papers which shows a total purchase price of $165.000.00. Netting out the structure at $14,728 leaves a land value of $150,272.00. Using the same form- ula (even though code specifies assessed value) produces a figure as follows: 8 x .0076 x 150,272 x 43,560 = .0608 x $10.45/sq.ft. x 43,560 ~ 27,674 14,381 This figure still represents over $3,000.00 per unit. In researching departmental files, the following fees were paid by recent residential developments: James Rourke December 3, 1980 page 2. Date Project Units Total Fee Fee/Unit 4-79 Village Homes 124 $55,870.00 $450.56 4-79 Tustin Seniors 101 46,704.00 462.61 4-79 Hyder Dev. 28 2,762.00 98.00 10-78 Kaul Dev. 5 1,547.00 309.00 We have been informed by the owne~ that he has lodged a protest with the County Assessor's office and they have acknowledged that something is possibly in error. it would appear, that something is amiss, to my staff as well. Either new assessment practices since the advent of Proposition 13 or an inherent discrepancy in the formula for some size property or number of units exists. Fees this high are counter-productive ~o creating affordable residential units. We recognize that a resonable fee is required. Perhaps you have some ideas in this regard. In the meantime, I will suggest he take his case to the City Council and perhaps we'll have come up with a possible code amendment or discovery of cause in the interim. MWB: ~ cc: Roy leen g~ite, Community Services Director Dan Blankenship, City Administrator PARKLAND DEDICATION FEES SURVEY Per unit/bedroom(2 bdr. ) Comparison Single-Family San Juan Capistrano Placentia Fountain Valley Costa Mesa Yorba Linda Fullerton Westminster Brea Anaheim Santa Ana Garden Grove Orange $2,200.00 1,265.00 1,000.00 861.76 825.00 800.00 785.00 673.00 578.00 525.00 325.00 200.00 median average=S836.48 Condominium San Juan Capistrano Placentia (average) Costa Mesa Fullerton Yorba Linda Fountain Valley Anaheim Santa Ana Westminster (average) Brea Garden Grove Orange $2,200.00 1,057.14 881.51 800.00 600.00 475.00 436.80 425.00 412.50 393.00 225.00 150.00 median average=S671.33 Multi-Family (apartments) San Juan Capistrano Placentia (average) Costa Mesa Futlerton Yorba Linda Fountain Valley Westminster (average) Brea Anaheim Santa Ana Garden Grove Orange $2,200.00 1,057.14 881.51 800.00 600.00 475.00 412.50 393.00 351.00 325.00 200.00 150.00 median average=653.76 PARKLAND DEDICATION FEES SURVEY (PER UNIT) ANAHEIM Single-family $578.76 Condominiums 436.80 Multi-family 351.O0 Mobile Home Park 294.84 BREA Single-family Multi-family Mobile Home Park GARDEN GROVE $673.00 393.00 329.00 per space ORANGE Single-family $325.00 Condo/PD 225.00 Multi-family 200.00 Mobile Home Park 170.00 Single-family Apt./Condo. Mobile Home Park WESTMINSTER Single-family Multi-family (8-14 units/ acre) Multi-family (14-24 units/ acre) Mobile Home Park 200.00 150.00 100.00 per space 785.00 525.00 300.00 150.00 per space FULLERTON $800.00 per unit, ~o matter what type. YORBA LINDA Single-family $825.00 Multi-family 600.00 If the development has a private park included the developer receives a credit towards the fee (up to 50% credit) based on the fair market value of the land. SAN JUAN CAPISTRANO 49 units or less/ acre $2,200.00 50 units or more/ acre, based on a formula (# of units x occupancy factor) SANTA ANA Single-family $ 525.00 Condo 425.00 Apts. (regardless of # of bedrms.) 325.00 Mobile Home Park 150.00/ space Ail developments have paid fees in lieu of dedi- cation. (continued) Parkland Dedication Fee Survey page 2. PLACENTIA R-1 $1,265.00 R-2 965.00 R-G (Garden Apts.)/R-3 790.00 Residential P.C. 1,097.00 PUD 1 1,265.00 PUD 2 (6-8 units/ acre) 1,181.00 PUD 3 (9-14 units/ acre) 1,090.00 PUD 4 (15 units/ acre) 1,012.00 Mobile Home Park 577.00 PARKLAND DEDICATION FEES SURVEY (PER BEDROOM COUNT) COSTA MESA Single-family 2 bdrms, or less $ 861.76 3 bdrms. 1,205.67 4 bdrms. 1,545.62 5 bdrms, or more 1,810.50 Multi-family Bach. or Studio $ 474.37 1 bdrm. 573.18 2 bdrm. 881.51 3 bdrm. or more 1,229.38 BUENA PARK Fee based on per bedroom figure. Maximum fee is 3 bedrooms. FOUNTAIN VALLEY Single-family (regardless of bedrooms) $1,000.00 per lot. Multi-family Bach. or 1 bdrm. $ 325.00 2 bdrm. 475.00 3 bdrm. 625.00 PARKLAND DEDICATION FEES SURVEY (PER FORMULA) SEAL BEACH Fees = A figure equal to the appraised value of the land that would otherwise have to be dediated. The City appoints the appraiser. If the developers don't agree with the appraised amount, they may appoint their own appraiser. If the two appraised amounts differ, they are averaged to reach the fee. Single- family= Actual appraised value of 762 sq. ft. of land per unit. Multi- family= Actual appraised value of 392 sq. ft. of land per unit. LAGUNA BEACH Value of property and density of proposed development. LOS ALAMITOS Fee based on type of residence and the fair market value @ $60,000 per acre, $.50 pe~ sq. ft. of land dedication. IRVINE Number of dwelling units x acres per unit x fair market value of land to be developed + cost of improvements. Very seldom used because The Irvine Company dedicates land.