COSTA MESA : Council Lowers Fee Charged Developers

The City Council, which had been considering increasing the fee it charges developers to improve streets, lowered it instead in an action that brought relief to the city’s business community.

After much debate, the council last week rejected a recommendation by a citizens committee that it increase the city traffic impact fee by $49, to $277 per unit. Instead it approved lowering the fee to $200.

All new developments in the city must pay the fee, calculated on the basis of the number of new cars the projects bring into Costa Mesa. Fee revenue is used to improve streets affected by the traffic generated by the projects.

Mayor Joe Erickson said the decision was a difficult one because lowering the fees may cause shortfalls in the city’s budget in years to come.

“It was not an easy call,” said Erickson. “The question remains, ‘How we will fund needed improvements?’ ”

Two years ago, Costa Mesa raised its traffic impact fees to $228, the highest in Orange County.

Several businessmen and developers who gathered in Council Chambers to protest a higher fee applauded the lower one. Business leaders have long complained that the higher fee was stifling development.

“The existing fee, because it is so high, is not allowing development to occur,” Ed Fawcett, executive director of the Costa Mesa Chamber of Commerce, told the council. “So development is not happening, and since there is no development, the fees are not being collected.”

“There is no question the trip fees are high, and that puts us at a disadvantage,” said Paul Freeman, director of community affairs for C.J. Segerstrom & Sons, a Costa Mesa real estate developer.