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4 6 8 1500 square foot EUD is used to set charges equitably for residential and commercial development. mire City Manager Fales stated that the EUD is used to make a simple recom- mendation, but the Council may establish charge levels depending upon all factors involved; that the objective is to develop value and alleviate taxes on those already in the District; and recommended that the charge should be reviewed annually in relation to the current status of certain variables. Discussion continued and Mr. Sinsky and Mr. Fales commented and replied to questions relating to,the build-out schedule; whether or not the facilities charges might cover all taxes; the anticipated 1987-88 increase in District taxes on homes to cover the bonds; how long that additional tax would be in effect; the fact that reclamation bonds will be paid by the developer; the fact that taxes will drop as bonds are paid off and it is known there will be no new reclamation bonds; the fact that staff can be instructed to implement the facilities charge concept and appropriate charges set, if Council approves it; and the need for action soon if the figures in the report are to be used. Donald G. Warren, President, Redwood Shores, Inc., suggested that the Bartle Wells recommended formula will satisfy all parties and referred to his letter of February 6, 1981 commenting on the conditions outlined therein which would make the recommendation acceptable to his organization. In response to question as to why Bartle Wells recommends an end-of-product balance of almost $3 million to which Mr. Warren objects, Mr. Sinsky sugges- ted the figure is due to "rounding off", and represents only an insignificant amount of eachifacilities charge. - Mr. Warren continued commenting on the aspects of the proposal which create areas of concern to Redwood Shores, Inc. which are described in his letter, +� and observed that the developer will be responsible for all reclamation. Ronald J. MacQuarrie, Chairman, GID 1-64 Advisory Committee, distributed copies of a sheet summarizing the Committee report which is being prepared. + ++ Mr. MacQuarrie also suggested Council consider establishing a moratorium on issuance of building permits for the District until facilities charges are set, so that the revenue from permits will not be lost while the amount of the charge is being determined. In response to questions, Mr. MacQuarrie said that the homeowners are aware of the effect of no development in the prospective shortfall years; that the homeowners would like an option other than the sale of bonds for the interim period when the shortfall will occur; whether the facilities charge could cover all costs so that bonds would not be issued; and whether any similar situation has been encountered elsewhere in an improvement district. City Manager Fales advised that staff made use of information from all over the State and that a facilities charge is common, but the problem is to evaluate the degree to which a fee can be imposed without driving away desirable development. Mr. MacQuarrie observed that the District is assessed every year, but because of the rising costs of homes and their rate of turnover being much higher than that for commercial property, the property tax burden is increasingly shifting to the homeowners. Mr. Fales pointed out that the shift is true of assessments outside the District also, and is a feature of Proposition 13. In response to question, Mr. .Fales advised that it would be expected the District would use a development permit in connection with the facilities charge, so that the delay suggested by Mr. MacQuarrie with regard to revenues would not occur: City Attorney Schricker confirmed that at the time of commencement of negotiating the agreement, a dollar figure would be considered when the contract is entered, so there would be no time problem. In response to question regarding any way in which property in the District Study Session - me • 2/9/81 Page 2