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Council Looks into $45 Million

By Jorge Casuso

September 25 – Careful not to call it an “investigation,” the City Council Tuesday night unanimously voted to “research” what may have happened to possible developer fees critics charge amount to some $45 million that should have been used to fight traffic over the past 16 years.

Allegations that the money was never collected were made by backers of Prop T, a measure on the November 4 ballot that would cap most commercial development in the City at 75,000 square feet a year for the next 15 years.

Proponents of the measure formerly known as the Residents’ Initiative to Fight Traffic (RIFT) contend that a 1991 ordinance unanimously passed by the council required developers to pay impact fees to help mitigate traffic, fees that were never paid.

“You have now given away over $45 million over the past 16 years,” said Diana Gordon, who is leading the initiative campaign. “We want a full investigation why they weren’t collected.”

“Who exactly is minding the store?” asked Zina Josephs, a leader of Friends of Sunset Park. “It’s time we find out what went wrong and why.”

Council members, who believe that the section of the ordinance in question was never implemented, worry that using the term “investigation” could be used by proponents in the hotly contested battle over Prop T.

“We need to get off the rhetoric that there’s an investigation,” said Pam O’Connor, who along with most of the council members opposes Prop T. Staff, O’Connor said, needs to simply “review the record.”

Council member Bobby Shriver, who has not taken a position on the controversial measure, called for staff to research the “unbiased historical record” before the alleged $45 million in lost developer fees “becomes an urban legend.”

“I think the council shouldn’t dismiss this,” said Council member Kevin McKeown, who made the motion to “investigate” the issue, before accepting the friendly amendment to replace the politically charged word with “research.”

“Probably we can never recover fees from the past. That is water under the bridge,” said McKeown, the only council member who supports Prop T. “We should take a look at what happened so it doesn’t happen again.”

Staff said the City never conducted a “nexus” study authorized under the 1991 ordinance to determine the correlation between traffic impacts generated by large developments and the fees developers would pay to mitigate them.

“We found out there was no nexus study ever done, and the fees were never activated,” said City Manager Lamont Ewell.

Planning officials said it was impossible to conduct such a study with the limited data the City had in 1991 and that the fees would have been likely earmarked to build or expand streets, a notion opposed by the community.

Tom Larmore, a longtime Santa Monica land use attorney, agreed.

“The ordinance was never implemented, so there were never fees,” said Larmore, a leading opponent of Measure T.

Larmore, as well as City officials, questioned the RIFT proponents’ math. They countered that at least half of the 9 million square feet of development factored into the $45 million in allegedly uncollected fees was approved and completed before the ordinance kicked in.

According to Planning Director Eileen Fogarty, the City has collected more than $11 million in fees from development agreements negotiated over the past 12 years.

That most of the development approved since 1984 took place after 1991 is “nonsense,” said Council member Ken Genser, who also questioned proponent’s use of the $5-per-square-foot fee used in San Francisco to come up with the $45 million.

“Maybe more than half (of the developments) were done before (1991), so the $45 million can’t be right,” said Genser, who has been on the council since 1988. “The issue is only valuable for its political value.”

The issue of the $45 million came up after the council heard a report outlining how development in the City would be tracked to determine traffic impacts under the Land Use and Circulation Element (LUCE) the council is currently updating.

The system the council greenlighted Tuesday would generate a state-of-the-art “traffic demand model” that can track developments down to a single block and measure how much traffic they generate.

The system would help the City gage the success of the council’s plan under the LUCE to locate taller developments in strategic locations in exchange for “community benefits.”

Under the plan, developers would be charged a fee the City would use to create traffic management districts that would encourage car-pooling, public transit and alternate modes of transportation with the goal of creating “no new net car trips.”

But backers of Prop T were skeptical.

“What was presented here tonight sounded pretty good, but what you approved in 1991 also sounded good,” said Ellen Brennan.

Gordon also recalled the City’s 1991 plan to combat “extreme levels of traffic overwhelming our streets due to commercial development

“Do any of you remember you did the very same thing?” said Gordon. “And then nothing happened.”

Ted Winterer for Santa Monica City Council

Dr. Margaret


Vote # 158


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