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Artesia Studying Development Impact Fee

By Rico Dizon

The City of Artesia is now studying the process and procedures for the proposed implementation of an entirely new municipal fee called “Development Impact Fee.”

A development impact fee is charged to property owners who intend to develop or improve their residential or business properties.

The fee will help the city offset major infrastructure costs and/or impacts that will be needed in the future as a result of the new developments that occurred in the city. This would include roads, parks, storm drains and other public facilities.

Community Development Director Okina Dor said in his report that the city, since its inception nearly 60 years ago, never had a development impact fee. He brought this issue to City Manager William Rawlings who together with some members of the Staff, went to work and came up with their report/study for delivery to the City Council.

During its regular monthly meeting last Nov.10, the City Council heard the report by Dor. “It is about time the city should explore the possibility of imposing a development impact fee on developers,” he said.

During the public comment section, John Martin, a resident and former city councilman complained that the city’s permit fee is already high. He said he knows of a certain family who moved to Artesia and had their 4,000 sq.ft. property developed. “This family had to spend about $38,000 just to start their dream abode,” he said.

Benkadesh Koka, another resident and businessman who owns a building and restaurant along Pioneer Blvd., attested that the city makes it very tough cost-wise to start and maintain a business.”

Margaret Saito, also a city resident and a familiar face in city council meetings, said, “the city should just retain the same policy of no development impact fee. Most residents are struggling with the economic difficulties.”

Part of the Staff report was an in-depth survey done among neighboring cities that revealed no less than 10 cities in Southern California have been charging their respective development impact fee in various ways. These cities include Bellflower, Buena Park, Cerritos, Garden Grove, Hawaiian Gardens, Lakewood, La Mirada, Norwalk, Paramount and Seal Beach.

In general, the report said there are two methods of determining the development impact fee. The traditional one is a flat fee assessed to the development based on the number of dwelling units or square footage of the development (typically used for park, street and storm drain fees.)

The other method relies on the percentage of the project value of development. Building permits are based on valuation as distinguished from development impact fee.

An evaluation conducted by the Planning Department showed that the 2012-2013 fiscal year was very low compared to developments in preceding years.

Throughout the fiscal year, 457 building permits were issued. Of this number, 11 were valued at $100,000 or more. Total project value from the 11 was $2,490,100. “If a 1% development impact fee had been in place, $24,901 could have been collected and with said amount can help to offset maintenance costs for the park, civic center and city hall,” the report said.

Mayor Pro Tem Miguel Canales said, “Let us plan for Artesia. In giving too many breaks, the city is loosing. Our goal for the new development fee should be directed to those establishments that make money. Like an apartment complex for instance, it should be charged a per unit fee while single-family dwellings can possibly be exempted.”

Rawlings believes that, “feedback from the individual owner/developers are very important.” The City Council voted to move forward with the study with City Council Member Sally Flowers abstaining.

 

 

 

 

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