HomeMy WebLinkAboutUpdates to the Transportation, Water, Sewer, and Fire-EMS impact fee Study_6 Commission Memorandum
REPORT TO: Honorable Mayor and City Commission
FROM: Chris Saunders
Tim McHarg
SUBJECT: Updates to the Transportation, Water, Sewer, and Fire/EMS impact fee
studies to establish methodology, and document required information to conform to statute, and
determine the generalized average cost per unit of service.
MEETING DATE: October 8, 2012
AGENDA ITEM TYPE: Action
RECOMMENDATION: Receive presentation of the four reports from the consultants, ask
questions, receive public comment, and schedule a date for consideration of motions regarding the studies.
SUGGESTED MOTION: Having received the updated reports for transportation, water, sewer,
and fire/EMS impact fees, I move to schedule discussion and possible action on these reports on
[DATE] and direct staff and the consultants to provide responses to questions identified by the City Commission and to prepare necessary the notices and documents to enable Commission
action.
BACKGROUND: This memo is structured in eight sections identified by letter. Each section
addresses an individual topic. As the impact fees share many similar procedural and data requirements a common elements section is provided to avoid needless repetition.
The majority of the sections are focused on the content of the new fee studies and the
presentation of information that will occur on October 8th. Section H identifies questions and
issues that will be addressed with implementation. Many of these items interrelate to other
issues, programs, and standards. These interrelationships are often complex and on-going. These items do not all need to be resolved prior to acceptance and adoption of the fee studies.
The sections are:
A. Summary History
B. Process C. Common Study Elements and Changes
D. Water
E. Sewer
F. Transportation
G. Fire H. Issues for Future Discussion
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Sections:
A. Summary History: The City funds its water, sewer, fire/EMS, and transportation systems
with multiple funding sources including impact fees. The City of Bozeman initially
adopted impact fees in 1996. Fees were initially adopted at a fraction of the calculated cost of service to provide a transition period. The percentage of the fees collected has
varied by time and type of fee. It is necessary from time to time to update the study which
documents and sets the upper limit for the unit costs for each type of impact fee.
The City adopted updates to the various facility plans which provide much of the base
information for the impact fees for transportation in 2001 and 2009, fire in 2006, and both wastewater and water in 2007. The City retained consultants in 2006 to update the
fee studies. The four fees were updated and adopted over the following 14 months.
The City has adopted a three year cycle to update the impact fee studies and a five year
cycle to evaluate and if needed update the facility plans. In 2011, the City began the
consultant selection process to again update the impact fee studies. TischlerBise was selected as the consultant for this update cycle with the contract being signed in June
2011.
B. Process: The City conducted a request for qualifications followed by a request for
proposal process to select a consultant to assist the City in updating the four fees. A
contract with the selected consultant, TischlerBise, was completed on June 29, 2011. Since that time, the consultant has been collecting and reviewing data, preparing analysis
and draft reports, and meeting with Staff and the Impact Fee Advisory Committee
(IFAC). The IFAC is the body required by statute and formed by local resolution to
advise the City Commission relating to impact fees.
The IFAC conducted public hearings on August 16th and September 13th to hear input from members of the public on the draft impact fee studies. After conducting the public
hearings the IFAC voted on motions to recommend approval of the individual fee studies.
The Committee recommended favorably on all four studies having found that the studies
were consistent with the requirements of state law regarding impact fees. The minutes of
the IFAC hearings are attached and provide greater detail on their actions. Minutes of all of the IFAC meetings are available through the Planning Department.
The City Commission will consider the draft documents and the IFAC recommendation.
One or more public hearings will be held by the City Commission to consider the matter.
The Commission may accept the recommendations from the IFAC or may come to a
different conclusion. During this public hearing process, or subsequent to acceptance of the fee study update and prior to its implementation, the Commission may discuss
broader topics of infrastructure funding as they believe appropriate.
October 8th is the date set for the City Commission to receive the reports and hear a
presentation from TischlerBise regarding the reports. No action on the studies is
scheduled for the October 8th meeting. This meeting is for receiving information, hearing from the public, and formulating questions from the Commission to be answered at a
future meeting when all Commissioners are present. Only one action will be required on
October 8th which is to set a date for Commission discussion and possible action on the
studies.
Implementation of the studies will likely require ordinance amendments. To minimize the potential for confusion and redundant work with multiple ordinances it is suggested that
the Commission act on all four of the fee studies with coordinated code amendments.
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C. Common Study Elements and Changes: Each fee is the subject of an independent study
as each fee is legally independent of the others and relies on different data and demand
characteristics. The introductory material in each study is very similar. There are three
main sections of each report: 1) Introduction to impact fees, 2) Impact fee calculations for each fee type, and 3) Implementation and administration. The second section of the report
contains the data sources and analysis and presents the resulting fee calculation broken
into cost per demand unit. This section will be most interesting to most people.
Several significant changes are occurring with this round of impact fee updates. Data was
available on home sizes from the MT Dept. of Revenue for the first time. This in conjunction with other data sets enabled the consultants to perform analysis to document
certain demands for service by home size. Please see the Setting the Stage document for
this analysis on home size and occupancy. They were then able to expand on this analysis
with each individual fee study for those elements unique to that fee type as documented
in Appendix A of each study.
All four of the fee types now base residential fees on expected occupancy per size of
home. The same home size range was used for all four fees with a lower end of 1,400
square feet and an upper end of 3,000. The range is broken into 200 square foot
increments so movement between increments will result in a small impact fee charge.
The consultant had analyzed the home range originally for detached and attached home styles. After discussing the results with the IFAC it was decided to consolidate the two as
there was a substantial amount of overlap between the size increments. There is also a
special residential category for group living which is distinguished by population rather
than dwelling area. The occupancy level per home in the studies reflects the population
spread across all housing units constructed from 1990 to 2010. This represents demand at any given point in time and accounts for vacancies without being tied to a particular
vacancy rate. As a result the occupancy per home used in the calculation is slightly less
than the actual number of residents expected to live in an occupied dwelling.
These are averages over large samples of the City housing stock. Therefore, some homes
will have different demands above or below the average at any given point in time. However, the overall system should equalize to the average. This occupancy approach
has the effect of recognizing the differences which come from smaller and larger homes
and reducing fees on smaller units which generate less demand. This appears consistent
with the City’s overall encouragement for land efficient development.
Because of this change all residential fees are on home size. Attached and detached homes are no longer separate categories. Affordable housing distinctions to individual
categories are also removed since the primary difference was also related to size of
homes.
Several examples of how these different approaches to the fee apply to development are
attached. There are both residential and non-residential examples for different intensities and types of development as well as for the downtown area which is subject to special
standards.
D. Water
Fee Components: 1) The draft study divides the water impact fee into two explicit parts;
treatment plant capacity and distribution (piping) capacity. This is shown in figure 12 of the report. Both parts were included as part of the cost calculations in the previous fee
studies but were consolidated into a single charge based on the size of the water meter.
The 2012 study keeps them separated. The treatment capacity portion is based on either
the size of the home or the meter serving the non-residential property. The distribution
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capacity portion is based on the land area of the parcel and the concept that larger parcels
require a greater amount of distribution piping to span their perimeter and transmit water.
This has been expressed as cost per acre for service. The dollar cost for the second
portion will vary for each project depending on the size of the lot. This area based approach has the effect of recognizing the differences in distribution pipe length which
come from smaller and larger parcels and reducing fees on smaller units which generate
less demand. This is consistent with the City’s overall encouragement for land efficient
development and increases proportionality of cost to impact. This will apply to both
residential and non-residential uses. This split will require slightly more administrative effort to track the different revenue components of the fee.
2) Integrated Water Resources Plan (IWRP): One important change from the 2007 study
is that the new 2012 study does not include a cost component for new water supply
development. In the 2007 study the source of supply storage was the second largest
component of the fee and was 34% of the total fee. . This is shown in table 5-4 of the 2007 study. The city’s Engineering Division is presently preparing the Integrated Water Resources Plan (IWRP) to evaluate the City’s needs and options to provide additional
water supply capacity. Therefore, it is not timely to include a cost factor for new water
supply development at this time for several reasons.
First, it is unknown at this point what the new water supply development project(s) will actually be. It could be that a new reservoir in Sourdough Canyon is recommended to
meet the City’s projected water needs, or perhaps a groundwater well field or wastewater
effluent re-use project is the solution. Secondly, each alternative has a unique cost
associated with it. Because the type of new water supply development project is
unknown, the cost of such a project is unknown and cannot be reasonably ascertained until the IWRP is completed in the 2nd quarter of 2013. A recommended water supply
development alternative, or portfolio of alternatives, will be presented to the City
Commission at the conclusion of the IWRP effort. Planning level cost estimates will be
available at this time for the recommended alternative(s). The estimate(s) can be used to
update future water impact fees in order to account for water supply development costs. The omission in the current fee study will mean the City forgoing some collection of
revenue to meet the need for new water supply.
3) Water Rights: Also excluded from the current and past impact fee studies is the cost of
providing water rights, the legal ability to divert water into the City’s treatment system.
This issue is also under evaluation simultaneously to the IWRP and will return for Commission consideration at a future time.
Residential: Current practice in Bozeman is to charge water impact fees on the basis of
the size of the water meter serving the property. As noted above, the proposed fee
structure would replace that approach to have a distinction based on the size of the home
by 200 sq ft increments and the size of the parcel.
The present approach using meter sizing has given builders price motivation to use the
smallest possible meter size which can cause problems with water pressure and meter
wear and tear. It also has made the cost per multi-household dwelling less predictable as
the combination of plumbing fixtures, water pressure at the main, and many other factors
influence the size of meter needed. A size per dwelling approach will increase predictability for the number of homes. In the event of home additions, the fractional
difference between the old and new sizes will be charged. In the event of a new dwelling
the amount due from a home of the new size will be charged even if the home previously
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had service. Basing the distribution component on parcel size will be predictable by size
but potentially different by project.
The change in approach to home size also allows the City to pro-actively address the
issue of residential fire sprinklers which piggyback on the metered domestic service line. Presently there is a question of when or if such a requirement may be implemented in the building codes. Some users have installed them voluntarily. By decoupling the impact
fee from the meter size an increase in impact fee resulting from increased meter size to
support the possible surge demand from the fire sprinkler but which doesn’t reflect daily
water demand can be avoided. Dedicated fire sprinkler lines for non-residential uses or large apartment complexes are not charged impact fees and are not affected by this change.
Non-Residential: The new report recommends continuing to use the meter size for non-
residential as there is not adequate data to show a correlation to building size and water
demand and there is a greater diversity of user types.
Consumption Rates: The analysis prepared for the water and sewer impact fees both
looked at the demand patterns for homes constructed in the past 20 years rather than the
entire city as being most representative of likely demand of new construction. This is a
change from the prior studies. See Section H for additional discussion about future study
options.
Special Cases: There are certain special cases relating to the change in how the piping
component (distribution system) is handled which must also be addressed and are
described below. The capacity component will continue to be handled as it is today.
a. Infill sites not previously developed: A property that has not had water/sewer service
during the time when impact fees were in place (March 26, 1996 to now). These should pay the capacity and the distribution/collection charge as they are completely
new demand and will require additional capacity in both parts of the
treatment/distribution system to serve them. As the system is a whole, the funds can
be legitimately used to extend the major items like the West Transmission Loop
which will benefit them.
b. Redevelopment/further development of sites which had service: These have paid for
needed service capacity expansion in fees paid earlier, either impact or monthly. The
calculations for impact fees do not require exacting precision and usually must be
generalized due to their future oriented nature. The City also acts to create additional
capacity in its distribution and collection systems as part of the regular and on-going maintenance of the system, especially in the older areas of the City. An example of
this is the replacement of an older 6 inch main with a new one for maintenance
reasons with the new pipe meeting the new minimum dimensional standard of 8
inches. The City conducts these types of replacements annually and has a structured
maintenance program for such work. These two factors together provide some flexibility in considering how to treat redevelopment of a site.
The City has adopted a standard for the provision of water rights with new
development. This is located in Section 38.23.180. Unlike impact fees which come at
the time of building permits, the water rights standard is often met during the
subdivision or site development process. If a project creates additional demand that meets or exceeds an additional acre-foot of water they have to mitigate this additional
demand for service. In Bozeman an acre-foot generally provides for about 3 homes
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over the course of a year. To keep consistency and to allow for some incremental
changes within the developed area the need to pay distribution/collection charges
should be linked to this same increase in consumption trigger. This recognizes the
variability inherent in averaging and the incremental capacity improvements from maintenance work. If you don’t need an additional acre foot then there will be no
distribution /collection area fee. Costs would be charged for the additional dwelling’s
area or meter size per normal to cover the capacity component.
c. Phased multi-building development: It would be inappropriate to charge each part of
a multi-unit complex the full fee for the distribution/collection systems of the entire site. Therefore, the costs will be prorated. Example: A site plan on 2 acres with ten duplexes is proposed. As each duplex comes in for building permit they would be
charged 1/10th of the overall distribution/collection cost component for the project.
This may be infill or Greenfield. An alternative approach would be to charge the first
of the units for the entire distribution component and then only the home/meter size charge to the remaining units. Staff recommends the first option.
d. Parks: The area of the city dedicated to public parks has been removed from the
calculation for the future area served. This only applies to the distribution component.
Development within the park will still directly pay the plant capacity costs
attributable to the meter size installed.
E. Sewer
Fee Components: In the same manner as described for the water impact fee above, the
draft study divides the sewer impact fee into two parts; treatment plant capacity and
collection (piping) system capacity. This is shown in figure 12 of the report. Both parts
were included in the cost calculations in the previous fee studies but were consolidated into a single charge based on the size of the water meter. For further information see the
section on water.
Special cases: The same special cases for sewer exist as for water and are addressed in
similar manner. Therefore they are not repeated here but can be found in Section D.
F. Transportation
General methodology of incremental expansion – This is similar to the presently used methodology in that it focuses on identifying an amount of additional capacity need per
unit of new development. This capacity is generally applied to the system. Specific
project identification for construction is then driven by the transportation plan, five year
CIP, and location needs within the community as demand occurs over time. This provides considerable flexibility for the City to partner with other non-impact fee funding sources to meet needs as they arise. Commission directed use of this methodology on March 5,
2012.
Categories of Uses – The fee calculated must be applied to a demand calculation which
can be applied to specific proposed construction. Staff and the advisory committee discussed with the consultant the possibility of revising how the schedule of fees is
developed. Several changes to current practice are proposed in the draft study and are
described below.
Residential Uses – Current impact practice in Bozeman is to charge impact fees primarily
on the basis of type of residence with some size distinction for detached homes. The proposed fee structure would use the size of the home by 200 sq ft increments approach
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as described in the common elements section and would not distinguish between attached
or detached homes. There is also a special category for group living which is
distinguished by population.
Non-Residential Uses – The current schedule of fees uses a variety of demand measures depending on the characteristics of the use. It has more than 35 different categories. This can be beneficial in supporting the proportionality of the fee to a specific site. However,
over time as a building is reused additional fees may become due as the uses in place
change from one category to another. There are also some categories that are infrequently
used.
The consultants proposed to consolidate the number of non-residential categories. A less
detailed set of categories simplifies the day to day administration of the program and is
advantageous to some users. It also reduces the likelihood of additional fees being due
with reuse of an existing building. This corresponds with the Commission’s direction to
be more business friendly and encourage rehabilitation/reuse of existing structures. Fees are paid for the building lifetime use as a given category. The Commission accepted the
recommendation and the new fee study uses a much consolidated list of non-residential
uses.
The primary impact of the change is the consolidation of retail and restaurants into a
single category. As a result of blending the two the cost per unit has gone up for retail and significantly reduced for restaurants. One of the most common changes between use
categories on a particular site is between retail and restaurant. Having them in a single
category will reduce the number of times a new user has to pay transportation impact fees
to occupy an existing building. Page 22 of the transportation impact fee study presents
the proposed list of use categories. The current list of categories is attached to this memo. Examples of these changes are included with the fee examples.
Trip Exchange District: Downtown – The 2008 impact fee update introduced the Trip
Exchange District (TED); a way to identify areas of town with demonstrably different
trip generation characteristics and resulting differentiated transportation impact fees
within the larger service area. The consultants have reevaluated the TED in this update. Recent research, see attached, has demonstrated that in a mixed use development
environment there is an overall 29% reduction in vehicle trip generation when all users
are blended together. The 2008 TED provided cost reductions for only selected use types
for which data was available. The 2012 TED has spread the cost reductions to all types of
uses, but are a more generalized approach and some uses will receive less of a cost reduction. In both cases the TED was applied consistent with the best available data. The
2012 TED is proposed to be slightly expanded to include both the B-3 zoning district and
the downtown tax increment district boundary. The TED is discussed in detail in
Appendix C of the Transportation Impact Fee study. Fully implementing the
recommended expansion to the TIF boundary would require a municipal code amendment.
Percentage collected: The transportation impact fee is the one impact fee which is not
presently collected at the full calculated cost of service. No recommendation is made in
the fee study on this issue. Additional discussion on this topic is in the future issues
section, Section H
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G. Fire
Use categories: The fire impact fee uses the same approach to residential as used in the
other fees. This consolidated two categories. The non-residential categories were divided
into four separate categories after the current analysis found significant demand differences between them. The costs across non-residential categories show significant spread which directly reflects the demand for services.
Existing deficiencies: This issue generated more discussion at the IFAC than any other
during the update process. The fire impact fee is unusual due to the infrequency with
which stations are constructed or new engines purchased. As described in Section 4 on page 7 of the study, the time separation between constructions in Bozeman has varied
between 90 and 34 years apart. This means that more than any other form of
infrastructure the infrastructure needed to provide service shows the greatest swings from
just before and just after construction. The physical city does not have the same radical
leaps in annexation or population change.
The fire service also has some of the most complicated measures of service with the type
of response; e.g. structure fire, vehicle collision, or heart failure, changing for each call
and needing different numbers and types of equipment. Although the stations are
geographically distributed to provide a soonest time response option, the various stations
all interact in providing services. There are new opportunities to improve service response. These include nearest unit dispatch becoming available with recent
improvements at the 911 center. In addition, there was not a formal fire facility plan in
place in 1996 when the impact fees were adopted.
As a result of these complexities, it was more difficult to identify and document what
constituted the established level of service to evaluate whether there was any existing deficiency in service. Change in ISO rating is noted which rating was recently upgraded.
ISO only looks at fire suppression and doesn’t include emergency medical responses.
After consideration, a relationship between square footage of fire stations and populations
was used to attempt a single measure to identify service.
The fire facility master plan was adopted in 2006 and identified an eventual need for five additional stations to be constructed to meet the eventual needs from the service
population by the end of the planning period. The first of those stations was constructed
in 2008 primarily with impact fees but a loan backed by the General Fund was also
needed to meet project financing requirements. Four more stations are called for as need
occurs. Based upon the future demand the consultants concluded that although the City does not presently have a deficient service a deficiency may occur before the next station
can be built with collected revenues.
There are two primary factors why impact fee funds haven’t kept up with the demand for
service. First, for many years the fire impact fee was charged at 90% or less of the cost of
service thereby building in a shortfall. Second, due to lengthy litigation there was an extended delay in updating the fee studies during a time when construction costs
significantly increased. A small amount of fire impact fees were also used to match a
significant federal grant to install traffic preemption for traffic signals and fire trucks
which enables them to reach their destinations more safely and efficiently. This match
diverted some money from the Fire Impact Fee Fund and minimally increased the service area for each station. The 911 system, funded by existing taxpayers, also added the
capability to do “Closest Available Dispatching” without contribution from development
impact fees. This capability has assisted in decreasing average response times across the
city.
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As shown in the minutes from the IFAC, there was vigorous debate on the findings of the
consultant. Possible means to address these finding is discussed under Section H.
H. Issues for Future Discussion.
Water
Consumption Rates: The analysis prepared for the water and sewer impact fees both
looked at the demand patterns for homes constructed in the past 20 years as being most
representative of likely demand of new construction. One interesting trend discovered
was that although both average water and sewer use has been decreasing over time the
consumption of water in new construction was higher than the city-wide average and has been trending downwards at a much slower pace than sewer usage over time. This
diverging consumption trend is counter intuitive to the more prevalent use of water
conserving fixtures in new construction and likely points to a greater percentage of use
for outside uses. This has an impact on the amount of the fee in the present study and
provides interesting opportunities to consider policy changes to reduce water consumption.
Water Sense: During the evaluation of water consumption at the IFAC meetings the
possibility of having a different fee for homes with superior water conservation measures
was discussed. This came before the analysis discussed above which showed an
unexpected water utilization trend in new construction. As the available data didn’t presently support such a distinct fee it did not move forward. However, the US EPA does
have a water conservation program called Water Sense which provides a metric and
procedure to pursue high efficiency water use certification. This was seen as a starting
point for this discussion. The IFAC agreed that even though it wasn’t ready for
implementation in this fee study the idea should carry forward for future analysis. The greatest questions on this subject revolved around verification and implementation.
Fire/EMS
Facility Plan: As described in Section G, there is a question on deficiencies for the
Fire/EMS impact fee. One of the possible remedies to the confusion is an update to the
facility plan to more precisely document existing conditions. The current plan was adopted in 2006 and is our oldest facility plan. An update could also provide an
opportunity to more clearly establish level of service standards reflecting the diverse
missions and activities of the Fire Department in a way that will simplify future impact
fee updates. As with all facility plan updates, much of the present information would
move forward. Adjustments can be made to account for activities which have taken place since the last plan such as building Station 3 and additional roads. Finally, new and
updated information can be used to evaluate how best to measure service delivery.
Transportation
Transportation System Improvements: The definition of what is the ‘transportation
system’ determines what streets can be improved with impact fees and is a major element in the calculation of the demand component of impact fees. The current definition of the
transportation system is in Section 2.06.1630.A.14, BMC and includes all those arterial
and collector streets identified in the transportation plan. The language is attached. Figure
9-2 from the transportation plan which maps those streets is attached. All local streets are
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excluded from the impact fee system costs and eligibility for funding. The interstate
system is also excluded.
The Commission directed the consultant to use the major street network, meaning
arterials and collectors as the basis for the study. The inventory of these streets is shown in Figure 6 and 7 of the report. Each street type represents about 50% of the major street network. A greater portion of the arterials were excluded from consideration in the fee
study as they have been built to their maximum standards and don’t represent opportunity
for additional expansion. Some of the collectors were also excluded for the same reasons.
Individual elements of the network, such as state highways, could be removed with a reduction in fee directly proportional to the length of lane miles included in the street segment removed.
The consequence of reducing the scope of the network would be to reduce the number
and location of the projects which could qualify for impact fee funding and would
therefore reduce total impact fee cost/contribution in the system. It would also have the effect of eliminating some projects from impact fee funding eligibility and therefore other
non-impact fee funding sources would have to be found to make up the difference. Since
those road segments would be removed from the basis for calculating the fee it would be
inappropriate to expend the fees on them. The alternate sources may result in different
minimum construction requirements or a need to commit or generate other dedicated funding such as general obligation bonds or special improvement districts. This would
also have the potential to place more burdens on adjacent development and the timing of
executing private projects. For example, if collectors were removed from the impact fee
calculation no impact fee funding or credits would be available to assist with
signalization of or widening of the collector. To remove collectors from the definition of the major street network would require an ordinance.
Initial Street Construction Requirements: One of the differences which gave a different
cost per lane mile of construction between the 2008 and 2012 studies is when the
construction happened. The 2008 study had construction costs resulting from projects
where collector and arterial roadways were expanded after initial construction. The 2012 study has projects where the center turn lane was included with initial construction. The
difference in timing results in considerably different costs.
The new study relies on the costs for the initial construction approach which are quite a
bit less costly. This reduces overall capital costs but increases the number of lane miles
being maintained. The City currently maintains 235 miles of streets and alleys. The City has adopted an initial minimum construction standard of two travel lanes for all streets.
The City could consider modifying this standard to require that three lanes be constructed
with the initial street construction to minimize capital costs. These ‘third lane’ projects
would be potentially impact fee credit eligible to offset the additional expense of the third
lane. This approach would require the City to set aside some funds for this which would lessen funds immediately available for other projects. To change the initial construction
requirements would require an ordinance.
Funding Mix: The funding for expanding, operating, and maintaining the transportation
network comes from several sources. Some funding such as the annual municipal streets
assessment is dedicated for daily operations and maintenance and deferred maintenance/reconstruction. Other funding sources such as Urban Funds which come
from the gas taxes paid by existing systems users are an intergovernmental transfer of
money from the Federal and State government. Urban funds can be used for both
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maintenance and for capacity expansion but only on certain streets designated as ‘urban
routes’. The Commission on March 5, 2012 directed that 75% of urban funds would be
designated for maintenance and 25% for capacity expansion to offset capacity needs for
non-impact fee payers and corrections of existing deficiencies. Existing deficiencies are shown in the transportation report in section 4 beginning on page 11.
The Montana Department of Transportation (MDOT) is responsible for coordinating the
Urban Routes program statewide. The location of urban routes is modified once every ten
years following the federal census. The MDOT has begun this process and we are now
working to schedule a meeting to consider changes to the local map of urban routes. Urban routes are typically collector or arterial streets. The number of miles allowed to the city is generally fixed so adding the urban route designation to one street means another
must be removed from the list.
The amount of money available for use on the urban routes is set by the Federal
commitment of transportation funding provided in the transportation bill. This was recently reauthorized as MAP-21 which restructured several federal transportation
programs. Dollar allocations for urban funds have been trending downward. The current
annual allocation is $805,177. The gas tax has been a fixed number of cents per gallon of
motor fuel sold and has not changed for many years. As the costs of construction have
escalated the funding available has not kept pace with increased need for funding.
Alternate transportation funding: The transportation impact fee is the one impact fee that
is presently collected at less than the calculated cost of service. The City Commission
when adopting the 2008 transportation study decided to collect the fee at 60% of the
calculated cost of service. Therefore, the City is required to find other funds to make up
the 40% difference to maintain levels of service. Over the past four years the City has collected $4,248,392 in transportation impact fees. This means that the 40% discount
results in an alternate funding need of $2,832,261. This alternative funding would only be
for capacity expansion and not for any maintenance or correction of existing problems.
To change the percentage of transportation impact fee collected would require an ordinance.
There are different methods which could be used to make up this difference. A single mil
of general property tax is valued at approximately $83,000. An annual levy of 7.68 mils
would meet the annual average need for alternative funding over the past four years. This
spreads the cost to the general tax payers. The City recently received an appropriation
(earmark) of $5,000,000 from the federal government. These funds were used to expand South 19th Avenue from 3 lanes to five lanes. Earmarks are unpredictable in their
frequency and amount. The City could use SIDs to pay for portions of work along
roadway corridors. Such special districts would require the City to demonstrate a
particular benefit to those within the district from the additional charges. State law
authorizes the County to establish a local gas tax of up to two cents per gallon. Establishment and distribution of such funding would likely require an interlocal
agreement and specific action by the County Commission.
Intersections: The manner and amount of funding intersection improvements has
generated some community discussion. A determination of what is new work and what
may be a maintenance item will vary by intersection and the proposed work. As a basic standard, impact fees may not be spent on maintenance. Intersections were one of the
items the consultant was asked about during the study update process. This item is related
to the funding mix and alternate street funding items above. There are two different
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elements to this question: 1) What should be calculated going forward; and 2) how do
you use funds received both before and after updated studies.
An average cost approach as suggested by TischlerBise applies the cost of improvements
to all users of the intersection. A marginal cost approach as used by the City previously applies the cost of improvements to the new/future users of an intersection. As an example: intersection presently serves 5,000 vehicles per day, post improvements will
serve 10,000 vehicles per day, and the work will cost $500,000 and will only add new
hardware and turning lanes. An average cost approach would charge each of the 10,000
vehicles both new and old $50. A marginal cost approach would charge each of the additional 5,000 vehicles $100.
This issue is also related to the manner in which level of service is measured. Intersection
level of service is measured by delay; corridor level of service is measured by number of
vehicles passing through in addition to delay. The transportation plan describes these
measures and identifies locations where known problems exist and future problems are likely.
Generally Applicable Items
Capital Improvements Program (CIP): One of the responsibilities of the IFAC is to advise
the Commission regarding the spending of impact fees. This is fit into the regular CIP
document which the City Commission considers and adopts annually. The CIP covers a rolling six year window with the current budget year and five future years. A point of
discussion at the IFAC is the relative merits of how to list projects on the CIP.
Three options were discussed. First, having a short list of high priority projects which are
all funded and leave no material uncommitted funds and no unfunded projects on the list.
Second, have a lengthy list of projects which are impact fee eligible but which collectively are beyond the five year financial reach of the program in order to
communicate possible options for the future. Third, have a short list of high priority
funded projects and deliberately leave an uncommitted balance in the program to enable
the City or individual developers to ask for partner funding as opportunities arise.
Credit management: One of the public comments during the public hearings before the FIAC was related to how credits are managed. This is related to the CIP item above. The current approach used by the City requires CIP listing prior to work being eligible for
funding with impact fees either as a city project or as a developer request. The request
was to allow as credit projects all qualifying work whether or not CIP listed. This change
would require an ordinance.
Data tracking: The revised approaches for assessing the impact fees by home size and
water and sewer by lot size will require additional data tracking. Coordination among
departments will be needed to ensure consistent collection and retention of the needed
information. It is believed that this can be accomplished with existing software tools.
Facility Plan updates: As noted above, the City relies upon its facility plans as essential information in preparing and administering impact fees. The City has completed several
major projects in the various plans and in some cases the documents were prepared
several years ago. The City’s ordinance requires a periodic review, and if needed update,
to these foundation documents. It is likely that updates to the water, wastewater, and fire
facility plans will be needed before the next impact fee update. These are major
74
endeavors and use a lot of staff and commission time and financial resources. It is
advisable to begin this process soon so as to be completed before the next required study
update.
Deferred payment: A member of the IFAC raised the question of timing of the required payment of impact fees. Presently the fees are due at issuance of building permit or connection to water or sewer systems. The Commission has considered this issue before.
A change of timing for required payment of fees would require an ordinance.
Sustainability: Impact fees are a tool used to provide infrastructure and maintain levels of
service in essential systems. Having adequate infrastructure facilitates urban development. Enabling land efficient urban development patterns reduces energy
consumption both from municipal operations and from private development and land use.
Construction is very energy intensive. Having funding to coordinate facility over sizing
with private development reduces the number of times construction must be undertaken.
This reduces energy consumption from delayed expansions and needless repairs. The new approach for water distribution and sewer collection systems directly rewards land
efficient development. Land efficient development is more likely to support pedestrian
and bicycle travel and reduce motor vehicle emissions and energy consumption. This is
demonstrated in the special treatment allowed mixed uses as described in the Trip
Exchange District portion of Section F.
Economic Development
How does the application of a revised impact fee methodology impact the adopted work-
plan of the City Commission? Specifically, how does the application of a new impact fee
methodology impact the “implement[ation of] the adopted economic development plan,
integrating economic development principles throughout the organization”?
It is important to discuss if, and how the implementation of a new impact fee
methodology will complement or undermine other guiding principles and priorities of the
Bozeman City Commission.
The adopted 2012 – 2013 Work-Plan includes the following priorities:
1. Implement the adopted economic development plan, integrating economic development principles throughout the organization;
2. Adopt comprehensive strategies and financial plans to address
deferred maintenance;
3. Improve parks and recreation amenities;
4. Complete an integrated water resources plan;
5. Create a storm-water utility;
6. Enhance downtown development opportunities;
7. Support Gallatin College programs;
8. Implementation of the community climate action plan; and
9. Develop a legislative agenda.
In 2009 the Bozeman City Commission adopted its first economic development plan.
Since adoption, the City’s Economic Development Council and city staff implement
75
programs, practices and partnerships that add value to the City’s economic development
efforts and builds capacity to serve more businesses in the area. The tenets of the
economic development plan are:
1. Support the expansion and retention of existing businesses and economic clusters that will continue to strengthen and diversify the economy and create higher paying jobs in Bozeman.
2. Maintain and upgrade infrastructure to support current and
future needs of business.
3. Support education and workforce development initiatives to provide Bozeman with the qualified workers to meet the needs of
business.
4. Leverage local, state and federal economic development resources
to enhance economic growth in Bozeman.
5. Create a more collaborative and effective working partnership between the business community and the City of Bozeman and effectively manage the City of Bozeman’s regulatory environment to accomplish goals without hindering business
expansion and economic growth.
6. Maintain the high quality of life that is considered an important asset to the business community.
7. Ongoing financial commitment to Economic Development.
Additionally, from the adopted plan, the Economic Development Council
delineated the following priorities and recommendations:
1. Commitment to a business-friendly process with a focus on retention and expansion of existing local businesses.
2. Stabilize existing local incubators and create a full service business
incubator program to achieve a healthy business ecosystem.
3. Core Services and Infrastructure.
4. Identification and Establishment of Business Incentives.
5. Workforce Development.
The City of Bozeman’s economic development goals are rooted in a job creation and
industry diversification strategy adopted in the 2009 Economic Development Plan. The
City has determined that supporting the start-up, growth or relocation of the following high growth potential sectors will create high paying jobs and add diversity to the local
economy:
1. Photonics;
2. Bio-Sciences;
3. Manufacturing;
4. Hi-Tech; and
5. the Outdoor Industries.
Support for high growth potential sectors includes creating partnerships where others can
take the lead in areas of workforce training, appropriate incentives, business resources.
76
The City has taken the lead on streamlining the development review process and
facilitating economic growth by strengthening and creating partnerships and matching
businesses with resources.
New development relies upon the availability of infrastructure to move forward in a timely manner. Delay can be a strong disincentive to investments. Impact fees help provide infrastructure in a timely manner thereby avoiding delays. Impact fees help
provide predictability in short and long term cost structures to business by identifying
costs up front and avoiding unplanned large tax or user fee increases in the future.
Different users are more or less sensitive to the known and upfront costs compared to more predictable long term costs over the average business lifecycle. The impact fee ordinance makes allowance for the City to provide financial support to offset the effects
of impact fees on desired development. The City can take advantage of this to focus
efforts on desired economic sectors. The change in the transportation impact fee to
consolidate non-residential uses for initial use and reuse should be supportive of reuse and redevelopment in existing facilities.
A well integrated policy and regulatory environment is advantageous for both the public
and private entities who work with the regulations. The effect of the new impact fee
methodology on the adopted work plan and implementation of the City’s 2009 Economic
Development Plan should be considered in the overall impact fee discussion.
UNRESOLVED ISSUES: As shown in Section H there are many items needing additional
discussion. However, the October 8th meeting is primarily for the Commission to receive
information. Therefore, the unresolved issues should be addressed at a future meeting.
ALTERNATIVES: As shown in Section H there are many items needing additional
discussion and many alternatives exist. However, the October 8th meeting is primarily for the
Commission to receive information. The Commission may identify specific alternatives they
wish to discuss or for which they wish to receive more information.
FISCAL EFFECTS: The fiscal effects of this specific policy discussion are not immediate.
These proposed studies directly impact the amounts the City will collect in Impact Fee revenues
in the coming years.
Below are the total Impact Fee revenues collected for each of the past 5 years. How much the city collects each year depends on a number of factors:
1. The level of the fee charged to the developer/property owner. (i.e. 60%, 80%, 100% of
the study amount.) and,
2. The mix of projects built in the City each year. (A Drive-Thru Restaurant will have a
higher Street Impact fee than a Single Family Residence; a change in use to remodel an office might require additional street impact fees but no water impact fees, etc.)
77
City Impact Fee
Collections FY08 FY09 FY10 FY11 FY12
TOTAL
FY08-FY12
Street Impact Fees
$ 1,948,550
$ 1,198,319
$ 751,223
$ 1,208,135
$ 1,090,715
$ 6,196,942
Fire Impact Fees
$
259,726
$
186,690
$
187,476
$
190,292
$
245,250
$
1,069,434
Water Impact Fees
$
1,237,939
$
768,363
$
744,557
$
713,387
$
981,095
$
4,445,341
Sewer Impact Fees $ 1,306,893
$ 663,766
$ 667,909
$ 636,878
$ 986,905
$ 4,262,351
$
4,753,108
$
2,817,138
$
2,351,165
$
2,748,692
$
3,303,965
$
15,974,068
These studies also affect the policies around how Impact Fees may be spent. For instance,
• if the adopted Fire Impact Fee study only supports 75% contribution to Fire Stations, our Capital Plans will need to be updated and/or changed to reflect this change in policy.
We will need to find another source of revenues to offset 25% of the costs of building
future fire stations.
• if the Water Impact Fee study no longer contains an element related to Water Supply development costs, we will need to change our funding plans for some of the future
IWRP outcomes and projects.
• If the Street Impact Fee Study does not contain collector streets then additional funding
sources must be identified and implemented.
Attachments: Transportation Impact Fee Study dated 9/03/2012
Water Impact Fee Study dated 9/23/2012
Sewer Impact Fee Study dated 9/23/2012 Fire/EMS Impact Fee Study dated 9/23/2012 Impact Fee Advisory Committee minutes from 8/16 and 9/13
Fee examples
List of current transportation impact fee use categories
Mixed Use Transportation study – Ewing, 2011 Transportation system definition, Section 2.06.1630.A.14 Figure 9-2, Greater Bozeman Area Transportation Plan
Report compiled on: 9/28/2012
78
DRAFT
Development
Impact
Fee
Study
Bozeman,
Montana
Streets
Development
Impact
Fee
City
of
Bozeman,
Montana
September
3,
2012
Prepared
by:
4701
Sangamore
Road
Suite
S240
Bethesda,
Maryland
20816
800.424.4318
www.tischlerbise.com
79
2012
Streets
Development
Impact
Fee
Study
Bozeman,
Montana
CONTENTS
INTRODUCTION
TO
IMPACT
FEES .........................................................................................................1
GENERAL
LEGAL
FRAMEWORK ........................................................................................................................1
UNIQUE
REQUIREMENTS
OF
THE
MONTANA
IMPACT
FEE
ACT ..............................................................................2
CONCEPTUAL
IMPACT
FEE
CALCULATION ..........................................................................................................3
GENERAL
METHODOLOGIES ...........................................................................................................................3
Recoupment
(past
improvements).......................................................................................................3
Incremental
Expansion
(concurrent
improvements)............................................................................3
Plan-‐Based
Fee
(future
improvements)................................................................................................4
Credits ..................................................................................................................................................4
IMPACT
FEES
FOR
STREETS...................................................................................................................5
Figure
1.
Street
Impact
Fee
Formula ....................................................................................................5
1.
OPERATION
AND
MAINTENANCE.................................................................................................................6
2.
SERVICE
AREA..........................................................................................................................................6
3.
EXISTING
CONDITIONS
AND
DEFICIENCIES .....................................................................................................6
Figure
2.
Functional
Classification
Map...............................................................................................7
Figure
3.
2005
Volume
to
Capacity
Ratio.............................................................................................8
Figure
4.
Existing
Traffic
Signals...........................................................................................................9
Figure
5.
Map
of
System
Designations...............................................................................................10
4.
LEVEL-‐OF-‐SERVICE
STANDARDS.................................................................................................................11
Figure
6.
Inventory
of
Arterial
Streets ...............................................................................................12
Figure
7.
Inventory
of
Collector
Streets.............................................................................................13
Figure
8.
Inventory
of
Improved
Intersections ..................................................................................14
5.
GROWTH
SHARE
DETERMINATION.............................................................................................................15
Figure
9.
Cost
Factors.........................................................................................................................16
6.
FUTURE
ADDITIONAL
NEEDS.....................................................................................................................16
Figure
10.
Travel
Demand
Model
Inputs............................................................................................17
Adjustments
for
Commuting
Patterns
and
Pass-‐By
Trips...................................................................17
Figure
11.
Inflow/Outflow
Analysis...................................................................................................18
Trip
Length
Weighting
Factor
by
Type
of
Land
Use ...........................................................................18
Lane
Capacity.....................................................................................................................................18
Future
Travel
Demand .......................................................................................................................19
Figure
12.
Needs
Analysis ..................................................................................................................20
7.
PROPORTIONATE
SHARE
CONSIDERATIONS..................................................................................................20
Figure
13.
Principal
Payment
Credit...................................................................................................20
8.
METHODOLOGY .....................................................................................................................................20
9.
IMPACT
FEE
SCHEDULE............................................................................................................................21
Figure
14.
Impact
Fee
Schedule
for
Streets........................................................................................22
Cash
Flow
Analysis
for
Streets
System
Improvements .......................................................................23
10.
CAPITAL
IMPROVEMENTS.......................................................................................................................23
Figure
15.
Streets
System
Capital
Improvements...............................................................................24
IMPLEMENTATION
AND
ADMINISTRATION........................................................................................25
CAPITAL
IMPROVEMENTS
PLAN.....................................................................................................................25
CONSTRUCTION
OF
PUBLIC
FACILITIES
IN
LIEU
OF
PAYMENT
OF
IMPACT
FEES........................................................25
IMPACT
FEE
ADVISORY
COMMITTEE ..............................................................................................................25
80
2012
Streets
Development
Impact
Fee
Study
Bozeman,
Montana
APPENDIX
A:
DEMOGRAPHIC
DATA...................................................................................................26
SUMMARY
OF
GROWTH
INDICATORS .............................................................................................................26
Figure
A1
–
Development
Projections
and
Growth
Rates ..................................................................27
RECENT
RESIDENTIAL
CONSTRUCTION............................................................................................................28
Figure
A2
–
Housing
Units
by
Decade ................................................................................................28
POPULATION
AND
JOBS
FORECAST ................................................................................................................29
Figure
A3
–
City
of
Bozeman
Population
Share..................................................................................30
Figure
A4
–
City
of
Bozeman
Job
Share..............................................................................................31
JOBS
BY
TYPE
OF
NONRESIDENTIAL
DEVELOPMENT...........................................................................................32
Figure
A5
–
Jobs
and
Floor
Area
Estimate..........................................................................................32
EMPLOYEES
PER
SQUARE
FOOT
OF
NONRESIDENTIAL
DEVELOPMENT...................................................................33
Figure
A6
–
Employee
and
Building
Area
Ratios ................................................................................33
DETAILED
DEVELOPMENT
PROJECTIONS .........................................................................................................34
Figure
A7
–
Annual
Demographic
Data..............................................................................................34
PERSONS
PER
HOUSING
UNIT.......................................................................................................................34
Figure
A8
–
Year-‐Round
Persons
per
Unit
by
Type
of
Housing...........................................................35
CUSTOMIZED
TRIP
GENERATION
RATES
PER
HOUSING
UNIT...............................................................................36
Figure
A9
-‐
Residential
Trip
Generation
Rates
by
Type
of
Housing....................................................36
DEMAND
INDICATORS
BY
SIZE
OF
HOUSING ....................................................................................................36
Figure
A10
–
Floor
Area
of
Living
Space
by
Bedrooms .......................................................................37
Figure
A11
–
Vehicle
Trips
and
Persons
by
Bedroom
Range ..............................................................38
TRIP
GENERATION
BY
FLOOR
AREA................................................................................................................38
Figure
A12
–
Vehicle
Trips
by
Dwelling
Size .......................................................................................39
APPENDIX
B:
FLOOR
AREA
CODES .....................................................................................................40
APPENDIX
C:
FEE
REDUCTION
IN
TRIP
EXCHANGE
DISTRICT
(TED)......................................................41
APPENDIX
D:
ALTERNATIVE
FEES
WITHOUT
COLLECTORS ..................................................................44
81
2012
Streets
Development
Impact
Fee
Study
Bozeman,
Montana
1
INTRODUCTION
TO
IMPACT
FEES
The
City
of
Bozeman,
Montana
retained
TischlerBise
to
update
impact
fees
for
Water,
Sewer,
Fire,
and
Streets
infrastructure.
This
document
is
the
written
analysis
required
by
Montana’s
impact
fee
enabling
legislation.
Consistent
with
this
enabling
legislation,
it
is
the
intent
of
the
City
of
Bozeman
to:
1. Ensure
adequate
public
facilities
are
available
to
serve
new
growth
and
development;
and
2. Promote
cost
effective
growth
and
establish
uniform
standards
by
which
the
City
may
require
payment
for
a
proportionate
share
of
the
cost
of
system
improvements
needed
to
serve
development.
Impact
fees
are
one-‐time
payments
used
to
construct
system
improvements,
identified
through
facility
planning,
needed
to
accommodate
new
development.
An
impact
fee
represents
new
growth’s
proportionate
share
of
capital
facility
needs.
Impact
fees
do
have
limitations,
and
should
not
be
regarded
as
the
total
solution
for
infrastructure
financing
needs.
Rather,
they
are
one
component
of
a
comprehensive
portfolio
to
ensure
adequate
provision
of
public
facilities
with
the
goal
of
maintaining
current
levels
of
service
in
a
community.
By
law,
impact
fees
can
only
be
used
for
capital
improvements,
not
operating,
maintenance,
or
rehabilitation
costs.
Also,
development
impact
fees
cannot
be
used
to
repair
infrastructure
or
correct
existing
deficiencies.
General
Legal
Framework
Both
state
and
federal
courts
have
recognized
the
imposition
of
impact
fees
on
development
as
a
legitimate
form
of
land
use
regulation,
provided
the
fees
meet
standards
intended
to
protect
against
regulatory
takings.
Land
use
regulations,
development
exactions,
and
impact
fees
are
subject
to
the
Fifth
Amendment
prohibition
on
taking
of
private
property
for
public
use
without
just
compensation.
To
comply
with
the
Fifth
Amendment,
development
regulations
must
be
shown
to
substantially
advance
a
legitimate
governmental
interest.
In
the
case
of
impact
fees,
that
interest
is
in
the
protection
of
public
health,
safety,
and
welfare
by
ensuring
that
development
is
not
detrimental
to
the
quality
of
essential
public
services.
The
means
to
this
end
are
also
important,
requiring
both
procedural
and
substantive
due
process.
The
process
followed
to
receive
community
input,
with
open
Advisory
Committee
meetings,
work
sessions
and
public
hearings
with
elected
officials,
provided
opportunity
for
comments
and
refinements
to
the
impact
fees.
There
is
little
federal
case
law
specifically
dealing
with
impact
fees,
although
other
rulings
on
other
types
of
exactions
(e.g.,
land
dedication
requirements)
are
relevant.
In
one
of
the
most
important
exaction
cases,
the
U.
S.
Supreme
Court
found
that
a
government
agency
imposing
exactions
on
development
must
demonstrate
an
“essential
nexus”
between
the
exaction
and
the
interest
being
protected
(see
Nollan
v.
California
Coastal
Commission,
1987).
In
a
more
recent
case
(Dolan
v.
City
of
Tigard,
OR,
1994),
the
Court
ruled
that
an
exaction
also
must
be
“roughly
proportional”
to
the
burden
created
by
development.
However,
the
Dolan
decision
appeared
to
set
a
higher
standard
of
review
for
mandatory
dedications
of
land
than
for
monetary
exactions
such
as
development
impact
fees.
These
standards
have
not
been
conclusively
litigated
in
Montana
in
the
context
of
impact
fees,
nor
has
"roughly
proportional"
been
defined
as
an
acceptable
range
of
value.
There
are
three
reasonable
relationship
requirements
for
development
impact
fees
that
are
closely
related
to
“rational
nexus”
or
“reasonable
relationship”
requirements
enunciated
by
a
number
of
state
courts.
Although
the
term
“dual
rational
nexus”
is
often
used
to
characterize
the
standard
by
which
courts
evaluate
the
validity
of
development
impact
fees
under
the
U.S.
Constitution,
we
prefer
a
more
rigorous
formulation
that
recognizes
three
elements:
“need,”
“benefit,”
and
“proportionality.”
The
dual
82
2012
Streets
Development
Impact
Fee
Study
Bozeman,
Montana
2
rational
nexus
test
explicitly
addresses
only
the
first
two,
although
proportionality
is
reasonably
implied,
and
was
specifically
mentioned
by
the
U.S.
Supreme
Court
in
the
Dolan
case.
The
reasonable
relationship
standard
of
the
Montana
statute
is
considered
less
strict
than
the
rational
nexus
standard
used
by
many
courts.
Individual
elements
of
the
nexus
standard
are
discussed
further
in
the
following
paragraphs.
All
new
development
in
a
community
creates
additional
demands
on
some,
or
all,
public
facilities
provided
by
local
government.
If
the
capacity
of
facilities
is
not
increased
to
satisfy
that
additional
demand,
the
quality
or
availability
of
public
services
for
the
enti re
community
will
deteriorate.
Development
impact
fees
may
be
used
to
recover
the
cost
of
development-‐related
facilities,
but
only
to
the
extent
that
the
need
for
facilities
is
a
consequence
of
development
that
is
subject
to
the
fees.
The
Nollan
decision
reinforced
the
principle
that
development
exactions
may
be
used
only
to
mitigate
conditions
created
by
the
developments
upon
which
they
are
imposed.
That
principle
clearly
applies
to
impact
fees.
In
this
study,
the
impact
of
development
on
improvement
needs
is
analyzed
in
terms
of
quantifiable
relationships
between
various
types
of
development
and
the
demand
for
specific
facilities,
based
on
applicable
level-‐of-‐service
standards.
The
requirement
that
exactions
be
proportional
to
the
impacts
of
development
was
clearly
stated
by
the
U.S.
Supreme
Court
in
the
Dolan
case
(although
the
relevance
of
that
decision
to
impact
fees
has
been
debated)
and
is
logically
necessary
to
establish
a
proper
nexus.
Proportionality
is
established
through
the
procedures
used
to
identify
development-‐related
facility
costs,
and
in
the
methods
used
to
calculate
impact
fees
for
various
types
of
facilities
and
categories
of
development.
The
demand
for
facilities
is
measured
in
terms
of
relevant
and
measurable
attributes
of
development
(e.g.
a
typical
housing
unit’s
average
weekday
vehicle
trips).
A
sufficient
benefit
relationship
requires
that
impact
fee
revenues
be
segregated
from
other
funds
and
expended
only
on
the
facilities
for
which
the
fees
were
charged.
Impact
fees
must
be
expended
in
a
timely
manner
and
the
facilities
funded
by
the
fees
must
serve
the
development
paying
the
fees.
However,
nothing
in
the
U.S.
Constitution
or
the
state
enabling
legislation
requires
that
facilities
funded
with
fee
revenues
be
available
exclusively
to
development
paying
the
fees.
In
other
words,
benefit
may
extend
to
a
general
area
including
multiple
real
estate
developments.
Procedures
for
the
earmarking
and
expenditure
of
fee
revenues
are
mandated
in
state
enabling
legislation,
as
discussed
further
below.
All
of
these
procedural
as
well
as
substantive
issues
are
intended
to
ensure
that
new
development
benefits
from
the
impact
fees
they
are
required
to
pay.
The
authority
and
procedures
to
implement
impact
fees
is
separate
from
and
complementary
to
the
authority
to
require
improvements
as
part
of
subdivision
or
zoning
review.
Unique
Requirements
of
the
Montana
Impact
Fee
Act
All
requirements
of
Montana
Code
Title
7,
Chapter
6,
Sections
1601-‐1604,
have
been
met
in
the
supporting
documentation
prepared
by
TischlerBise.
There
are
three
requirements
of
the
Montana
legislation
that
are
not
common
to
impact
fee
enabling
legislation
in
other
states.
These
unique
requirements
are
highlighted
below.
First,
as
specified
in
7-‐6-‐1602
(7)
(d),
“New
development
may
not
be
held
to
a
higher
level
of
service
than
existing
users
unless
there
is
a
mechanism
in
place
for
the
existing
users
to
make
improvements
to
the
existing
system
to
match
the
higher
level
of
service.”
Second,
Montana
requires
documentation
of
ten
topics
in
the
written
analysis
that
supports
the
impact
fees
(see
7-‐6-‐1602).
These
ten
topics
are
addressed
under
separate
headings
in
this
report.
83
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3
Third,
Montana
specifically
authorizes
a
maximum
5%
increase
in
the
amount
collected
to
cover
the
cost
of
impact
fee
administration
[see
7-‐6-‐1601
(5)(a)].
The
City
of
Bozeman
impact
fees
include
the
5%
administration
surcharge.
Conceptual
Impact
Fee
Calculation
In
contrast
to
project-‐level
improvements,
impact
fees
fund
growth-‐related
infrastructure
that
will
benefit
multiple
development
projects,
or
the
entire
jurisdiction
(usually
referred
to
as
system
improvements).
The
first
step
is
to
determine
an
appropriate
demand
indicator,
or
service
unit,
for
the
particular
type
of
infrastructure.
The
demand/service
indicator
measures
the
number
of
demand
or
service
units
for
each
unit
of
development.
For
example,
an
appropriate
indicator
of
the
demand
for
parks
is
population
growth
and
the
increase
in
population
can
be
estimated
from
the
average
number
of
persons
per
housing
unit.
The
second
step
in
the
impact
fee
formula
is
to
determine
infrastructure
units
per
demand
unit,
typically
called
Level-‐Of-‐Service
(LOS)
standards.
In
keeping
with
the
park
example,
a
common
LOS
standard
is
park
acreage
per
thousand
people.
The
third
step
in
the
impact
fee
formula
is
the
cost
of
various
infrastructure
units.
To
complete
the
park
example,
this
part
of
the
formula
would
establish
the
cost
per
acre
for
land
acquisition
and/or
park
improvements.
General
Methodologies
There
are
three
general
methods
for
calculating
development
impact
fees.
The
choice
of
a
particular
method
depends
primarily
on
the
timing
of
infrastructure
construction
(past,
concurrent,
or
future)
and
service
characteristics
of
the
facility
type
being
addressed.
Each
method
has
advantages
and
disadvantages
in
a
particular
situation,
and
can
be
used
simultaneously
for
different
cost
components.
Reduced
to
its
simplest
terms,
the
process
of
calculating
development
impact
fees
involves
two
main
steps:
(1)
determining
the
cost
of
development-‐related
capital
improvements
and
(2)
allocating
those
costs
equitably
to
various
types
of
development.
In
practice,
though,
the
calculation
of
impact
fees
can
become
quite
complicated
because
of
the
many
variables
involved
in
defining
the
relationship
between
development
and
the
need
for
facilities
within
the
designated
service
area.
The
following
paragraphs
discuss
three
basic
methods
for
calculating
development
impact
fees
and
how
those
methods
can
be
applied.
Recoupment
(past
improvements)
The
rationale
for
recoupment,
often
called
cost
recovery,
is
that
new
development
is
paying
for
its
share
of
the
useful
life
and
remaining
capacity
of
facilities
already
built,
or
land
already
purchased,
from
which
new
growth
will
benefit.
This
methodology
is
often
used
for
utility
systems
that
must
provide
adequate
capacity
before
new
development
can
take
place.
Montana
enabling
legislation
specifically
authorizes
recoupment
in
7-‐6-‐1603
(3).
Incremental
Expansion
(concurrent
improvements)
The
incremental
expansion
method
documents
current
level-‐of-‐service
(LOS)
standards
for
each
type
of
public
facility,
using
both
quantitative
and
qualitative
measures.
This
approach
ensures
that
there
are
no
existing
infrastructure
deficiencies
or
surplus
capacity
in
infrastructure.
New
development
is
only
paying
its
proportionate
share
for
growth-‐related
infrastructure.
LOS
standards
are
determined
in
a
manner
similar
to
the
current
replacement
cost
approach
used
by
property
insurance
companies.
However,
in
contrast
to
insurance
practices,
the
fee
revenues
would
not
be
for
renewal
and/or
replacement
of
existing
facilities.
Rather,
revenue
will
be
used
to
expand
or
provide
additional
facilities,
84
2012
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Bozeman,
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4
as
needed,
to
accommodate
new
development.
An
incremental
expansion
cost
method
is
best
suited
for
public
facilities
that
will
be
expanded
in
regular
increments,
concurrent
with
new
development.
Plan-‐Based
Fee
(future
improvements)
The
plan-‐based
method
allocates
costs
for
a
specified
set
of
improvements
to
a
specified
amount
of
development.
Improvements
are
typically
identified
in
a
long-‐range
facility
plan
and
development
potential
is
identified
by
a
land
use
plan.
There
are
two
options
for
determining
the
cost
per
demand
unit:
1)
total
cost
of
a
public
facility
can
be
divided
by
total
demand
units,
or
2)
the
growth-‐share
of
the
public
facility
cost
can
be
divided
by
the
net
increase
in
demand
units
over
the
planning
timeframe.
Credits
Regardless
of
the
methodology,
a
consideration
of
“credits”
is
integral
to
the
development
of
a
legally
defensible
impact
fee
methodology.
There
are
two
types
of
“credits”
with
specific
characteristics,
both
of
which
should
be
addressed
in
development
impact
fee
studies.
The
first
is
a
revenue
credit
due
to
possible
double
payment
situations,
which
could
occur
when
other
revenues
may
contribute
to
the
capital
costs
of
infrastructure
covered
by
the
impact
fee.
Montana’s
enabling
legislation
requires,
“consideration
of
payments
for
system
improvements
reasonably
anticipated
to
be
made
by
or
as
a
result
of
the
development
in
the
form
of
user
fees,
debt
service
payments,
taxes,
and
other
available
sources
of
funding
the
system
improvements.”
[7-‐6-‐1602
(7)
(b)
(ii)]
This
type
of
credit
is
integrated
into
the
impact
fee
calculation,
thus
reducing
the
fee
amount.
The
second
is
a
site-‐specific
credit
or
developer
reimbursement
for
dedication
of
land
or
construction
of
system
improvements.
This
type
of
credit
is
addressed
in
the
administration
and
implementation
of
the
impact
fee
program.
85
2012
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5
IMPACT
FEES
FOR
STREETS
As
shown
in
Figure
1,
the
street
impact
fee
is
derived
from
trip
generation
rates,
trip
rate
adjustment
factors
and
the
net
capacity
cost
per
average
length
vehicle
trip.
The
cost
per
average
length
vehicle
trip
is
a
function
of
the
average
trip
length,
trip-‐length
weighting
factor,
growth
cost
per
lane
mile,
lane
capacity,
and
a
credit
for
future
principal
payments
on
an
existing
General
Obligation
Bond
for
transportation
improvements.
Each
component
in
the
fee
formula
will
be
explained
in
the
following
sections
that
address
all
requirements
of
Montana’s
impact
fee
enabling
legislation
[see
7 -‐6-‐1602]
regarding
the
calculation
of
impact
fees.
Figure
1.
Street
Impact
Fee
Formula
0.55
1.71 1.22
842000 7300
City
of
Bozeman
Service
Area
Attraction
Trips
per
Development
Unit
Multiplied
by
Net
Capacity
Cost
per
Average
Length
Vehicle
Trip
Average
Trip
Length
(miles)
Multiplied
by
Trip
Length
Weighting
Factor
Multiplied
by
Capital
Cost
per
Lane
Mile
Divided
by
Lane
Capacity
(vehicles
per
lane
per
day)
Less
Credit
for
Other
Applicable
Revenues
Weekday
Vehicle
Trip
Ends
per
Development
Unit
Multiplied
by
Trip
Rate
Adjustment
Factor
86
2012
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6
1.
Operation
and
Maintenance
Impact
fee
revenue
will
not
be
used
for
operating
and
maintenance
expenses.
Capital
items
are
segregated
operationally
and
for
accounting
purposes.
The
City
of
Bozeman
will
fund
operation
and
maintenance
costs
with
Gas
Tax,
Street
Maintenance
Assessment,
and
limited
General
Fund
revenue.
City
property
owners
annually
pay
street
maintenance
assessments
based
on
the
square
footage
of
their
lot.
These
assessments
are
the
major
funding
source
for
street
maintenance.
2.
Service
Area
Bozeman’s
streets
form
a
single
integrated
network
that
serves
all
parcels
within
the
city
limits.
For
the
purpose
of
calculating
and
imposing
Streets
Impact
Fees,
the
entire
City
will
be
treated
as
a
single
service
area
pursuant
to
MCA
7-‐6-‐1602
(1)
(f).
3.
Existing
Conditions
and
Deficiencies
The
following
four
maps
provide
a
general
understanding
of
the
street
network
in
Bozeman.
Complete
documentation
of
existing
condition s
and
deficiencies
may
be
found
in
the
Greater
Bozeman
Area
Transportation
Plan
(Robert
Peccia
and
Associates
2007
Update).
Impact
fees
will
not
be
used
to
correct
existing
deficiencies.
Street
segments
and
intersections
with
existing
deficiencies
were
deducted
from
the
inventories
used
to
derive
current
infrastructure
standards,
as
discussed
further
in
the
next
section.
87
2012
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Bozeman,
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7
The
map
below
is
a
portion
of
Figure
2-‐2
from
the
2007
Transportation
Plan.
Arterial
streets
are
shown
with
red
and
blue
lines.
Collector
streets
are
shown
in
green.
For
the
purpose
of
street
impact
fees,
arterial
and
collector
streets
are
considered
to
be
system
improvements.
Impact
fees
will
not
be
used
to
improve
local
streets
or
Interstate
90.
Figure
2.
Functional
Classification
Map
88
2012
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8
Vehicular
traffic
congestion
is
often
measured
by
volume
to
capacity
ratios,
as
shown
below.
This
map
is
a
portion
of
Figure
3-‐19
from
the
2007
Transportation
Plan,
based
on
2005
traffic
counts.
Recent
improvements,
such
as
the
widening
of
S.
19th
have
solved
some
of
the
congestion
problems.
Figure
3.
2005
Volume
to
Capacity
Ratio
89
2012
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9
The
map
below
is
a
portion
of
Figure
2-‐8
from
the
2007
Transportation
Plan,
updated
by
City
staff
(see
signal
locations
labeled
with
letters).
Figure
4.
Existing
Traffic
Signals
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2012
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10
The
map
below,
obtained
from
Montana
Department
of
Transportation,
indicates
National
Highway
System
roads
(e.g.
I-‐90)
and
State
Highways.
Primary
State
Highway,
like
Huffine,
Main,
and
Rouse,
are
shown
in
red.
The
extensive
network
of
Urban
State
Highways,
like
19th
and
7th,
are
shown
in
gold.
Figure
5.
Map
of
System
Designations
91
2012
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11
4.
Level-‐of-‐Service
Standards
The
Transportation
Plan
used
various
performance
measures,
such
as
the
ratio
to
traffic
volume
to
street
capacity,
to
identify
the
need
for
capital
improvements.
For
the
purpose
of
impact
fee
calculations,
performance
measures
must
be
converted
into
infrastructure
standards
that
document
the
need
for
capital
improvements
required
to
serve
new
development
[see
MCA
7-‐6-‐1602.(7)(b)(i)].
Because
Montana’s
impact
fee
enabling
legislation
specifies
that
new
development
may
not
be
held
to
a
higher
level
of
service
than
existing
users,
unless
there
is
a
mechanism
in
place
for
the
existing
users
to
make
improvements
to
the
existing
system
to
match
the
higher
level
of
service
[see
MCA
7-‐6-‐
1602.(7)(d)],
TischlerBise
worked
with
City
staff
to
document
existing
infrastructure
standards
for
arterial
and
collector
lane
miles,
and
improved
intersections.
Figure
6
lists
arterial
streets
in
Bozeman,
deducting
three
street
segments
with
existing
deficiencies
as
defined
by
a
volume
to
capacity
ratio
greater
than
1.00
(see
rows
with
gray
shading)
and
seven
street
segments
that
have
reached
their
ultimate
width
of
5
lanes.
According
to
City
policy,
no
additional
improvements
are
expected
to
5-‐lane
streets.
For
the
purpose
of
street
impact
fees,
Bozeman’s
current
inventory
is
55
lane
miles
of
arterials.
A
lane
mile
is
a
rectangular
area
one
lane
wide
and
one
mile
long.
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2012
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Figure
6.
Inventory
of
Arterial
Streets
An
inventory
of
existing
collector
streets
is
provided
in
Figure
7,
indicating
a
total
of
62.6
lane
miles.
Consistent
with
City
policy,
no
additional
improvements
are
expected
to
3-‐lane
collectors
and
they
were
excluded
from
the
documentation
of
current
infrastructure
standards.
93
2012
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13
Figure
7.
Inventory
of
Collector
Streets
94
2012
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Bozeman,
Montana
14
As
shown
in
Figure
8,
Bozeman
has
an
inventory
of
39
improved
intersections
(i.e.
traffic
signals
or
roundabouts).
The
three
intersections
with
gray
shading
represent
existing
deficiencies
that
may
not
be
corrected
with
impact
fee
funding.
If
other
funds
are
used
to
cure
the
deficiency,
further
expansion
to
accommodate
future
development
may
be
funded
with
impact
fees.
Figure
8.
Inventory
of
Improved
Intersections
95
2012
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Bozeman,
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15
5.
Growth
Share
Determination
Where
specific
improvements
benefit
existing
development
and
expand
capacity
for
new
development,
the
growth
share
of
the
capital
cost
can
be
determined
by
an
engineering
analysis
of
the
specific
improvement.
Also,
the
growth
share
to
be
funded
by
impact
fees
might
be
less
than
the
total
cost
because
adjacent
development
is
paying
for
project-‐level
improvements.
In
Bozeman,
sidewalks,
curb
and
gutter,
and
the
initial
two
lanes
are
considered
to
be
project-‐level
improvements.
Figure
9
summarizes
the
recent
expenditures
and
the
planned
costs
that
were
used
to
derive
cost
factors
for
the
impact
fee
calculations.
For
road
segments,
the
growth
cost
of
$914,000
per
lane
mile
is
based
on
actual
expenditures.
Improvements
to
West
Babcock,
Baxter,
and
Cottonwood
were
in
conjunction
with
other
project-‐level
improvements.
The
amounts
shown
are
only
the
growth
share
(i.e.
system
improvements),
not
the
total
cost.
MDT
provided
the
cost
of
widening
South
19th
from
3
to
5
lanes.
The
cost
of
right-‐of-‐way
is
100%
growth-‐related,
with
59%
of
all
remaining
costs
deemed
to
be
impact
fee
eligible
based
on
the
increased
capacity
of
the
wider
street.
For
intersection
improvements,
the
impact
fee
cost
factor
is
a
combination
of
three
recent
projects
and
eight
cost
estimates
from
the
City’s
approved
FY13-‐17
CIP.
Across
the
nation,
many
jurisdictions
are
turning
to
greater
use
of
roundabouts
because
they
are
more
effective,
even
though
the
initial
construction
cost
might
be
higher.
In
comparison,
the
Bozeman
roundabout
was
less
than
the
MDT
expenditure
for
intersection
improvements
on
College
Street.
The
growth
share
determination
for
improvements
to
existing
intersections
is
a
site-‐specific
evaluation
depending
on
current
design
and
performance
of
the
intersection,
compared
to
planned
improvements.
Typically,
an
intersection
has
to
“warrant”
improvement,
meaning
it
no
longer
performs
at
an
acceptable
level
of
service.
Given
this
situation,
TischlerBise
recommends
that
the
non-‐growth
share
of
the
cost
of
improvements
(i.e.
using
revenue
other
than
impact
fees)
be
determined
by
the
current
design
capacity
divided
by
the
design
capacity
of
the
intersection
after
improvements.
In
other
words,
when
existing
intersections
are
improved,
impact
fees
should
only
fund
the
increase
in
design
capacity.
As
shown
below,
impact
fees
are
based
on
an
estimated
growth
cost
of
$869,000
per
improved
intersection.
Given
the
existing
arterial
and
collector
road
network
has
117.6
lane
miles,
the
cost
of
intersection
improvements
is
$288,000
per
lane
mile.
For
both
road
segments
plus
intersection
improvements,
the
impact
fees
are
based
on
a
total
cost
of
$1,202,000
per
lane
mile.
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Figure
9.
Cost
Factors
6.
Future
Additional
Needs
The
relationship
between
the
amount
of
development
in
Bozeman
and
the
need
for
impact
fee
system
improvements
is
documented
in
the
following
two
tables.
Figure
10
summarizes
the
input
variables
used
to
determine
average
weekday
vehicle
trips
and
Vehicle
Miles
of
Travel
(VMT).
In
the
table
below
97
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HU
means
housing
units,
KSF
means
square
feet
of
nonresidential
development,
in
thousands,
and
the
Institute
of
Transportation
Engineers
is
abbreviated
ITE.
Data
in
each
column
are
explained
below.
Figure
10.
Travel
Demand
Model
Inputs
Street
impact
fees
are
based
on
average
weekday
Vehicle
Trip
Ends
(VTE).
Trip
generation
rates
are
from
the
reference
book
Trip
Generation
published
by
the
Institute
of
Transportation
Engineers
(2008).
A
vehicle
trip
end
represents
a
vehicle
either
entering
or
exiting
a
development
(as
if
a
traffic
counter
were
placed
across
a
driveway).
To
calculate
street
impact
fees,
trip
generation
rates
are
adjusted
to
avoid
double
counting
each
trip
at
both
the
origin
and
destination
points.
Therefore,
the
basic
trip
adjustment
factor
is
50%.
As
discussed
further
below,
the
impact
fee
methodology
includes
additional
adjustments
to
make
the
fees
proportionate
to
the
infrastructure
demand
for
particular
types
of
development.
Adjustments
for
Commuting
Patterns
and
Pass-‐By
Trips
Residential
development
has
a
larger
trip
adjustment
factor
of
57%
to
account
for
commuters
leaving
Bozeman
for
work.
According
to
the
2009
National
Household
Travel
Survey
(see
Table
30)
weekday
work
trips
are
typically
31%
of
production
trips
(i.e.,
all
out-‐bound
trips,
which
are
50%
of
all
trip
ends).
As
shown
in
Figure
11,
the
Census
Bureau’s
web
application
OnTheMap
indicates
that
42%
of
Bozeman’s
resident
workers
traveled
outside
the
city
for
work
in
2010.
In
combination,
these
factors
(0.31
x
0.50
x
0.42
=
0.07)
support
the
additional
7%
allocation
of
trips
to
residential
development.
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Figure
11.
Inflow/Outflow
Analysis
Data
contained
in
Trip
Generation
Handbook
(ITE
2004)
indicate
an
inverse
relationship
between
commercial
building
size
and
pass-‐by
trips.
For
commercial
developments,
the
trip
adjustment
factor
is
less
than
50%
because
retail
development
and
some
services,
like
day-‐care
centers,
attract
vehicles
as
they
pass
by
on
arterial
and
collector
roads.
For
example,
when
someone
stops
at
a
convenience
store
on
the
way
home
from
work,
the
convenience
store
is
not
the
primary
destination.
For
the
average
size
commercial
shopping
center,
the
ITE
data
indicates
that
on
average
34%
of
the
vehicles
that
enter
are
passing
by
on
their
way
to
some
other
primary
destination.
The
remaining
66%
of
attraction
trips
have
the
commercial
building
as
their
primary
destination.
Because
attraction
trips
are
half
of
all
trips,
the
trip
adjustment
factor
is
66%
multiplied
by
50%,
or
approximately
33%
of
the
trip
ends.
Trip
Length
Weighting
Factor
by
Type
of
Land
Use
The
streets
impact
fee
methodology
includes
a
percentage
adjustment,
or
weighting
factor,
to
account
for
trip
length
variation
by
type
of
land
use.
As
documented
in
Table
6
of
the
2009
National
Household
Travel
Survey,
vehicle
trips
from
residential
development
are
approximately
121%
of
the
average
trip
length.
The
residential
trip
length
adjustment
factor
includes
data
on
home-‐based
work
trips,
social
and
recreational
purposes.
Conversely,
shopping
trips
associated
with
commercial
development
are
roughly
66%
of
the
average
trip
length
while
other
nonresidential
development
typically
accounts
for
trips
that
are
73%
of
the
average
trip
length.
Lane
Capacity
Bozeman’s
street
impact
fees
are
based
on
a
lane
capacity
standard
of
7,500
vehicles
per
lane,
as
shown
in
Table
4-‐5
of
the
2007
Transportation
Plan.
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19
Future
Travel
Demand
The
projected
need
for
arterial
and
collector
lane
miles,
plus
improved
intersections,
is
a
function
of
the
ten-‐year
development
forecast
(see
Appendix
A)
and
the
existing
infrastructure
standards
discussed
above.
As
shown
in
Figure
12,
trip
generation
rates
and
trip
adjustment
factors
convert
projected
development
into
average
weekday
vehicle
trips.
A
typical
vehicle
trip,
such
as
a
person
leaving
their
home
and
traveling
to
work,
generally
begins
on
a
local
street
that
connects
to
a
collector
street,
which
connects
to
an
arterial
road
and
eventually
to
a
state
or
interstate
highway.
For
the
purpose
of
impact
fees,
this
progression
of
travel
up
and
down
the
functional
classification
chain
narrows
the
average
trip
length
determination
to
the
following
question,
“What
is
the
average
vehicle
trip
length
on
impact
fee
system
improvements
(i.e.,
the
same
type
of
arterial
and
collector
streets
used
to
document
current
infrastructure
standards)?”
With
117.6
lane
miles
of
system
improvements
and
a
lane
capacity
standard
of
7,500
vehicles
per
lane,
the
impact
fee
road
network
has
approximately
882,000
vehicle
miles
of
capacity
(i.e.,
7,500
vehicles
per
lane
using
the
entire
117.6
lane
miles).
To
derive
the
average
utilization
(i.e.,
average
trip
length
expressed
in
miles)
of
the
system
improvements,
we
divide
vehicle
miles
of
travel
by
the
vehicle
trips
attracted
to
development
in
Bozeman.
As
shown
below,
development
in
Bozeman
currently
attracts
172,116
average
weekday
vehicle
trips.
Dividing
882,000
vehicle
miles
of
capacity
by
172,116
average
weekday
vehicle
trips
yields
an
unweighted
average
trip
length
of
approximately
5.12
miles.
However,
the
calibration
of
average
trip
length
includes
the
same
adjustment
factors
used
in
the
impact
fee
calculations
(i.e.,
journey-‐to-‐work
commuting,
commercial
pass-‐by
adjustment,
and
average
trip
length
adjustment
by
type
of
land
use).
Using
a
series
of
spreadsheet
iterations,
the
weighted-‐average
trip
length
is
5.73
miles,
as
shown
above
in
Figure
10.
A
Vehicle
Mile
of
Travel
(VMT)
is
a
measurement
unit
equal
to
one
vehicle
traveling
one
mile.
In
the
aggregate,
VMT
is
the
product
of
vehicle
trips
multiplied
by
the
average
trip
length1.
Existing
infrastructure
standards
in
Bozeman
are
1.33
lane-‐miles
of
arterials
and
collectors
per
10,000
VMT
(see
Figure
12).
With
39
improved
intersections
and
881,436
vehicle
miles
of
travel,
the
existing
infrastructure
standard
is
0.44
improved
intersections
per
10,000
VMT.
To
maintain
the
existing
infrastructure
standards,
Bozeman
needs
an
additional
24.6
lane
miles
of
system
improvements
and
8.2
improved
intersections
to
accommodate
projected
development
over
the
next
ten
years.
The
total
cost
of
system
improvements,
including
intersections,
is
estimated
to
be
approximately
$29 .6
million
in
current
dollars
(i.e.
not
inflated
over
time).
1
Typical
VMT
calculations
for
development-‐specific
traffic
studies,
along
with
most
transportation
models
of
an
entire
urban
area,
are
derived
from
traffic
counts
on
particular
road
segments
multiplied
by
the
length
of
that
road
segment.
For
the
purpose
of
impact
fees,
VMT
calculations
are
based
on
attraction
(inbound)
trips
to
development
located
in
the
service
area,
with
the
trip
lengths
calibrated
to
the
road
network
considered
to
be
system
improvements.
This
refinement
eliminates
pass-‐through
or
external-‐
external
trips,
and
travel
on
roads
that
are
not
system
improvements
(e.g.
interstate
highways).
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20
Figure
12.
Needs
Analysis
7.
Proportionate
Share
Considerations
A
credit
for
future
gas
taxes
is
only
necessary
if
there
is
potential
double
payment
for
system
improvements.
In
Bozeman,
gas
tax
revenue
will
be
used
for
maintenance
of
existing
facilities,
correcting
existing
deficiencies,
and
for
capital
projects
that
are
not
impact
fee
system
improvements.
As
shown
in
Figure
13,
remaining
principal
payments
on
the
City’s
General
Obligation
Bond
for
transportation
are
divided
by
Vehicle
Miles
of
Travel
(VMT).
To
account
for
the
time
value
of
money,
the
annual
revenue
stream
was
discounted
to
yield
a
present
value
of
$0.84
per
VMT,
which
will
be
deducted
from
the
cost
of
system
improvements.
After
the
transportation
bond
is
paid
off,
the
City
could
eliminate
the
principal
payment
credit,
which
would
slightly
increase
the
street
impact
fee.
Figure
13.
Principal
Payment
Credit
8.
Methodology
The
formula
for
the
updated
streets
impact
fees
(see
Figure
1)
is
similar
to
Tindale-‐Oliver
&
Associates’
2008
study.
Input
variables
for
the
streets
impact
fee
are
shown
in
Figure
14.
Given
a
cost
factor
of
$1,202,000
per
lane
mile,
which
is
shared
by
7,500
vehicles
on
an
average
weekday,
the
capital
cost
is
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21
$160.27
per
VMT.
Deducting
the
revenue
credit
of
$0.84
per
VMT
yields
the
net
capital
cost
of
$159.43
per
VMT.
To
derive
the
street
impact
fee
for
a
housing
unit
with
1,400
square
feet
or
less
of
living
space
multiply
the
following
factors
from
Figure
14.
3.93
weekday
vehicle
trip
ends
per
housing
unit
x
0.57
trip
ends
to
inbound
trips
adjustment
factor
x
5.73
average
miles
per
trip
x
1.21
trip
length
adjustment
factor
by
general
type
of
land
use
x
$159.43
net
capital
cost
per
VMT
x
1.05
administrative
surcharge
=
$2,599
per
housing
unit
(truncated)
9.
Impact
Fee
Schedule
In
comparison
to
the
current
fee
schedule,
the
proposed
fee
schedule
(shown
below)
is
easier
to
administer.
For
example,
current
street
impact
fees
for
residential
development
required
decisions
regarding
type
of
construction,
ownership,
and
possibly
income
of
occupants.
The
proposed
fee
schedule
is
the
same
for
all
housing
units,
but
increases
by
floor
area.
Because
house
size
is
directly
correlated
to
persons,
vehicles
available,
and
income,
larger
units
tend
to
have
higher
trip
generation
rates
than
smaller
dwellings.
Supporting
documentation
on
trip
rates
by
house
size
may
be
found
at
the
end
of
Appendix
A.
For
nonresidential
development,
the
proposed
fee
schedule
has
consolidated
categories
and
eliminated
size
thresholds
for
both
retail
and
office.
The
current
fee
schedule
requires
smaller
retail
and
office
development
to
pay
more
per
1,000
square
feet
of
floor
area
than
larger
nonresidential
development,
like
big -‐box
retail
stores.
The
recommended
approach
should
increase
Bozeman’s
economic
competitiveness
while
helping
small
businesses,
which
tend
to
be
locally
owned
and
operated.
Proposed
street
impact
fees
(see
the
column
with
blue
shading
in
Figure
14)
are
compared
to
the
current
street
impact
fees,
which
are
only
60%
of
the
supportable
fee
amount.
The
current
fee
for
the
smallest
size
residential
unit
(i.e.
1400
square
feet
or
less)
is
the
amount
for
an
“Apartment.”
For
all
other
sizes,
the
current
fee
amount
is
based
on
detached
housing
according
to
three
size
thresholds.
The
two
columns
on
the
right
side
of
the
table
indicate
the
percentage
change
compared
to
the
fee
amount
currently
collected
and
the
supportable
fee
amount
from
the
2008
impact
fee
study.
Appendix
C
provides
supporting
documentation
for
a
recommended
29%
reduction
in
street
impact
fees
within
the
Trip
Exchange
District
(TED).
An
alternative
fee
schedule,
that
excludes
collectors,
is
shown
in
Appendix
D.
If
collectors
are
regarded
as
a
project-‐level
improvement,
impact
fees
are
reduced
but
the
cost
burden
shifts
to
individual
development
projects.
Also,
additional
collector
lane
miles
constructed
adjacent
to
individual
projects
may
leave
gaps
in
the
network
due
to
non-‐contiguous
(i.e.
“leap-‐frog”)
development.
The
gaps
could
be
funded
through
a
combination
of
special
assessments,
improvement
districts,
property
taxes,
and
Urban
Fund
(as
available).
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Figure
14.
Impact
Fee
Schedule
for
Streets
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23
Cash
Flow
Analysis
for
Streets
System
Improvements
Over
the
next
ten
years,
streets
impact
fees
should
yield
approximately
$29
million,
if
implemented
at
the
proposed
level.
The
cash
flow
estimate
provides
an
indication
of
the
impact
fee
revenue
and
expenditures
necessary
to
meet
the
projected
demand
for
system
improvements.
To
the
extent
the
rate
of
development
either
accelerates
or
slows
down,
there
will
be
a
corresponding
change
in
the
impact
fee
revenue
and
the
need
for
growth-‐related
improvements.
During
the
next
ten
years
(2013
through
2022),
Bozeman
anticipates
an
increase
of
approximately
3,800
housing
units
and
2.7
million
square
feet
of
nonresidential
floor
area.
See
Appendix
A
for
additional
discussion
of
the
development
projections
that
drive
the
cash
flow
analysis.
10.
Capital
Improvements
A
summary
of
planned
growth-‐related
system
improvements
for
streets
is
shown
in
Figure
15.
The
Capital
Improvement
Plan
(CIP)
for
FY13-‐17
identifies
12
lane
miles
of
road
segments,
which
is
about
half
of
the
growth-‐related
need
shown
in
Figure
12.
Planned
intersection
improvements
(8
over
the
next
ten
years)
match
the
need
analysis.
The
cumulative
cost
of
growth-‐related
system
improvements
to
be
funded
by
impact
fees
over
the
next
ten
years
is
approximately
$29.6
million
in
the
needs
analysis
(see
Figure
12)
and
approximately
$25
million
in
the
approved
CIP
(see
Figure
15).
The
City
of
Bozeman
selects
growth-‐related
capital
improvements
from
recommended
projects
for
streets
(see
Figure
5-‐2
in
the
2007
Transportation
Plan)
and
recommended
intersection
improvements
(see
Figure
5-‐4
in
the
2007
Transportation
Plan).
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Figure
15.
Streets
System
Capital
Improvements
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IMPLEMENTATION
AND
ADMINISTRATION
Upon
collection,
impact
fees
must
be
deposited
in
a
special
proprietary
fund,
which
must
be
invested
with
all
interest
accruing
to
the
fund
[see
7-‐6-‐1603
(1)
(a)].
The
City
of
Bozeman
complies
with
this
requirement.
Capital
Improvements
Plan
In
7-‐6-‐1602
(2)
(k),
Montana
requires
a
component
of
the
budget
that:
• Schedules
construction
of
public
facility
capital
improvements
to
serve
projected
growth;
• Projects
costs
of
the
capital
improvements;
• Allocates
collected
impact
fees
for
construction
of
the
capital
improvements;
and
• Covers
at
least
a
5-‐year
period
and
is
reviewed
and
updated
at
least
every
2
years.
The
City
of
Bozeman
complies
with
this
requirement
in
the
approved
CIP,
the
latest
version
covering
FY13-‐17.
Construction
of
Public
Facilities
in
Lieu
of
Payment
of
Impact
Fees
In
7-‐6-‐1603
(4),
Montana
legislation
addresses
site-‐specific
credits
or
developer
reimbursements
for
system
improvements
that
have
been
included
in
the
impact
fee
calculations.
Project-‐level
improvements
normally
required
as
part
of
the
development
approval
process
are
not
eligible
for
credits
against
development
impact
fees.
Specific
policies
and
procedures
related
to
site-‐specific
credits
or
developer
reimbursements
for
system
improvements
have
been
addressed
in
the
ordinance
that
establishes
the
City’s
development
impact
fees.
Impact
Fee
Advisory
Committee
The
City
of
Bozeman
has
established
the
required
advisory
committee,
as
specified
in
7-‐6-‐1604.
The
committee
reviews
and
monitors
the
process
of
calculating,
assessing,
and
spending
impact
fees.
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APPENDIX
A:
DEMOGRAPHIC
DATA
Supporting
documentation
on
population,
housing
units,
jobs,
and
nonresidential
floor
area
is
essential
in
order
to
update
development
impact
fees
for
the
City
of
Bozeman.
Although
long-‐range
projections
are
necessary
for
planning
capital
improvements,
a
shorter
time
frame
of
five
to
ten
years
is
critical
for
the
impact
fees
analysis.
Infrastructure
standards
are
calibrated
using
the
latest
available
data
and
the
first
projection
year
is
fiscal
year
2012-‐13.
In
the
City
of
Bozeman
the
fiscal
year
begins
on
July
1st.
Summary
of
Growth
Indicators
Development
projections
and
growth
rates
are
summarized
in
Figure
A1.
These
projections
will
be
used
to
estimate
impact
fee
revenue
and
to
indicate
the
anticipated
need
for
growth-‐related
infrastructure.
However,
impact
fees
methodologies
are
designed
to
reduce
sensitivity
to
accurate
development
projections
in
the
determination
of
the
proportionate-‐share
fee
amounts.
If
actual
development
is
slower
than
projected,
impact
fees
revenues
will
also
decline,
but
so
will
the
need
for
growth-‐related
infrastructure.
In
contrast,
if
development
is
faster
than
anticipated,
the
City
will
receive
an
increase
in
impact
fee
revenue,
but
will
also
need
to
accelerate
the
capital
improvements
program
to
keep
pace
with
the
actual
rate
of
development.
Bozeman
specific
base
data
for
the
demographic
analysis
and
development
projections
include
2010
census
counts
of
population
and
housing
units,
American
Community
Survey
tables
and
Public
Use
Micro-‐data
Samples
(PUMS),
plus
databases
provided
by
City
staff
including
Montana
Department
of
Revenue
data
on
floor
area
and
utility
billing
records.
The
projected
increase
in
housing
units
is
based
on
the
City’s
population
projection
from
the
2009
Community
Plan,
but
instead
of
54,500
residents
by
2015,
the
projections
for
the
impact
fee
analysis
assume
this
population
level
will
not
be
reached
until
2030.
Projected
population
was
converted
to
housing
units
using
the
2010
average
of
2.13
year-‐round
residents
per
housing
unit.
Given
the
five-‐year
update
cycle
for
impact
fees,
TischlerBise
did
not
vary
this
ratio
over
time
or
assume
any
changes
to
vacancy
rates
in
Bozeman,
which
was
approximately
10%
at
the
time
of
the
2010
census.
From
the
2000
to
2010
census,
Bozeman
had
an
average
annual
increase
of
589
housing
units
per
year.
According
to
the
City’s
building
permits
(see
Year
2010
Annual
Report
from
the
Department
of
Planning
and
Community
Development),
2005
was
the
peak
year
for
residential
construction
with
955
housing
units.
The
low
point
for
the
past
decade
was
2009
with
182
housing
units
permitted.
Residential
constructed
increased
slightly
in
2010
to
208
units.
Based
on
54,500
residents
by
2030,
Bozeman
would
see
an
increase
of
341
units
in
2012,
increasing
slowly
over
time
to
375
housing
units
being
constructed
in
2017.
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Because
the
2009
Community
Plan
does
not
provide
job
projections
for
Bozeman,
TischlerBise
assumed
a
constant
jobs-‐to-‐housing
ratio,
yielding
35,647
jobs
in
2030.
Current
ratios
of
floor
area
per
job,
for
four
general
types
of
nonresidential
development,
were
used
to
convert
projected
jobs
into
the
floor
area
increase
shown
below.
For
both
residential
and
nonresidential
development,
the
impact
fee
study
assumes
a
compound
annual
growth
rate
1.9%.
Figure
A1
–
Development
Projections
and
Growth
Rates
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Recent
Residential
Construction
Since
2000,
Bozeman
has
increased
by
an
average
of
589
housing
units
per
year.
The
chart
at
the
bottom
of
Figure
A2
indicates
the
estimated
number
of
housing
units
added
by
decade
in
Bozeman.
Consistent
with
the
nationwide
decline
in
development
activity,
residential
construction
has
slowed
significantly
since
2008.
Even
with
the
recent
drop
in
housing
starts,
Bozeman
added
more
units
during
the
past
decade
than
any
previous
decade.
Figure
A2
–
Housing
Units
by
Decade
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Population
and
Jobs
Forecast
To
provide
context
for
population
and
job
growth
in
Bozeman,
TischlerBise
prepared
comparisons
to
Gallatin
County
projections
published
by
Woods
&
Poole
Economics
(2011).
As
shown
below,
July
1st
population
data
for
the
entire
county
is
compared
to
1990-‐2010
census
data
for
the
City
of
Bozeman
(April
1st).
Woods
&
Poole
annually
updates
a
database
containing
more
than
900
economic
and
demographic
variables
for
every
county
in
the
United
States.
Their
economic
and
demographic
projections
use
an
integrated
projection
model,
so
that
changes
in
one
county
will
affect
growth
or
decline
in
other
counties.
The
methods
used
by
Woods
&
Poole
to
generate
county
projections
proceed
in
four
stages.
First,
forecasts
to
2040
of
total
United
States
personal
income,
earnings
by
industry,
employment
by
industry,
population,
inflation,
and
other
variables
are
made.
Second,
the
country
is
divided
into
179
Economic
Areas
(EA)
as
defined
by
the
U.S.
Department
of
Commerce,
Bureau
of
Economic
Analysis
(BEA).
EAs
are
aggregates
of
contiguous
counties
that
attempt
to
measure
cohesive
economic
regions
in
the
United
States.
For
each
EA,
a
projection
is
made
for
employment,
using
an
“export-‐base”
approach.
The
employment
projection
for
each
EA
is
then
used
to
estimate
earnings
in
each
EA.
The
employment
and
earnings
projections
then
become
the
principal
explanatory
variables
used
to
estimate
population
and
number
of
households
in
each
EA.
The
third
stage
is
to
project
population
by
age,
sex,
and
race
for
each
EA
on
the
basis
of
net
migration
rates
associated
with
employment
opportunities.
For
stages
two
and
three,
the
U.S.
projection
is
the
control
total
for
the
EA
projections.
The
fourth
stage
replicates
stages
two
and
three
except
that
it
is
performed
at
the
county
level,
using
the
EAs
as
the
control
total
for
the
county
projections.
Figure
A3
indicates
the
City’s
share
of
countywide
population
over
time.
Bozeman’s
2009
Community
Plan
projected
a
population
of
54,500
by
2015
(see
Table
A-‐12
in
Appendix
B),
based
on
growth
rates
prior
to
the
Great
Recession.
Due
to
the
significant
decrease
in
housing
construction
in
recent
years,
the
impact
fee
update
assumes
this
population
level
will
not
be
reached
until
2030.
Given
these
projections
of
total
County
and
City
population,
Bozeman
would
experience
a
decrease
in
population
share
over
the
next
20
years.
To
derive
annual
data
for
the
impact
fee
analysis,
TischlerBise
used
an
exponential
growth
formula
to
yield
more
conservative
short-‐term
development
increases.
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Figure
A3
–
City
of
Bozeman
Population
Share
In
addition
to
data
on
residential
development,
the
calculation
of
impact
fees
requires
data
on
nonresidential
development.
TischlerBise
uses
the
term
“jobs”
to
refer
to
employment
by
place
of
work.
Similar
to
the
population
share
evaluation
discussed
above,
countywide
jobs
are
shown
in
Figure
A4
along
with
the
City
of
Bozeman
job
share.
Countywide
jobs
are
from
Woods
&
Poole
Economics
(2011),
scaled
according
to
the
year
2000
ratio
of
jobs
reported
by
the
Census
Transportation
Planning
Package
(CTPP)
compared
to
the
Bureau
of
Economic
Analysis
(BEA)
job
data
used
by
Woods
&
Poole.
For
the
purpose
of
transportation
impact
fees,
CTPP
data
provide
a
better
representation
of
the
demand
for
journey-‐to-‐work
travel.
BEA
includes
self-‐employed,
sole
proprietors,
and
part-‐time
employment.
Even
though
2010
CTPP
data
is
not
yet
available,
the
methodology
for
deriving
these
two
data
sets
has
not
changed
significantly
over
the
past
decade.
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For
the
City
of
Bozeman,
TischlerBise
assumed
a
constant
jobs-‐to-‐housing
ratio
over
time,
starting
from
the
2010
job
estimate
available
from
OnTheMap
(U.S.
Census
Bureau
web
application).
TischlerBise
also
used
an
exponential
formula
to
derive
annual
jobs
from
2010
to
2030,
thus
minimizing
short-‐term
increases
in
jobs
and
nonresidential
floor
area.
Jobs
were
converted
to
nonresidential
floor
area
using
average
square
feet
per
employee
multipliers,
as
discussed
further
below.
Figure
A4
–
City
of
Bozeman
Job
Share
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Jobs
by
Type
of
Nonresidential
Development
Figure
A5
indicates
2011
estimates
of
jobs
and
nonresidential
floor
area
located
in
Bozeman.
Current
floor
area
was
derived
from
Montana
Department
of
Revenue
(DOR)
parcel
data,
aggregated
into
four
nonresidential
categories
using
DOR
land
use
descriptions2.
General
land
use
types
are
based
on
two-‐
digit
industry
sectors
(NAICS),
with
Health
Care
&
Social
Assistance
shown
separately
for
the
purpose
of
the
fire
impact
fee
analysis.
The
percentage
distribution
of
jobs
by
type
of
nonresidential
development
was
obtained
from
the
U.S.
Census
Bureau’s
On-‐The-‐Map
web
application.
Average
square
feet
of
floor
area
per
job,
for
the
four
categories,
helped
TischlerBise
select
nonresidential
prototypes
to
be
used
in
the
transportation
and
fire
impact
fee
analysis,
as
discussed
further
below.
Figure
A5
–
Jobs
and
Floor
Area
Estimate
2
See
Appendix
B
for
a
listing
of
the
DOR
categories
aggregated
into
four
general
types
of
nonresidential
development.
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Employees
per
Square
Foot
of
Nonresidential
Development
In
Figure
A6,
gray
shading
indicates
four
nonresidential
development
prototypes
used
by
TischlerBise
to
derive
vehicle
trips
and
estimate
potential
impact
fee
revenue.
The
prototype
development
for
industrial
jobs
is
“Warehousing”.
Average
weekday
vehicle
trip
generation
rates
are
from
the
Institute
of
Transportation
Engineers
(ITE
2008).
The
prototype
for
Retail,
Food
&
Accommodation
Services
is
an
average-‐size
shopping
center.
The
prototype
for
Health
Care
&
Social
Assistance
is
“Hospital”.
For
all
other
service
jobs,
the
development
prototype
is
an
average-‐size
general
office
building.
Figure
A6
–
Employee
and
Building
Area
Ratios
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Detailed
Development
Projections
Demographic
data
shown
in
Figure
A7
provide
key
inputs
for
updating
development
impact
fees
in
the
City
of
Bozeman.
Cumulative
data
are
shown
at
the
top
and
projected
annual
increases
by
type
of
development
are
shown
at
the
bottom
of
the
table.
Given
the
expectation
that
impact
fees
are
updated
every
three
to
five
years,
TischlerBise
did
not
evaluate
long-‐term
demographic
trends
such
as
declining
household
size.
As
discussed
in
the
next
section,
TischlerBise
recommends
the
use
of
persons
per
housing
unit
to
derive
impact
fees.
Therefore,
vacancy
rates
and
number
of
households
are
not
essential
to
the
demographic
analysis.
Figure
A7
–
Annual
Demographic
Data
Persons
per
Housing
Unit
The
2010
census
did
not
obtain
detailed
information
using
a
“long-‐form”
questionnaire.
Instead,
the
U.S.
Census
Bureau
has
switched
to
a
continuous
monthly
mailing
of
surveys,
known
as
the
American
Community
Survey
(ACS),
which
is
limited
by
sample-‐size
constraints
in
areas
with
relatively
few
residents.
For
cities
like
Bozeman,
data
on
detached
housing
units
are
now
combined
with
attached
single
units
(commonly
known
as
townhouses).
Part
of
the
rationale
for
deriving
fees
by
housing
unit
size,
as
discussed
further
below,
is
to
address
this
ACS
data
limitation.
Because
townhouses
and
mobile
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homes
generally
have
less
floor
area
than
detached
units,
fees
by
house
size
ensure
proportionality
and
facilitate
construction
of
affordable
units.
According
to
the
U.S.
Census
Bureau,
a
household
is
a
housing
unit
that
is
occupied
by
year-‐round
residents.
Impact
fees
often
use
per
capita
standards
and
persons
per
housing
unit
or
persons
per
household
to
derive
proportionate-‐share
fee
amounts.
When
persons
per
housing
unit
are
used
in
the
fee
calculations,
infrastructure
standards
are
derived
using
year-‐round
population.
When
persons
per
household
are
used
in
the
fee
calculations,
the
impact
fee
methodology
assumes
all
housing
units
will
be
occupied,
thus
requiring
seasonal
or
peak
population
to
be
used
when
deriving
infrastructure
standards.
TischlerBise
recommends
that
impact
fees
for
residential
development
in
the
City
of
Bozeman
be
imposed
according
to
the
number
of
year-‐round
residents
per
housing
unit.
As
shown
at
the
bottom
of
Figure
A8,
census
data
indicates
Bozeman
had
17,464
housing
units
in
2010.
In
2010,
dwellings
with
a
single
unit
per
structure
(detached,
attached,
and
mobile
homes)
averaged
2.23
persons
per
housing
unit.
Dwellings
in
structures
with
multiple
units
averaged
1.62
year-‐round
residents
per
unit.
Figure
A8
–
Year-‐Round
Persons
per
Unit
by
Type
of
Housing
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Customized
Trip
Generation
Rates
per
Housing
Unit
As
an
alternative
to
simply
using
the
national
average
trip
generation
rate
for
residential
development,
the
Institute
of
Transportation
Engineers
(ITE)
publishes
regression
curve
formulas
that
may
be
used
to
derive
custom
trip
generation
rates
using
local
demographic
data.
Key
independent
variables
needed
for
the
analysis
(i.e.
vehicles
available,
housing
units,
households
and
persons)
are
available
from
American
Community
Survey
(ACS
2008-‐2010)
data
for
Bozeman.
Customized
average
weekday
trip
generation
rates
by
type
of
housing
are
shown
in
Figure
A9.
A
vehicle
trip
end
represents
a
vehicle
either
entering
or
exiting
a
development,
as
if
a
traffic
counter
were
placed
across
a
driveway.
Figure
A9
-‐
Residential
Trip
Generation
Rates
by
Type
of
Housing
Demand
Indicators
by
Size
of
Housing
The
impact
fee
update
recommends
residential
impact
fees
that
increase
with
floor
area
of
living
space.
An
extensive
analysis
of
demographic
data
from
the
U.S.
Census
Bureau
and
unit
size
data
from
Montana
DOR
supports
the
proportionate
share
methodology
for
the
proposed
cost
allocation.
Number
of
bedrooms
is
the
common
connection
between
the
two
databases,
with
the
analysis
limited
to
units
constructed
during
the
past
two
decades.
As
shown
in
Figure
10,
the
average-‐size
one
bedroom
117
2012
Streets
Development
Impact
Fee
Study
Bozeman,
Montana
37
dwelling
in
Bozeman
has
1,254
square
feet
of
living
area.
The
average
size
of
a
two-‐bedroom
unit
is
1,966
square
feet
of
living
area.
Housing
units
with
three
bedrooms
average
2,065
square
feet
of
living
area.
Due
to
sample-‐size
limitations
in
the
demographic
data
(discussed
further
below),
TischlerBise
aggregated
all
units
with
four
or
more
bedrooms.
These
large
units
average
3,189
square
feet
of
living
space.
Figure
A10
–
Floor
Area
of
Living
Space
by
Bedrooms
118
2012
Streets
Development
Impact
Fee
Study
Bozeman,
Montana
38
Custom
tabulations
of
demographic
data
by
bedroom
range
can
be
created
from
individual
survey
responses
provided
by
the
U.S.
Census
Bureau,
in
files
known
as
Public
Use
Micro-‐data
Samples
(PUMS).
Because
PUMS
files
are
only
available
for
areas
of
roughly
100,000
persons,
the
City
of
Bozeman
is
included
in
Public
Use
Micro-‐data
Area
(PUMA)
00500,
which
includes
five
counties
(Meagher,
Park,
Gallatin,
Madison,
and
Beaverhead).
As
shown
in
Figure
A11,
TischlerBise
derived
trip
generation
rates
and
average
persons
per
housing
unit
by
bedroom
range,
from
PUMS
data.
Recommended
multipliers
were
scaled
to
make
the
average
value
for
all
housing
units
in
PUMA
00500
match
the
average
value
derived
from
2010
census
data
for
the
City
of
Bozeman.
For
example,
the
PUMS-‐derived
average
of
1.87
persons
per
housing
unit
was
less
than
the
actual
average
in
Bozeman
(2.13
persons
per
housing
unit
as
shown
in
Figure
A8).
Multiplying
the
PUMS-‐derived
average
for
each
bedroom
range
by
2.13/1.87
increases
persons
per
housing
unit
to
the
Bozeman-‐specific
data.
The
recommended
multipliers
shown
below
are
for
all
types
of
housing
units
(consolidated
residential
analysis
of
units
constructed
1990-‐
2010).
Figure
A11
–
Vehicle
Trips
and
Persons
by
Bedroom
Range
Trip
Generation
by
Floor
Area
To
derive
average
weekday
vehicle
trip
ends
by
house
size,
TischlerBise
combined
demographic
data
from
the
Census
Bureau
and
floor
area
data
obtained
by
City
staff
from
the
Montana
Department
of
Revenue.
Average
floor
area
and
weekday
vehicle
trip
ends
by
bedroom
range
are
plotted
in
Figure
A12,
with
a
logarithmic
trend
line
derived
from
the
four
actual
averages
in
Bozeman.
TischlerBise
used
the
trend
line
formula
to
derive
estimated
trip
ends
by
size
of
single
unit
house,
in
200
square
feet
intervals.
The
weighted
average
residential
unit
has
2,357
square
feet
of
living
space.
A
small
unit
of
1,400
square
feet
or
less
would
pay
60%
of
the
transportation
impact
fee
paid
by
an
average
size
unit.
A
large
unit
of
3,001
square
feet
or
more
would
pay
122%
of
the
transportation
impact
fee
paid
by
an
average
size
unit.
In
the
2008
transportation
impact
fee
study,
the
fee
schedule
for
single-‐family
units
119
2012
Streets
Development
Impact
Fee
Study
Bozeman,
Montana
39
was
also
structured
with
size
thresholds
in
combination
with
income
criteria,
but
in
one
thousand
square
feet
thresholds.
Figure
A12
–
Vehicle
Trips
by
Dwelling
Size
120
2012
Streets
Development
Impact
Fee
Study
Bozeman,
Montana
40
APPENDIX
B:
FLOOR
AREA
CODES
121
2012
Streets
Development
Impact
Fee
Study
Bozeman,
Montana
41
APPENDIX
C:
FEE
REDUCTION
IN
TRIP
EXCHANGE
DISTRICT
(TED)
Urban
areas
like
downtown
Bozeman
have
distinct
demographic
profiles
and
physical
traits
that
reduce
vehicle
trips,
such
as
higher
internal
capture,
design
characteristics
that
promote
walking
and
biking,
and
superior
transit
service.
A
recent
report
“documents
that
vibrant
downtown
areas
are
associated
with
lower
greenhouse
gas
emissions
from
driving
and
greater
public
transit
use
…
seemingly
unrelated
efforts,
such
as
fighting
crime
and
improving
urban
schools,
actually
make
for
good
environmental
policy,
as
these
efforts
enable
people
to
live
in
higher
density,
more
compact
neighborhoods
where
people
are
comfortable
driving
less
and
walking
and
using
transit
more.”3
Downtown
areas
have
more
diverse
travel
options
including
public
transportation
and
muscle-‐powered
mobility.
For
example,
a
study
titled
Trip
Generation
Rates
for
Urban
Infill
Land
Uses
in
California
documented
auto
trips
averaged
approximately
50%
of
the
modal
share,
compared
to
90%
or
higher
auto
dependency
in
most
metropolitan
areas.4
Lower
dependency
on
private
vehicles
reduces
the
need
for
street
capacity
and
supports
an
impact
fee
reduction
for
new
development
in
downtown
Bozeman.
The
report
Driving
and
the
Built
Environment
found
a
strong
link
between
development
patterns
and
vehicle
miles
of
travel,
encouraging
mixing
of
land
uses
to
reduce
vehicle
trip
rates
and
reduce
trip
lengths.5
Recommended
reductions
up
to
24%
for
transit
service
and
pedestrian/bicycle
friendliness
is
recommended
for
nonresidential
development
in
a
2005
study
titled
Crediting
Low -‐Traffic
Developments.6
However,
the
detailed
methodology
in
this
study
requires
extensive
data
on
average
weekday
bus
stops
within
a
quarter
mile
of
the
study
area,
intersection
density,
and
the
completeness
of
sidewalk
and
bike
networks.
Jobs-‐Housing
Balance
By
balancing
the
number
of
jobs
with
nearby
housing
units,
urban
centers
have
the
potential
for
reducing
journey-‐to-‐work
travel.
The
magnitude
of
effect
is
dependent
on
matching
job
and
housing
locations
of
individual
workers,
which
can
be
aided
by
offering
a
variety
of
housing
styles
and
price
ranges
within
downtown
Bozeman.
Inclusionary
policies,
such
as
requiring
at
least
10%
affordable
housing
units
within
each
development,
can
foster
a
better
jobs-‐housing
balance
and
reduce
the
need
for
street
capacity.
Mixed
Use
Development
with
Local-‐Serving
Retail
Large-‐scale,
mixed-‐use
developments
exhibit
lower
vehicular
trips
because
of
“internal
capture”
(i.e.,
many
daily
destinations
do
not
require
travel
outside
the
study
area).
For
example,
a
study
titled
Internalizing
Travel
by
Mixing
Land
Uses
examined
20
mixed
use
communities
in
South
Florida,
documenting
internal
capture
rates
up
to
57
percent
with
an
average
of
25
percent.7
In
addition
to
a
percent
reduction
for
the
jobs-‐housing
balance
in
downtown
Bozeman,
credit
can
be
given
for
local-‐
3
Matthew
Holian
and
Matthew
Kahn.
Impact
of
Center
City
Economic
and
Cultural
Vibrancy
on
Greenhouse
Gas
Emissions
from
Transportation.
Mineta
Transportation
Institute,
Report
11-‐13,
2012.
4
James
M.
Daisa
and
Terry
Parker,
ITE
Journal,
2009.
5
Transportation
Research
Board
Special
Report
298,
Washington,
DC:
2009.
6
Nelson
/
Nygaard
Consulting
Associates.
7
Reid
Ewing,
Eric
Dumbaugh,
and
Mike
Brown.
Transportation
Research
Record
1780,
2003.
122
2012
Streets
Development
Impact
Fee
Study
Bozeman,
Montana
42
serving
retail.
Urban,
transit-‐oriented
development
offers
coffee
shops,
restaurants,
general
retail
stores
and
services
that
reduce
the
need
for
vehicular
trips
outside
the
area.8
Urban
Development
Pattern
Urban
areas
with
grid
streets
and
small
blocks
offer
a
variety
of
routes
that
encourage
walking
and
biking.
Interesting
streetscapes
with
human-‐scale
design
features
encourage
people
to
walk
and
bike
farther
in
urban
areas,
while
lowering
our
perception
of
distance.9
Also,
vehicle
congestion
in
many
urban
centers
tends
to
minimize
travel
time
differences
across
modes,
especially
when
public
transit
is
provided
in
separate
rights-‐of-‐way
or
given
priority
signaling
at
intersections.
TED
Recommendation
Consistent
with
the
literature
summarized
above,
a
recent
analysis
of
mixed-‐use
developments
in
six
regions
of
the
United
States
found
an
average
29%
reduction
in
trip
generation
as
a
function
of
“D”
variables,
including:
density,
diversity,
design,
destination
accessibility,
distance
to
transit,
demographics,
and
development
scale.10
Because
mixed-‐use
development
located
in
downtown
Bozeman
will
put
less
strain
on
the
external
street
network,
trip
generation
rates
should
be
less
than
standalone
suburban
development.
Therefore,
TischlerBise
recommends
a
29%
reduction
in
street
impact
fees
for
all
types
of
new
development
in
downtown
Bozeman.
The
TED
is
currently
delineated
by
the
B3
zoning
district,
which
is
only
used
in
downtown
Bozeman.
TischlerBise
also
recommend
the
TED
boundary
be
defined
as
the
larger
of
the
B3
Zoning
(red
line)
or
the
Tax
Increment
District
(yellow
line)
shown
in
the
map
below.
By
using
the
larger
of
either
area,
the
TED
will
be
slightly
larger
but
still
relies
on
existing
geographic
areas.
8
Brian
S.
Bochner,
Kevin
G.
Hooper,
and
Benjamin
R.
Sperry,
Improving
Estimation
of
Internal
Trip
Capture
for
Mixed-‐Use
Development,
ITE
Journal,
2010.
9
Alan
Jacobs,
2001.
Great
Streets.
MIT
Press.
10
Reid
Ewing,
Michael
Greenwald,
Ming
Zhang,
Jerry
Walters,
Mark
Feldman,
Robert
Cervero,
Lawrence
Frank,
and
John
Thomas.
Traffic
Generated
by
Mixed-‐Use
Developments:
Six-‐Region
Study
Using
Consistent
Built
Environmental
Measures.
Journal
of
Urban
Planning
and
Development,
2011.
123
2012
Streets
Development
Impact
Fee
Study
Bozeman,
Montana
43
Map
of
Downtown
Bozeman
124
2012
Streets
Development
Impact
Fee
Study
Bozeman,
Montana
44
APPENDIX
D:
ALTERNATIVE
FEES
WITHOUT
COLLECTORS
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127
128
129
130
131
132
133
134
135
136
137
138
139
140
141
142
143
144
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148
149
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152
153
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155
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157
158
159
160
161
162
163
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165
166
167
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Page 1 of 11
Impact Fee Advisory Committee Meeting– August 16, 2012
** MINUTES ** THE CITY OF BOZEMAN
IMPACT FEE ADVISORY COMMITTEE
THURSDAY, AUGUST 16, 2012 Chairperson Nickelson called the meeting to order at 6:03 p.m., in the City Commission Meeting
Room, City Hall, 121 North Rouse Avenue, Bozeman, Montana.
Members Present Staff Present James Nickelson, Chairperson Tara Hastie, Recording Secretary
David Graham, Vice Chairperson Chris Saunders, Assistant Planning Director
Anna Rosenberry
Brian Heaston
George Thompson Erik Nelson
Rob Evans
Members Absent
Randy Carpenter Guests Present
Daryl Schliem
Ann Kesting
Cordell Pool Chris Mehl, City Commission Liaison ITEM 2. MINUTES OF MAY 24, 2012.
MOTION: Ms. Rosenberry moved, Mr. Nelson seconded, to approve the minutes of May 24, 2012 as presented. The motion carried 6-0. Those voting aye being Vice Chairperson Graham, Mr. Nelson, Mr. Thompson, Mr. Heaston, Ms. Rosenberry, and Chairperson Nickelson. Those
voting nay being none.
ITEM 3. MINUTES OF JUNE 14, 2012. MOTION: Ms. Rosenberry moved, Mr. Heaston seconded, to approve the minutes of June 14,
2012 as presented. The motion carried 6-0. Those voting aye being Vice Chairperson Graham,
Mr. Nelson, Mr. Thompson, Mr. Heaston, Ms. Rosenberry, and Chairperson Nickelson. Those
voting nay being none. ITEM 4. PUBLIC COMMENT {Limited to any public matter within the jurisdiction of the Impact Fee Advisory
Committee and not scheduled on this agenda. (Three-minute time limit per speaker.}
No public comment was forthcoming.
240
Page 2 of 11
Impact Fee Advisory Committee Meeting– August 16, 2012
ITEM 5. CITY COMMISSION LIAISON {A standing item to be used as needed}
Mr. Mehl noted that Mr. Evans was on his way, and that the City Commission hoped the fee studies would be adopted by the end of the year.
ITEM 6. BY-LAWS
1. Revocation of proxy from adopted by-laws.
Assistant Planning Director Saunders noted the by-laws had been reviewed by the City
Attorney and he had requested the Impact Fee Advisory Committee repeal the by-laws. He
added that the City Clerk and city Attorney are developing a model by-laws document for use
by advisory boards. MOTION: Mr. Nelson moved, Mr. Mr. Thompson seconded, to approve the amendment to the
by-laws as presented.
Ms. Rosenberry stated she had a general understanding of what the City Attorney intended with regard to the removal of the proxy voting language and she was in favor of the repeal. She
stated it was nice to keep the ability to conduct business through proxy votes.
Chairperson Nickelson stated he echoed Ms. Rosenberry’s comments that it was nice to keep
the ability to conduct business through proxy voting.
The motion carried 6-0. Those voting aye being Vice Chairperson Graham, Mr. Nelson, Mr.
Thompson, Mr. Heaston, Ms. Rosenberry, and Chairperson Nickelson. Those voting nay being
none.
ITEM 7. PROJECT REVIEW
Assistant Planning Director Saunders noted the Committee had previously discussed draft of
the studies and their suggestions had been incorporated into the current proposals. He noted
this was the first public hearing that would be held and if they believed appropriate, they could act tonight or take more time to consider the proposals. He introduced Dwayne Guthrie from
Tischler Bise and noted the City Commission would conduct at least one public hearing on the
proposals. He stated the proposed were drafts and changes could be made if something needed
clarification. He stated the impact fees were only one portion of the overall funding necessary
to operate the systems, whatever they may be.
A. Presentation by Tischler Bise.
1. Transportation Impact Fee update.
2. Fire/EMS Impact Fee update.
241
Page 3 of 11
Impact Fee Advisory Committee Meeting– August 16, 2012
3. Water Impact Fee update.
4. Wastewater Impact Fee update.
Mr. Guthrie stated he wanted to highlight the major changes first and then move to the more minor changes in each study. He noted compliance with Montana Law had initiated some of
the changes and additional needs in Capital Improvements had also been addressed. He noted
the amount for each unit increase in service demand had also been addressed. He stated the last
time fees had been done were during the recession, but the most detailed data from the census bureau had been used to provide the current fees as well as data specific to Bozeman. He stated the Department of Revenue data had been used to determine the living space by number of
bedrooms and persons per housing unit.
Mr. Guthrie directed the Committee to the summary slides for methods and cost components and noted which fees included cost recovery; water and sewer. He noted for the streets the incremental expansion method would be utilized. He stated the current fees for water/sewer
were proposed to be assessed by unit size instead of meter size and all development would pay
water distribution and sewer collection fees based on the area of the lot.
Mr. Guthrie directed the Committee to the current fees and the information necessary that was to determine the fees; he noted the summary indicated the proposed impact fees were all less
than the current fees though there would be variations to those fees. He stated that generally the
street impact fees would be less, but not always based on the size of the housing units.
Assistant Director Saunders clarified that the white column in the examples was reflecting the number of dollars actually collected and was not 100% of the cost. Mr. Guthrie confirmed that Assistant Director Saunders was correct and that 60% could be assumed unless he noted
otherwise. He noted it was basically the same pattern of lesser fees as had initially been
proposed and the most significant change was within the Trip Exchange District which had
been expanded to include discounts to all types of development. Examples of how the studied fees would apply to several uses were shown.
Mr. Evans joined the Committee.
Mr. Guthrie explained those types of development that had been consolidated into single categories for transportation fees and noted they generated higher trips than other uses. He stated the average trip lengths were longer than the previous draft had been and it was part of
the methodology driven by the Montana Act to document a specific level of service. Assistant
Director Saunders noted the actual lot sizes and meter sizes that would be used had been used to
determine the rates. Mr. Guthrie noted the industrial use numbers were relatively close to those originally proposed and added that in the trip exchange district the numbers were a little bit higher for restaurants but would receive a 29% reduction for streets.
Mr. Guthrie directed the Committee to the major changes in the water fees including;
redundancy mains, water distribution, and the exclusion of a new dam due to more conservative development numbers. He noted the City of Bozeman water billing records from 2009 to 2011 for water/sewer demand were from newer units by year built. He suggested the City’s
242
Page 4 of 11
Impact Fee Advisory Committee Meeting– August 16, 2012
conservation efforts were working and less was being used over time and still the average was
slightly more than all the housing units in Bozeman; people were irrigating more and providing
for the increased usage. He stated they had used the demand factors for the newer units for
both the water and sewer fees proposed. He explained the per acres approach to the water distribution system and noted the relative size of the current city limits; he noted the areas with conservation easements or locations where there would be no development had been removed
from the service area calculations. He revisited the mathematical calculation with regard to the
water distribution cost for linear feet per acre and noted the gross acres were converted to net
acres and the road right of ways had been removed. He noted the cost per gallon had been presented at the last meeting and they had used an average day basis instead of a peak day basis. He noted a credit would be allowed at a cost per gallon basis as a result of the bond
financing. He noted the housing and lot size would play a factor in the water impact fee
distribution as an average housing unit, which could lower the cost of the fee up to $1,068.00
than the current fee. Mr. Guthrie noted the cash flow analysis indicated a yield of 3.99 million dollars for the Water
Treatment Plant debt service payments as well as 4.34 million dollars for the expansion of the
water distribution system over 5 years.
Mr. Nelson asked for clarification of the 18% reduction Mr. Guthrie had spoken of. Mr. Guthrie responded it was an allowable reduction to subtract the road right of way. Mr. Nelson
asked if parkland had been considered. Mr. Guthrie responded it had not. Assistant Director
Saunders responded private and public open spaces would be included and noted that the
consideration was how far the pipes would have to reach in order to deliver the service and was purely a geographical distribution. Mr. Guthrie concurred. Ms. Rosenberry asked if the impact fee was paid, it would be for construction on a lot and not the parkland how the acreage cost
would be calculated given that park projects paid impact fees as well. Mr. Guthrie suggested it
would make the cost per acre go up, but the major park land area could be removed from the
acreage. Assistant Director Saunders responded Staff would have to investigate the issue and determine a recommendation.
Vice Chairperson Graham asked if an average house size had been used to determine the
proposed fees. Mr. Guthrie responded an average house size and had been used. Assistant
Director Saunders further explained the range of sizes that would be representative of what was actually being constructed in Bozeman. Vice Chairperson Graham asked for clarification of how the lot size was also used to determine the fee. Mr. Guthrie responded the geographic
spread of the surface area was a function of the amount of area that was being developed to
cover the service area; more units per acres would mean cost would be reduced.
Mr. Nelson asked that in the event of a 12,000 square foot lot that already had piping going past it, would the fee be cheaper for the infill of an existing boundary. Assistant Director Saunders
responded the water distribution only referred to expansion or new construction. Mr. Guthrie
added that an existing lot with something already on it would not be required to pay that fee.
Assistant Director Saunders added that if the redevelopment were an intensification of use, the site would be required to make up the difference in uses.
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Chairperson Nickelson asked if the land use inventory would have an effect on the fees
assessed. Assistant Director Saunders responded that the data being used looked at physical
occupancy of the site and would be considered undeveloped if it was vacant; he added the
question would be whether or not it was a previously developed site but some may need additional demand. Mr. Heaston clarified that a larger project might demand a larger amount of capacity. Assistant Director Saunders responded that Mr. Heaston was correct.
Ms. Rosenberry clarified that a residence could expand and conceivably incur a cost for that
expansion. Assistant Director Saunders responded that Ms. Rosenberry was correct and that four attached dwellings that were large dwellings might pay a larger fee than four attached dwellings that were small.
Vice Chairperson Graham asked if Mr. Guthrie would provide more examples of the non-
residential development. Mr. Guthrie responded that he would provide more examples. Assistant Director Saunders added that the original examples could be utilized with some modification.
Mr. Guthrie noted the major changes to the proposed sewer impact fees and noted there had
been a reduction. He noted the sewer billing records had been utilized for the average daily sewer demand. He directed the Committee to the average day flow chart for the sewer usage and noted the existing and future sewer collection system standards utilizing linear feet per
acres.
Mr. Mehl asked why water and sewer fees were so different in number of miles of pipe. Mr. Guthrie responded the sewer system was more of a gravity system. Assistant Director Saunders added that there were already a lot of large lines in place with regard to the water system.
Mr. Guthrie noted there was a small credit for the bonds due on the Water Reclamation Facility
but would still be significantly less cost; he noted the next CIP update needed to identify more projects as there would be a little more money than was expected to be used.
Mr. Mehl asked why the Water Reclamation Facility costs per gallon had increased from the
previous impact fee study draft. Mr. Guthrie responded the original cost was before the phase 2
and phase 3 expansions had been removed. Mr. Thompson asked if the regulatory requirements were just a blanket requirement or based on
the number of gallons treated. Assistant Director Saunders responded it was a matter of
treating to a higher level of pollutants, but at this point it was an unknown amount.
Vice Chairperson Graham asked if the water/sewer projections were supposed to match the CIP. Mr. Guthrie responded the next update to the CIP would bring those numbers more into
line; part of the projects were unscheduled. Assistant Director Saunders responded that all of
the funding had been dedicated to getting the plant built before additional project were
assigned; he added the CIP was only a five year schedule with a five year revenue schedule. Mr. Guthrie noted the per acres basis had been utilized to be more in keeping with the water master plan driven by the CIP.
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Chairperson Nickelson stated the schedule was based on the revenue. Ms. Rosenberry noted
Chairperson Nickelson was correct and added they had discussed having a big laundry list on
the CIP but had been using the facility plans to determine the order of importance of projects;
she added it didn’t surprise her that those documents did not match up at this time. Mr. Evans asked if Vice Chairperson Graham had indicated there was a need to identify ways
to spend the surplus. Mr. Guthrie responded the uncommitted funds were to be used to identify
those items that had been unscheduled and get them scheduled. Mr. Mehl added that the CIP
was full of projects but the impact fees were not due to a decrease in growth; growth would cause the need for those projects to appear. Mr. Evans clarified that the growth was the impetus. Mr. Thompson added it gave them the flexibility to identify projects that weren’t
included in the CIP and he was cautious about the surplus and instead was attempting to
anticipate some development.
Mr. Guthrie directed the Committee to the draft Fire Impact Fee study. He noted the locations of the proposed future and existing fire stations. He stated the level of service had been based
on acres and the first fire station built had been incorporated into the calculation. He noted the
calculation used to determine that the level of service would remain constant in the future;
population and land area growth had also been utilized. Mr. Mehl asked whether population or land should be used for our level of service. Mr.
Guthrie suggested acreage was the best approach due to the response time. Mr. Mehl asked the
size of units was also being considered and asked how the two were tied together. Mr. Guthrie
responded the increase of population, jobs, etc. would determine how many calls were handled and the response time would be affected; he noted the response time had already been determined. Mr. Mehl suggested the fire fee combine the service area and the units. Mr.
Guthrie added that some of the calls would be for emergency services which would support the
units and increase in jobs or population. Assistant Director Saunders added that if we had
density like New York City there would be a higher rate of calls per 1,000 acres although it was imprecisely linked; he added as a distinction to the other fees that the City did not measure how long it took for the water to get to the faucet. Mr. Guthrie noted that different incidents had
been identified by type of development. He noted the current cost factors had been included so
that new development would pay for the gross share, which was critical for the impact fee
analysis. Mr. Guthrie explained that the revenues would increase over time and pay for the gross shares of future fire apparatus; if the City decided to use bonds for the next fire station, impact fees should not be used to pay the bond amount needed for existing users and should
only be used to fund the growth share of the costs.
Ms. Rosenberry stated the fire fee was where one of the policy changes had occurred as a quarter of the total cost would not be demanded by growth. Mr. Guthrie responded it was the number of calls for service and the response time, but the Fire Chief would be best to respond;
he noted it was demand driven. Ms. Rosenberry responded the City would always need more
money for future facilities. Mr. Guthrie responded the time frame was way out there, but a
certain amount of revenue would be collected over 10 years; the next Fire Station could be bond financed and fees collected for the Fire Station after that. Ms. Rosenberry clarified that Fire Station #4 would be necessary. Mr. Guthrie responded that the Fire Chief had convinced
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him to that affect. Chairperson Nickelson clarified that 25% of the next Fire Station will be
funded with something other than impact fees. Mr. Evans added that response times were not
the only factor, more congestion would cause more hurdles to overcome; he noted there was no
question that there would be a lifestyle upgrade. Assistant Director Saunders stated that impact fees were reliant on averages and could not be
specific to each individual user; there were two different approaches to the situation where each
station was funded at 25% of alternate revenue or one of the next four stations could be funded
to satisfy the requirement of not overcharging. He noted that once the time came, there would be better information regarding the need for another fire station. Ms. Rosenberry asked if that would lend to a general charge to apply just to those identified service areas. Assistant Director
Saunders responded that it could. Ms. Rosenberry asked if the fire station was at capacity with
regard to the ability to respond. Assistant Director Saunders responded that he would have to
ask the Fire Chief although he had not indicated they were at full capacity for call response at this time.
Mr. Thompson stated he was challenged with regard to industrial uses as he was thinking the
industrial equipment would cause more serious calls to the site. Mr. Guthrie responded that just
incidents had been taken into consideration. Assistant Director Saunders added that sometimes rural fire agencies assisted with fires in the City just as the City assisted them wherever possible. Mr. Evans suggested he was hesitant to say that a certain area pay for the costs of a
Fire Station just because they are benefitting the most; he suggested he was more comfortable
with spreading the costs and it made more sense to him. Assistant Director Saunders responded
that if a benefit could be defined, the City Commission could decide to enact a geographic area. Chairperson Nickelson added he thought it could be difficult to force a portion of the community to pay those costs when the rest of the community did not have to pay.
Mr. Mehl asked Mr. Guthrie if he knew communities that handled these fees in the same way
Bozeman did. Mr. Guthrie responded that if it appeared not to be reasonable, maybe other avenues should be investigated. Mr. Mehl suggested the downtown explosion was very expensive. Mr. Guthrie responded most communities just did incidents. Mr. Evans responded
that every job his company went out on was job-costed and he felt as though it was a good idea.
Ms. Rosenberry responded that the capital involved in responding to a call was the same for any
type of call and operations couldn’t be included n the impact fee. Mr. Guthrie stated the street fee amounts were exactly the same as had been proposed before
and noted the boundary (whether it was the tax increment boundary or the B-3 boundary) for
the Trip Exchange District. He noted they were trying to satisfy the State of Montana’s
requirements. He directed the Committee to the inventory of arterial streets in Bozeman per the Transportation Plan. He noted there were a few inconsistencies with regard to inclusion of three lane facilities. He noted there were 39 approved intersections where two arterials or an
arterial and collector street came together. He noted the cost factor had come out much better
than the original proposal as the cost per lane miles would be less. He noted the current level of
service and projected need and directed the Committee to a travel demand model that indicated an average trip length of 5.9 miles; the level of service would be maintained over time. He directed the Committee to the street impact fee formula and noted residential fees were done
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based on the living area of the building. He noted the projected revenues compared to the
scheduled projects in the current CIP.
Mr. Mehl noted the number of residents commuting outside of Bozeman, staying in Bozeman, or coming into Bozeman to work and asked if Mr. Guthrie had taken that into consideration. Mr. Guthrie responded it was a commuting pattern graphic on page 21 and those were used in
the methodology and analysis to determine that the overall demand for transportation was not
being funded by those that had the advantage of using it. Mr. Mehl added that 2/3 of the jobs in
the City were not filled by people that live in the City. Mr. Evans added that because it was more expensive to live in the City and have to pay impact
fees which ultimately drove the impact fees up to make the necessary improvements. Mr.
Guthrie suggested the allowable reductions were a step in the right direction. Mr. Evans noted
that an alternative means of financing to force people from outside the City to pay would be helpful, though state statute would need to be altered. Mr. Guthrie noted sales taxes are often used to capture revenue from users in these situations but Montana law doesn’t allow it.
Mr. Nelson asked how the boundary of the Trip Exchange District had been defined. Mr.
Guthrie responded there were many factors that were characteristic of downtowns and urban centers and was why their trips were less. Mr. Nelson asked if the boundary were shirked, wouldn’t logic indicate the homes within a two block radius would be functioning in the same
manner. Mr. Guthrie concurred with Mr. Nelson and suggested that was the reasoning behind a
fuzzy boundary; he had suggested recognizable boundaries for the time being.
Mr. Mehl asked Mr. Guthrie’s recommendation on how to handle future areas with high pedestrian/bicycle traffic. Mr. Guthrie stated some of the studies had very specific
methodology but intersection density, etc. could be included in that methodology. Assistant
Director Saunders responded it was easy to recognize downtown as it was established, and it
was difficult to recognize what will be done with a specific piece of land though we know what we would like to see done with it.
Chairperson Nickelson asked what percentage of an intersection improvement could be funded
by impact fees. Mr. Guthrie responded the design of the intersection currently versus the
improvements and it would be a site specific evaluation was their recommendation. Vice Chairperson Graham asked how far back they would go to look at the level of service. Mr. Guthrie responded the original design’s load and level of service standards; the existing versus
the proposed. Ms. Rosenberry asked if the City went from 4 stops signs to an intersection with
lights what that cost would be. Mr. Mehl suggested Ms. Rosenberry had asked the primary
question. Vice Chairperson Graham clarified that the existing facility would factor into those
improvement costs eligible to be funded through impact fees. Mr. Guthrie responded Mr.
Graham was correct.
Chairperson Nickelson opened the public comment period.
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Cordell Poole, 717 N. Bozeman Ave., stated he was a local engineer. He noted the cost of
improvements was not the cost of actual construction; it was an improvement, not starting over
which was a growth allocated share for the most part. He stated he had read through the draft
reports and he thought they were moving in the right direction with the area allocation for water/sewer fees. He stated the impact fee justification was not only for water mains surrounding the development, but to each plant for collection and distribution even if it was for
redevelopment. He stated his main concern was with regard to impact fee credits. He stated
the water and sewer were discreet improvements and suggested the developer should be
credited for the improvements that he had made whether it was on the CIP or not; he thought that anytime someone voluntarily installed an improvement, it should be crossed off the list as it would no longer need to be funded. He noted some of the arterials were constructed as
project level improvements; he suggested removing it from the cost basis or crediting it to the
developer to be fair. Mr. Evans asked for clarification. Mr. Poole responded the current policy
did not allow credit eligibility unless a project was on the CIP. Assistant Director Saunders responded Mr. Poole was correct, but there was a method in place that would allow the approval of a modification of the CIP upon request from the City Commission. Ms. Rosenberry
responded that requiring the project be on the CIP before it was funded was intended to be an
opportunity for public comment and prioritization of what the impact fee funds should be spent
on. She added that the credit process requires that the City see what was spent to make the improvements to know that the costs in the studies were the true costs. Mr. Poole noted it was understandable if money was being paid out and noted there was a lot to it; specifically the
costs as when a developer had to pay more to improve a lane mile than the impact fee study
estimate indicated. Assistant Director Saunders responded that when the City paid credits, the
payment was the actual costs. Mr. Poole suggested math to math so that up or down costs did not have to be considered. Mr. Evans clarified that Mr. Poole was suggesting a constant amount despite the cost to the developer. Mr. Poole responded he thought it would be the
fairest method. Mr. Evans clarified that the City would pay the actual costs. Assistant Director
Saunders responded that Mr. Evans was correct and actual bills needed to be provided for
documentation. Seeing no further public comment, the public comment period was closed.
Chairperson Nickelson suggested Mr. Guthrie address the park and open space questions with
regard to the water fees. Assistant Director Saunders suggested it would also be applicable to the sewer fees; he added he could look back to see if parks had been included in the distribution. Mr. Heaston responded there is never going to be an irrigation demand for
parkland. He added he would like to see the distribution system somehow applied to the cost of
capacity for redevelopment. Mr. Guthrie agreed that an incremental change should be applied
to redevelopment and that he would investigate further. Assistant Director Saunders responded that the incremental change in redevelopment was so small in Bozeman that it could fall into the maintenance and incidental operations category paid for by utility billing. Ms. Rosenberry
stated that the weighting factor for meter indicated the capacity that still had to go through the
distribution system and she understood what Mr. Heaston was indicating. Mr. Evans stated
there were consequences to people able to live cheaper within the County and he thought it was new development that was not paying their way; he suggested if someone used they should have to pay and it should be a simpler process – the holes in the bucket should be plugged.
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Chairperson Nickelson stated he did not know how much was billed in the County for impact
fees, but he knew there was an amount. Mr. Evans responded Mr. Nickelson was correct. Vice
Chairperson Graham stated he was not ready to cast a vote tonight given the new information and suggested the inclusion of an allowance to let commercial businesses pay their fees over time. Assistant Director Saunders responded the Committee could make that suggestion though
it was not part of the fee studies as proposed. Mr. Mehl suggested the City Commission would
be discussing the timing of the fees. Mr. Evans responded that he agreed with Mr. Graham.
Chairperson Nickelson agreed that it was a great discussion item, but was a larger policy decision that he recommended discussion later; he noted he definitely saw the benefit.
Chairperson Nickelson suggested the fire chief clarify the 25% share that went to the global
community and the capacity with regard to the number of calls they can handle.
Ms. Rosenberry asked Mr. Guthrie for an example of an intersection calculation with regard to the growth share and what should be paid with impact fee funds. Mr. Evans agreed that he would be interested in seeing that. Assistant Director Saunders added the collector size would
also be investigated for its inclusion in the inventory charts. Chairperson Nickelson suggested a
generic intersection be utilized for the example. Assistant Director Saunders responded that
both specific and generic examples would be provided. Mr. Graham suggested the roundabout at 11th should be an example. Mr. Evans responded he liked the 15th & Oak intersection as Ms.
Rosenberry had suggested.
Chairperson Nickelson reopened and continued the public comment period to the next meeting
of the IFAC.
Due to the lateness of the hour, the action items were continued to the next meeting of the
Committee.
B. Discussion/Action by Committee 1. Transportation Impact Fee update.
2. Fire/EMS Impact Fee update.
3. Water Impact Fee update.
4. Wastewater Impact Fee update.
ITEM 8. OLD BUSINESS Chairperson Nickelson asked when the Committee would like to meet next; on August 30, or
September 13, 2012. The Committee concurred that they would meet on September 13, 2012.
ITEM 9. COMMITTEE COMMENTS No items were forthcoming.
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ITEM 10. ADJOURNMENT
There being no further business to come before the Committee at this time, Chairperson Nickelson adjourned the meeting at 9:21 p.m.
James Nickelson, Chairperson Chris Saunders, Assistant Planning Director Impact Fee Advisory Committee Dept. of Planning & Community Development
City of Bozeman City of Bozeman
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** MINUTES ** THE CITY OF BOZEMAN
IMPACT FEE ADVISORY COMMITTEE
THURSDAY, SEPTEMBER 13, 2012 Chairperson Nickelson called the meeting to order at 6:13 p.m., in the Madison Meeting Room,
City Hall, 121 North Rouse Avenue, Bozeman, Montana.
Members Present Staff Present James Nickelson, Chairperson Tara Hastie, Recording Secretary
Rob Evans Chris Saunders, Assistant Planning Director
Anna Rosenberry
Brian Heaston
George Thompson Erik Nelson
Randy Carpenter
Members Absent
David Graham Guests Present
Chris Mehl, City Commission Liaison
Chris Kukulski
Greg Megaard Brit Fontenot Dick Milligan
Bonny Milligan
ITEM 2. MINUTES OF AUGUST 16, 2012. MOTION: Mr. Thompson moved, Mr. Nelson seconded, to approve the minutes of August 16,
2012 as presented. The motion carried 7-0. Those voting aye being Mr. Evans, Mr. Carpenter,
Mr. Nelson, Mr. Thompson, Mr. Heaston, Ms. Rosenberry, and Chairperson Nickelson. Those
voting nay being none. ITEM 3. PUBLIC COMMENT {Limited to any public matter within the jurisdiction of the Impact Fee Advisory
Committee and not scheduled on this agenda. (Three-minute time limit per speaker.}
Dick Milligan stated he and his wife Bonny were at the meeting because they owned property on N. 27th Avenue and they were under the understanding that impact fee changes would be
made to enhance the viability of owning property in Bozeman. He stated they felt they had
been impacted pretty heavily and had begun with raw land and converted it to three, 3.3 acres
lots. He stated they had installed the infrastructure along N. 27th Avenue and then had recently been included in an SID after they had been told there would be no further SID’s on their
property. He stated that recently they had been told that Catamount Street would need to be
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completed prior to being approved on future Building Permits. He stated they had been
impacted very heavily and some of the costs were contingent costs that may come up including
the impact fees and the cost would be close to $900,000.00 total cost to them. He stated they
were not in the development business and the subdivision process for Bozeman had taken 2 ½ years while the same process in Belgrade had taken only 8 months. He stated they were asking,
from a sales price standpoint, less than the property was worth. Ms. Milligan stated they had a
property on the market for over a year due to all the entitlements constraining the site. She
added the City may make more money on the property than they would ever see. Mr. Milligan
added that more impact fees would be a hell of an impact. Mrs. Milligan stated the next person would be a buyer and would check into the costs associated with new development of the
property. Mr. Milligan stated the tax man indicated the lots were worth $600,000 a piece, but
were selling the lots for $200,000. He added that if the City of Bozeman were looking for land
they would make them a great deal.
Mr. Thompson confirmed that the fees would need to be paid to the City prior to any
construction on the site. Mr. and Mrs. Milligan confirmed that Mr. Thompson was correct.
Mrs. Milligan added that their engineer had indicated that there had been no condition of
approval with their subdivision to pay for streets in the future and they had completed what had
been required of them. Mr. Evans confirmed that Planning Staff had required the street improvements. Mrs. Milligan stated they were being knocked out of the market. Mr. Milligan
added that there had been an indication from Planner Riley that the Impact Fee Advisory
Committee would take their concerns into consideration. Mrs. Milligan asked for direction.
Mr. Thompson asked if there was an appeal process that the Milligan’s could consider pursuing; he suggested there should be some type of an appeals format that meshed with the
planning process. He added the owner would have no revenue to pay the taxes that were
already assessed for the property. Assistant Director Saunders responded there was an appeal
process that would be reviewed by the City Commission; he added Staff had some flexibility
administratively but most appeals of that nature would be reviewed by the City Commission. Mrs. Milligan responded that she had already notified the City Commission in writing of their
concerns. Mr. Mehl responded that discussions among the City Commission would include
setting the policy for impact fee assessments in addition to the impact those fees would have on
the community and fee implementation. He invited the Milligan’s to attend the City
Commission meetings and encouraged them to contact Staff representative Chris Saunders if they had any questions regarding credit requests or appeals. Mr. Carpenter suggested Assistant
Director Saunders discuss impact fee credits. Assistant Director Saunders responded that
impact fee credits work in lieu of payments and were intended to offset the costs of the work.
Mrs. Milligan stated it sounded like she needed to speak with Assistant Director Saunders with
regard to the impact fee credit request. Assistant Director Saunders responded that Planner Riley should also be involved in the discussions as he had handled the projects in that vicinity
recently. Chairperson Nickelson noted the fees being discussed at the meeting were proposed
to be modified with the current updates.
ITEM 4. CITY COMMISSION LIAISON {A standing item to be used as needed}
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Mr. Mehl stated they had covered the process and tentative schedule for City Commission
consideration of the proposed updates. He thanked the Committee members for their
dedication and willingness to put in the time on the Committee. He stated they had given the
Commission the groundwork upon which to make their decision.
Chairperson Nickelson thanked Mr. Mehl for his support. Assistant Director Saunders added
that October 8, 2012 was the tentative date the City Commission was scheduled to initially
review the updates and they would schedule additional meetings as necessary. Mr. Mehl added
he suspected they would actually vote on the studies in November. ITEM 5. PROJECT REVIEW (Continued from August 16, 2012.)
A. Discussion/Action by Committee
1. Question responses from 8/16/12 meeting.
Assistant Director Saunders stated Staff had provided responses from questions brought up by
Committee members at the last meeting. He stated the first response was with regard to both
water and sewer fees and how infill development would fit into the calculation for piping. He stated properties that had never been developed would be all new demand and would pay the
distribution component of the development. He stated City maintenance of mains below the
minimum standard would bring the pipes up to meet the minimum standard which adds some
capacity. He stated the longstanding developments and those that had paid impact fees would
be granted flexibility and not automatically charged the full distribution fee. He noted there was a standard the Commission had adopted that indicated a threshold for redevelopment of a
site and it would provide consistency between the similar programs and a reasonable threshold
for incidental expansion and significant expansion. He gave the example of the Armory that
had water/sewer service for a really long time, but adding a hotel to the site would significantly
increase the use of those facilities on the site and a distribution fee would be applied. He stated when there were phased or multi-building developments; they would be prorated and
considered with regard to their total consumption.
Ms. Rosenberry asked how the administration of the program would be handled as it was no
longer based on a per meter system. Assistant Director Saunders responded that it would add complexity to the administration of the policy, but it would be possible and manageable; he
added most developments existed for long periods of time but it would be more work. Ms.
Rosenberry asked how MSU would be handled. Assistant Director Saunders responded that
MSU was unique in that they had meters they had already paid for all around their site and each
instance would have to be investigated. Mr. Nelson asked whether or not there would be an ability to incentivize projects by allowing phased commercial development if the owner entered
into an agreement with the City to pay impact fees over a period of four or five years to allow
businesses to find a way to avert the burden of carrying those costs until their businesses were
established. Assistant Director Saunders responded Staff had investigated that avenue in the
past and the Commission had concluded that the down sides outweighed the good sides; he noted it was a policy discussion that the City Commission could discuss though it had not been
included in the proposed studies. Mr. Nelson responded that financing was still the burden of
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the owner. Assistant Director Saunders responded that the money would still need to be
accounted for in addition to the consideration that the owner may go bankrupt, etc. Mr. Mehl
assured Mr. Nelson that the topic would be discussed by the Commission. He noted questions
regarding the fourth fire station and funding would come up and be brought up at the meeting.
Assistant Director Saunders stated another question that had come up was with regard to public
parks and their consumption. He stated Mr. Guthrie would modify the language to include the
necessity to account for public parks; he added concession stands and things usually came later
on down the line with donation funding.
Assistant Director Saunders stated fire and EMS services had come into question on whether or
not they were at capacity for demand. He stated the Fire Department had operational data that
could possibly be parsed out, but it was difficult to say whether or not capacity was reached on
any given day. Chairperson Nickelson stated his understanding of the original question had been whether or not the new fire station could be funded 75% by impact fees. Assistant
Director Saunders responded that the funds could be distributed evenly amongst the stations or
distributed in a different manner. Mr. Heaston asked if there was an expiration of the time that
the funds were allowed to be spent. Assistant Director Saunders responded that there was an
expiration time but it had been set locally. Mr. Megaard added that the City was never left uncovered whether utilizing mutual aid or funding from another source; he added the growth
had died down after the construction of station #3. Mr. Thompson asked what was necessary to
commit those funds. Assistant Director Saunders responded committed was defined and it was
more than just having the money in the account; it did not have to be spent yet, but he did not
have the specific ordinance at the evening’s meeting.
Mr. Kukulski asked if any of the fire impact fee money had been spent on anything other than
fire station #3. Ms. Rosenberry responded that the opticom system had been 10% funded by
impact fees and 90% by a grant. Mr. Kukulski asked how if station #3 had been fully funded
while station #4 was not eligible for impact fees. Assistant Director Saunders responded that it was in how the funding was distributed amongst the construction of the stations. Ms.
Rosenberry stated that if by virtue of the location of where development occurred would it
mean development in certain places should have a local cost that did not just go to the general
impact fee. Mr. Evans noted it got sticky when the resources were pushed outside of the
delineated boundary. Ms. Rosenberry asked if it was reasonable to charge the whole City for a station constructed in a certain part of town. Assistant Director Saunders responded the metric
used was a key because of travel time, number of gallons pumped, number of vehicles sent,
hydrant locations, etc. were all factors that could be considered. Mr. Megaard responded the
ISO was that standard and took all those components into consideration. Mr. Nelson suggested
the void in the level of service would need to be filled with regard to annexations of large developments. Mr. Kukulski responded that the scenario had happened and indicated the City
was stretched too thin and needed to provide a third fire station. Mr. Megaard added it was part
of the ISO evaluation and noted the City had obtained the property to build station #4.
Assistant Director Saunders noted there had been a question regarding the difference in the size of collector streets. The biggest collector was for three lanes while the smallest was for two
lanes. He stated Mr. Heaston and Mr. Nickelson had looked into how there were a whole lot of
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factors in determining the capacity of an intersection and its classification including the time
frame; he added a fifteen to twenty year review was standard for those requirements. Mr.
Heaston added that before the signalization of intersection, the major leg has no impediment
while installing a traffic light impedes both legs of the intersection. Assistant Director Saunders added the metric that gets adopted is the level of service while considering the overall
functionality of the intersection; the nature of traffic signals was a balancing act. Mr. Heaston
added that the overall level of service would go up. Assistant Director Saunders noted he had
found an article regarding the State giving the City of Billings water rights to handle a
population of 500,000 people and he thought it was a great illustration of the differences from city to city and how it affected infrastructure needs.
2. Transportation Impact Fee update.
MOTION: Mr. Nelson moved, Mr. Carpenter seconded, to forward a recommendation of approval to the City Commission for the Draft Transportation Impact Fee Study Update as
proposed and amended by the Committee.
Mr. Carpenter asked if discussions of separate service areas had been discussed. Assistant
Director Saunders responded that the issue had been included as an appendix and was not readily visible. An adjustment to make it easier to find would be made in the final draft. He
added that overall there was a 29% benefit to the type of business located downtown so 29%
would be taken off the top and though it was not as steep a discount as in the past, it would
even the uses out. Mr. Mehl added that right now the downtown area was the only area
demonstrating compliance with the criteria for reduction but other areas could be considered for the same reduction. Mr. Nelson asked for clarification that each fee offered an opportunity to
request a reduction. Assistant Director Saunders responded a reduction could be requested for
any fee and would be required to be reviewed by the City Commission for approval.
Assistant Director Saunders added that after further discussion with the consultant, the final draft would remove the collector streets that had already been constructed as being fully built
out. He noted collector streets served an essential role in the overall traffic patterns and there
was a lot of additional expense with regard to the addition of a third lane and added the City
Commission would have to decide whether or not collector streets would be included or would
the City’s development standards be modified to automatically include the third lane; he noted there would be an additional annual expense for maintenance of those roadways. Mr. Mehl
asked how much more the impact fees would cost for installing the third lane. Assistant
Director Saunders responded it would cost no more as those fees had already been included.
Mr. Nelson asked if there was a different way to consider collector streets as two lanes instead of three lanes while upgrading some of the collector streets to arterials streets to provide for the
three lane construction. Mr. Evans suggested the upgrade would be a good investment even if
ten percent of them turned out to be unnecessary. Mr. Mehl added that the City got to designate
whether streets were an arterial or collector. Assistant Director Saunders directed the
Committee to the Transportation Plan Figure 9-2 map.
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Ms. Rosenberry stated she thought it was the second or third study she had reviewed and they
were tough; she thought it would get better and her understanding would be better, but the
methodology changed a lot. She noted she liked that the data being used was more recent; she
just thought it was difficult and complicated. She added she was concerned with regard to administration of the policy and the City Commission would also take additional public
comment.
Mr. Evans stated he did not have the impression that there had been enough public comment
and suggested he would feel more comfortable waiting for the next meeting. Assistant Director Saunders responded the draft documents had been posted on the website for public view for two
months.
Mr. Nelson recommended that the City include the information on the front page of the
Chronicle to engage the public in what was proposed. Assistant Director Saunders responded his expectation was that it would become new again once it was scheduled to be heard before
the City Commission. Mr. Mehl noted the Commission review would likely take 6 weeks and
he would request the Chronicle write an article prior to the November meeting so they would
have plenty of time. Mr. Carpenter suggested an overview of the updated impact fees be
provided to members of the public.
Mr. Evans added that the residential aspect of the fee made sense to him and seemed sound, but
the commercial aspect and consequences being drawn did not seem to make sense. Assistant
Director Saunders responded there were a lot of differences in the two calculations and it was
due to the differences in the uses within those districts. Mr. Evans stated he thought that warehouses and similar uses would move to the County while fast food restaurants would litter
Bozeman; he suggested the Commission consider the economic impetus and the impact on
development. Mr. Nelson responded if the study shows their impact is what it is, a mechanism
to pay over time should be put in place to allow the business to access the market they are
trying to access. Mr. Thompson stated they heard anecdotal stories with regard to the cost of impact fees in addition to all the equipment and added that part of the challenge was to get the
information out to the public. Assistant Director Saunders noted that part of the answer was a
policy question that the City Commission would need to consider.
Ms. Rosenberry stated she thought the Committee had done good work on the proposals and she thought they should move it forward to the City Commission. Mr. Carpenter stated it was
not just what Bozeman charged, but what was happening in the County as well.
The motion carried 7-0. Those voting aye being Mr. Evans, Mr. Carpenter, Mr. Nelson, Mr.
Thompson, Mr. Heaston, Ms. Rosenberry, and Chairperson Nickelson. Those voting nay being none.
3. Fire/EMS Impact Fee update.
MOTION: Mr. Evans moved, Mr. Nelson seconded, to forward a recommendation of approval to the City Commission for the Draft Fire Impact Fee Study Update as proposed and amended
by the Committee to use population as the applicable metric.
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Mr. Mehl encouraged the Committee to discuss the level of service and clarify if exceeding
level of service should be impact fee eligible and in what percentages.
Mr. Evans stated he was not a huge fan of impact fees though he thought the process was
sound; he felt the existing residences were in fact benefiting from improvements especially
concerning fire and despite their location. He stated it was almost the jurisdictions
responsibility to provide the service and everyone should pay; he added he liked paying 25% of
each of the four stations with general funding.
Ms. Rosenberry stated she took issue with the indicated deficiency in the current fire service as
it was not her current understanding of the level of service. She stated there was no policy for
the local portion of the fire station like there was a policy for the local portion of a street and
she thought there might be something missing. She stated new development paying its way as not being upheld with the proposal as by design there was no local portion of funding allocated
to the fire station without increasing taxes.
Mr. Nelson asked if the consultant was correct that new development could not be held in a
higher standard unless there was a mechanism otherwise in place and asked if that would be a levy. Mr. Mehl responded it would be a levy and explained that time would be used as the
determinate.
Chairperson Nickelson stated that when fire station #4 was built a certain part of town would
attain a much better level of service. Mr. Megaard added that he agreed with Ms. Rosenberry that the level of service in Bozeman was adequate as it was not just the geographical location of
the station, but the closest equipment available to take the call. Chairperson Nickelson noted
fire station proximity would benefit individuals on their fire insurance rates as well. Ms.
Rosenberry noted the fire station could not be built until there was enough money to staff it
even if impact fees paid for the entire thing. Mr. Evans responded that with development there was a broader tax base that would account for the difference. Mr. Mehl stated he struggled with
the consultant’s recommendation as it went against ISO with regard to the level of service; a
current level of service would make the station eligible when facility increases would not be
eligible. Assistant Director Saunders responded that he thought it was positive to bring the
point forward.
Ms. Rosenberry stated she had thought it was always the level of service that was indicated
when the impact fee was implemented. Mr. Mehl suggested the level of service has to move
and could not go back to the original baseline. Ms. Rosenberry responded that she was
referring to identified deficiencies and it seemed situational.
Mr. Heaston asked what the enabling statute indicated. Assistant Director Saunders responded
it just indicated the level of service and added the Facility Plan could be updated to include
language regarding the ISO rating. Mr. Megaard added that the City had more water in the
distribution than they could pump. Mr. Mehl suggested that the study would indicate what the City wanted to see new development bring to the City.
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Assistant Director Saunders asked the timeframe in which the ISO rated the City. Mr. Megaard
responded they were rated every 10 years unless they requested one earlier. Assistant Director
Saunders suggested considering including ISO in the definition of the level of service for fire in
the future. AMENDED MOTION: Mr. Thompson moved, Mr. Nelson seconded, to forward a
recommendation of approval to the City Commission for the Draft Fire Impact Fee Study
Update with the defining marker being population instead of land area.
Ms. Rosenberry stated she did not want to go against the decision of the Committee, but she
disagreed with the consultant that there is a less than adequate level of service. Assistant
Director Saunders responded that using population instead of land area would be included and
the language would be revised accordingly.
The amended motion carried 7-0. Those voting aye being Mr. Evans, Mr. Carpenter, Mr.
Nelson, Mr. Thompson, Mr. Heaston, Ms. Rosenberry, and Chairperson Nickelson. Those
voting nay being none.
4. Water Impact Fee update.
MOTION: Mr. Carpenter moved, Mr. Thompson seconded, to forward a recommendation of
approval to the City Commission for the Draft Water Impact Fee Study Update as proposed and
amended by the Committee to address parks per Assistant Director Saunders 9/13/12 memo.
Mr. Evans stated he concurred with Mr. Nelson that any of the fees getting collected before
service was implemented was problematic to him because during construction fire, water, and
sewer usage is not applicable. He suggested collecting impact fees at the time of the request for
Final Occupancy as it seemed fairer.
Mr. Nelson asked for clarification of water impact fees and asked if those two numbers on page
19would be added together. Assistant Director Saunders responded the fractional cost for acres
would be factored into the equation. Mr. Carpenter asked Mr. Evans if he felt the discussion
and its reflection in the minutes would be adequate to convey his opinion to the City
Commission. Mr. Evans responded it would and he was also planning on attending the City Commission meetings to provide his input as well; when the fees were collected would make
the housing more affordable.
Mr. Evans responded it was hard enough to convince a home owner to build a new home and
then they are the bearers of the bad news of the cost of impact fees.
Ms. Rosenberry stated she hoped the shift in impact fee trigger with the change of a meter size
would not catch the community by surprise. Mr. Evans responded the Building Division would
need to distribute the information. Mr. Mehl suggested people were aware of the requirements
already and it was starting to catch on even if the general public was not aware of the change; he added there were other benefits. Mr. Evans added it would be fairer.
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The motion carried 7-0. Those voting aye being Mr. Evans, Mr. Carpenter, Mr. Nelson, Mr.
Thompson, Mr. Heaston, Ms. Rosenberry, and Chairperson Nickelson. Those voting nay being
none.
5. Wastewater Impact Fee update.
MOTION: Ms. Rosenberry moved, Mr. Carpenter seconded, to forward a recommendation of
approval to the City Commission for the Draft Wastewater Impact Fee Study Update as
proposed and amended by the Committee to address parks per Assistant Director Saunders 9/13/12 memo.
Chairperson Nickelson noted for the record that the water discussion also applied to the sewer
discussion.
The motion carried 7-0. Those voting aye being Mr. Evans, Mr. Carpenter, Mr. Nelson, Mr.
Thompson, Mr. Heaston, Ms. Rosenberry, and Chairperson Nickelson. Those voting nay being
none.
ITEM 6. OLD BUSINESS There were no items forthcoming.
ITEM 7. COMMITTEE COMMENTS
Ms. Rosenberry stated the Committee had completed their revisions of the studies and noted the
CIP’s would be under their review in October or November as the Commission was required to
review the proposals in December.
Mr. Nelson suggested an easier way for individual projects to be included on the CIP could be identified and encouraged his fellow members to consider it. Assistant Director Saunders
responded there is a method in place for those types of requests to be considered. Ms.
Rosenberry suggested she did not know how to better spread the information to the public.
Assistant Director Saunders noted that every approval through Planning included a letter stating
that impact fees would be assessed and explaining the necessity for those assessments. ITEM 8. ADJOURNMENT There being no further business to come before the Committee at this time, Chairperson
Nickelson adjourned the meeting at 9:04 p.m.
James Nickelson, Chairperson Chris Saunders, Assistant Planning Director
Impact Fee Advisory Committee Dept. of Planning & Community Development
City of Bozeman City of Bozeman
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Proposed and Current Fees – Single Unit Residentialwith Smaller House and Lot 260
Proposed and Current Fees – Single Unit Residentialwith Larger House and Lot 261
Proposed and Current Fees – Attached Residential2 to 4 Units 262
Proposed and Current Fees – Attached Residential24 Units 263
Proposed and Current Fees – Office 264
Proposed and Current Fees –Retail 265
Proposed and Current Fees – Industrial 266
Proposed and Current Fees in Trip Exchange District 267
STREET IMPACT FEE SCHEDULE - General
ITE
LUC
Type of Land Use Unit Measure
Amount Due Per
Unit*
RESIDENTIAL:
210 Single Family (Detached)
Less than 1,500 sf and very low income(2)dwelling unit $1,465.37
Less than 1,500 sf and low income (3)dwelling unit $2,124.14
Less than 1,500 sf dwelling unit $2,678.30
1,500 to 2,499 sf dwelling unit $3,642.16
2,500 sf or larger dwelling unit $4,105.19
220 Apartments dwelling unit $2,253.74
230 Residential Condominium/ Townhouse dwelling unit $1,988.47
240 Mobile Home Park dwelling unit $1,075.23
LODGING:
310 Hotel room $2,067.45
320 Motel room $1,132.61
RECREATION:
430 Golf Course hole $8,298.81
411 City Park acre $368.54
444 Movie Theaters 1,000 sf $4,362.36
INSTITUTIONS:
610 Hospital 1,000 sf $4,065.37
620 Nursing Home bed $257.17
520 Elementary School student $212.62
530 High School student $321.96
540 University (7,500 or fewer students) (4)student $411.06
550 University (more than 7,500 students) (4)student $357.06
560 Church/ Synagogue 1,000 sf $1,638.84
565 Day Care 1,000 sf $5,017.08
OFFICE:
710 50,000 sf or less 1,000 sf $2,684.37
710 50,001-100,000 sf 1,000 sf $2,445.43
710 100,001-200,000 sf 1,000 sf $2,081.62
710 greater than 200,000 1,000 sf $1,660.44
720 Medical Office 1,000 sf $6,468.95
RETAIL:
820 under 50,000 sf 1,000 sf $6,329.91
820 50,000-99,000 sf 1,000 sf $6,470.98
820 100,000-199,000 sf 1,000 sf $6,298.18
820 200,000-299,000 sf 1,000 sf $5,782.50
820 greater than 300,000 sf 1,000 sf $5,496.99
812 Building Material/ Lumber 1,000 sf $14,315.52
813 Discount Super-Store 1,000 sf $18,221.60
817 Nursery/Garden Center 1,000 sf $12,759.03
851 Convenience Store 1,000 sf $30,108.57
931 Quality Restaurant 1,000 sf $14,873.73
934 Fast Food Rest w/ Drive-Thru 1,000 sf $41,325.29
841 New/Used Auto Sales 1,000 sf $8,121.96
890 Furniture Store 1,000 sf $1,136.66
912 Bank/ Savings Drive-in 1,000 sf $21,400.73
INDUSTRY:
110 General Light Industrial 1,000 sf $1,545.69
140 Manufacturing 1,000 sf $843.72
150 Warehouse 1,000 sf $1,098.18
151 Mini-Warehouse 1,000 sf $546.73
* Represents 60% of cost of service per Section 2.06.1640 BMC
CY 2012-v1 Effective January 1, 2012
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2.06.1630.A.14. "Transportation system" means capacity-adding improvements to collectors or arterial roads of three lanes or more, which are included on the 2001 Greater Bozeman
Transportation Plan Update or the city's impact fee capital improvement program, and which will
benefit new development as required by law and this division. The transportation system
includes only those bicycle and pedestrian facilities built in conjunction with and included in a capacity-adding transportation facility improvement otherwise eligible for impact fee funding pursuant to the terms of this division. The "transportation system" does not include project-
related improvements.
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0 5,0002,500
Feet
Interpretation of MapThis map presents the Recommended Major Street Network. It shows how the street network should develop over time and is intended to be used as a planning tool. It will assist in theevaluation of long-term traffic needs when planning future developments. The route alignments shown are conceptual in nature.The actual alignments may vary based on development patterns, geographic features, and other issues unknown at this time. The community planners will strive to designthe roads to fit the character of the landscape and minimize impacts on natural features such as wetlands, mature trees, and riparian corridors.Most of these routes are not recommended for construction at this time. The development of these conceptual routes will take decades to become reality, and will only become roadsif traffic needs materialize as a result of development in the area. Many of the existing roads identified as arterial routes are currently functioning as collectors or local streets and will beupgraded as traffic needs increase.It is important to note that although this major street network is recommended as part of the Transportation Plan, it does not reflect the federally approved functional classification criteriawhich is based on current conditions rather than anticipated future conditions.
Existing Major Street Network andFuture Right-Of-Way Corridor NeedsFigure 9-2
Greater Bozeman Area Transportation Plan(2007 Update)Legend
Local Roadway
Detail Area
Urban Boundary
City Boundary
Interstate
Principal Arterial
Minor Arterial
Collector
Future Principal Arterial*
Future Minor Arterial*
Future Collector*
Note:Future links identified where no roadcurrently exists will be constructed asthe surrounding are develops.
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