Fees for Developers Could Soon Increase

First published in the June 11 print issue of the Burbank Leader.

The Burbank City Council indicated this week it will charge developers higher one-time fees for their projects, a change that would help fund infrastructure improvements.
The council voted unanimously during its Tuesday meeting to introduce an ordinance to update Burbank’s development impact fees, or DIFs. Developers pay DIFs to compensate the city for their projects’ impacts to local police, fire, transportation and library infrastructure, with those fees earmarked toward facility upgrades the city deems necessary to accommodate the new developments.
If a majority of the council adopts the ordinance on June 21, the new fees will go into effect starting Aug. 21. City staff members said the last time Burbank updated its DIFs, besides for inflation, was in the 1990s.
Beverley Ibarra, an administrative analyst with the city, told the council that the DIFs could help pay for some — though not all — of the costs of new projects.
These include new vehicles for the fire and police departments, a new dog park and soccer fields, renovations of park facilities, an expanded library and roadway improvements. The city can only charge fees on new square footage, and must show the projects are necessary because of future growth.
The DIF changes would increase fees from about $3,100 to $13,200 for each single-family residential unit, from $2,300 to $7,300 for each multi-family residential unit, from $8.35 to $9.94 per square foot of a retail business and from $9.29 to $17.74 per square foot of an office building.
Community development officials warned that making the DIFs too high could discourage new construction, explaining they set the proposed increases at 80% of the maximum allowable fees.
Arguing that providing exemptions would allow growth to continue, they also recommended setting the DIFs charged at 33% of the maximum for retail developments and 67% for hotel developments.
Those projects, according to city staff members, provide regular tax revenue to the city that eventually exceeds the amount offered by the one-time DIFs.
“We don’t want to disturb that … revenue stream,” said David Kriske, assistant community development director of transportation. “If you load on too many costs, it will discourage or lessen the ability [for businesses to operate].”
Councilman Nick Schultz also asked that developments that meet an affordable housing requirement see their DIFs reduced to 67% of the maximum allowable fee for affordable units. The city would charge additional affordable units, under his proposal, at 50%. City staff members had originally suggested all affordable units be charged at 50%.
“I don’t know if we should be treating someone who’s doing the bare minimum the same [as someone] who’s going above and beyond,” Schultz said, noting that recent state housing laws make denying projects, even those with only a few affordable units, more difficult. “We’re kind of losing the stick, but we still have the carrot.”
Though the proposed increases in DIFs would substantially boost the amount of money Burbank receives from some developments, its residential fees would remain substantially lower than those charged in Glendale and Pasadena.
Glendale currently charges more than $20,400 per multi-family residential unit, while Pasadena charges $24,600. However, Ibarra said that those cities charge DIFs for purchasing park land, a practice Burbank does not have. Burbank’s non-residential DIFs would be higher than the fees charged by its neighbors.
The update to the DIFs would also add an information technology fee to fund Wi-Fi, video cameras and traffic sensors. It would also aim to have the City Council consider another update in two or three years, upon the completion of Burbank’s area-specific development guidelines.