Title
AB 1600 Annual Reports on Receipt and Use of Development Impact Fees for the Fiscal Year Ended June 30, 2026.
Staffreport
SUMMARY
Annual Development Impact Fee reports for the fiscal year ending June 30, 2026 (FY 2026) required as part of AB 1600.
RECOMMENDATIONS
Staff recommends Finance Committee review the Annual Reports on Receipt and Use of Development Impact Fees for the Fiscal Year Ended June 30, 2026, and recommend to the City Council for consideration and acceptance.
BACKGROUND
The legal requirements for enacting development impact fees are set forth in Government Code sections 66000-66025 (Mitigation Fee Act) and are commonly referred to as AB 1600 and SB 1693 requirements. These fees are generally intended to mitigate cost impacts that development projects have on existing City infrastructure and facilities.
Requirements under Government Code Section 66006 are:
1. A brief description of the fee program.
2. The amount of the fee.
3. Beginning and ending balances of the fee program.
4. Amount of fees collected, interest earned, and transfers/loans.
5. An identification of each public improvement. The expenditures on each project. The total percentage of the cost of the public improvement is funded with development impact fees.
6. A description of each interfund transfer or loan. The date the loan will be repaid, the rate of interest, and a description of the public improvement.
7. The estimated date when projects will begin if enough revenues are available to construct the project.
8. The number of refunds made to property owners.
The Annual Report must be reviewed by the City Council at a regularly scheduled public meeting. Notice of the time and place of the meeting shall be mailed at least 15 days prior to the meeting to any interested party having filed a written request with the City.
One of the provisions in the State law regulating development fees is to regularly review funds collected and held for more than five years and to make certain findings to continue to hold those funds.
ANALYSIS
The Government Code requires an annual accounting of all development fees to be made available at the close of the fiscal year. The Annual Report (Attachment A) presents the revenues, expenditures, and fund balance for the City development fees. Four City fees are subject to AB 1600 requirements-Development Fee for Street Improvement (DFSI), Marina Boulevard/Interstate 880 Interchange Traffic Impact Fee, Davis Street/Doolittle Drive Traffic Impact Fee, and the Park Development Impact Fee. The attached report includes revenues collected and the expenses incurred through fiscal year ending June 30, 2026.
Developer fees are segregated from the General Fund and from other funds and accounts containing fees for other purposes in accordance with accounting standards. Interest earned on each fee is deposited into the fund or account and used only for the purposes of the fee.
Development Fees for Street Improvements (DFSI) are deposited into the Street/Traffic Improvement Special Revenue Fund. This fund is used to account for development fee assessments levied to provide street and traffic improvement costs attributable to residential and commercial growth. DFSI revenues may be used for improvements to right-of-way, pavement, traffic signals, curbs, gutters, and sidewalks. In FY 2026, DFSI amounted to $185,275. Projects expenditures amounted to $63,291, with an ending DFSI fund balance of $1,849,503.
Effective July 1st, 2025, Development Fees for Street Improvements (DFSI) were set as follows:
Development Fees for Street Improvements (DFSI)
|
Category |
Fee |
|
Residential |
|
|
General residential |
$1,711.57 / Unit |
|
Senior housing |
$854 / Unit |
|
Accessory Dwelling Unit |
$0 / Unit |
|
Commercial |
|
|
General Office |
$4.75 / gross bldg. sq. ft. (No fee when <360 sq. ft.) |
|
Medical Office |
$6.65 / gross bldg. sq. ft. (No fee when <257 sq. ft.) |
|
Retail |
|
|
General Retail |
$5.32 / gross bldg. sq. ft. (No fee when <322 sq. ft.) |
|
Personal Services |
$2.85 / gross bldg. sq. ft. (No fee when <601 sq. ft.) |
|
Restaurants |
|
|
Quality Restaurants |
$3.81 / gross bldg. sq. ft. (No fee when <449 sq. ft.) |
|
All Other Restaurants |
$15.40 / gross bldg. sq. ft. (No fee when <111 sq. ft.) |
|
Financial Services |
$14.25 / gross bldg. sq. ft. (No fee when <120 sq. ft.) |
|
Hotel/Motel |
$1,159.34 / room |
|
Industrial |
|
|
General |
$1.53 / gross bldg. sq. ft. (No fee when <1,119 sq. ft.) |
|
Mini-warehouse |
$0.48 / gross bldg. sq. ft. (No fee when <3,566 sq. ft.) |
|
Service Station |
$12,164.51 / station |
The Marina Boulevard/Interstate 880 Interchange Traffic Impact Fee is also deposited into the Street/Traffic Improvement Special Revenue Fund, but is tracked under its own distinct revenue object code. This fee may be used only for the capital improvements identified in the Marina Boulevard/I-880 Interchange study, and applies to development within the defined benefit zone that directly benefits from the reconstructed interchange.
Eligible uses include interchange-related roadway improvements, traffic signal upgrades, circulation enhancements, and other capital improvements necessary to maintain safe and efficient traffic operations at the Marina Boulevard/I-880 interchange.
In FY 2026, Marina Boulevard/I-880 Traffic Impact Fee revenue totaled $79,784 with $20,580 in eligible project expenditures, resulting in an ending fund balance of $61,121.
Effective July 1st, 2025, Marina Boulevard/I-880 Interchange Traffic Impact Fees were set as follows:
Marina Boulevard/Interstate 880 Traffic Impact Fee
|
Category |
Fee |
|
Residential |
|
|
General residential |
$860.89 / Unit |
|
Senior housing |
$290.92 / Unit |
|
Accessory Dwelling Unit |
$0 / Unit |
|
Commercial |
|
|
General Office |
$1.81 / gross bldg. sq. ft. (No fee when <475 sq. ft.) |
|
Medical Office |
$3.40 / gross bldg. sq. ft. (No fee when <253 sq. ft.) |
|
Retail |
|
|
General Retail |
$2.10 / gross bldg. sq. ft. (No fee when <411 sq. ft.) |
|
Personal Services |
$2.91 / gross bldg. sq. ft. (No fee when <295 sq. ft.) |
|
Restaurants |
|
|
Quality Restaurants |
$3.95 / gross bldg. sq. ft. (No fee when <218 sq. ft.) |
|
All Other Restaurants |
$6.72 / gross bldg. sq. ft. (No fee when <128 sq. ft.) |
|
Financial Services |
$14.98 / gross bldg. sq. ft. (No fee when <57 sq. ft.) |
|
Hotel/Motel |
$771.85 / room |
|
Industrial |
|
|
General |
$1.12 / gross bldg. sq. ft. (No fee when <765 sq. ft.) |
|
Mini-warehouse |
$0.25 / gross bldg. sq. ft. (No fee when <3,328 sq. ft.) |
|
Service Station |
$3,090.04/ station |
The Davis Street/Doolittle Drive Traffic Impact Fee is likewise deposited into the Street/Traffic Improvement Special Revenue Fund, with revenue recorded under a separate object code. This fee may be used exclusively for capital improvements identified in the Davis Street/Doolittle Drive corridor study and applies only to development within the designated benefit zone that contributes to traffic demand along the corridor.
Eligible uses include intersection improvements, signal upgrades, roadway widening, and other corridor-specific capital improvements required to support increased traffic volumes generated by new development.
In FY 2026, Davis Street/Doolittle Drive Traffic Impact Fee revenue totaled $32,769 with no eligible project expenditures, resulting in an ending fund balance of $33,166.
Effective July 1, 2025, Davis Street/Doolittle Drive Traffic Impact Fees were set as follows:
|
Davis Street / Doolittle Drive Intersection Traffic Impact Fee |
|
Land Use |
|
|
|
|
|
|
|
|
|
Category |
Use Type |
1 |
2 |
3 |
4 |
5 |
6 |
8 |
|
Residential |
|
|
|
|
|
|
|
|
|
|
General Residential |
$0.14 |
$6.52 |
$0.32 |
$0.23 |
$0.07 |
$0.08 |
$0.87 |
|
|
Senior Housing |
$0.07 |
$3.70 |
$0.17 |
$0.12 |
$0.04 |
$0.04 |
$0.40 |
|
Commercial |
|
|
|
|
|
|
|
|
|
|
General Office |
$0.24 |
$10.96 |
$0.55 |
$0.38 |
$0.11 |
$0.15 |
$1.47 |
|
|
Medical Office |
$0.33 |
$15.74 |
$0.77 |
$0.57 |
$0.17 |
$0.22 |
$2.08 |
|
Retail |
|
|
|
|
|
|
|
|
|
|
General Retail |
$0.28 |
$12.59 |
$0.62 |
$0.43 |
$0.12 |
$0.17 |
$1.68 |
|
|
Personal Services |
$0.14 |
$6.74 |
$0.33 |
$0.23 |
$0.07 |
$0.08 |
$0.90 |
|
Financial Services |
|
$0.73 |
$33.72 |
$1.67 |
$1.19 |
$0.36 |
$0.46 |
$4.49 |
|
Hotel/Motel |
|
$0.11 |
$5.40 |
$0.26 |
$0.19 |
$0.06 |
$0.07 |
$0.72 |
|
Industrial |
|
|
|
|
|
|
|
|
|
|
General |
$0.07 |
$3.59 |
$0.17 |
$0.12 |
$0.04 |
$0.04 |
$0.46 |
|
|
Mini-Warehouse |
$0.03 |
$1.12 |
$0.06 |
$0.04 |
$0.01 |
$0.01 |
$0.14 |
|
|
Service Station |
$0.98 |
$44.91 |
$2.19 |
$1.59 |
$0.50 |
$0.62 |
$5.98 |
Park Facilities Development Impact Fees pay for public park and recreation facility acquisition and development. Funds are directed toward the study, design, acquisition, and construction of park and recreation facilities. In FY 2026, Park Development Impact Fees amounted to $40,625. Projects expenditures amounted to $141,539, with an ending fund balance of $7,105,429.
Effective July 1st, 2025, Park Development Impact Fees were set as:
|
Park Facilities Development Impact Fees |
|
Category |
Fee |
|
Park Land Acquisition Fee |
|
|
Unit Size <550 SF |
$1,513/unit |
|
Unit Size 550-750 SF |
$1,891/unit |
|
Unit Size 751-1,150 SF |
$2,900/unit |
|
Unit Size 1,151-1,650 SF |
$4,035/unit |
|
Unit Size 1,651-1,950 SF |
$5,170/unit |
|
Unit Size >1,950 SF |
$6,431/unit |
|
Accessory Dwelling Unit |
$0/unit |
|
Park Improvement Fee |
|
|
Unit Size <550 SF |
$4,539/unit |
|
Unit Size 550-750 SF |
$5,674/unit |
|
Unit Size 751-1,150 SF |
$8,700/unit |
|
Unit Size 1,151-1,650 SF |
$12,105/unit |
|
Unit Size 1,651-1,950 SF |
$15,509/unit |
|
Unit Size >1,950 SF |
$19,292/unit |
|
Accessory Dwelling Unit |
$0/unit |
|
Total Acquisition and Improvement Fee |
|
Unit Size <550 SF |
$6,052/unit |
|
Unit Size 550-750 SF |
$7,565/unit |
|
Unit Size 751-1,150 SF |
$11,600/unit |
|
Unit Size 1,151-1,650 SF |
$16,140/unit |
|
Unit Size 1,651-1,950 SF |
$20,679/unit |
|
Unit Size >1,950 SF |
$25,723/unit |
|
Accessory Dwelling Unit |
$0/unit |
FINANCIAL IMPACTS
The annual AB 1600 report is a mandated reporting requirement provided to the City Council for information purposes. There is no direct fiscal impact associated with receiving the annual report.
ATTACHMENT(S)
Attachment A: FY 2026 AB 1600 Development Impact Fee Financial Summary Report
Attachment B: FY 2026 AB1600 DIF Report
Attachment C: FY 2026 AB 1600 Development Fee Impact Report Presentation
PREPARED BY: Angie Nichols, Finance Manager, Finance Department