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REQUEST FOR COUNCIL ACTION CITY COUNCIL MEETING DATE: AUGUST 18, 2008 TITLE: PUBLIC HEARING - ORDINANCE TEMPORARILY DEFERRING COLLECTION OF DEVELOPMENT IMPACT FEES ~~ CITY MANAGER RECOMMENDED ACTION CLERK OF COUNCIL USE ONLY: APPROVED ^ As Recommended ^ As Amended ^ Ordinance on 1S` Reading ^ Ordinance on 2nd Reading ^ Implementing Resolution ^ Set Public Hearing For_ CONTINUED TO FILE NUMBER Adopt an ordinance amending various sections of the Santa Ana Municipal Code to temporarily defer collection of development fees until the issuance of certificates of occupancy/compliance. DISCUSSION Santa Ana like most cities collects various fees to offset impacts created by new development. These impact fees are used to provide and upgrade infrastructure, facilities and equipment to properly serve new development. Examples of these fees include: • Parks Acquisition and Development Fee • Drainage Area Master Plan Fee • Transportation System Improvement Assessment (TSIA) • Major Thoroughfare and Bridge Fee • Fire Facilities Fee Under the current system, these impact fees must be paid before building permits are issued. However, given the general slowdown in the economy the Building Industry Association of Orange County (BIA/OC) has requested that cities consider deferring collection of these fees to the point when projects are complete and certificates of occupancy/compliance are issued. When combined, these fees can represent millions of dollars. Therefore, deferring payment of the fees can present a significant cash flow benefit for developers, which according to BIA/OC may mean the difference between projects that move forward and those that do not. A temporary one-year deferral program is recommended as a stimulus for both residential and non-residential development. To ensure that fees are paid prior to certificate of occupancy/compliance, provisions in the 75A-1