The Regional Development Impact Fee program, as adopted by the Transportation Agency Board of Directors and each of the jurisdictions, went into effect in August 2008.  Prior to the adoption of the regional fee program, development proposals were evaluated on a case-by-case basis for cumulative impacts to the regional transportation network as part of the California Environmental Quality Act (CEQA) review.  This process resulted in, at times, lengthy negotiations with developers, and assessments were not consistently applied throughout the County.  The purpose of establishing a county-wide Regional Fee program was to streamline the environmental review of new development, and establish a consistent methodology to assess in-lieu fees as a CEQA mitigation for new trips on the regional transportation system. Caltrans considers payment of the regional development impact fee as mitigation for cumulative impacts on the State highway system.

In 2013 and 2018, the nexus study for the regional fee program was updated, per the state’s Mitigation Fee Act.  The next such update will occur in 2023.  The 2018 update, approved by the Transportation Agency Board in September 2018, was based upon a set of regionally-significant projects identified and environmentally reviewed in the 2018 Monterey County Regional Transportation Plan and its accompanying CEQA Findings. The regionally-significant projects in the Regional Transportation Plan will be incorporated into the next analysis conducted as part of the Metropolitan Transportation Plan / Sustainable Communities Strategy.  The Sustainable Communities Strategy demonstrates the land use and transportation measures used to meet the region's greenhouse gas emission reduction targets as established by the California Air Resources Board.

In December, 2018, pursuant to Senate Bill 743, the Office of Planning and Research adopted changes to the CEQA Guidelines that identified new metrics for transportation analysis, including Vehicle Miles Traveled (“VMT”) on a per capita, per employee, and net VMT basis.  The prior metric utilized to evaluate the impact of projects was whether or not the project increased traffic Levels of Service above a locally-set threshold, defined according to a letter grade system of A (no traffic) through F (stop and go). The purpose of this change was to focus on reducing the creation of new trips and miles traveled rather than accommodating them with new travel lanes.  The new VMT metrics went into effect on July 1, 2020.  The Office of Planning and Research acknowledges that this change was intended to achieve general consistency with both the Caltrans statewide target for VMT reduction and the regional targets for greenhouse gas emissions reductions established under Senate Bill 375. The Regional Development Impact Fee program then is unique as compared to local impact fee programs with respect to Senate Bill 743 consistency due to its connection to the Sustainable Communities Strategy.  The projects included in the regional fee program are directly related to the region meeting its greenhouse gas reduction target under Senate Bill 375, thus meeting the goals of Senate Bill 743. 

In addition to this, while the Nexus Study for the regional fee program uses Level of Service to determine what regional roads will require mitigation from the effects of new growth in the county, the amount of regional fees paid by a new development are determined based on the number of vehicle trips that are generated.  A development can then lower its assessment of regional fees by reducing the number of vehicle trips it will produce, which will result in lower overall vehicle miles travelled.  The regional fee program also provides a reduced fee for developments that are sited near transit or within defined infill areas that result in fewer vehicle trips.  As stated above, these features of the program meet the goal of Senate Bill 743 by encouraging new development to reduce the creation of new trips and vehicle miles travelled.  In addition to this, a recent court ruling in Citizens for Positive Growth & Preservation v. City of Sacramento (2019), the Court found that “automobile delay, as described solely by level of service or similar measures of vehicular capacity or traffic congestion shall not be considered a significant impact on the environment” under CEQA, except for roadway capacity projects. Thus, the former obligation under CEQA to address Level of Service in transportation analyses ceased to exist, except (at agencies’ discretion) with respect to transportation projects.

However, while the Court ruling indicates that Level of Service can still be used in the analysis of transportation projects, the projects included in the regional fee program are not all strictly roadway capacity projects.  In general, all the projects included in the regional fee program incorporate bicycle, pedestrian, and transit features that also lead to a reduction in vehicle miles travelled.  Particular projects of note are the Highway 1 Busway project and the Marina-Salinas Multimodal Corridor project both of which provide significant multimodal benefits.  In fact, the fee program includes $10 million for transit capital projects to be used by Monterey-Salinas Transit.

To begin planning for the next update to the regional fee program in 2023, the Transportation Agency is contracting with Kimley-Horn to discuss strategies for incorporating more program elements that reduce vehicle miles travelled.  Transportation Agency staff will present this information at the September Technical Advisory Committee meeting and address Committee member questions and feedback.