Fire Protection Impact Fee TOWN of WAKE FOREST Fire Protection Impact Fee MAY 3, 2016

What are Development Impact Fees? What Are Impact Fees? What are Development Impact Fees? One-time capital charges assessed to new development or new customers to recover a proportional share of the costs of capital facilities required to provide service to the new customers. Objective: “Intergenerational Equity”

Rational Nexus Test Basis for Cost Justification Must demonstrate a linkage between the service needs of new customers and additional facilities and equipment needed to meet those needs Must demonstrate a linkage between the level of fees and benefits received by new development Must not exceed the proportional share of costs for the additional facilities and equipment

Methodology Methodology for Calculating Fire Protection Impact Fees Define the service area and standard of service Define capital needs to address service requirements Allocate costs between current and future beneficiaries Allocate costs between residential and non-residential (employment) base Calculate cost justified level of fees

Service Area And Projected Growth Notes: Town of Wake Forest and Wakette Fire District Population growth rate: 5.45% Employment and Square Footage growth rate: 2.76%

Calculation of Cost per Person Assumptions 81.9% of growth driven by residential demand Equates to $8.93 million of CIP for residential growth 18.1% of growth driven by non-residential demand Equates to $1.98 million of CIP for commercial/industrial growth Calculation $8.93 mm / 32,458 new residents = $274.50 / resident $1.98 mm / 3,307 new employees = $598.29 / employee Addresses proportionality concerns related to development impact fees.

Residential Fee Based On Functional Population Units

Residential Fire Protection Fee Calculation Single Family Residence $274.50 per resident * 1.66 = $454 per unit Multi-Family Residence $274.50 per resident * 1.24 = $341 per unit

Non-Residential Fee Assumptions 1.28 Commercial and Institutional employees per 1,000 square feet 0.44 Industrial and Manufacturing employees per 1,000 square feet Source: Town of Wake Forest NAICS employment by use and square footage by use data used to calculate these factors.

Non-Residential Fee

Non-Residential Fee Calculation Commercial & Institutional $598 per employee * 1.28 employees per 1,000 square feet = $767 per 1,000 square feet Industrial & Manufacturing $598 per employee * 0.44 employees per 1,000 square feet = $265 per 1,000 square feet

Summary and Comparison To Prior Fire Protection Fees Important Trends Affecting Fee Calculations: Residential and employment growth did not reach levels projected in 2007; Fewer residents across which to spread costs Investment in fire protection infrastructure also did not grow as projected Change in management for Wake Forest Fire Department More growth in commercial sector than manufacturing and industry

QUESTIONS and DISCUSSION?