ESCONDIDO — As one developer looks to build upwards of 100 new houses in Escondido, City Council is faced with balancing a neighborhood’s need for infrastructure improvements with desired development.
Pacific Land Investors (PLI), a developer base in Irvine, Calif. is working to gain city approval to build just over 100 units in the northeastern part of the city.
The city determined years ago that that area, deemed the “North Broadway Deficiency Area,” requires wider streets, sidewalks, larger sewers, and other improvements to sustain its current and future residents.
To accumulate funds for these improvements, officials established a deficiency fee for every new home built in the area. In exchange, developers can build projects sooner without having to wait for the city to eventually obtain financing and build the needed infrastructure.
“The deficiency fee is intended to help the city build the priority improvements that are necessary in the area,” explained city principal planner Bill Martin.
Today, city professionals estimate that the most needed street and drainage improvements in the North Broadway Deficiency Area will cost around $11.34 million total. Divided by the 668 units that could potentially be built in the area, staff calculated a $17,000 fee per house.
Over the course of proposing its housing development to the city, PLI has argued that new development should not be financially responsible for current infrastructure inadequacies.
PLI’s development is coming before the city in 11- to 16-unit projects because the developer is working on acquiring individual parcels of land owned by different people.
The first two projects of the development, both along Lehner Avenue, came before City Council on Dec. 4. One contained 11 houses and the other 16.
“You cannot depend on this fee totally paying for all of the improvements,” PLI’s attorney David Ferguson, told Council.
He emphasized that PLI would be unable to afford to build the projects with a $17,000 per unit fee, and that the city should find other ways to fund the improvements.
Because the fee amount is set at the Council’s discretion, Ferguson requested that PLI only have to pay $12,000 per unit.
City Council, and the Planning Commission before it, agreed that development in the North Broadway Deficiency Area is desirable and would bring in tax revenue for the city.
Deputy Mayor Olga Diaz expressed concern that without the full $17,000 fee recommended by staff, the city would be unable to afford the infrastructure improvements.
But the council majority’s perspective offered that new development shouldn’t have to pay for the inadequacies of nearby neighborhoods left by past builders.
“We’re talking about burdening new projects, new homeowners, new citizens with improvements that they necessarily shouldn’t be responsible for in their entirety,” said Councilmember John Masson.
Except for Diaz, the majority voted to charge PLI $12,5000 per unit for the 27 units discussed in the meeting.
Martin explained that with the fee set lower than staff’s recommendation, the city would have to look to other funding sources, perhaps capital improvement project funds, to complete all of the most needed infrastructure improvements in the North Broadway Deficiency Area. He said that this has the potential to delay some top priority improvements.
Ferguson said that PLI plans to bring forth its additional projects, which will make up the 100-plus total proposed houses, for approval over the coming year.
With each project proposal, City Council will continue to address the financing of the North Broadway Deficiency Area’s infrastructure and negotiate fees with PLI. Council’s decisions will determine how many street and drainage improvements will be funded and which will be put on hold.
Clarification Jan. 9: This article was updated to clarify that Council’s decision did not decrease the deficiency fee since there was no set fee amount to begin with. Rather the fee was lower than the fee amount recommended by staff. The sentence, “Martin explained that with the fee set lower than staff’s recommendation, the city would have to look to other funding sources, perhaps capital improvement project funds, to complete all of the most needed infrastructure improvements in the North Broadway Deficiency Area,” was changed to make this clarification.