2010 G&IC Conference Program

www.growthandinfrastructure.org

Welcome Welcome to our first ever conference as the Growth & Infrastructure Consortium! We have met annually for the past 16 years as the National Impact Fee Roundtable. This year, we move to a new phase, building on the contributions of our founding members as we respond to the rapidlychanging world of public infrastructure. You may recall from past conferences a growing interest in expanding the scope of the National Impact Fee Roundtable beyond the subject of just impact fees. In fact, it was happening almost by itself. Each year our topics seemed to broaden. As the Board deliberated on the decision to change the name, we reflected on NIFR’s past: the first “members” of NIFR who literally gathered around tables in Florida to share their experiences with impact fees, the transition of NIFR from a single-state organization to one that now draws members from around the country, and, of course, an economy and public landscape that are changing rapidly before our eyes. So, our new name includes an important tag line: the “Growth & Infrastructure Consortium: Impact Fees, Capital Planning and Public Finance.” It is our goal to remain the most reliable resource for those who fund, plan, build, or rely on the efficient provision of the public infrastructure needed to serve the demands created by new growth. This year, we will hear from one of our founding members, Pedro Leon, who currently serves as Project Management Director for the Volusia County Department of Economic Development. Pedro was there in the beginning and served a number of years on the NIFR board after it incorporated. He will share with us his stories of the good old days during lunch on Thursday. We look forward to your continued involvement and contributions to this group and hope that you will encourage others to join the Growth & Infrastructure Consortium.

Gold

Sponsors Platinum

Schedule Time

Hernando Room

Hillsborough Room

Wednesday, November 3 3:00pm - 7:00pm

Registration

5:00pm - 7:00pm

Opening Reception (Atrium)

7:00am - 4:00pm

Registration

7:30am - 8:00am

Continental Breakfast (Welcome) (Manatee/Orange Ball Room)

8:00am - 9:15am

Impact Fee Basics

Activity Impact Fees to Mitigate Street Deterioration

9:30am - 10:45am

Impact Fee Administrators’ Roundtable

Considering Previously Unused Sources of Transportation Funding

11:00am - 12:15pm

Do Impact Fee Reductions Stimulate Growth?

ITE Trip Generation and Beyond: Cost Allocation Approaches for Transportation Impact Fees

Thursday, November 4

12:15pm - 2:15pm

Lunch and Plenary Session (Manatee/Orange Ball Room) Special Presentation (12:45pm - 1:00pm) Mobility Plans and Fees: The Future of Transportation Funding (1:00pm - 2:15pm) Structuring Complex Financial Debt Transactions for Infrastructure in New Market Realities

2:30pm - 3:45pm 3:45pm - 4:00pm

The New Coordinative and Projection Role for the CIP

Refreshments (Manatee/Orange Ball Room) Bulletproofing Impact Fees Against Expenditure Challenges

4:00pm - 5:15pm

Reforming Infrastructure Financing in Light of New Fiscal Realities

5:30pm

Deadline for Voting in Board of Directors Election

6:00pm - 9:00pm

Off-Site Dinner at the Columbia Restaurant in Ybor City (bus leaves at 6:00pm)

All Morning

Registration

7:30am - 8:15am

Breakfast - Annual Membership Meeting (Manatee/Orange Ball Room)

Friday, November 5

8:15am - 9:30am

Building a Business Case for Infrastructure Projects

Alternative Delivery Methods for Water and Wastewater Infrastructure

9:45am - 11:00am

Impact Fee Alternatives for Low Growth and Redeveloping Cities

Assessments: When Do They Work Best?

11:15am - 12:30pm

“Green” Credits - Incentivize Green Technology and Avoid Challenge

Levels of Service in Impact Fees

12:30pm - 2:30pm

Lunch and Plenary Session (Manatee/Orange Ball Room) Case Law Update 2010 & the Footprint of the Great Recession on Impact Fees and Infrastructure Finance

2:30pm

Conference Ends

s r e k a e p S f o t Lis Maik Aagaard Carson Bise Robert W. Burchell Crystie Carey Todd Chase Frank Davis David Goldstein Jamie Gomes Robert Grantham Amanda Haas Jeffrey L. Hays Nilgun Kamp Tim LaPorte Clancy Mullen Chris Nelson James C. Nicholas Jonathan B. Paul Amy Patterson Mike Rocca Mark Schiavone Susan Schoettle-Gumm Robert Sheets Harold Smith Tyson Smith Greg Stewart Lea Ann Thomas Angi Thompson Steve Tindale Eric J. Tripi Robert Wallace Riley Whitcomb Jonathan Young Randy Young

Managing Principal, DPFG, FL President, TischlerBise, Inc., Bethesda, MD Professor, Rutgers University, New Brunswick, NJ Attorney, Nabors Giblin & Nickerson, Tallahassee, FL Senior Project Manager, FCS Group, Portland, OR Manager, Raftelis Financial Consulting, Inc., Charlotte, NC Chief Assistant County Attorney, Pasco County, FL Principal, Economic & Planning Systems, Inc., Sacramento, CA California Regional Branch Manager, FCS Group, San Francisco, CA Senior Planner, Tindale-Oliver & Associates, Inc., Tampa, FL Sr. Transportation Planner, Alachua County, FL Associate Principal, Tindale-Oliver & Associates, Inc., Tampa, FL Public Works Director, City of Kent, WA Director of Infrastructure Finance, Duncan Associates, Austin, TX Professor, University of Utah, Salt Lake City, UT Professor Emeritus, University of Florida, Gainesville, FL Concurrency and Impact Fee Manager, Alachua County, FL Impact Fee Coordinator, Collier County, FL Raftelis Financial Consulting, Inc., Orlando, FL Impact Fee Coordinator, Jefferson County, WV Attorney, Sarasota, FL Chief Executive Officer, Government Services Group, Inc., Tallahassee, FL Raftelis Financial Consulting, Inc., Charlotte, NC White & Smith, LLC, Charleston, SC Attorney, Nabors, Giblin & Nickerson, Tallahassee, FL Assistant County Manager, Polk County, FL Development Processing Manager, Lake County, FL Chief Executive Officer, Tindale-Oliver & Associates, Inc., Tampa, FL Director of Operations in South Carolina, Iteris, Inc., Mt. Pleasant, SC Vice-President, Tindale-Oliver & Associates, Inc., Orlando, FL Portland Parks and Recreation, Portland, OR Project Manager, Wildan Financial Services, Oakland, CA Principal, Henderson, Young & Company, Redmond, WA

9:45 -11:00 AM Special Facilities Funding and Impact Fee Considerations for Low Growth and Redeveloping Cities - Are Impact Fees Ever Like Unnecessary Surgery? Some cities have growth potential free of planning constraints, while others are approaching buildout or are expected to grow by adding residents and workers in already-developed areas. These cities present special challenges for funding infrastructure improvements through impact fees, including limited impact fee revenue potential and the need for significant revenues from other non-fee sources. Facilities to be funded by fees often differ from those needed in “greenfield” development areas, including improvements to or diversification of existing facilities. Fees may not comprise the majority of funding needed in these cases but can be used to fill in pieces of the funding puzzle. This session will examine the infrastructure financing options for low-growth and redeveloping cities and explore the frequent policy decisions made by those cities to update or adopt impact fees to fund many types of public facilities. Basic policy tests focusing on facility standards, inventories, funding sources, and future development potential will be presented to suggest when allocating scarce public dollars to fee studies is a good idea and when the cost of doing so may outweigh the benefit. Speakers: Eric Nickell and Jonathan Young (Willdan Financial Services) Assessments: When Do They Work Best? Given the fluctuations in ad valorem taxes and reduction in impact fees due to the economic downturn and low growth rates, assessments provide a more reliable revenue source. This session will focus on when this revenue source is most effective, some of the methods used in their calculation, and key issues/considerations in their implementation. Speakers: Nilgün Kamp, AICP and Amanda Haas (Tindale-Oliver & Associates); Susan Schoettle-Gumm (attorney)

11:15 -12:30 PM “Green” Credits - Considerations to Incentivize Green Technology and Prevent Financial Challenges During recent years, there has been a growing commitment by local governments to stimulate green building and technologies. This presentation will review the advantages and disadvantages of establishing “green” credits, with particular attention to applications for water and wastewater utilities. Where green credits may be properly used to incentivize green technology and how awarding green credits can impose challenges on municipalities will be discussed, as will the financial considerations that must be explored when establishing green credits, including the methods for setting such credits based on actual cost of service reductions. Speaker: Robert Grantham and Todd Chase, AICP (FCS Group) Level of Service Standards This session will focus on how to determine appropriate level of service (LOS) standards for impact fee calculation purposes versus from the perspective of service provided to the public. While in some program areas, such as transportation, both are related, in others, such as fire/EMS services, capital facilities level of service may be appropriate for impact fee calculations and response time tends to be a more relevant measure in terms of the service provided to the public. In addition, for impact fee purposes, it may be more appropriate to measure the LOS in terms of dollar amount spent per person versus a more traditional measure. These issues, as well as data showing variation on achieved LOS and LOS standards in several program areas, will be discussed. Speakers: Steven A. Tindale, P.E., AICP and Nilgün Kamp, AICP (Tindale-Oliver & Associates); Gregory Stewart (Nabors, Giblin & Nickerson; Amy Patterson (Impact Fee Manager, Collier County, FL)

12:45 -2:00 PM Case Law Update 2010 & the Footprint of the Great Recession on Impact Fees and Infrastructure Finance Tyson Smith with discuss judicial trends in growth-related infrastructure finance, including any impact fee cases discussed at the 2009 Roundtable that have been resolved on appeal. In addition, he will cover recent cases related to development fees, adequate public facility programs, special districts, and local government authority in general, as it relates to infrastructure finance and regulation. Professor Arthur Nelson will discuss the trends he sees emerging in the field of infrastructure finance as a result of the ongoing economic downturn. Many communities are repealing impact fees and other regulations in hopes of spurring economic growth, but is there empirical evidence that doing so benefits the economy? Dr. Nelson also will describe other trends in infrastructure finance emerging in response to the poor economy and the resulting pinch on local budgets. Speakers: Tyson Smith, AICP (White & Smith, LLC); Dr. Arthur C. (Chris) Nelson, FAICP (University of Utah)

4:00 -5:15 PM

Bulletproofing Against Expenditure Challenges Methodologies used to calculate the impacts of development on infrastructure often are based on estimated capital costs for land and improvements needed to maintain adopted levels of service. These capital costs become the bones for capital improvement plans (CIPs) that may be implemented over a 10- to 20-year period. The CIPs developed from these methodologies provide the side boards for expenditures, but in no way control the internal and external pressures for “creative funding” of desired projects that may test the limits of proper use of funds from impact fee revenues. The session will discuss the challenges and importance of documenting expenditures of system development charge (SDC) and impact fee revenues for specific capital projects and steps that can be taken to “bulletproof” an organization from the potential for a successful challenge to an expenditure. Documentation techniques and methods used by Portland Parks to evaluate potential projects, including use of GIS and other data for analysis, will be presented and discussed. Questions to be addressed in this session will include: Where do pressures to use impact fee revenues for every imaginable project come from? How do we determine if a project can be justified? How do we prevent “crossing the line” and funding unjustifiable projects? What safeguards can we use to protect the jurisdiction and the program? Speakers: Riley Whitcomb (Parks SDC Manager, Portland OR) Reforming Infrastructure Financing in Light of New Fiscal Realities Many services provided by local governments are capable of generating significant and, in some cases, sufficient revenues that can be used to fund the provision of those services. This would include both capital and operating expenses. The current state of local government finance together with increasing resistance to taxation requires a new look at funding of local services. This session will explore means and methods to continue to provide the services that citizens demand in light of the new fiscal reality. The speakers’ presentations will recast the entire framework for infrastructure financing as currently practiced in the U.S. The session will address the current state of affairs, trends that are not sustainable, elements of infrastructure finance reform, and legislative needs. Speakers: Dr. Arthur C. (Chris) Nelson, FAICP (University of Utah); Dr. James C. Nicholas (University of Florida, Emeritus)

8:15 -9:30 AM

Friday 11/05/2010

Building a Business Case for Infrastructure Projects Local government officials know the infrastructure projects needed in their communities. Unfortunately, however, most citizens take little notice until there is a need for repair or a need personally touches their life. Public support is paramount in successfully building a case for infrastructure projects since public support is the result of successful two-way communication between the public officials and the citizens who use the services. Three critical steps must be undertaken to be successful: garnering public support, understanding the legal framework in which to operate, and developing creative alternative and non-traditional funding solutions. This presentation will walk attendees through how to make the case for infrastructure projects, look at funding alternatives, and give a real life example of how a project was funded and implemented. Speakers: Lea Ann Thomas (Assistant County Manager, Polk County, FL); Robert Sheets (Government Services Group); Crystie Carey (Nabors, Giblin & Nickerson) Alternative Delivery Methods for Water and Wastewater Infrastructure Raftelis Financial Consulting provides financial and management consulting services to government-owned water and wastewater utilities. In an effort to overcome evolving regulatory requirements, aging infrastructure, and a weak economy, water and wastewater utilities are changing the way they do business. Smart utilities recognize that they must take advantage of industry advances in technology, new management approaches, and new financing options to provide the level of services their customers expect. The traditional approach to providing utilities services involves public-sector employees operating and maintaining the government-owned facilities constructed using a traditional design-bid-build (DBB) procurement approach. As regulatory and economic environments become more challenging, it has become apparent that the traditional approach may limit a government-owned utility’s ability to meet the financial and environmental demands placed on it by customers and regulators. To address these challenges, some government-owned utilities have turned to alternative delivery systems that involve increased private sector participation in the operation, management, and ownership of utilities. This session will discuss alternative project delivery methods including Design/Build (D/B) with government operations, Design/Build/Operate (DBO), Design/Build/Maintain (DBM), Design/Build/Finance/Operate (DBFO), and Design/Build/Finance/Own/Operate (DBFOO). This session also will discuss other alternative capital funding options available to utilities in the current economy. These alternatives will include Special Assessment Districts, Special Rates & Charges, Private Activity Bonds (PABs), Taxable Bonds, State Revolving Fund (SRF) Loans, and the “Build America Bonds” introduced under the American Recovery and Reinvestment Act of 2009. Speakers: Frank Davis, Harold Smith, Mike Rocca (Raftelis Financial Consulting)

Thursday 11/04/2010

8:00 -9:15 AM Impact Fee Basics We will review key principles of impact fee practice and also discuss “non-impact fee” factors faced by fee administrators, including prior development agreements, the relationship of other funding sources to the fee program, and emerging trends in light of the political resistance impact fees face in this economy. Tyson Smith will cover the legal issues, discussing fundamental authority issues and legal parameters. He also will review typical challenges to impact fee programs and suggest “Practice Points” for avoiding litigation. Carson Bise will discuss alternative means of calculating impact fees based on the needs of a particular local government, the data available, and local planning and CIP practices. He also will review several case studies to illustrate implementation techniques. Mark Schiavone will discuss what it was like starting off his program, the tricks of the trade, and, most important, the non-impact fee alternatives Jefferson County is considering, or would, were it authorized. Speakers: Tyson Smith, AICP (White & Smith, LLC); Carson Bise, AICP (TischlerBise); Mark Schiavone (Impact Fee Administrator, Jefferson County, WV) Activity Impact Fees to Mitigate Street Deterioration Refuse collection and construction vehicles that carry heavy loads have a cumulative impact on streets that results in deterioration. A growing number of communities in California have designed and implemented refuse collection, construction, and/or truck “impact fees” designed to recover the costs of the deterioration caused by these activities. This session will present information from a study prepared for the Town of Los Gatos, California. Included will be a comparison of this type of “impact fee” with traditional trip-generation based impact fees, a description of how these fees fit with California’s impact fee legislation (CC 66000), and discussion of the potential for “activity impact” fees for other types of infrastructure. Speakers: Todd Chase, AICP (FCS Consulting Group)

9:30 -10:45 AM Impact Fee Administrators’ Roundtable This is an opportunity for impact fee administrators to get together and share experiences related to the management of their fee programs. Although fee administrators typically represent a diversity of state and local governments, each with differing legislative environments, these roundtables in the past have been successful at addressing common issues such has dealing with odd commercial uses and difficult-to-document exemptions or navigating the politics of fee disbursement. The roundtable is also an excellent place for new fee administrators to meet the seasoned veterans in the field. The session will be held in a classroom-style break-out room. (Note: There will be no AICP credit for this session.) Co-moderators: Mark Schiavone (Impact Fee Administrator, Jefferson County, WV); Angi Thompson (Development Processing Manager, Lake County, FL) Leading the Horse to Water: Considering Previously-Unused Sources of Transportation Funding Like many cities, Kent, Washington needed costly transportation improvements and did not have enough money to pay for them. With a population of 112,000 and 72,000 jobs, the City updated its Transportation Master Plan, identifying $595 million in transportation projects needed in the next 25 years. Grants and local improvement districts were projected to produce a maximum of $350 million in a healthy economy. The project team identified another $380 million of funding from 7 specific sources that had not been used by the City but that were within the control of the City (none were grants!). Predictably, there was strong opposition to the new funding sources from interest groups and also from inside the City government. Kent’s Public Works Director and his consultants will describe their experience, from documenting the need for capital projects and identifying specific additional sources of unused revenue to presenting the problem and solutions to stakeholders and elected officials and seeking approval of the funding mechanisms. Speakers: Randy Young (Henderson Young & Co.); Tim LaPorte (Public Works Director, Kent WA)

11:00 -12:15 PM Do Impact Fee Reductions Stimulate Growth? In the wake of the housing and economic downturn that began in 2006, many jurisdictions in Florida have suspended or significantly reduced some or all of their impact fees in an attempt to stimulate development activity. This session reviews the extent of this

movement in Florida, arguments for and against this approach that are being made in the political arena, what economic theory would lead us to expect, and the evidence about whether such measures have had any positive effect. The results of a new quantitative study also will be presented. Speakers: Clancy Mullen (Duncan Associates); Dr. James C. Nicholas (University of Florida, Emeritus) ITE Trip Generation and Beyond: Cost Allocation Approaches for Transportation Impact Fees This session will present different perspectives on ITE Trip Generation and its relationship to transportation impact fees. Basic transportation concepts and trends will be presented to explain in more detail ITE’s Trip Generation publication, level of service/ traffic impact studies/traffic projections, and road and Infrastructure Improvements. Attendees, especially newcomers, will learn more about the theory behind trip generation: what it is, how the rates/equations were developed, how to use them, etc. Common adjustments to ITE trip rates and alternative cost allocation approaches for traffic impact fees will be discussed. Fees based on ITE trip rates with adjustments for differences in trip length and pass-by trips by land use can result in fees per thousand square feet of retail or office space that are double or triple the fees charged to a single family house. While technically defensible, these results are often in conflict with local agencies’ economic development goals. Examples of two Independent Impact Fee studies that addressed the limitations of simply using ITE trip generation rates as the sole factor for determining impact fees will be presented, and the impact fee ordinance as it was written, the independent studies conducted, and the resulting negotiations with the public agency will be discussed. The session also will review a number of adopted fee programs with alternative approaches to allocating improvement costs between residential and nonresidential land uses and compare the outcomes of these alternative approaches with those under an ITE trip rate-based cost allocation approach. Data needs, outcomes, and rough proportionality considerations of each approach will be discussed. Attendees will come away with a better understanding of the options available for designing transportation impact fee programs that meet as many of their objectives as possible. Speakers: Eric J. Tripi, P.E., PTOE (Iteris, Inc.); Jonathan Young (Willdan Financial Services)

1:00 -2:15 PM Mobility Plans and Fees: The Future of Transportation Funding This session will start with a review of historical transportation funding in Florida, recent legislation that affected transportation funding, and the introduction of mobility plans and fees. Methodologies used to calculate a mobility fee using case study examples will be discussed. The possibility of varying fees by geographic areas based on variations in cost, credit, and demand components will be reviewed by the panel, and policy decisions concerning the buy down of fees will be discussed, including by subareas or for the entire county or geographic area, by all land uses verses targeted land uses, by the type of revenues used to buy down the fees and any legal implications concerning the use of these revenues to buy down fees, and the effect growth rates have on the existing and future population contributions to buying down fees. Include will be a case study description of a mobility plan developed for Alachua County, Florida, which envisions a reduction in per capita vehicle miles of travel and per capita green house gas emissions within the Urban Cluster through provision of mobility within compact, mixed-use, interconnected Traditional Neighborhood Developments and Transit Oriented Developments that promote walking and bicycling, allowing for the internal capture of vehicular trips and the allowance of densities and intensities needed to support frequent transit service. A principal element of the Mobility Plan was to provide an alternative to traditional transportation concurrency within the Urban Cluster by allowing private development to mitigate its transportation impacts and receive concurrency approval through payment of a one-time multi-modal transportation fee. This session will describe the multi-modal land use and transporta-

tion planning that forms the basis for creation of a multi-modal transportation fee based on vehicle miles of travel and both capital infrastructure such as roadways, multi-use paths, dedicated transit lanes and the funding of transit operations consistent with the adopted Mobility Plan. Speakers: Steven A. Tindale, P.E., AICP and Robert P. Wallace, P.E., AICP (Tindale-Oliver & Associates); Tyson Smith, AICP (White & Smith, LLC); David Goldstein (Assistant County Attorney, Pasco County FL); Jonathan B. Paul, AICP (Impact Fee Manager, Alachua County, FL) and Jeffrey L. Hays (Senior Transportation Planner, Alachua County, FL)

2:30 -3:45 PM Structuring Complex Financial Debt Transactions for Infrastructure in New Market Realities The recent financial meltdown has resulted in more stringent lending practices for public and private infrastructure improvements. This session will focus on land-secured special assessment districts from a developer’s and investment banker’s perspective. The use of complex financial strategies incorporating tax exempt debt for infrastructure will be described based on real world case studies from Florida, Oregon, Washington, and other locations. Lessons learned for mitigating risks using public/private financing techniques with rates, taxes, assessments, impact fees, and utility connection charges will be gleaned by applying specific criteria to determine the best-fit funding mix for capital projects. Using an example public facilities financing plan for a large-scale master planned community, the second part of the session will describe the suite of funding options available to fund backbone infrastructure and other public facilities, including a brief summary of the pros and cons of various funding mechanisms. The discussion will also detail the process used to identify the mix of funding mechanisms ultimately included in a project’s financing strategy. Many infrastructure financing plans completed at the peak of the market are now infeasible to implement as a result of the bursting of the housing bubble. The second half of the presentation will discuss strategies to “reset” a project’s infrastructure and public facility financing program to match anticipated future market realities. The focus of this discussion will be on creative solutions to address the ever-present tension between public agencies needs and desires with private development’s ability to pay for such requirements. The goal of the session is to educate the audience on the multitude of public facility financing mechanisms that area available and how such mechanisms can be creatively structured to implement financially feasible development projects. Speakers: Todd Chase, AICP (FCS Consulting Group); Jamie Gomes (Economic Planning Systems, Inc.) The Capital Improvement Plan as the Funding Guide to Future Capital Revenues - The New Coordinative and Projection Role for the CIP This session will review the process of preparing a Capital Improvement Plan and ensuring that the various projects are adequately funded as they come due. Included will be discussion of the necessity to find new revenues to replace both state and federal funding of capital facilities and the specific role of reduced impact fees in this process. The role and likelihood of revenue production from public improvement districts, special assessment districts, tax increment financing, general obligation and revenue bonds, and specific earmarks for gross receipts tax revenues will be discussed. Within this array of revenues, what is the role of impact fees? Are they planned in advance as part of the revenue stream or do they make up what is not funded from the above sources? The new CIP is a strong document that guides both comprehensive plan and growth strategy implementation. It is expected that it will be fully funded with adequate revenues to justify its role. Is this really happening, or is the CIP an unfunded wish list? Speakers: Dr. Robert W. Burchell (Rutgers University); Dr. James C. Nicholas (University of Florida, Emeritus); Dr. Arthur Nelson, FAICP (University of Utah); Maik Aagaard (Development Planning & Financing Group)