STATEMENT OF ISSUE
On February 11, 2009, the City Commission adopted the Local Economic Emergency Fast Tracking Program for Public Sector Projects. The program was designed to stimulate our local economy by creating jobs while also developing a streamlined regulatory program that facilitates construction of needed public sector projects. In addition to adopting the public sector stimulus package, the Commission expressed an interest in considering potential measures for assisting the private sector in withstanding the current economic crisis.
The City Commission directed staff to explore potential incentives that could help stimulate private sector development and job creation. Staff and representatives from the development community worked as a team to prepare a temporary economic emergency concurrency relief program for your consideration. The primary purpose of the proposed time-limited program is to stimulate development activity and job creation in the short-term.
RECOMMENDED ACTION
Adopt Options 1 and 2 as follows:
1. Direct staff to reduce the cost per lane mile used in the calculation of concurrency fees from $10 million to $7.5 million.
2. Adopt the Temporary Economic Emergency Concurrency Relief Program described in this agenda item (maximum of 50% and 75% reductions).
FISCAL IMPACT
Potential reduction in concurrency fees collected. However, the proposed incentive program also increases the likelihood that stalled projects will move forward, which may result in a net increase in the concurrency fees collected (since no fees will be collected if the projects do not move forward).
Robert L. Herman, Growth Management
Anita Favors Thompson, City Manager
For information, please contact: Karen M. Jumonville, 891-7030.
SUPPLEMENTAL MATERIAL/ISSUE ANALYSIS
HISTORY/FACTS & ISSUES
On February 11, 2009, the City Commission adopted the Local Economic Emergency Fast Tracking Program for Public Sector Projects. The program was designed to stimulate our local economy by creating jobs, while also developing a streamlined regulatory program that facilitates construction of needed public sector projects. In addition to adopting the public sector stimulus package, the Commission expressed an interest in considering potential measures for assisting the private sector in withstanding the current economic crisis. The Commission requested that the development community prepare some options that would facilitate progress on development projects while providing the Commission with assurances that the projects will be built in a timely manner and provide a community benefit. After meeting on two separate occasions, staff and a team of representatives from the development community have prepared a temporary economic emergency concurrency relief program below for consideration by the Commission.
Alternative 1: Cost Per Lane Mile of Roadway Construction
Staff is required to perform an annual analysis of the cost per lane mile of roadway construction. While the annual update is not required until October 2009, staff recommends that the Commission consider updating the fee as part of this agenda item so that it more closely reflects the actual costs in the current market. Specifically, in addition to the program described above, staff recommends a reduction in the lane mile cost from the current $10 million to $7.5 million, which is more reflective of the actual cost incurred for roadway construction ad determined by the Public Works Department.
Alternative 2: Temporary Economic Emergency Concurrency Relief Program
A team of representatives from the development community met with staff in an effort to develop criteria that must be met for a project to qualify for reduced concurrency fees. The proposed program provides substantial concurrency fee reductions for projects that are determined by the City Commission to provide a public benefit. The development community representatives indicated that the proposed program appears to provide sufficient incentives to encourage developers to move forward with projects that would otherwise be stalled.
During the February 11, 2009 meeting, several Commissioners expressed a desire to link transportation concurrency fee reductions to the provision of site-specific project enhancements that provide a community benefit. However, during this exercise between staff and development community representatives, it became apparent that it would be difficult to quantify the specific enhancements to a project without knowing the use, location, and density/intensity. For example, while staff encourages more urban design patterns (e.g. buildings close to the street, wider sidewalks, the use of more transparent materials on the ground floor, street trees instead of onsite greenspace) in the multi-modal transportation area, this type of design is not ideal for suburban development. Since there is no single formula applicable to all potential development scenarios, staff and the development community concluded that it would be best to recommend a more open-ended approach that would provide the Commission with flexibility to consider design elements on a case-by-case basis utilizing concurrency agreements so that the character of the development could be taken into account. In addition to allowing the enhancements to be customized to a particular site, the proposed approach also provides the Commission with the ability to balance the cost of the required enhancements with the concurrency savings to ensure that the enhancements costs do not exceed the savings from concurrency fee reductions. Furthermore, the concurrency agreement could specify the percentage of concurrency fee reduction authorized.
While a mandatory list of design enhancements would not be the best implementation tool for the proposed program, staff believes the following examples represent the type of enhancements that would create a public benefit: mixed-use developments; buildings with green roofs; the use of low-impact development techniques; preservation of existing trees (in excess of what is already required by the Land Development Code); energy efficient buildings/green buildings; inclusionary housing; developments that facilitate the creation of new jobs; and transit enhancements such as park and ride facilities. Again, staff is not recommending this as an exhaustive or mandatory list of enhancements but instead as guiding elements for the program.
Concurrency Benefits
• Reduce concurrency fees by a maximum of 50% for new development and a maximum of 75% for redevelopment for all non-residential projects outside the multi-modal transportation area (attachment 1). The Commission would establish the specific amount of reduction through the provisions of the concurrency agreement.
• Reduce concurrency fees by a maximum of 50% for new development and a maximum of 75% for redevelopment for all projects (residential and non-residential) within the multi-modal transportation area. The Commission would establish the specific amount of reduction through the provisions of the concurrency agreement.
Application Process
• An application period would commence immediately upon adoption of the program and would run through December 1, 2009. Applicants requesting inclusion in the concurrency relief program would submit conceptual project drawings and an application for a staff pre-submittal review. Staff would evaluate the proposed project and schedule it for consideration by the City Commission. The agenda item would include recommendations related to the specific percentage of concurrency fee reduction and the project enhancements necessary to ensure that the project provides a public benefit and is built in a timely manner.
• As mentioned above, the legal mechanism through which the concurrency relief program could be implemented is the concurrency agreement. This agreement could stipulate not only the percentage of concurrency fee reductions and the construction timelines but also the specific design guidelines unique to each development site.
• In keeping with the overall goal of stimulating the economy in the short-term, staff recommends that each concurrency agreement stipulate that construction commence no later than December 31, 2010 and show continuous progress. Continuous progress is defined as a minimum of one approved inspection every 180 days.
CHARITABLE CONTRIBUTIONS
N/A
OPTIONS
1. Direct staff to reduce the cost per lane mile used in the calculation of concurrency fees from $10 million to $7.5 million.
Pros: Reduces the cost associated with development for the private sector.
Provides a fee that more closely reflects the actual roadway construction costs in the current market.
Cons: Less money would be collected for roadway improvements.
2. Adopt the Temporary Economic Emergency Concurrency Relief Program described in this agenda item (maximum of 50% and 75% reductions).
Pros: Encourages job creation in the short-term.
Reduces the cost associated with development for the private sector.
Provides additional incentives for redevelopment.
Provides the Commission with flexibility to determine project specific enhancements.
Encourages development in the multi-modal transportation area by providing additional incentives (both commercial and residential development) in this geographic area.
Cons: Reduces the amount of concurrency fees collected to make improvements.
Option 3: Provide alternative direction.
ATTACHMENTS/REFERENCES
Attachment 1: Map of Multi-Modal Transportation District