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Annual and Five-Year Development Impact Fee Report <br />Fiscal Year Ending June 30, 2024 <br />City of Redwood City 3 <br />66001 (d) (1) (A): Identify the purpose to which the fee is to be put. <br />66001 (d) (1) (B): Demonstrate a reasonable relationship between the fee and purpose for <br />which it is charged. <br />66001 (d) (1) (C): Identify all sources and amounts of funding anticipated to complete <br />financing in incomplete improvements. <br />66001 (d) (1) (D): Designate the approximate dates on which the funding is expected to be <br />deposited into the appropriate account or fund. <br />Establishing a Reasonable Relationship Between the <br />Fee and the Purpose for Which It Is Charged (Nexus) <br />Development impact fees provide the proportionate share of the funding for the City’s capital <br />facilities needs that can be reasonably attributed to new growth in the City. The revenue from <br />development impact fees, in turn, provides the transportation facilities, parkland and park <br />improvements, affordable housing, and other improvements necessary to mitigate the impacts of <br />new residential, commercial, and industrial development on the City of Redwood City and its <br />residents and businesses. To ensure a reasonable relationship between the fee and the purpose <br />for which it is charged, development impact fees must be supported by a Nexus Study.3 A Nexus <br />Study identifies the reasonable relationship between the fee and the purpose based on <br />mathematical calculations that consider future development, the facilities and infrastructure <br />needed to serve that future development, and the estimated costs of those improvements. These <br />mathematical calculations establish the relationship between contemplated future development, <br />the facilities needed to serve that development, and the estimated costs of those improvements <br />based on the City’s Capital Improvement Programs (CIP). The fees are then used to fund <br />facilities and infrastructure necessary to serve new development and/or benefit the broader <br />community. <br />Funding of Infrastructure <br />The State of California Government Code Section 66002 states that local agencies that developed <br />a fee program may adopt a Capital Improvement Program indicating the approximate location, <br />size, and timing of projects, plus an estimate for the cost of all facilities or improvements to be <br />financed by fees. <br />The City of Redwood City has developed and adopted a CIP, which is updated every year during <br />the normal fiscal budget process. The City also maintains a Five-Year Capital Improvement Plan <br />which offers a longer-term outlook on needed capital improvements. This Plan serves as a fiscal <br />and strategic tool to plan, fund, prioritize and monitor capital improvements in the Community. <br />3 AB 602 requires Nexus Studies to be complete prior to the adoption of each impact fee and must be updated <br />every eight years. <br />6.A. - Page 12 of 55 <br />17