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6. 3B Page 1 REpoRT To the Honorable Mayor and City Council From the City Manager April 3, 2006 Subject Transportation Impact Fee Ordinance Amendment -- Reimbursement Related to Deletion of the Three Year Vacancy Limit for Credits Recommendation Adopt the amendment to Section 18.249.C.3 of the City Code, which would allow reimbursement of any portion of impact fees paid between March 28, 2006 and May 3, 2006 that would qualify for a credit under the provisions of Section 18.249.C. 1 as introduced for amendment on March 27, 2006, which amendment deletes the requirement that existing structures must have been occupied within the past three years to receive a credit for prior use in determining Transportation Impact Fee payment. Background • At the March 27, 2006 City Council meeting, an ordinance was introduced for amendment of Section 18.249. C. 1 of the Transportation Impact Fee Ordinance, Article XV of the Municipal Code. The amendment deletes the requirement that existing structures must have been occupied within the past three years to receive a credit for prior use in determining Transportation Impact Fee payment. Council also introduced an amendment to the Ordinance as needed to provide for reimbursement of any portion of impact fees paid by developers between the introduction of the amendment and its effective date that would qualify for a credit under the amended provisions of Section 18.249. C. 1 . Staff is currently aware of only one development application that would be eligible for the reimbursement if impact fees are paid to obtain a building permit before the ordinance amendment is effective: the proposed re-occupancy of the Emerald Market on Oak Knoll Drive with the same use that previously occupied that building. Under current Ordinance, credit for this prior use has expired, and even accounting for the special neighborhood-serving use and location of this development, a traffic fee of approximately $39,000 is due at the issuance of a building permit. In this case, the amendment proposed in this staff report would allow credit for the prior (identical) use, which fully offsets that fee amount, and any fee payment made prior to the effective date of the amendment would be reimbursed to the applicant when the ordinance becomes effective. Staff is not aware of other possible applications for occupancy of buildings with long-term vacancies (outside Downtown, which is currently exempt from traffic fees) that might seek building permits before ordinance becomes effective, but any such developments would be eligible for reimbursement of the credit allowance for their prior use under the amended Ordinance. Page 1 of 2