MEMORANDUM

To: Hon. Mayor Jean Quan, the Oakland City Council, and Henry Gardner, Interim City Administrator

From: Development Impact Fees Working Group

RE: Comments on the Pending Hausrath Economics Group Contract

Date: 12/4/14

SUMMARY

The City of Oakland currently does not charge developers any fees authorized under either the Mitigation Fee Act (Government Code Section 66000, et seq.) and the Quimby Act (Section 66477). The City Of Oakland Community and Economic Development Agency (CEDA) did issue a Request for Proposal (RFP) for professional services relating to the development of a nexus study for development impact fees. Hausrath Economics Group has been recommended by staff to provide professional services to assist your Council in determining what fees shall be assessed for new development activities in the City of Oakland. Hausrath’s scope of work emphasizes the needs for funding to support affordable housing development, capital improvements (roadways, sewer upgrades, etc.), and so called “other capital improvements”. This is a step in the right direction; however, Hausrath’s scope of work does not include the specification of a separate and distinct fee for parks and recreational facilities.

Parks and recreational facilities have been included in the category “other capital improvements”; however, we maintain that there is a need for separate, discrete mitigation fee to support the rehabilitation, expansion, and creation of parks. Currently, the City of Oakland’s Capital Improvement Plan has budget no funds, for the improvement and expansion of parks and recreational facilities. We are concerned that funding for parks and recreational facilities will either be minimal or non-existent. As a result, we request that your Council modify Hausrath Economics Group scope of work to state that its analysis will include a calculation of distinct Parks Mitigation Fees (both in lieu fees and land dedication requirements) as permitted under both the Mitigation Fee and Quimby Acts. Furthermore, we request that your Council modify their scope to include the preparation of a Parks Master Plan which will inform their analysis and calculation of a Parks Mitigation Fee.

BACKGROUND

Development Impact Fees

One of the ways that cities throughout the state fund the expansion, rehabilitation and creation of parks and recreational facilities is through development impact fees. Development impact fees are charged to developers of new housing units to pay for improvements and infrastructure needed to support the new housing development. Owners of existing property are not charged development impact fees, and their property taxes are not affected.

Development Impact Fees must be approved by the Oakland City Council. There is process defined in State law (California Government Code 66000-66025 which is also referred to as “The Mitigation Fee Act”) that sets the requirements for determination of development impact fees. In order to assess development impact fees the City of Oakland must demonstrate:

· The purpose of the fee.

· The use of the fee.

· The relationship between the use of the fee and the types of development on which it is imposed.

· The relationship between the need for the public facilities and the type of development on which the fee is imposed.

· The relationship between the fee amount and the cost of the public facilities.

· The fees are not in excess of the estimated reasonable cost of the facilities and development’s proportionate share of that cost.

The basis for the findings listed above is generally made through what is called a “nexus study”.

Parks Impact Fees Charged Locally

Impact fees, such as those permitted under the Quimby or Mitigation Fee Acts (Government Code Section 66477 and Section 66000, et seq. respectively), are intended to ensure that parks and related facilities are sufficient to support the needs of a local community. The lack of a park impact fee for parks facilities and land acquisition puts into question the cumulative impacts of development projects under consideration by the City of Oakland. Moreover, the City of Oakland is one of three jurisdictions in Alameda County (Oakland, Berkeley and Piedmont) that does not assess any fee for parks or similar community facilities (art centers, libraries, etc.). However, both have property tax assessments related to parks. Please see the attached spreadsheet for more information. Outside of Alameda County, San Francisco and San Jose assess parks fees. Fees assessed in San Francisco vary by neighborhood, parks fees for single family dwellings in San Jose is currently set at $38,900.

To not require the payment of a fee or dedication of land that is standard practice across the State and within Alameda County, is a perennial barrier to expanding and maintaining parks services for Oakland residents.

Over time, the lack of parks space becomes more critical as predictions from regional bodies such as the Association of Bay Area Governments (ABAG) predicts that the City’s population will drastically increase over the next several decades. Therefore, we propose that the City of Oakland take steps to rectify the lack of local, community serving parks and athletic fields available to Oakland residents. Specifically, we ask the City to implement several actions in its OSCAR Element, by modifying the scope of Hausrath Economics Group and its sub-consultants to include tasks that we believe will lead to increased funding and acreage for local, community serving parks, recreational facilities and athletic fields/courts.

Open Space, Conservation and Recreation Element

The number and condition of Oakland’s parks and recreational facilities has not kept up with demand. According to the 1996 City of Oakland Open Space, Conservation and Recreation Element (OSCAR), the City has established a “parkland standard” of 4 acres per 1,000 residents.[1] That document goes on to state that Oakland currently provides 1.33 acres of parks land to serve the active recreational needs of the Oakland residents, which is one third of the acreage that has been recommended in the General Plan. Ratio of parks acreage per 1,000 residents published in the OSCAR Element may over estimate the amount of parks acreage available for public use as it includes “school yards”. Schools may or may not be available and open to the public outside of school hours and therefore including school yards in the calculation for parkland acreage may inflate the acreage calculation. The lack of parkland acreage is especially dire in East Oakland where there is only 0.89 acres of parkland per 1,000 residents--approximately 1/5 of the City’s standard.

On page 4-40, Table 15 includes goals not only for parks acreage, but also for parks facilities, they are:

[table omitted]

SUGGESTED MODIFICATIONS TO HAUSRATH ECONOMICS SCOPE OF WORK BASED ON OSCAR ELEMENT ACTIONS

We recommend that the scope of work for Hausrath Economics Group be amended to include the following tasks which are directly related to the implementation of the OSCAR Element. In addition, we believe that the tasks and associated deliverables can be accommodated within the existing budget and would not require an extension to the contract duration.

Additional Task 1: Provide documentation and analysis that can be used to prepare a Citywide Park Plan (Action REC-1.5.1)

Additional Task 2: Provide analysis that supports the adoption of a Quimby Act Fee (Action REC-10.2.1)

Additional Task 3: Provide evidence and recommendations that provide a nexus for Parks Focused Development Impact Fees (Action REC-10.5.2)

Deliverables for Tasks 1, 2 and 3:

Invite OPR staff to participate in regularly scheduled project team meetings
Provide updates to OPR on deliverables pertaining to analysis and evaluation of parks facilities and the determination of parks related fees
Provide a report to CEDA and OPR staff that includes the following:

· Listing of parks facilities, amenities, acreage

· Existing Population and Demographic Data for the City of Oakland

· Growth Projections for the City of Oakland

· The current ratio of parks ratio per 1,000 residents, differentiate by park and facility type

· Compare parks ratio to the General Plan standard

· Identification of facilities requiring retrofit or modifications to meet ADA requirements

· Listing of priority projects for rehabilitation and estimated costs

· Determine land acquisition costs for the expansion or creation of new parks

· Determine, based on recent property transactions and estimated land values, the number of acres and the cost to purchase and develop park and recreational facilities which meet the General Plan standard

· A summary of findings from community surveys, focus groups, or the like conducted by the consultant and coordinated with CEDA and OPR staff to ascertain community need and preferences for parks and recreational amenities

CONCLUSION

Although the OSCAR Element has not been updated in nearly twenty years, the facts remain virtually unchanged--Oakland is severely “under parked”. Despite the for ongoing need for parks expansion and rehabilitation, the City of Oakland’s Capital Improvement Plan for FY 2014-15 approved by your Council provides no funds for parks facilities. If Oakland is to live up to its potential as a world class city, we request that the Council seriously consider how parks and recreational facilities are critical to providing opportunities for exercise, enjoyment and social interaction. We ask you to consider what New York City would be without its Central or Prospect Parks, or the numerous playgrounds, pocket parks and playing fields spread throughout the city. Therefore, we ask that you use this opportunity to identify an ongoing source for funding for such facilities in Oakland.

[1] Open Space, Conservation and Recreation Element, page 4-9