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New Business 1.
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| Brentwood City Commission Agenda |
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| Information |
| Subject |
| Ordinance 2019-10 - An Ordinance to Amend Chapter 14, Article IX of the Municipal Code regarding Public Works Projects. |
| Background |
The FY 2020 non-routine work plan for the Planning and Codes Department includes continuation of the review and update of Chapter 14 of the Municipal Code regarding Public Works Projects. Public Works Project Fees (PWPF) are intended to address the additional traffic demands of new development and are assessed on each new building, addition, or change of use within an existing structure. The fees are collected as part of the process of issuing building permits for most uses. PWPF are used to fund the engineering and construction of road projects around the City. The Code establishes a regulatory system and method by which the City calculates, collects, and obligates the fee.
The fee schedule and the listing of eligible road projects were last updated by staff in December 2007 using the Institute of Traffic Engineers (ITE) Trip Generation data. The 2019 proposed update is necessary to insure the City’s fee calculation methodology accurately determines the appropriate fee amount based upon the updated road project costs and remains defensible in light of more recent cases about development fees. In addition, the trip generation standards from the various land uses was reviewed based upon the latest ITE Trip Generation data. The study also identifies an expanded listing of land uses, which are more reflective of the types of developments that are being proposed today.
In mid-2018, Planning and Codes Department staff prepared a Request for Qualifications (RFQ) to update the Municipal Code regarding Public Works Projects. The RFQ was sent to five firms specializing in the preparation and update of impact fee studies. Staff reviewed the three RFQs that were received and selected Duncan Associates as the most qualified firm to complete the work due to their nationwide experience and their Tennessee experience in particular, which includes impact fee studies for Columbia, Franklin, LaVergne, Nolensville, and Smyrna.
Duncan Associates prepared a draft study, which includes recommendations regarding ordinance amendments and new fee amounts based upon an updated cost allocation methodology and the latest impact fee legal precedents. The study results were discussed with the City Commission at the regularly scheduled briefing on August 26.
Changes to the ordinance and the fee schedule will require separate adoption by the City Commission. This agenda item provides for amendments to the Public Works Project Fee section of the Brentwood Municipal Code. These amendments primarily involve land use definition changes, fee calculation methodology changes based on the 2019 study, clarification on allowable developer credits, changes to exemptions, and annual indexing of the fee amounts. The proposed ordinance amendments do not included the updated fee schedule. Adoption of the new fee schedule will be done via resolution scheduled to be considered by the Board at the November 25, 2019 meeting, the same meeting where Ordinance 2019-10 will be considered on second and final reading.
The major recommendation for this fee study update relates to the methodology applied to calculate the required fees. The City’s current fees were calculated using a “plan-based” methodology. Plan-based methodologies are simple to calculate (total planned improvement costs divided by new trips), but they are difficult to implement correctly. The plan-based methodology requires a master plan that can demonstrate that the cost of improvements needed over the planning horizon are attributable to the amount of growth projected to occur over that period. The City’s current Major Thoroughfare Plan does not contain the level of data and analysis needed to establish the connection between the projected growth and the need for the improvements.
The proposed methodology bases the fees on a “demand-driven” methodology. This approach is more commonly used in Tennessee than the plan-based methodology. It bases the impact fee on the average cost to replace major roadway capacity consumed by new development. It does not depend on having a list of planned improvements or growth projections, although planned improvement costs may be used to determine the average cost to add new roadway capacity, and growth projections may be used to forecast future revenues. It also allows fee revenues to be used for any needed capacity-expanding improvement to the major roadway network. A more detailed discussion of the study's methodology and fee calculation formula is provided in the final version of the 2019 Public Works Project Fee Study attached.
As noted above, adoption of this ordinance does not directly adjust the fee schedule. However, for the benefit of the Commission in considering the ordinance, a comparison of the existing and proposed fee schedules is attached.
The current version of the ordinance exempts church and governmental buildings uses (i.e. public schools). Under the proposed ordinance, government buildings will still be exempted from payment of the fees, but staff is recommending that churches no longer be exempted. Duncan Associates recommends that these two land uses be included as part of the new fees and be assessed the appropriate levels at the time the building permit is issued. Nolensville and Franklin both include impact fees for churches and schools in their fee schedule. However, Franklin does not assess the fee for public schools in the Williamson County or Franklin Special school districts. Spring Hill, based upon past practice, has waived the fees for public educational facilities. Fees for places of worship are assessed. However, there have been no recent requests for new churches in Spring Hill.
Finally, the proposed ordinance allows for automatic indexing of the fees for inflation. The fees adopted by the Board of Commissioners pursuant to the 2019 Public Works Project Fee study shall be adjusted to account for construction cost inflation on January 1 following each year in which the fees were not comprehensively updated based on a new impact fee study, with the first year of adjustment being 2021. The existing fees will be multiplied by the ratio of the Engineering News-Record Construction Cost Index for the most recent month for which the index is available to the index for the same month of the previous year. The adjusted fee schedule will be posted on the City’s web site and made publicly available by December 1 and will become effective on January 1.
Second and final reading of the proposed ordinance is scheduled for November 25, at which time the Board will also consider a resolution formally adopting the new fee schedule. If adopted on November 25, 2109, the proposed effective date of the new fees will be for all new building permit applications filed after January 1, 2020.
Should you have any questions, please contact the City Manager or the Planning and Codes Director. |
| Staff Recommendation |
| Staff recommends approval of Ordinance 2019-10, on first reading. |
| Previous Commission Action |
On September 27, 2018 the Board of Commissioners approved Resolution 2018-81, authorizing an agreement with Duncan Associates for the update of Article IX -- Public Works Projects.
On December 10, 2007, the Board of Commissioners approved Resolution 2007-93, which designated a revised list of eligible projects for PWPF system and adopt a revised fee schedule.
On November 27, 1995 the Board of Commissioners adopted Resolution 95-46, which designated a list of eligible projects for PWPF system and adopt a schedule of Public Works Project Fees.
Also on November 27, 1995 the Board of Commissioners approved Ordinance 95-45, adopting a Public Works Project Fee ordinance. The ordinance became effective on December 1, 1995.
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| Fiscal Impact |
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| Fiscal Impact: |
| For the past six years, average annual collections for Public Works Project Fees has been approximately $950,000. The significant fee increases proposed as a result of the study will result in increased collections. However, the amount of collections is completely dependent on the level of new development (residential and non-residential) in the City. |
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