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CITY OF VICTORVILLE

Annual Development Impact Fee Report

Fiscal Year Ended June 30, 2022

December 5, 2022

Prepared by: NBS for the CITY OF VICTORVILLE

City of Victorville

City Officials

Debra Jones, Mayor Leslie Irving, Mayor Pro Tem Elizabeth Becerra, Councilmember Blanca Gomez, Councilmember

Officers Jennifer Thompson, City Clerk

Administrative Team

Keith Metzler, City Manager Jenele Davidson, Deputy City Manager Sophie Smith, Deputy City Manager Andre De Bortnowsky, City Attorney In Mendiola, City Treasurer/Finance Director

TABLE OF CONTENTS

1. Development Impact Fee Report.....1 1.1 Annual Report .....1 1.2 Five-Year Report.....2
2. Current Impact Fees & Capacity Charges.....4 2.1 Types of Impact Fees, Capacity Charges and Associated Funds.....4 2.2 Current Fee Schedule.....5
3. Financial Summary Report.....6
4. Public Improvements .....7
5. Interfund Loans.....8
6. Refunds .....10

Attachment – Current Impact Fee Schedule (effective through December 31, 2022)

1. DEVELOPMENT IMPACT FEE REPORT

The California Mitigation Fee Act (Government Code Sections 66000 et seq.) mandates procedures for administration of impact fee programs, including collection and accounting, reporting, and refunds. Regarding reporting requirements, the Mitigation Fee Act requires annual reporting for each impact fee fund, and a separate five-year reporting process. This report meets the requirements described in 1.1 Annual Report, below. A combined Annual and Five-Year Report will be provided in future years when needed to meet required reporting timelines.

1.1 Annual Report

Section 66006 (b) (1) requires that once each year, within 180 days of the close of the fiscal year, the local agency must make available to the public the following information for each separate account established to receive impact fee revenues:

1. A brief description of the type of fee in the account or fund; (report section 2)
2. The amount of the fee; (report section 2 and attachment)
3. The beginning and ending balance of the account or fund; (report section 3)
4. The amount of the fees collected and interest earned; (report section 3)
5. Identification of each public improvement on which fees were expended and the amount of the expenditures on each improvement, including the percentage of the cost of the public improvement that was funded with fees; (report section 4)
6. Identification of the approximate date by which the construction of a public improvement will commence, if the City determines sufficient funds have been collected to complete financing of an incomplete public improvement; (report section 4)
7. A description of each inter-fund transfer or loan made from the account or fund, including interest rates, repayment dates, and a description of the improvement on which the transfer or loan will be expended; (report section 5)
8. The amount of any refunds or allocations made pursuant to Section 66001, paragraphs (e) and (f). (report section 6)

The annual report must be reviewed by the City Council at its next regularly scheduled public meeting, but not less than 15 days after the statements are made public, per Section 66006 (b) (2).

Section 66013(d) has similar requirements for capacity charges in that, within 180 days after the close of each fiscal year, the local agency must make available to the public the following information:

City of Victorville Annual Development Impact Fee Report Prepared by NBS

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1. A description of the charges deposited in the fund; (report section 2)
2. The beginning and ending balance of the fund and the interest earned from investment of moneys in the fund; (report section 3)
3. The amount of charges collected in that fiscal year; (report section 3)
4. An identification of:
5. a.Each public improvement on which charges were expended and the amount of expenditure for each improvement, including the percentage of the total cost of the public improvement that was funded with those charges if more than one source of funding was used; (report section 4)
6. b.Each public improvement on which charges were expended that was completed during that fiscal year; (report section 4)
7. c.Each public improvement that is anticipated to be undertaken I the following fiscal year; (report section 4)
5. A description of each interfund transfer or loan made from the capital facilities fund, including the public improvement on which the transferred or loaned charges are or will be expended and, in the case of an interfund loan, the date on which the loan will be repaid and the rate of interest that the fund will receive on the loan. (report section 6)

1.2 Five-Year Report

Prior to 1996, The Mitigation Fee Act required that a local agency collecting impact fees was required to expend or commit impact fee revenue within five years or make findings to justify a continued need for the money. Otherwise, those funds had to be refunded. SB 1693, adopted in 1996 as an amendment to the Mitigation Fee Act, changed that requirement in material ways.

Now, Section 66001 (d) requires that, for the fifth fiscal year following the first deposit of any impact fee revenue into an account or fund as required by Section 66006 (b), and every five years thereafter, the local agency shall make all of the following findings for any fee revenue that remains unexpended, whether committed or uncommitted:

1. Identify the purpose to which the fee will be put;
2. Demonstrate the reasonable relationship between the fee and the purpose for which it is charged;
3. Identify all sources and amounts of funding anticipated to complete financing of incomplete improvements for which impact fees are to be used;
4. Designate the approximate dates on which the funding necessary to complete financing of those improvements will be deposited into the appropriate account or fund.

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Those findings are to be made in conjunction with the annual reports discussed above. If such findings are not made as required by Section 66001, the local agency could be required to refund the moneys in the account or fund, per Section 66001 (d).

Once the agency determines that sufficient funds have been collected to complete financing on incomplete improvements for which impact fee revenue is to be used, it must, within 180 days of that determination, identify an approximate date by which construction of the public improvement will be commenced (Section 66001 (e)). If the agency fails to comply with that requirement, it must refund impact fee revenue in the account according to procedures specified in Section 66001 (d).

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2. CURRENT IMPACT FEES & CAPACITY CHARGES

Development impact fees (DIFs) in the City of Victorville are one-time charges levied on new development in Victorville to fund various infrastructure, facilities, vehicles, and equipment. The basis for these impact fees is presented in the “Development Impact Fee 2006 Update Study” (2006 Study) report, completed by AGAJANIAN & Associates.

2.1 Types of Impact Fees, Capacity Charges and Associated Funds

The fees documented in the body of this Annual Development Impact Fee Report (Report) include the following fees listed below. The revenue and expenditures for each fee type is tracked by the City in a separate fund.

City of Victorville

Annual Development Impact Fee Report

Prepared by NBS

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2.2 Current Fee Schedule

The Attachment to this Report provides a copy of Victorville's Development Impact Fee Schedule active through June 30, 2022. The basis for these impact fees is presented in the "Development Impact Fee 2006 Update Study" (2006 Study) report, completed by AGAJANIAN & Associates. The City also completed a comprehensive impact fee study during the 2021/2022 fiscal year, which was adopted on June 7, 2022 by City Council which will go into effect in the 2022/23 Fiscal Year.

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3. FINANCIAL SUMMARY REPORT

The following financial summary report provides a statement of revenue, expenditures, and changes in fund balance for each impact fee fund, for the Fiscal Year End June 30, 2022.

1Fund 354, escrow refund for overpayment

2 Fund 350, land return/debt dissolution with SCLAA; Fund 351, repayment of loan from General Fund. See Section 5 Interfund Loans for more information

3 Beginning&Ending Fund Balance is presented on a cash basis per trial balance financial reports provided by the City's Finance Department. Water and Sewer Fund balances were also provided by City staff.

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4. PUBLIC IMPROVEMENTS

This section of the Annual Report identifies each public improvement on which fees were expended and the amount of the expenditures on each improvement, including the percentage of the cost of the public improvement that was funded with fees.

FISCAL YEAR 2021/22 PUBLIC IMPROVEMENT EXPENDITURES

• 352 Road NISQ/I15 INTERCHANGE-ST CONST 48,860,904 22,762,803 47 22,741,318 21,485
• 352 Road 352 Road 352-60013 Green Tree Blvd Extension NISQ/I15 INTERCHANGE-ST CONST 80,550,764 $ 48,860,904 19,005,393 $ 22,762,803 24 47% 692,143 $ 22,741,318 9,218,145 $ 21,485 9,095,105 $

Expenditures Expenditures Remaining

• City of Victorville

City of Victorville Annual Development Impact Fee Report Prepared by NBS

5. INTERFUND LOANS

The Mitigation Fee Act requires a description of each inter-fund transfer or loan made from the account or fund, including interest rates, repayment dates, and a description of the improvement on which the transfer or loan will be expended.

There were no new interfund transfers or loans made between impact fee funds in Fiscal Year 2021/22. However, two loans were paid off during Fiscal Year 2021/22. The loan between Fund 352 Roads and Fund 351 Fire Safety was repaid by the General Fund per City Council direction on May 17, 2022, in the amount of $2,286,536.07. Also, the loan between Fund 350 Public Buildings and SCLAA was terminated during the same Council meeting, by way of transferring property back to SCLAA and nullifying the loan which had a balance of $1,943,928. The following table summarizes all active interfund loans to and/or from the City's impact fee funds.

FISCAL YEAR 2021/22 INTERFUND LOAN STATUSES

City of Victorville

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6. REFUNDS

As discussed in this Section 4 of this report, in Fiscal Year 2021/22, no such determination has been made regarding sufficient funds collected to complete incomplete improvements. Therefore, no refunds were made or required. The refunding requirements for the Mitigation Fee Act are summarized as follows:

Refunds under the Mitigation Fee Act: If the City determines that sufficient funds have been collected to complete financing on incomplete improvements for which impact fee revenue is to be used, it must, within 180 days of that determination, identify an approximate date by which construction of the public improvement will be commenced (Government Code Section 66001 (e)). If the agency fails to comply with that requirement, it must refund impact fee revenue in the account according to procedures specified in Section 66001 (d).

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ATTACHMENT CURRENT IMPACT FEE SCHEDULE

CITY OF VICTORVILLE DEVELOPMENT IMPACT FEES MASTER FEE SCHEDULE

Residential Development Effective through 12/31/2022

[1] Subtotal does not include Water System Capacity fee, Sewer fee and Regional Drainage fee.

Residential

CITY OF VICTORVILLE DEVELOPMENT IMPACT FEES MASTER FEE SCHEDULE

Non-Residential Effective through 12/31/2022

[1] Subtotal does not include Water System Capacity fee, Sewer fee and Regional Drainage fee.

Non-Residential