AZ FY 2021 & FY 2022 Development Impact Fee Audit.pdf
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City of Phoenix, AZ FY 2021 & FY 2022 Development Impact Fee Audit Table of Contents Section 1 - Introduction ................................................................................................................................ 1 1.1. Background ........................................................................................................................................ 1 1.2. Organization of the Audit Report ..................................................................................................... 1 1.3. Audit Approach ................................................................................................................................. 2 1.4. Audit Objectives ................................................................................................................................ 2 1.5. Audit Results ..................................................................................................................................... 3 1.6. Audit Limitations ............................................................................................................................... 4 Section 2 - Fire Review ................................................................................................................................. 5 2.1. Fee Development .............................................................................................................................. 5 2.2. Land Use Assumptions ...................................................................................................................... 5 2.3. Infrastructure Improvement Plan ..................................................................................................... 7 2.4. Level of Service .................................................................................................................................. 9 2.5. Audit Results ................................................................................................................................... 10 Section 3 - Police ........................................................................................................................................ 11 3.1. Fee Development ............................................................................................................................ 11 3.2. Land Use Assumptions .................................................................................................................... 11 3.3. Infrastructure Improvement Plan ................................................................................................... 13 3.4. Level of Service ................................................................................................................................ 15 3.5. Audit Results ................................................................................................................................... 16 Section 4 - Parks ......................................................................................................................................... 17 4.1. Fee Development ............................................................................................................................ 17 4.2. Land Use Assumptions .................................................................................................................... 17 4.3. Infrastructure Improvement Plan ................................................................................................... 19 4.4. Level of Service ................................................................................................................................ 21 4.5. Audit Results ................................................................................................................................... 21 Section 5 - Libraries .................................................................................................................................... 23 5.1. Fee Development ............................................................................................................................ 23 5.2. Land Use Assumptions .................................................................................................................... 23 5.3. Infrastructure Improvement Plan ................................................................................................... 25 Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | ii 5.4. Level of Service ................................................................................................................................ 27 5.5. Audit Results ................................................................................................................................... 27 Section 6 - Major Arterials ......................................................................................................................... 29 6.1. Fee Development ............................................................................................................................ 29 6.2. Land Use Assumptions .................................................................................................................... 29 6.3. Infrastructure Improvement Plan ................................................................................................... 30 6.4. Level of Service ................................................................................................................................ 31 6.5. Audit Results ................................................................................................................................... 31 Section 7 - Storm Drainage ........................................................................................................................ 33 7.1. Fee Development ............................................................................................................................ 33 7.2. Land Use Assumptions .................................................................................................................... 33 7.3. Infrastructure Improvement Plan ................................................................................................... 34 7.4. Level of Service ................................................................................................................................ 35 7.5. Audit Results ................................................................................................................................... 35 Section 8 - Water System ........................................................................................................................... 37 8.1. Fee Development ............................................................................................................................ 37 8.2. Land Use Assumptions .................................................................................................................... 37 8.3. Infrastructure Improvement Plan ................................................................................................... 39 8.4. Level of Service ................................................................................................................................ 40 8.5. Audit Results ................................................................................................................................... 40 Section 9 - Water Resource ........................................................................................................................ 42 9.1. Fee Development ............................................................................................................................ 42 9.2. Land Use Assumptions .................................................................................................................... 42 9.3. Infrastructure Improvement Plan ................................................................................................... 43 9.4. Level of Service ................................................................................................................................ 44 9.5. Audit Results ................................................................................................................................... 44 Section 10 - Wastewater ............................................................................................................................ 45 10.1. Fee Development .......................................................................................................................... 45 10.2. Land Use Assumptions .................................................................................................................. 45 10.3. Infrastructure Improvement Plan ................................................................................................. 48 Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | iii 10.4. Level of Service .............................................................................................................................. 53 10.5. Audit Results ................................................................................................................................. 53 Section 11 - Permit Sampling ..................................................................................................................... 55 11.1. Sampling Results ........................................................................................................................... 55 Section 12 - Conclusions ............................................................................................................................. 56 12.1. Land Use Assumptions .................................................................................................................. 56 12.2. Infrastructure Improvement Plan ................................................................................................. 56 12.3. Level of Service .............................................................................................................................. 56 12.4. Permit Sampling ............................................................................................................................ 56 12.5. Final Conclusion............................................................................................................................. 56 Section 1 - Introduction 1.1. Background Willdan Financial Services (Willdan) was retained by the City of Phoenix, Arizona (City) to conduct a Development Impact Fee (DIF) Audit (Audit) as required under Arizona Revised Statutes (ARS) 9- 463.05(G)(2).1 This report details the results of the audit for the period fiscal year (FY) 2021 and FY 2022. The City’s FY is the 12-month period from July 1 through the following June 30. This Audit compares the development projections through the land use assumptions (LUA); capital needs as identified in the adopted Infrastructure Improvements Plan (IIP); and level of service (LOS) plan. The adopted plan was the City of Phoenix Infrastructure Financing Plan: 2020 Update with fees effective April 13, 2020 (Plan). The projection of development, revenues and expenditures were compared to those actually experienced by the City in FYs 2021 and 2022. 1.2. Organization of the Audit Report This audit report is organized as follows: • Section 1 - Introduction • Section 2 – Fire Review • Section 3 – Police Review Section 4 – Parks Review • Section 5 – Libraries Review • Section 6 – Major Arterials Review • Section 7 – Storm Drainage Review • Section 8 – Water System Review • Section 9 – Water Resources Review • Section 10 – Wastewater System Review • Section 11 – Permit Sampling Results • Section 12 – Conclusions and Recommendations The appendices to this report are as follows: 1 For reference, a copy of this statute appears in Appendix A. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 2 Appendix A - ARS§ 9-463.05 • Appendix B – Fire Analysis Appendix C – Police Analysis Appendix D – Parks Analysis • Appendix E – Libraries Analysis • Appendix F – Major Arterials Analysis • Appendix G – Storm Drainage Analysis • Appendix H – Water System Analysis • Appendix I – Water Resource Analysis • Appendix J –Wastewater Analysis • Appendix K – Permit Sampling Results 1.3. Audit Approach Willdan performed this Audit between September 2022 and January 2023. All Willdan staff supporting the Audit meet the definition of “Qualified Professional” as set forth in ARS§ 9-463.05(T)(8). Consistent with the requirements of ARS§ 9-463.05(G)(2), Willdan audit staff were neither employees or officials of the City of Phoenix nor did they prepare the IIP. Audit activities consisted solely of document review and discussions with City staff via email and teleconference. Audit activities did not include site visits, first-hand data collection, or independent verification of data submitted by the City. In particular, in support of this audit, Willdan: a) Reviewed IIP forecast and actual expenditures. b) Reviewed projected and actual IIP-related fee offsets or credits. c) Reviewed LUA forecasted and actual developments. d) Reviewed LOS at two points in time: time of the initial plan and the audit timeframe. e) Permit data for purposes of sampling to verify the accuracy of the application of the fees. 1.4. Audit Objectives The primary objectives of the Audit were to: Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 3 a) Audit the City’s Biennial Development Impact Fees for the periods FY 2021 and FY 2022; b) Comply with ARS§ 9-463.05 by: i. Reviewing the progress of anticipated development as identified in the LUA; ii. Reviewing the progress of the infrastructure improvements plan; iii. Reviewing collections and expenditures of development impact fees for each project in the plan; and iv. Evaluating any inequities in implementing the plan or imposing the development impact fees. 1.5. Audit Results Based on Willdan’s scope of services performed as part of this Audit as documented in this Report, the results of this audit follow. a) The City’s Biennial Development Impact Fees for the periods FY 2021 and FY 2022 comply with ARS§ 9-463.05 as further discussed in Sections two through ten; b) With respect to ARS§ 9-463.05 compliance: i. Willdan’s review of the progress of the LUA, identified minor differences between projected and actual development, but anticipates the development over the 10-year study period will not significantly vary from projections. The audit of the LUA is further discussed in sections two through ten; ii. Willdan’s review of the progress of the IIP identified projects that differed from the projected schedule, but all projects for which funds were expended were included in the adopted IIP as further discussed in sections two through ten; iii. Willdan’s review of collections and expenditures of the development impact fees for each project in the plan, indicate that all expenditures made with development impact fee funds were on projects or debt expenses as identified in the 2020 Plan, as further discussed in sections two through ten; and iv. Willdan’s evaluation of any inequities in implementing the plan or imposing the development impact fees indicates that the fees were assessed in an appropriate manner based upon the size and type of the development as further discussed in section eleven. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 4 1.6. Audit Limitations Willdan’s role in this Audit was solely that of third-party independent auditor. The results presented in this Audit Report are predicated upon information provided by the City and representations made by City personnel. Willdan made reasonable efforts given the nature of this audit to assess the reasonableness of such representations. However, Willdan has no means to determine the extent to which material facts concerning information provided have been fully and accurately disclosed, nor is this a forensic audit. All findings in this report are based solely on Willdan’s review of materials furnished by the City as identified or publicly available information as cited as well as information obtained by Willdan through emails and meetings with key City staff involved in this audit. Review of additional documentation or disclosure or discovery of material facts could change the findings cited in this Report. This report documents the audit for the sole purpose of demonstrating compliance with the requirements of ARS§ 9-463.05(G)(2); no other use is expressed or implied. Nothing in this report can be considered a legal opinion. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 5 Section 2 - Fire Review This section of the Audit Report presents Willdan’s review of the City’s fire development impact fees. 2.1. Fee Development The fire DIFs were calculated using the incremental (a forward looking) approach to develop a cost per equivalent dwelling unit (EDU) as the basis for assessing fees. Fees were developed for four service areas: Northwest Northeast Southwest Ahwatukee The resulting DIFs per development type are identified in Table 2-1. Table 2-1 Fire DIFs Service Area Single Family (per Unit) Multifamily (per unit) Com/Ret (per 1,000 sqft) Office (per 1,000 sqft) Ind/WH (per 1,000 sqft) Pub/Inst (per 1,000 sqft) Northwest $516 $387 $418 $330 $144 $299 Northeast 551 413 446 353 154 320 Southwest 487 365 394 312 136 282 Ahwatukee 470 353 381 301 132 273 2.2. Land Use Assumptions The biennial audit includes comparing the growth projections adopted in the City’s LUA to the actual growth by development type. Tables 2-2 through 2-5 summarize the projected development from the Plan and the actual development experienced by the City in FY 2021 and FY 2022. Table 2-2 Northwest Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDU) Multifamily (EDU) Com/Ret (EDU) Office (EDU) Ind/WH (EDU) Pub/Inst (EDU) Actual 2021 25 195 0 0 0 0 Projected 2021 (1) 688 145 164 68 22 88 Difference (663) 50 (164) (68) (22) (88) Actual 2022 156 353 5 0 1,062 0 Projected 2022 (1) 688 145 164 68 22 88 Difference (532) 208 (159) (68) 1,040 (88) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 2-2, Northwest actual developments in 2021 exceeded the projected level of development for the multifamily use classifications but fell short of projections for all other designations. The actual developments in 2022 saw actual multifamily and industrial/warehouse Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 6 development exceed projections, but the actual development for all other land use classifications fell short of the projected development in the Plan. Table 2-3 Northeast Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDU) Multifamily (EDU) Com/Ret (EDU) Office (EDU) Ind/WH (EDU) Pub/Inst (EDU) Actual 2021 364 34 0 0 0 549 Projected 2021 (1) 1,134 472 98 55 0 153 Difference (770) (438) (98) (55) 0 396 Actual 2022 339 230 0 0 0 95 Projected 2022 (1) 1,134 472 98 55 0 153 Difference (795) (242) (98) (55) 0 (58) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 2-3, Northeast actual developments in 2021 and 2022 fell short of projections for all land use designations except the industrial/warehouse category which did not anticipate any new development and the public institution category (FY 2021). Table 2-4 Southwest Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDU) Multifamily (EDU) Com/Ret (EDU) Office (EDU) Ind/WH (EDU) Pub/Inst (EDU) Actual 2021 1,834 377 72 8 442 16 Projected 2021 (1) 1,581 462 291 168 367 369 Difference 254 (85) (219) (160) 75 (353) Actual 2022 1,553 912 67 6 1,345 4 Projected 2022 (1) 1,581 462 291 168 367 369 Difference (28) 450 (224) (162) 977 (365) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 2-4, for 2021 Southwest actual developments for the single family, and industrial/warehouse categories exceeded projections while the other land use classifications fell short of projections. In 2022 multifamily and industrial/warehouse development exceeded projections while the single family, commercial/retail, office and public/institution fell short of projections. Table 2-5 Ahwatukee Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDU) Multifamily (EDU) Com/Ret (EDU) Office (EDU) Ind/WH (EDU) Pub/Inst (EDU) Actual 2021 150 0 10 0 0 6 Projected 2021 (1) 141 39 11 18 0 0 Difference 9 (39) (2) (18) 0 6 Actual 2022 18 0 420 0 0 9 Projected 2022 (1) 141 39 11 18 0 0 Difference (123) (39) 408 (18) 0 (9) (1) Projections are the average annual over the 10-year study period, rather than specific development by year Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 7 As indicated in Table 2-5, Ahwatukee actual developments for the single family and public/institution categories exceeded projections while multifamily, commercial/retail and office fell short of 2021 projections. In 2022 only commercial/retail development exceeded projections. Development of forward-looking financial plans, DIF studies rely on the best available forecast at a point in time. Actual conditions often vary from projections. Tables 2-2 through 2-5 represent a “snapshot” in time for the 10-year study period. Over time new studies are undertaken as circumstances change and new information becomes available. It should also be noted that projections in the report were made for a 10-year period in aggregate and not for individual years within the study period. As such, development in aggregate should be considered the focus rather than fluctuations from year to year. 2.3. Infrastructure Improvement Plan The Plan identified capital projects to be constructed or acquired over the 10-year study period as opposed to specific years. Capital projects to be completed for the Northwest, Northeast and Southwest zones included: Fire stations; Fire station land; Fire vehicles and equipment; and Record management system. Capital needs for the Ahwatukee zone included: Fire station – 19th Ave & Chandler Blvd; Fire vehicles and equipment; and Record management system. Northwest Zone During FY 2021 and FY 2022 the City generated $893,666 in fire DIF revenues as well as an additional $6,029 in interest income for total revenues of $899,695. During the same period the City did not expend any funds on capital projects resulting in revenues exceeding expenditures during the two-year period. Appendix B provides a summary of the revenues and expenditures for the fire DIF funds. The financials are summarized in Table 2-6. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 8 Table 2-6 Northwest Fire DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $88,687 $2,737 ($120,939) $0 2022 804,979 3,292 0 0 Total $893,666 $6,029 ($120,939) $0 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. Northeast Zone During FY 2021 and FY 2022 the City generated $921,872 in fire DIF revenues as well as an additional $38,616 in interest income for total revenues of $960,488. During the same period the City did not expend any funds on capital projects resulting in revenues exceeding expenditures during the two-year period. Appendix B provides a summary of the revenues and expenditures for the fire DIF funds. The financials are summarized in Table 2-7. Table 2-7 Northeast Fire DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $578,614 $21,934 $0 $0 2022 343,258 16,682 0 0 Total $921,872 $38,616 $0 $0 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. Southwest Zone During FY 2021 and FY 2022 the City generated $3,448,628 in fire DIF revenues as well as an additional $70,698 in interest income for total revenues of $3,519,326. During the same period the City expended $1,850,677 on fire stations resulting in revenues exceeding expenditures during the two-year period. Appendix B provides a summary of the revenues and expenditures for the fire DIF funds. The financials are summarized in Table 2-8. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 9 Table 2-8 Southwest Fire DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $1,536,672 $39,216 $754,530 $0 2022 1,911,956 31,482 1,096,147 0 Total $3,448,628 $70,968 $1,850,677 $0 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. Ahwatukee Zone During FY 2021 and FY 2022 the City generated $287,397 in fire DIF revenues as well as an additional $8,157 in interest income for total revenues of $295,554. During the same period the City did not expend any funds on capital projects resulting in revenues exceeding expenditures during the two-year period. Appendix B provides a summary of the revenues and expenditures for the fire DIF funds. The financials are summarized in Table 2-9. Table 2-9 Ahwatukee Fire DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $78,111 $4,499 $0 $0 2022 209,286 3,658 0 0 Total $287,397 $8,157 $0 $0 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. 2.4. Level of Service Level of service projections are intended to ensure that new development is assessed for facilities or capital needs at the existing level of service (LOS), not at an increased overall level of service, unless a corresponding funding source from existing development is also provided. In each of the four zones expenditures fell short of the annual average expenditures identified in the Plan. During the study period, the actual LOS will fluctuate as compared to that identified in the Plan based on the timing of construction or acquisition of new facilities relative to new development. As of the end of FY 2022, due to new development outpacing acquisition and construction of new facilities, the LOS for fire for all zones is below that in the Plan (the growth-related needs for identified fire facilities were not met). However, the LOS Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 10 should be monitored over the entire study period compared to the level identified in the Plan over the remaining study period as the full IIP and LUA projections are realized. 2.5. Audit Results Through our audit of the fire DIFs we identified some differences between what was projected in the Plan and actual occurrences, such as differences in the projected and actual developments. These differences are the results of projections being made based on the available data at the time. Our review of the current development environment is consistent with the regulations set forth in ARS§ 9-463.05. The LUA, IIP and LOS should continue to be monitored over the 10-year study period on which the Plan was based. Based on Willdan’s review of the fire DIF, we are of the opinion that: a) City’s Biennial DIFs for fire in FY 2021 and FY 2022 comply with ARS§ 9-463.05; b) With respect to ARS§ 9-463.05 compliance: i. Willdan’s review of the progress of the LUA, identified differences between projected and actual development, but anticipates development over the current 10-year study period will not significantly vary from projections; ii. Willdan’s review of the progress of the IIP identified the projects for which funds were expended were included in the adopted IIP; and iii. Willdan’s review of collections and expenditures of development impact fees indicate that all expenditures made with DIF funds were on projects as identified in the Plan. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 11 Section 3 - Police This section of the Audit Report presents Willdan’s review of City’s police DIFs. 3.1. Fee Development The police DIFs were calculated using the incremental (a forward looking) approach to develop a cost per equivalent dwelling unit (EDU) as the basis for assessing fees. Fees were developed for four service areas: Northwest Northeast Southwest Ahwatukee The resulting DIFs per development type are identified in Table 3-1. Table 3-1 Police DIFs Service Area Single Family (per Unit) Multifamily (per unit) Com/Ret (per 1,000 sqft) Office (per 1,000 sqft) Ind/WH (per 1,000 sqft) Pub/Inst (per 1,000 sqft) Northwest $293 $220 $237 $188 $82 $170 Northeast 314 236 254 201 88 182 Southwest 285 214 231 182 78 165 Ahwatukee 342 257 277 219 96 198 3.2. Land Use Assumptions The biennial audit includes comparing the growth projections adopted in the City’s LUA to the actual growth by development type. Tables 3-2 through 3-5 summarize the projected development from the Plan and the actual development experienced by the City in FY 2021 and FY 2022. Table 3-2 Northwest Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDU) Multifamily (EDU) Com/Ret (EDU) Office (EDU) Ind/WH (EDU) Pub/Inst (EDU) Actual 2021 25 195 0 0 0 0 Projected 2021 (1) 688 145 164 68 22 88 Difference (663) 50 (164) (68) (22) (88) Actual 2022 156 353 5 0 1,062 0 Projected 2022 (1) 688 145 164 68 22 88 Difference (532) 208 (159) (68) 1,040 (88) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 3-2, Northwest actual developments in 2021 exceeded the projected level of development for the multifamily land use classification but fell short of projections for all other designations. The actual developments in 2022 saw actual multifamily and industrial/warehouse Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 12 development exceed projections, but the actual development for all other land use classifications fell short of the projected development in the Plan. Table 3-3 Northeast Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDU) Multifamily (EDU) Com/Ret (EDU) Office (EDU) Ind/WH (EDU) Pub/Inst (EDU) Actual 2021 364 34 0 0 0 549 Projected 2021 (1) 1,134 472 98 55 0 153 Difference (770) (438) (98) (55) 0 395 Actual 2022 339 230 0 0 0 95 Projected 2022 (1) 1,134 472 98 55 0 153 Difference (795) (242) (98) (55) 0 (59) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 3-3, Northeast actual developments in 2021 fell short of projections for all land use classifications except the industrial/warehouse (no development projected) and public/institutional category, and in 2022 fell short of projections for all other land use designations except the industrial/warehouse category which did not anticipate any new development. Table 3-4 Southwest Projected versus Actual Development FY 2021 & FY 2022 Year Single Family (EDU) Multifamily (EDU) Com/Ret (EDU) Office (EDU) Ind/WH (EDU) Pub/Inst (EDU) Actual 2021 1,834 377 72 8 442 16 Projected 2021 (1) 1,581 462 291 168 367 369 Difference 254 (85) (219) (160) 75 (353) Actual 2022 1,553 912 67 6 1,345 4 Projected 2022 (1) 1,581 462 291 168 367 369 Difference (28) 450 (224) (162) 977 (365) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 3-4, for 2021 Southwest actual developments for the single family, and industrial/warehouse categories exceeded projections while the other land use classifications fell short of projections. In 2022 multifamily and industrial/warehouse development exceeded projections while the single family, commercial/retail, office and public/institution fell short of projections. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 13 Table 3-5 Ahwatukee Projected versus Actual Development FY 2021 & FY 2022 Year Single Family (EDU) Multifamily (EDU) Com/Ret (EDU) Office (EDU) Ind/WH (EDU) Pub/Inst (EDU) Actual 2021 150 0 10 0 0 6 Projected 2021 (1) 141 39 11 18 0 0 Difference 9 (39) (2) (18) 0 6 Actual 2022 18 0 420 0 0 9 Projected 2022 (1) 141 39 11 18 0 0 Difference (123) (39) 408 (18) 0 (9) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 3-5, Ahwatukee actual developments for the single family and public/institution categories exceeded projections while multifamily, commercial/retail and office fell short of 2021 projections. In 2022 only commercial/retail development exceeded projections. Development of forward-looking financial plans, DIF studies rely on the best available forecast at a point in time. Actual conditions often vary from projections. Tables 3-2 through 3-5 represent a “snapshot” in time for the 10-year study period. Over time new studies are undertaken as circumstances change and new information becomes available. It should also be noted that projections in the report were made for a 10-year period in aggregate and not for individual years within the study period. As such, development in aggregate should be considered the focus rather than fluctuations from year to year. 3.3. Infrastructure Improvement Plan The Plan identified capital projects to be constructed or acquired over the 10-year study period as opposed to specific years. Capital projects to be completed for all four zones included: Police precincts Police station land Police vehicles and radios Record management system Northwest Zone During FY 2021 and FY 2022 the City generated $534,025 in police DIF revenues as well as an additional $20,271 in interest income for total revenues of $554,296. During the same period the City expended $180,197 on record management systems resulting in revenues exceeding expenditures during the two- year period. Appendix C provides a summary of the revenues and expenditures for the police DIF funds. The financials are summarized in Table 3-6. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 14 Table 3-6 Northwest Police DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $65,061 $12,230 $0 $0 2022 468,964 8,041 180,197 0 Total $534,025 $20,271 $180,197 $0 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. Northeast Zone During FY 2021 and FY 2022 the City generated $531,288 in police DIF revenues as well as an additional $33,702 in interest income for total revenues of $564,990. During the same period the City expended $285,587 on record management systems resulting in revenues exceeding expenditures during the two- year period. Appendix C provides a summary of the revenues and expenditures for the police DIF funds. The financials are summarized in Table 3-7. Table 3-7 Northeast Police DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $335,383 $20,110 $0 $0 2022 195,905 13,592 285,587 0 Total $531,288 $33,702 $285,587 $0 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. Southwest Zone During FY 2021 and FY 2022 the City generated $2,018,210 in police DIF revenues as well as an additional $56,276 in interest income for total revenues of $2,074,486. During the same period the City expended $519,285 on record management systems resulting in revenues exceeding expenditures during the two- year period. Appendix C provides a summary of the revenues and expenditures for the police DIF funds. The financials are summarized in Table 3-8. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 15 Table 3-8 Southwest Police DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $899,380 $30,644 $0 $0 2022 1,118,830 25,632 519,285 0 Total $2,018,210 $56,276 $519,285 $0 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. Ahwatukee Zone During FY 2021 and FY 2022 the City generated $209,211 in police DIF revenues as well as an additional $3,125 in interest income for total revenues of $212,336. During the same period the City expended $45,832 on record management systems resulting in revenues exceeding expenditures during the two- year period. Appendix C provides a summary of the revenues and expenditures for the police DIF funds. The financials are summarized in Table 3-9. Table 3-9 Ahwatukee Police DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $56,922 $1,600 $0 $0 2022 152,289 1,525 45,832 0 Total $209,211 $3,125 $45,832 $0 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. 3.4. Level of Service Level of service projections are intended to ensure that new development is assessed for facilities or capital needs at the existing level of service (LOS), not at an increased overall level of service, unless a corresponding funding source from existing development is also provided. In each of the four zones expenditures fell short of the annual average expenditures identified in the Plan. During the study period, the actual LOS will fluctuate as compared to that identified in the Plan based on the timing of construction or acquisition of new facilities relative to new development. As of the end of FY 2022, due to new development outpacing acquisition and construction of new facilities, the LOS for police for all zones is below that in the Plan (the growth-related needs for identified police facilities were not met). However, Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 16 the LOS should be monitored over the entire study period compared to the level identified in the Plan over the remaining study period as the full IIP and LUA projections are realized. 3.5. Audit Results Through our audit of the police DIFs we identified some differences between what was projected in the Plan and actual occurrences, such as differences in the projected and actual developments. These differences are the results of projections being made based on the available data at the time. Our review of the current development environment is consistent with the regulations set forth in ARS§ 9-463.05. The LUA, IIP and LOS should continue to be monitored over the 10-year study period on which the Plan was based. Based on Willdan’s review of the police DIF, we are of the opinion that: a) City’s Biennial DIFs for police in FY 2021 and FY 2022 comply with ARS§ 9-463.05; b) With respect to ARS§ 9-463.05 compliance: i. Willdan’s review of the progress of the LUA, identified differences between projected and actual development, but anticipates development over the current 10-year study period will not significantly vary from projections; ii. Willdan’s review of the progress of the IIP identified the projects for which funds were expended were included in the adopted IIP; and iii. Willdan’s review of collections and expenditures of development impact fees indicate that all expenditures made with DIF funds were on projects as identified in the Plan. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 17 Section 4 - Parks This section of the Audit Report presents Willdan’s review of City’s parks DIFs. 4.1. Fee Development The parks DIFs were calculated using the incremental (a forward looking) approach to develop a cost per equivalent dwelling unit (EDU) as the basis for assessing fees. Fees were developed for four service areas: Northwest Northeast Southwest Ahwatukee The resulting DIFs per development type are identified in Table 4-1. Table 4-1 Parks DIFs Service Area Single Family (per Unit) Multifamily (per unit) Com/Ret (per 1,000 sqft) Office (per 1,000 sqft) Ind/WH (per 1,000 sqft) Pub/Inst (per 1,000 sqft) Northwest $1,368 $1,026 $68 $96 $27 $68 Northeast 1,236 927 62 87 25 62 Southwest 1,241 931 62 87 25 62 Ahwatukee 1,225 919 61 86 25 61 4.2. Land Use Assumptions The biennial audit includes comparing the growth projections adopted in the City’s LUA to the actual growth by development type. Tables 4-2 through 4-5 summarize the projected development from the Plan and the actual development experienced by the City in FY 2021 and FY 2022. Table 4-2 Northwest Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDU) Multifamily (EDU) Com/Ret (EDU) Office (EDU) Ind/WH (EDU) Pub/Inst (EDU) Actual 2021 25 195 0 0 0 0 Projected 2021 (1) 688 145 10 7 2 8 Difference (663) 50 (10) (7) (2) (152) Actual 2022 156 353 0 0 76 0 Projected 2022 (1) 688 145 10 7 2 8 Difference (532) 208 (10) (7) 74 (8) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 4-2, Northwest actual developments in 2021 exceeded the projected level of development for the multifamily land use classification but fell short of projections for all other designations. The actual developments in 2022 saw actual multifamily and industrial/warehouse Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 18 development exceed projections, but the actual development for all other land use classifications fell short of the projected development in the Plan. Table 4-3 Northeast Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDU) Multifamily (EDU) Com/Ret (EDU) Office (EDU) Ind/WH (EDU) Pub/Inst (EDU) Actual 2021 364 34 0 0 0 550 Projected 2021 (1) 1,134 472 6 6 0 13 Difference (770) (438) (6) (6) 0 537 Actual 2022 338 230 0 0 0 8 Projected 2022 (1) 1,134 472 6 6 0 13 Difference (796) (242) (6) (6) 0 (5) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 4-3, Northeast actual developments in 2021 fell short of projections for all land use classifications except the industrial/warehouse (no development projected) and public/institutional category, and in 2022 fell short of projections for all other land use designations except the industrial/warehouse category which did not anticipate any new development. Table 4-4 Southwest Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDU) Multifamily (EDU) Com/Ret (EDU) Office (EDU) Ind/WH (EDU) Pub/Inst (EDU) Actual 2021 1,834 377 4 1 32 1 Projected 2021 (1) 1,581 462 18 18 26 32 Difference 254 (85) (14) (17) 5 (30) Actual 2022 1,553 912 4 1 96 0 Projected 2022 (1) 1,581 462 18 18 26 32 Difference (28) 450 (14) (18) 70 (31) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 4-4, for 2021 Southwest actual developments for the single family and industrial/warehouse categories exceeded projections while the other land use classifications fell short of projections. In 2022 multifamily and industrial/warehouse development exceeded projections while the single family, commercial/retail, office and public/institution fell short of projections. Table 4-5 Ahwatukee Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDU) Multifamily (EDU) Com/Ret (EDU) Office (EDU) Ind/WH (EDU) Pub/Inst (EDU) Actual 2021 150 0 1 0 0 0 Projected 2021 (1) 141 39 1 2 0 0 Difference 9 (39) 0 (2) 0 0 Actual 2022 18 0 26 0 0 1 Projected 2022 (1) 141 39 1 2 0 0 Difference (123) (39) 25 (2) 0 (1) (1) Projections are the average annual over the 10-year study period, rather than specific development by year Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 19 As indicated in Table 4-5, Ahwatukee actual developments for the single family and public/institution categories exceeded projections, commercial/retail met projections while multifamily and office fell short of 2021 projections. In 2022 only commercial/retail development exceeded projections. Development of forward-looking financial plans, DIF studies rely on the best available forecast at a point in time. Actual conditions often vary from projections. Tables 4-2 through 4-5 represent a “snapshot” in time for the 10-year study period. Over time new studies are undertaken as circumstances change and new information becomes available. It should also be noted that projections in the report were made for a 10-year period in aggregate and not for individual years within the study period. As such, development in aggregate should be considered the focus rather than fluctuations from year to year. 4.3. Infrastructure Improvement Plan The Plan identified capital projects to be constructed or acquired over the 10-year study period as opposed to specific years. Capital projects to be completed for the Northwest zone included: Park development Land acquisition Capital projects for the remaining three zones assumed “park development” in each zone. Northwest Zone During FY 2021 and FY 2022 the City generated $975,208 in parks DIF revenues as well as an additional $50,225 in interest income for total revenues of $1,025,433. During the same period the City did not expend any funds on capital resulting in revenues exceeding expenditures during the two-year period. Appendix D provides a summary of the revenues and expenditures for the parks DIF funds. The financials are summarized in Table 4-6. Table 4-6 Northwest Parks DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $224,907 $32,982 $0 $0 2022 750,301 17,243 0 0 Total $975,208 $50,225 $0 $0 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 20 Northeast Zone During FY 2021 and FY 2022 the City generated $1,373,871 in parks DIF revenues as well as an additional $116,235 in interest income for total revenues of $1,490,106. During the same period the City expended $526,212 on park development resulting in revenues exceeding expenditures during the two-year period. Appendix D provides a summary of the revenues and expenditures for the parks DIF funds. The financials are summarized in Table 4-7. Table 4-7 Northeast Parks DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $694,909 $68,098 $0 $0 2022 678,962 48,137 526,212 0 Total $1,373,871 $116,235 $526,212 $0 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. Southwest Zone During FY 2021 and FY 2022 the City generated $5,749,105 in parks DIF revenues as well as an additional $208,664 in interest income for total revenues of $5,957,769. During the same period the City expended $768,874 on park development resulting in revenues exceeding expenditures during the two-year period. Appendix D provides a summary of the revenues and expenditures for the parks DIF funds. The financials are summarized in Table 4-8. Table 4-8 Southwest Parks DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $3,115,851 $128,934 $6,279 $0 2022 2,633,254 79,730 762,595 0 Total $5,749,105 $208,664 $768,874 $0 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 21 Ahwatukee Zone During FY 2021 and FY 2022 the City generated $157,966 in parks DIF revenues as well as an additional $6,931 in interest income for total revenues of $164,897. During the same period the City did not expend any funds on capital resulting in revenues exceeding expenditures during the two-year period. Appendix D provides a summary of the revenues and expenditures for the parks DIF funds. The financials are summarized in Table 4-9. Table 4-9 Ahwatukee Parks DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $110,236 $3,937 $0 $0 2022 47,730 2,994 0 0 Total $157,966 $6,931 $0 $0 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. 4.4. Level of Service Level of service projections are intended to ensure that new development is assessed for facilities or capital needs at the existing level of service (LOS), not at an increased overall level of service, unless a corresponding funding source from existing development is also provided. In each of the four zones expenditures fell short of the annual average expenditures identified in the Plan. During the study period, the actual LOS will fluctuate as compared to that identified in the Plan based on the timing of construction or acquisition of new facilities relative to new development. As of the end of FY 2022, due to new development outpacing acquisition and construction of new facilities, the LOS for parks for all zones is below that in the Plan (the growth-related needs for identified parks facilities were not met). However, the LOS should be monitored over the entire study period compared to the level identified in the Plan over the remaining study period as the full IIP and LUA projections are realized. 4.5. Audit Results Through our audit of the parks DIFs we identified some differences between what was projected in the Plan and actual occurrences, such as differences in the projected and actual developments. These differences are the results of projections being made based on the available data at the time. Our review of the current development environment is consistent with the regulations set forth in ARS§ 9-463.05. The LUA, IIP and LOS should continue to be monitored over the 10-year study period on which the Plan was based. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 22 Based on Willdan’s review of the parks DIF, we are of the opinion that: a) City’s Biennial DIFs for parks in FY 2021 and FY 2022 comply with ARS§ 9-463.05; b) With respect to ARS§ 9-463.05 compliance: i. Willdan’s review of the progress of the LUA, identified differences between projected and actual development, but anticipates development over the current 10-year study period will not significantly vary from projections; ii. Willdan’s review of the progress of the IIP identified the projects for which funds were expended were included in the adopted IIP; and iii. Willdan’s review of collections and expenditures of development impact fees indicate that all expenditures made with DIF funds were on projects as identified in the Plan. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 23 Section 5 - Libraries 5.1. Fee Development The libraries DIFs were calculated using the incremental (a forward looking) approach to develop a cost per equivalent dwelling unit (EDU) as the basis for assessing fees. Fees were developed for four service areas: Northwest Northeast Southwest Ahwatukee The resulting DIFs per development type are identified in Table 5-1. Table 5-1 Libraries DIFs Service Area Single Family (per Unit) Multifamily (per unit) Com/Ret (per 1,000 sqft) Office (per 1,000 sqft) Ind/WH (per 1,000 sqft) Pub/Inst (per 1,000 sqft) Northwest $105 $79 $5 $7 $2 $5 Northeast 105 79 5 7 2 5 Southwest 105 79 5 7 2 5 Ahwatukee 105 79 5 7 2 5 5.2. Land Use Assumptions The biennial audit includes comparing the growth projections adopted in the City’s LUA to the actual growth by development type. Tables 5-2 through 5-5 summarize the projected development from the Plan and the actual development experienced by the City in FY 2021 and FY 2022. Table 5-2 Northwest Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDU) Multifamily (EDU) Com/Ret (EDU) Office (EDU) Ind/WH (EDU) Pub/Inst (EDU) Actual 2021 25 195 0 0 0 0 Projected 2021 (1) 688 145 10 7 2 8 Difference (663) 50 (10) (7) (2) (152) Actual 2022 156 353 0 0 76 0 Projected 2022 (1) 688 145 10 7 2 8 Difference (532) 208 (10) (7) 74 (8) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 5-2, Northwest actual developments in 2021 exceeded the projected level of development for the multifamily land use classification but fell short of projections for all other designations. The actual developments in 2022 saw actual multifamily and industrial/warehouse Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 24 development exceed projections, but the actual development for all other land use classifications fell short of the projected development in the Plan. Table 5-3 Northeast Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDU) Multifamily (EDU) Com/Ret (EDU) Office (EDU) Ind/WH (EDU) Pub/Inst (EDU) Actual 2021 364 34 0 0 0 550 Projected 2021 (1) 1,134 472 6 6 0 13 Difference (770) (438) (6) (6) 0 537 Actual 2022 338 230 0 0 0 8 Projected 2022 (1) 1,134 472 6 6 0 13 Difference (796) (242) (6) (6) 0 (5) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 5-3, Northeast actual developments in 2021 fell short of projections for all land use classifications except the industrial/warehouse (no development projected) and public/institutional category, and in 2022 fell short of projections for all other land use designations except the industrial/warehouse category which did not anticipate any new development. Table 5-4 Southwest Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDU) Multifamily (EDU) Com/Ret (EDU) Office (EDU) Ind/WH (EDU) Pub/Inst (EDU) Actual 2021 1,834 377 4 1 32 1 Projected 2021 (1) 1,581 462 18 18 26 32 Difference 254 (85) (14) (17) 5 (30) Actual 2022 1,553 912 4 1 96 0 Projected 2022 (1) 1,581 462 18 18 26 32 Difference (28) 450 (14) (18) 70 (31) (1) Projections are the average annual over the 10-year study period, rather than specific development by yar As indicated in Table 5-4, for 2021 Southwest actual developments for the single family and industrial/warehouse categories exceeded projections while the other land use classifications fell short of projections. In 2022 multifamily and industrial/warehouse development exceeded projections while the single family, commercial/retail, office and public/institution fell short of projections. Table 5-5 Ahwatukee Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDU) Multifamily (EDU) Com/Ret (EDU) Office (EDU) Ind/WH (EDU) Pub/Inst (EDU) Actual 2021 150 0 1 0 0 0 Projected 2021 (1) 141 39 1 2 0 0 Difference 9 (39) 0 (2) 0 0 Actual 2022 18 0 26 0 0 1 Projected 2022 (1) 141 39 1 2 0 0 Difference (123) (39) 25 (2) 0 (1) (1) Projections are the average annual over the 10-year study period, rather than specific development by year Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 25 As indicated in Table 5-5, Ahwatukee actual developments for the single family and public/institution categories exceeded projections, commercial/retail met projections while multifamily, and office fell short of 2021 projections. In 2022 only commercial/retail development exceeded projections. Development of forward-looking financial plans, DIF studies rely on the best available forecast at a point in time. Actual conditions often vary from projections. Tables 5-2 through 5-5 represent a “snapshot” in time for the 10-year study period. Over time new studies are undertaken as circumstances change and new information becomes available. It should also be noted that projections in the report were made for a 10-year period in aggregate and not for individual years within the study period. As such, development in aggregate should be considered the focus rather than fluctuations from year to year. 5.3. Infrastructure Improvement Plan The Plan identified “library planned costs” as the only projected capital for each zone. Northwest Zone During FY 2021 and FY 2022 the City generated $59,132 in libraries DIF and related revenues (interest income). During the same period the City did not expend any funds on capital resulting in revenues exceeding expenditures during the two-year period. Appendix E provides a summary of the revenues and expenditures for the libraries DIF funds. The financials are summarized in Table 5-6. Table 5-6 Northwest Libraries DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $2,945 $5,315 $0 $0 2022 47,384 3,488 0 0 Total $50,329 $8,803 $0 $0 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. Northeast Zone During FY 2021 and FY 2022 the City generated $114,996 in libraries DIF revenues as well as an additional $13,503 in interest income for total revenues of $128,499. During the same period the City did not expend any funds on capital resulting in revenues exceeding expenditures during the two-year period. Appendix E provides a summary of the revenues and expenditures for the libraries DIF funds. The financials are summarized in Table 5-7. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 26 Table 5-7 Northeast Libraries DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $59,061 $12,810 $0 $3,847,320 2022 55,935 693 0 3,847,320 Total $114,996 $13,503 $0 $7,694,640 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. Southwest Zone During FY 2021 and FY 2022 the City generated $532,504 in libraries DIF revenues as well as an additional $51,413 in interest income for total revenues of $583,917. During the same period the City did not expend any funds on capital but did expend $7,964,640 on advance repayments and debt service. The result is expenses exceeding revenues during the two-year period. Appendix E provides a summary of the revenues and expenditures for the libraries DIF funds. The financials are summarized in Table 5-8. Table 5-8 Southwest Libraries DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $270,657 $37,824 $0 $0 2022 261,847 13,589 0 0 Total $532,504 $49,469 $0 $0 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. Ahwatukee Zone During FY 2021 and FY 2022 the City generated $4,480 in libraries DIF revenues as well as an additional $4,627 in interest income for total revenues of $9,107. During the same period the City did not expend any funds on capital resulting in revenues exceeding expenditures during the two-year period. Appendix E provides a summary of the revenues and expenditures for the libraries DIF funds. The financials are summarized in Table 5-9. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 27 Table 5-9 Ahwatukee Libraries DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $1,052 $2,787 $0 $0 2022 3,428 1,840 0 0 Total $4,480 $4,627 $0 $0 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. 5.4. Level of Service Level of service projections are intended to ensure that new development is assessed for facilities or capital needs at the existing level of service (LOS), not at an increased overall level of service, unless a corresponding funding source from existing development is also provided. In each of the four zones expenditures fell short of the annual average expenditures identified in the Plan. During the study period, the actual LOS will fluctuate as compared to that identified in the Plan based on the timing of construction or acquisition of new facilities relative to new development. As of the end of FY 2022, due to new development outpacing acquisition and construction of new facilities, the LOS for library for all zones is below that in the Plan (the growth-related needs for identified library facilities were not met). However, the LOS should be monitored over the entire study period compared to the level identified in the Plan over the remaining study period as the full IIP and LUA projections are realized. 5.5. Audit Results Through our audit of the libraries DIFs we identified some differences between what was projected in the Plan and actual occurrences, such as differences in the projected and actual developments. These differences are the results of projections being made based on the available data at the time. Our review of the current development environment is consistent with the regulations set forth in ARS§ 9-463.05. The LUA, IIP and LOS should continue to be monitored over the 10-year study period on which the Plan was based. Based on Willdan’s review of the libraries DIF, we are of the opinion that: a) City’s Biennial DIFs for libraries in FY 2021 and FY 2022 comply with ARS§ 9-463.05; b) With respect to ARS§ 9-463.05 compliance: Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 28 i. Willdan’s review of the progress of the LUA, identified differences between projected and actual development, but anticipates development over the current 10-year study period will not significantly vary from projections; ii. Willdan’s review of the progress of the IIP identified the projects for which funds were expended were included in the adopted IIP; and iii. Willdan’s review of collections and expenditures of development impact fees indicate that all expenditures made with DIF funds were on projects as identified in the Plan. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 29 Section 6 - Major Arterials 6.1. Fee Development The major arterials DIFs were calculated using the hybrid approach to develop a cost per equivalent dwelling unit (EDU) as the basis for assessing fees. Fees were developed for two service areas: Northern Southwest The resulting DIFs per development type are identified in Table 6-1. Table 6-1 Major Arterials DIFs Service Area Single Family (per Unit) Multifamily (per unit) Com/Ret (per 1,000 sqft) Office (per 1,000 sqft) Industrial (per 1,000 sqft) Pub/Inst (per 1,000 sqft) Mini-Warehouse (per 1,000 sqft) Hotel (room) Northern $3,080 $2,310 $3,758 $1,694 $986 $1,386 $277 $1,078 Southwest 1,928 1,446 2,352 1,060 617 868 174 675 6.2. Land Use Assumptions The biennial audit includes comparing the growth projections adopted in the City’s LUA to the actual growth by development type. Tables 6-2 and 6-3 summarize the projected development from the Plan and the actual development experienced by the City in FY 2021 and FY 2022. Table 6-2 Northern Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDU) Multifamily (EDU) Com/Ret (EDU) Office (EDU) Ind/WH (EDU) Pub/Inst (EDU) Actual 2021 389 229 0 0 0 427 Projected 2021 (1) 1,822 617 395 105 25 187 Difference (1,433) (388) (395) (105) (25) 240 Actual 2022 495 584 8 0 1,214 74 Projected 2022 (1) 1,822 617 395 105 25 187 Difference (1,327) (33) (387) (105) 1,189 (113) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 6-2, Northern actual developments in 2021 exceeded the projected level of development for the public/institutional land use classification but fell short of projections for all other designations. The actual developments in 2022 saw actual industrial/warehouse development exceed projections, but the actual development for all other land use classifications fell short of the projected development in the Plan. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 30 Table 6-3 Southwest Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDU) Multifamily (EDU) Com/Ret (EDU) Office (EDU) Ind/WH (EDU) Pub/Inst (EDU) Actual 2021 1,835 377 109 7 473 13 Projected 2021 (1) 1,581 462 438 144 420 287 Difference 255 (85) (329) (137) 53 (274) Actual 2022 1,545 912 101 5 1,537 3 Projected 2022 (1) 1,581 462 438 144 420 287 Difference (36) 450 (337) (139) 1,117 (283) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 6-3, Southwest actual developments in 2021 exceeded projected development for the single family and industrial/warehouse but fell short of projections for all land use classifications. In 2022 multifamily and industrial/warehouse exceeded projections while all other land use classifications fell short of projections. Development of forward-looking financial plans, DIF studies rely on the best available forecast at a point in time. Actual conditions often vary from projections. Tables 6-2 and 6-3 represent a “snapshot” in time for the 10-year study period. Over time new studies are undertaken as circumstances change and new information becomes available. It should also be noted that projections in the report were made for a 10- year period in aggregate and not for individual years within the study period. As such, development in aggregate should be considered the focus rather than fluctuations from year to year. 6.3. Infrastructure Improvement Plan The Plan identified major arterial roads, culverts and bridges capital projects for the Northern zone and major arterial roads, storm drains and bridges for the southwest zone. Northern Zone During FY 2021 and FY 2022 the City generated $9,106,457 in major arterial DIF revenues. During the same period the City expended $2,790,701 on major arterial roads and $173,421 on bridges resulting in revenues exceeding expenditures during the two-year period. Appendix F provides a summary of the revenues and expenditures for the major arterials DIF funds. The financials are summarized in Table 6-4. Table 6-4 Northern Major Arterials DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $2,123,184 $128,730 $2,962,550 $0 2022 6,751,532 103,011 1,572 0 Total $8,874,716 $231,741 $2,964,122 $0 Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 31 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. Southwest Zone During FY 2021 and FY 2022 the City generated $12,507,862 in major arterials DIF revenues as well as an additional $95,562 in interest income for total revenues of $12,603,424. During the same period the City expended $2,296,119 on major arterials roads resulting in revenues exceeding expenditures during the two-year period. Appendix F provides a summary of the revenues and expenditures for the major arterials DIF funds. The financials are summarized in Table 6-5. Table 6-5 Southwest Major Arterials DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $4,757,343 $37,054 $2,296,010 $0 2022 7,750,519 58,508 109 0 Total $12,507,862 $95,562 $2,296,119 $0 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. 6.4. Level of Service Level of service projections are intended to ensure that new development is assessed for facilities or capital needs at the existing level of service (LOS), not at an increased overall level of service, unless a corresponding funding source from existing development is also provided. In each of the two zones expenditures fell short of the annual average expenditures identified in the Plan. During the study period, the actual LOS will fluctuate as compared to that identified in the Plan based on the timing of construction or acquisition of new facilities relative to new development. As of the end of FY 2022, due to new development outpacing acquisition and construction of new facilities, the LOS for major arterials for both zones is below that in the Plan (the growth-related needs for identified major arterials infrastructure were not met). However, the LOS should be monitored over the entire study period compared to the level identified in the Plan over the remaining study period as the full IIP and LUA projections are realized. 6.5. Audit Results Through our audit of the major arterials DIFs we identified some differences between what was projected in the Plan and actual occurrences, such as differences in the projected and actual developments. These differences are the results of projections being made based on the available data at the time. Our review of the current development environment is consistent with the regulations set forth in ARS§ 9-463.05. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 32 The LUA, IIP and LOS should continue to be monitored over the 10-year study period on which the Plan was based. Based on Willdan’s review of the major arterials DIF, we are of the opinion that: a) City’s Biennial DIFs for major arterials in FY 2021 and FY 2022 comply with ARS§ 9-463.05; b) With respect to ARS§ 9-463.05 compliance: i. Willdan’s review of the progress of the LUA, identified differences between projected and actual development, but anticipates development over the current 10-year study period will not significantly vary from projections; ii. Willdan’s review of the progress of the IIP identified the projects for which funds were expended were included in the adopted IIP; and iii. Willdan’s review of collections and expenditures of development impact fees indicate that all expenditures made with DIF funds were on projects as identified in the Plan. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 33 Section 7 - Storm Drainage This section of the Audit Report presents Willdan’s review of City’s storm drainage DIFs. 7.1. Fee Development Fees were developed for three service areas: Northeast Estrella Laveen The storm drainage DIFs were calculated using the plan based approach for the Northeast zone and a hybrid approach for Estrella and Laveen to develop a cost per equivalent dwelling unit (EDU) as the basis for assessing fees. The resulting DIFs per development type are identified in Table 7-1. Table 7-1 Storm Drainage DIFs Service Area Single Family (per Unit) Multifamily (per acre) Com/Ret (per acre) Office (per acre) Industrial (per acre) Pub/Inst (per acre) Northeast $1,715 $6,860 $6,860 $6,860 $6,860 $6,860 Estrella 770 3,080 3,080 3,080 3,080 3,080 Laveen 1,037 4,148 4,148 4,148 4,148 4,148 7.2. Land Use Assumptions The biennial audit includes comparing the growth projections adopted in the City’s LUA to the actual growth by development type. Table 7-2 summarizes the projected development from the Plan and the actual development experienced by the City in FY 2021 and FY 2022. Table 7-2 Northeast Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDU) Multifamily (EDU) Com/Ret (EDU) Office (EDU) Ind/WH (EDU) Pub/Inst (EDU) Actual 2021 0 0 0 0 0 0 Projected 2021 (1) 276 76 200 0 0 81 Difference (276) (76) (200) 0 0 (81) Actual 2022 0 0 0 0 0 0 Projected 2022 (1) 276 76 200 0 0 81 Difference (276) (76) (200) 0 0 (81) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 7-2, there was no storm drainage related development in 2021 and 2022. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 34 Table 7-3 Estrella & Laveen Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDU) Multifamily (EDU) Com/Ret (EDU) Office (EDU) Ind/WH (EDU) Pub/Inst (EDU) Actual 2021 1,833 135 61 8 382 42 Projected 2021 (1) (2) 1,581 Total for All Multifamily and Nonresidential: 965 Difference 252 Difference for All Multifamily and Nonresidential: (336) Actual 2022 1,559 333 58 5 1,033 0 Projected 2022 (1) (2) 1,581 Total for All Multifamily and Nonresidential: 965 Difference (22) Difference for All multifamily and Nonresidential: 465 (1) Projections are the average annual over the 10-year study period, rather than specific development by year. (2) The plan identified EDUs for multifamily and all other rather than for individual development categories. As indicated in Table 7-3, single family developments in Estrella and Laveen actual development exceeded projections whereas multifamily and nonresidential developments feel short of projections for 2021. In 2022, single family actual development fell short of projections whereas multifamily and nonresidential developments exceeded projections. Development of forward-looking financial plans, DIF studies rely on the best available forecast at a point in time. Actual conditions often vary from projections. Tables 7-2 and 7-3 represent a “snapshot” in time for the 10-year study period. Over time new studies are undertaken as circumstances change and new information becomes available. It should also be noted that projections in the report were made for a 10- year period in aggregate and not for individual years within the study period. As such, development in aggregate should be considered the focus rather than fluctuations from year to year. 7.3. Infrastructure Improvement Plan The Plan identified NE Phoenix/Rawhide Wash capital projects for the Northeast zone and existing and planned drainage facility costs for Estrella & Laveen. Northeast Zone While there was single family development in the Northeast zone, fees were not assessed and the City did not generate any revenue nor were any funds expended in the Northeast storm drainage zone. Estrella & Laveen Zones During FY 2021 and FY 2022 the City generated $4,870,764 in storm drainage DIF revenues as well as an additional $127,472 in interest income for total revenues of $4,998,236. During the same period the City expended $3,439 on Estrella drainage capital resulting in revenues exceeding expenditures during the two-year period. Appendix G provides a summary of the revenues and expenditures for the storm drainage DIF funds. The financials are summarized in Table 7-4. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 35 Table 7-4 Estrella & Laveen DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $2,267,955 $69,158 $1,106 $0 2022 2,602,809 58,314 2,333 0 Total $4,870,764 $127,472 $3,439 $0 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. 7.4. Level of Service Level of service projections are intended to ensure that new development is assessed for facilities or capital needs at the existing level of service (LOS), not at an increased overall level of service, unless a corresponding funding source from existing development is also provided. In each of the three zones expenditures fell short of the annual average expenditures identified in the Plan. During the study period, the actual LOS will fluctuate as compared to that identified in the Plan based on the timing of construction or acquisition of new facilities relative to new development. As of the end of FY 2022, due to new development outpacing acquisition and construction of new facilities, the LOS for storm drainage for the three zones is below that in the Plan (the growth-related needs for identified storm drainage infrastructure were not met). However, the LOS should be monitored over the entire study period compared to the level identified in the Plan over the remaining study period as the full IIP and LUA projections are realized. 7.5. Audit Results Through our audit of the storm drainage DIFs we identified some differences between what was projected in the Plan and actual occurrences, such as differences in the projected and actual developments. These differences are the results of projections being made based on the available data at the time. Our review of the current development environment is consistent with the regulations set forth in ARS§ 9-463.05. The LUA, IIP and LOS should continue to be monitored over the 10-year study period on which the Plan was based. Based on Willdan’s review of the storm drainage DIF, we are of the opinion that: a) City’s Biennial DIFs for storm drainage in FY 2021 and FY 2022 comply with ARS§ 9-463.05; b) With respect to ARS§ 9-463.05 compliance: Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 36 i. Willdan’s review of the progress of the LUA, identified differences between projected and actual development, but anticipates development over the current 10-year study period will not significantly vary from projections; ii. Willdan’s review of the progress of the IIP identified the projects for which funds were expended were included in the adopted IIP; and iii. Willdan’s review of collections and expenditures of development impact fees indicate that all expenditures made with DIF funds were on projects as identified in the Plan. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 37 Section 8 - Water System This section of the Audit Report presents Willdan’s review of City’s water system DIFs. 8.1. Fee Development The water system DIFs were calculated using a mix of incremental (forward looking) and buy-in approaches to develop a cost per equivalent dwelling unit (EDU) as the basis for assessing fees. Fees were developed for two service areas: Northern Southern The resulting DIFs per development type are identified in Table 8-1. Table 8-1 Water System DIFs Meter Size Northern Southern Single Family up to 1-inch $6,330 $4,016 Single Family 1.5-inch 22,477 14,771 Single Family 2-inch 36,337 24,003 Multifamily unit 2,273 1,394 ¾-inch Displacement (nonres) 14,092 9,186 1-inch Displacement (nonres) 23,032 14,841 1.5-inch Displacement (nonres) 46,166 29,829 2-inch Displacement (nonres) 73,809 47,661 2-inch Turbine Class II 85,801 54,747 3-inch Compound Class II 162,209 104,960 3-inch Turbine Class II 196,829 125,696 4-inch Compound Class II 278,832 180,719 4-inch Turbine Class II 349,290 226,648 6-inch Compound Class II 633,522 412,767 6-inch Turbine Class II 746,006 484,385 8-inch Compound Class II 735,506 473,885 8-inch Turbine Class II 1,317,170 859,322 8.2. Land Use Assumptions The biennial audit includes comparing the growth projections adopted in the City’s LUA to the actual growth by development type. Tables 8-2 and 8-3 summarize the projected development from the Plan and the actual development experienced by the City in FY 2021 and FY 2022. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 38 Table 8-2 Northern Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDUs) Multifamily (EDUs) Com/Ret (EDUs) Office (EDUs) Ind/WH (EDUs) Pub/Inst (EDUs) Actual “D” 2021 392 116 4 0 11 107 Actual “L” 2021 0 18 47 0 4 18 Total Actual 2021 392 134 50 0 15 126 Projected 2021 (1) 1,822 428 139 54 18 92 Difference (1,430) (293) (89) (54) (3) 34 Actual “D” 2022 495 296 25 0 890 0 Actual “L” 2022 0 58 78 0 11 0 Total Actual 2022 495 354 104 0 902 0 Projected 2022 (1) 1,822 428 139 54 18 92 Difference (1,327) (74) (35) (54) 884 (92) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 8-2, Northern actual developments in 2021 exceeded the projected level of development for the public/institutional land use classification but fell short of projections for all other designations. The actual developments in 2022 saw actual industrial/warehouse developments exceed projections, but the actual development for all other land use classifications fell short of the projected development in the Plan. Table 8-3 Southern Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDUs) Multifamily (EDUs) Com/Ret (EDUs) Office (EDUs) Ind/WH (EDUs) Pub/Inst (EDUs) Actual 2021 1,979 191 68 11 167 18 Projected 2021 (1) 1,722 347 160 81 289 140 Difference 257 (156) (93) (70) (122) (122) Actual 2022 1,675 462 108 4 175 0 Projected 2022 (1) 1,722 347 160 81 289 140 Difference (47) 115 (53) (78) (113) (140) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 8-3, Southern actual developments in 2021 exceeded projected development for all land use classifications the single family land use classification only. In 2022 multifamily, exceeded projections while all other land use classifications fell short of projections. Development of forward-looking financial plans, DIF studies rely on the best available forecast at a point in time. Actual conditions often vary from projections. Tables 8-2 and 8-3 represent a “snapshot” in time for the 10-year study period. Over time new studies are undertaken as circumstances change and new information becomes available. It should also be noted that projections in the report were made for a 10- year period in aggregate and not for individual years within the study period. As such, development in aggregate should be considered the focus rather than fluctuations from year to year. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 39 8.3. Infrastructure Improvement Plan The Plan identified the following capital projects for the Northern zone: New transmission mains New booster stations New PRV stations New WTP New wells The Plan identified the following capital projects for the Southern zone: New transmission mains New PRV stations New WTP Northern Zone During FY 2021 and FY 2022 the City generated $16,755,047 in water system DIF revenues and an additional $472,129 in interest earnings for total revenues of $17,227,176. During the same period the City expended $375,646 on water system capital and $14,000,000 on advance repayments and debt service resulting in revenues exceeding expenditures during the two-year period. Appendix H provides a summary of the revenues and expenditures for the water system DIF funds. The financials are summarized in Table 8-4. Table 8-4 Northern Water System DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $4,395,444 $279,378 $365,544 $0 2022 12,359,603 192,751 10,102 14,000,000 Total $16,755,047 $472,129 $375,646 $14,000,000 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. Southern Zone During FY 2021 and FY 2022 the City generated $25,814,739 in water system DIF revenues as well as an additional $500,365 in interest income for total revenues of $26,315,104. During the same period the City expended $15,537,728 on water system capital resulting in revenues exceeding expenditures during Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 40 the two-year period. Appendix H provides a summary of the revenues and expenditures for the water system DIF funds. The financials are summarized in Table 8-5. Table 8-5 Southern Water System DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $15,405,901 $271,708 $8,794,496 $0 2022 10,408,838 228,657 6,743,232 0 Total $25,814,739 $500,365 $15,537,728 $0 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. 8.4. Level of Service Level of service projections are intended to ensure that new development is assessed for facilities or capital needs at the existing level of service (LOS), not at an increased overall level of service, unless a corresponding funding source from existing development is also provided. In each of the two zones expenditures fell short of the annual average expenditures identified in the Plan. During the study period, the actual LOS will fluctuate as compared to that identified in the Plan based on the timing of construction or acquisition of new facilities relative to new development. As of the end of FY 2022, due to new development outpacing acquisition and construction of new facilities, the LOS for the water system for both zones are below that in the Plan (the growth-related needs for identified water system infrastructure were not met). However, the LOS should be monitored over the entire study period compared to the level identified in the Plan over the remaining study period as the full IIP and LUA projections are realized. 8.5. Audit Results Through our audit of the water system DIFs we identified some differences between what was projected in the Plan and actual occurrences, such as differences in the projected and actual developments. These differences are the results of projections being made based on the available data at the time. Our review of the current development environment is consistent with the regulations set forth in ARS§ 9-463.05. The LUA, IIP and LOS should continue to be monitored over the 10-year study period on which the Plan was based. Based on Willdan’s review of the water system DIF, we are of the opinion that: a) City’s Biennial DIFs for water system in FY 2021 and FY 2022 comply with ARS§ 9-463.05; b) With respect to ARS§ 9-463.05 compliance: Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 41 i. Willdan’s review of the progress of the LUA, identified differences between projected and actual development, but anticipates development over the current 10-year study period will not significantly vary from projections; ii. Willdan’s review of the progress of the IIP identified the projects for which funds were expended were included in the adopted IIP; and iii. Willdan’s review of collections and expenditures of development impact fees indicate that all expenditures made with DIF funds were on projects as identified in the Plan. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 42 Section 9 - Water Resource This section of the Audit Report presents Willdan’s review of City’s water resource DIFs. 9.1. Fee Development The water resource DIFs were calculated using the incremental (forward looking) approach to develop a cost per equivalent dwelling unit (EDU) as the basis for assessing fees. Water resource fees are divided into two service areas: On-Project Off-Project Only development within the off-project zone are assessed fees. The resulting DIFs per development type are identified in Table 9-1. Table 9-1 Water Resource DIFs Meter Size Off-Project Fee/EDU Single Family and Multi Family Domestic Meters Single Family 5/8-inch Displacement $583 Single Family 3/4-inch Displacement 583 Single Family 1-inch Displacement 583 Single Family 1 ½-inch Displacement 1,940 Single Family 2-inch Displacement 3,106 Multifamily Unit 221 Mobile Home Space (in Mobile Home Park) 221 Commercial, Industrial & Dedicated Irrigation Meters 5/8-inch Displacement $1,235 3/4-inch Displacement 1,235 1-inch Displacement 2,063 1.5-inch Displacement 4,114 2-inch Displacement 6,584 2-inch Turbine Class II 7,820 3-inch Compound Class II 14,416 3-inch Turbine Class II 17,912 4-inch Compound Class II 24,707 4-inch Turbine Class II 30,884 6-inch Compound Class II 55,590 6-inch Turbine Class II 65,881 8-inch Compound Class II 65,881 8-inch Turbine Class II 115,925 9.2. Land Use Assumptions The biennial audit includes comparing the growth projections adopted in the City’s LUA to the actual growth by development type. Table 9-2 summarizes the projected development from the Plan and the actual development experienced by the City in FY 2021 and FY 2022. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 43 Table 9-2 Off-Project Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDUs) Multifamily (EDUs) Nonresidential (EDUs) Actual 2021 1,472 271 1,075 Projected 2021 (1) 2,204 615 589 Difference (732) (344) 486 Actual 2022 1,550 423 1,845 Projected 2022 (1) 2,204 615 589 Difference (654) (192) 1,256 (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 9-2, actual developments in both 2021 and 2022 exceeded the projected level of development for nonresidential land use classification but fell short of projections for residential designations. Development of forward-looking financial plans, DIF studies rely on the best available forecast at a point in time. Actual conditions often vary from projections. Table 9-2 represents a “snapshot” in time for the 10-year study period. Over time new studies are undertaken as circumstances change and new information becomes available. It should also be noted that projections in the report were made for a 10- year period in aggregate and not for individual years within the study period. As such, development in aggregate should be considered the focus rather than fluctuations from year to year. 9.3. Infrastructure Improvement Plan The Plan identified the following water resource capital projects: Arizona state land department CAP allocation New service area ASR wells During FY 2021 and FY 2022 the City generated $4,403,286 in water resource DIF revenues and an additional $358,148 in interest earnings for total revenues of $4,761,434. During the same period the City did not expend any funds on water resource capital resulting in revenues exceeding expenditures during the two-year period. Appendix I provides a summary of the revenues and expenditures for the water system DIF funds. The financials are summarized in Table 9-3. Table 9-3 Northern Water System DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $1,892,318 $209,353 ($15,925) $0 2022 2,510,968 148,795 0 0 Total $4,403,286 $358,148 ($15,925) $0 Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 44 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. 9.4. Level of Service Level of service projections are intended to ensure that new development is assessed for facilities or capital needs at the existing level of service (LOS), not at an increased overall level of service, unless a corresponding funding source from existing development is also provided. Expenditures fell short of the annual average expenditures identified in the Plan. During the study period, the actual LOS will fluctuate as compared to that identified in the Plan based on the timing of construction or acquisition of new facilities relative to new development. As of the end of FY 2022, due to new development outpacing acquisition and construction of new facilities, the LOS water resources are below that in the Plan (the growth-related needs for identified water resource infrastructure were not met). However, the LOS should be monitored over the entire study period compared to the level identified in the Plan over the remaining study period as the full IIP and LUA projections are realized. 9.5. Audit Results Through our audit of the water resource DIFs we identified some differences between what was projected in the Plan and actual occurrences, such as differences in the projected and actual developments. These differences are the results of projections being made based on the available data at the time. Our review of the current development environment is consistent with the regulations set forth in ARS§ 9-463.05. The LUA, IIP and LOS should continue to be monitored over the 10-year study period on which the Plan was based. Based on Willdan’s review of the water resource DIF, we are of the opinion that: a) City’s Biennial DIFs for water resource in FY 2021 and FY 2022 comply with ARS§ 9-463.05; b) With respect to ARS§ 9-463.05 compliance: i. Willdan’s review of the progress of the LUA, identified differences between projected and actual development, but anticipates development over the current 10-year study period will not significantly vary from projections; ii. Willdan’s review of the progress of the IIP identified the projects for which funds were expended were included in the adopted IIP; and iii. Willdan’s review of collections and expenditures of development impact fees indicate that all expenditures made with DIF funds were on projects as identified in the Plan. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 45 Section 10 - Wastewater This section of the Audit Report presents Willdan’s review of City’s wastewater DIFs. 10.1. Fee Development The wastewater DIFs were calculated using a mix of the buy-in, incremental (forward looking) and plan development fee approaches to develop a cost per equivalent dwelling unit (EDU) as the basis for assessing fees. Fees were developed for seven service areas: Northern (Northwest and Northeast) Deer Valley Estrella North Estrella South Laveen West Laveen East Ahwatukee The resulting DIFs per development type are identified in Table 10-1. Table 10-1 Wastewater DIFs Meter Size Northern Deer Valley Estrella North, Laveen East & Ahwatukee Estrella South Laveen West Single Family up to 1-inch $3,303 $1,380 $1,380 $3,787 $3,630 Single Family 1.5-inch 12,397 5,993 5,993 14,008 13,486 Single Family 2-inch 20,203 9,953 9,953 22,782 21,946 Multifamily unit 1,552 610 610 1,789 1,712 ¾-inch Displacement (nonres) 8,182 3,855 3,855 9,271 8,917 1-inch Displacement (nonres) 13,175 5,945 5,945 14,995 14,405 1.5-inch Displacement (nonres) 26,473 12,070 12,070 30,098 28,922 2-inch Displacement (nonres) 42,297 19,240 19,240 48,100 46,218 2-inch Turbine Class II 48,379 20,995 20,995 55,271 53,035 3-inch Compound Class II 93,252 42,754 42,754 105,962 101,839 3-inch Turbine Class II 111,155 48,407 48,407 126,948 121,825 4-inch Compound Class II 160,635 74,100 74,100 182,415 175,350 4-inch Turbine Class II 201,544 93,375 93,375 228,769 219,937 6-inch Compound Class II 367,579 172,875 172,875 416,584 400,687 6-inch Turbine Class II 430,821 200,080 200,080 488,896 470,058 8-inch Compound Class II 420,321 189,580 189,580 478,396 459,558 8-inch Turbine Class II 765,591 361,780 361,780 867,226 834,258 10.2. Land Use Assumptions The biennial audit includes comparing the growth projections adopted in the City’s LUA to the actual growth by development type. Tables 10-2 through 10-8 summarize the projected development from the Plan and the actual development experienced by the City in FY 2021 and FY 2022. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 46 Table 10-2 Northern Projected versus Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDUs) Multifamily (EDUs) Com/Ret (EDUs) Office (EDUs) Ind/WH (EDUs) Pub/Inst (EDUs) Actual 2021 381 39 0 0 12 90 Projected 2021 (1) 1,817 404 138 52 18 93 Difference (1,436) (365) (138) (52) (6) (3) Actual 2022 470 133 27 0 993 0 Projected 2022 (1) 1,817 404 138 52 18 93 Difference (1,347) (271) (111) (52) 975 (93) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 10-2, Northern actual developments in 2021 exceeded the projected level of development for the public/institutional land use classification but fell short of projections for all other designations. The actual developments in 2022 saw actual industrial/warehouse developments exceed projections, but the actual development for all other land use classifications fell short of the projected development in the Plan. Table 10-3 Deer Valley Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDUs) Multifamily (EDUs) Com/Ret (EDUs) Office (EDUs) Ind/WH (EDUs) Pub/Inst (EDUs) Actual 2021 5 127 0 0 0 0 Projected 2021 (1) 5 0 0 0 0 2 Difference 0 127 0 0 0 (2) Actual 2022 24 231 0 0 0 0 Projected 2022 (1) 5 0 0 0 0 2 Difference 19 231 0 0 0 (2) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 10-3, Deer Valley actual developments in 2021 met projections for the single family land use classification, exceeded projected development for the multifamily land use classification and fell short of projections for public/institutional. In 2022 both single family and multifamily land uses exceeded projections while the public/institutional land use classification fell short of projections. Table 10-4 Estrella North Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDUs) Multifamily (EDUs) Com/Ret (EDUs) Office (EDUs) Ind/WH (EDUs) Pub/Inst (EDUs) Actual 2021 0 0 12 0 85 0 Projected 2021 (1) 1 23 11 9 120 18 Difference (1) (23) 1 (9) (34) (18) Actual 2022 0 0 2 0 111 0 Projected 2022 (1) 1 23 11 9 120 18 Difference (1) (23) (8) (9) (9) (18) (1) Projections are the average annual over the 10-year study period, rather than specific development by year Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 47 As indicated in Table 10-4, Estrella North actual developments in 2021 exceeded projected development for the commercial/retail land use classification and fell short of projections for all other land use classifications. In 2022 all land use classification fell short of projections. Table 10-5 Estrella South Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDUs) Multifamily (EDUs) Com/Ret (EDUs) Office (EDUs) Ind/WH (EDUs) Pub/Inst (EDUs) Actual 2021 903 171 30 12 89 0 Projected 2021 (1) 555 113 54 31 175 63 Difference 349 58 (24) (19) (86) (63) Actual 2022 548 177 11 0 51 0 Projected 2022 (1) 555 113 54 31 175 63 Difference (7) 64 (43) (31) (124) (63) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 10-5, Estrella South actual developments 2021 saw residential (single family and multifamily) developments exceed projected development while all other land use classification fell short of projections.in 2022, only multifamily developments exceeded projections. Table 10-6 Laveen West Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDUs) Multifamily (EDUs) Com/Ret (EDUs) Office (EDUs) Ind/WH (EDUs) Pub/Inst (EDUs) Actual 2021 740 76 22 0 10 12 Projected 2021 (1) 830 167 66 31 4 52 Difference (90) (91) (43) (31) 5 (40) Actual 2022 831 419 39 4 0 0 Projected 2022 (1) 830 167 66 31 4 52 Difference 1 252 (27) (27) (4) (52) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 10-6, Laveen West actual developments for the industrial/warehouse land use classification exceeded projections in 2021, while all other land use classifications fell short. In 2022, the residential (single family and multifamily) developments exceed projected development while all other land use classification fell short of projections. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 48 Table 10-7 Laveen East Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDUs) Multifamily (EDUs) Com/Ret (EDUs) Office (EDUs) Ind/WH (EDUs) Pub/Inst (EDUs) Actual 2021 179 0 0 0 0 0 Projected 2021 (1) 195 0 23 0 0 12 Difference (16) 0 (23) 0 0 (12) Actual 2022 263 0 19 0 0 0 Projected 2022 (1) 195 0 23 0 0 12 Difference 68 0 (4) 0 0 (12) (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 10-7, in 2021 no Laveen East actual developments met or exceeded projections, all land use classifications for which development was projected fell short of projections. In 2022, single family developments exceed projected development, commercial/retail developments met projections and the public/institutional land use classification fell short of projections. Table 10-8 Ahwatukee Projected versus Actual Equivalent Dwelling Units FY 2021 & FY 2022 Year Single Family (EDUs) Multifamily (EDUs) Com/Ret (EDUs) Office (EDUs) Ind/WH (EDUs) Pub/Inst (EDUs) Actual 2021 150 0 7 0 0 0 Projected 2021 (1) 141 25 6 8 0 0 Difference 9 (25) 1 (8) 0 0 Actual 2022 10 0 43 0 0 7 Projected 2022 (1) 141 25 6 8 0 0 Difference (131) (25) 37 (8) 0 7 (1) Projections are the average annual over the 10-year study period, rather than specific development by year As indicated in Table 10-8, 2021 Ahwatukee actual single family and commercial/retail developments exceeded projections, while the multifamily and office land use fell short of projections. In 2022, commercial/retail and public/institutional developments exceed projected development while the single family, multifamily and office actual developments fell short of projections. Development of forward-looking financial plans, DIF studies rely on the best available forecast at a point in time. Actual conditions often vary from projections. Tables 10-2 through 10-8 represent a “snapshot” in time for the 10-year study period. Over time new studies are undertaken as circumstances change and new information becomes available. It should also be noted that projections in the report were made for a 10-year period in aggregate and not for individual years within the study period. As such, development in aggregate should be considered the focus rather than fluctuations from year to year. 10.3. Infrastructure Improvement Plan The Plan identified the following capital projects by zone: Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 49 Northern New sewers WWTP expansion New force mains New lift stations Deer Valley WWTP expansion Estrella North WWTP expansion Estrella South New sewers WWTP expansion New force mains New lift stations Laveen West New sewers WWTP expansion New force mains New lift stations Laveen East WWTP expansion Ahwatukee WWTP expansion Northern Zone During FY 2021 and FY 2022 the City generated $23,222,520 in wastewater DIF and DIF related revenues. During the same period the City did not expend any funds on capital but did expend $16,226,928 on advance repayments and debt service resulting in revenues exceeding expenditures during the two-year period. Appendix J provides a summary of the revenues and expenditures for the wastewater DIF funds. The financials are summarized in Table 10-9. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 50 Table 10-9 Northern Wastewater DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $18,117,281 $212,677 $0 $0 2022 4,804,090 88,472 0 16,226,928 Total $22,921,371 $301,149 $0 $16,226,928 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. Deer Valley Zone During FY 2021 and FY 2022 the City generated $453,814 in wastewater DIF revenues as well as an additional $1,803 in interest income for total revenues of $455,617. During the same period the City did not expend any funds on capital, but did expend $147,367 in advance repayments and debt service resulting in revenues exceeding expenditures during the two-year period. Appendix J provides a summary of the revenues and expenditures for the wastewater DIF funds. The financials are summarized in Table 10-10. Table 10-10 Deer Valley Wastewater DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $145,603 $425 $0 $0 2022 308,211 1,378 0 147,367 Total $453,814 $1,803 $0 $147,367 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. Estrella North Zone During FY 2021 and FY 2022 the City generated $447,464 in wastewater DIF revenues as well as an additional $1,873 in interest income for total revenues of $449,337. During the same period the City did not expend any funds on capital but did expend $190,593 in advance repayments and debt service resulting in revenues exceeding expenditures during the two-year period. Appendix J provides a summary of the revenues and expenditures for the wastewater DIF funds. The financials are summarized in Table 10-11. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 51 Table 10-11 Estrella North Wastewater DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $188,586 $722 $0 $0 2022 258,878 1,151 0 190,593 Total $447,464 $1,873 $0 $190,593 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. Estrella South Zone During FY 2021 and FY 2022 the City generated $3,691,576 in wastewater DIF revenues as well as an additional $186,378 in interest income for total revenues of $3,877,954. During the same period the City expended $134,762 on new sewers and expended $9,739,915 in advance repayments and debt service resulting in expenditures exceeding revenues during the two-year period. Appendix J provides a summary of the revenues and expenditures for the wastewater DIF funds. The financials are summarized in Table 10-12. Table 10-12 Estrella South Wastewater DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $2,324,433 $119,391 $0 $0 2022 1,367,143 66,987 134,762 9,739,915 Total $3,691,576 $186,378 $134,762 $9,739,915 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. Laveen West Zone During FY 2021 and FY 2022 the City generated $6,713,503 in wastewater DIF revenues as well as an additional $127,485 in interest income for total revenues of $6,840,988. During the same period the City expended $26,667 on capital and expended $9,901,769 in advance repayments and debt service resulting in expenditures exceeding revenues during the two-year period. Appendix J provides a summary of the revenues and expenditures for the wastewater DIF funds. The financials are summarized in Table 10-13. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 52 Table 10-13 Laveen West Wastewater DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $3,261,607 $89,659 ($25,822) $0 2022 3,451,896 37,826 52,489 9,901,769 Total $6,713,503 $127,485 $26,667 $9,901,769 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. Laveen East Zone During FY 2021 and FY 2022 the City generated $652,959 in wastewater DIF revenues as well as an additional $3,184 in interest income for total revenues of $656,143. During the same period the City did not expend any funds on capital and expended $308,382 in advance repayments and debt service resulting in revenues exceeding expenditures during the two-year period. Appendix J provides a summary of the revenues and expenditures for the wastewater DIF funds. The financials are summarized in Table 10-14. Table 10-14 Laveen East Wastewater DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $232,489 $1,447 $0 $0 2022 420,470 1,737 0 308,382 Total $652,959 $3,184 $0 $308,382 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. Ahwatukee Zone During FY 2021 and FY 2022 the City generated $299,872 in wastewater DIF revenues as well as an additional $1,598 in interest income for total revenues of $301,470. During the same period the City did not expend any funds on capital and expended $217,811 in advance repayments and debt service resulting in revenues exceeding expenditures during the two-year period. Appendix J provides a summary of the revenues and expenditures for the wastewater DIF funds. The financials are summarized in Table 10-15. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 53 Table 10-15 Ahwatukee Wastewater DIF Revenues and Expenditures FY 2021 & FY 2022 Fiscal Year Revenues Expenditures DIF Collections Interest Income CIP Advance Repayments & Debt 2021 $208,551 $849 $0 $0 2022 91,321 749 0 217,811 Total $299,872 $1,598 $0 $217,811 It should be noted that in some cases collection of DIF revenues do not have an exact matching between the year in which the revenues are recorded and the development occurs. 10.4. Level of Service Level of service projections are intended to ensure that new development is assessed for facilities or capital needs at the existing level of service (LOS), not at an increased overall level of service, unless a corresponding funding source from existing development is also provided. In each of the seven zones expenditures fell short of the annual average expenditures identified in the Plan. During the study period, the actual LOS will fluctuate as compared to that identified in the Plan based on the timing of construction or acquisition of new facilities relative to new development. As of the end of FY 2022, due to new development outpacing acquisition and construction of new facilities, the LOS for wastewater for all zones are below that in the Plan (the growth-related needs for identified wastewater infrastructure were not met). However, the LOS should be monitored over the entire study period compared to the level identified in the Plan over the remaining study period as the full IIP and LUA projections are realized. 10.5. Audit Results Through our audit of the wastewater DIFs we identified some differences between what was projected in the Plan and actual occurrences, such as differences in the projected and actual developments. These differences are the results of projections being made based on the available data at the time. Our review of the current development environment is consistent with the regulations set forth in ARS§ 9-463.05. The LUA, IIP and LOS should continue to be monitored over the 10-year study period on which the Plan was based. Based on Willdan’s review of the wastewater DIF, we are of the opinion that: c) City’s Biennial DIFs for wastewater in FY 2021 and FY 2022 comply with ARS§ 9-463.05; d) With respect to ARS§ 9-463.05 compliance: Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 54 i. Willdan’s review of the progress of the LUA, identified differences between projected and actual development, but anticipates development over the current 10-year study period will not significantly vary from projections; ii. Willdan’s review of the progress of the IIP identified the projects for which funds were expended were included in the adopted IIP; and iii. Willdan’s review of collections and expenditures of development impact fees indicate that all expenditures made with DIF funds were on projects as identified in the Plan. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 55 Section 11 - Permit Sampling 11.1. Sampling Results As part of the audit process Willdan took a random sample of residential and non-residential permits that were issued between FY 2021 and FY 2022 (60 permits for each year). The purpose of the sampling was to identify any instances where the fee that was assessed to the development varied from the fee that should have been assessed based on number of dwelling units, square footage of development or meter size. We did not find any discrepancies and did not identify any developments that were assessed incorrect DIFs. The full sample data is shown in Appendix K. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 56 Section 12 - Conclusions 12.1. Land Use Assumptions Willdan conducted an audit of City’s actual development projections for FY 2021 and FY 2022 and compared the actual new development with the development projections in the Plan. While there were variances between what had been originally projected and what actually occurred, the original projections were based on the best available data at the time of the Plan. We believe that the actual developments for FY 2021 and FY 2022 are still consistent with the overall development projections for the 10-year study period. 12.2. Infrastructure Improvement Plan We reviewed the projects that were anticipated to be completed in FY 2021 and FY 2022 timeframe of the study period (per the Plan). As was the case with the LUA, the IIP was developed based on the best available information at the time of the analysis, and the actual expenditures differed from what was projected. However, the differences that did occur were related to the timing of projects that were originally anticipated rather than the addition of new projects. We therefore conclude that the expenditures were consistent with the overall capital needs objectives identified in the IIP. 12.3. Level of Service The level of service for a given fee area is in flux over time and will change as new projects are incorporated into City’s existing facilities and networks or as development within City changes. There are cases where it is not possible to exactly match the existing level of service with the required level of service based on new development. For example, the new development over FY 2021 and FY 2022 may require the construction of 1/5 of a fire station. Building a fraction of a fire station is not feasible or realistic, but not building the fraction of a fire station would technically result in a lowering of the overall level of service. The City intends to meet the level of service goals by the end of the 10-year study period. 12.4. Permit Sampling Our review of the sample permits did not identify any cases where a development was assessed an incorrect fee based on development type, square footage or meter size. 12.5. Final Conclusion Based on Willdan’s scope of services performed as part of this Audit as documented in this Report, the results of this Audit follow. Development Impact Fee Biennial Audit Final Report April 13, 2023 P a g e | 57 a) The City’s Biennial development impact fees for the periods FY 2021 and FY 2022 comply with ARS§ 9-463.05; b) With respect to ARS§ 9-463.05 compliance: i. Willdan’s review of the progress of the LUA, identified minor differences between projected and actual development, but anticipates the development over the 10-year study period will not significantly vary from projections; ii. Willdan’s review of the progress of the IIP identified projects that were either accelerated from the projected schedule or delayed based on the projected schedule, but all projects for which funds were expended were included in the adopted IIP; iii. Willdan’s review of collections and expenditures of the development impact fees for each project in the plan, indicate that all expenditures made with DIF funds were on projects or debt expenses as identified in the Plan; and iv. Willdan’s evaluation of any inequities in implementing the plan or imposing the system development fees indicates that the fees were assessed in an appropriate manner based upon the size and type of the development. APPENDIX A ARS §9-463.05 9-463.05. Development fees; imposition by cities and towns; infrastructure improvements plan; annual report; advisory committee; limitation on actions; definitions A. A municipality may assess development fees to offset costs to the municipality associated with providing necessary public services to a development, including the costs of infrastructure, improvements, real property, engineering and architectural services, financing and professional services required for the preparation or revision of a development fee pursuant to this section, including the relevant portion of the infrastructure improvements plan. B. Development fees assessed by a municipality under this section are subject to the following requirements: 1. Development fees shall result in a beneficial use to the development. 2. The municipality shall calculate the development fee based on the infrastructure improvements plan adopted pursuant to this section. 3. The development fee shall not exceed a proportionate share of the cost of necessary public services, based on service units, needed to provide necessary public services to the development. 4. Costs for necessary public services made necessary by new development shall be based on the same level of service provided to existing development in the service area. 5. Development fees may not be used for any of the following: (a) Construction, acquisition or expansion of public facilities or assets other than necessary public services or facility expansions identified in the infrastructure improvements plan. (b) Repair, operation or maintenance of existing or new necessary public services or facility expansions. (c) Upgrading, updating, expanding, correcting or replacing existing necessary public services to serve existing development in order to meet stricter safety, efficiency, environmental or regulatory standards. (d) Upgrading, updating, expanding, correcting or replacing existing necessary public services to provide a higher level of service to existing development. (e) Administrative, maintenance or operating costs of the municipality. 6. Any development for which a development fee has been paid is entitled to the use and benefit of the services for which the fee was imposed and is entitled to receive immediate service from any existing facility with available capacity to serve the new service units if the available capacity has not been reserved or pledged in connection with the construction or financing of the facility. 7. Development fees may be collected if any of the following occurs: (a) The collection is made to pay for a necessary public service or facility expansion that is identified in the infrastructure improvements plan and the municipality plans to complete construction and to have the service available within the time period established in the infrastructure improvement plan, but in no event longer than the time period provided in subsection H, paragraph 3 of this section. (b) The municipality reserves in the infrastructure improvements plan adopted pursuant to this section or otherwise agrees to reserve capacity to serve future development. ARS 9-463.05 A-1 (c) The municipality requires or agrees to allow the owner of a development to construct or finance the necessary public service or facility expansion and any of the following apply: i. The costs incurred or money advanced are credited against or reimbursed from the development fees otherwise due from a development. ii. The municipality reimburses the owner for those costs from the development fees paid from all developments that will use those necessary public services or facility expansions. iii. For those costs incurred the municipality allows the owner to assign the credits or reimbursement rights from the development fees otherwise due from a development to other developments for the same category of necessary public services in the same service area. 8. Projected interest charges and other finance costs may be included in determining the amount of development fees only if the monies are used for the payment of principal and interest on the portion of the bonds, notes or other obligations issued to finance construction of necessary public services or facility expansions identified in the infrastructure improvements plan. 9. Monies received from development fees assessed pursuant to this section shall be placed in a separate fund and accounted for separately and may only be used for the purposes authorized by this section. Monies received from a development fee identified in an infrastructure improvements plan adopted or updated pursuant to subsection D of this section shall be used to provide the same category of necessary public services or facility expansions for which the development fee was assessed and for the benefit of the same service area, as defined in the infrastructure improvements plan, in which the development fee was assessed. Interest earned on monies in the separate fund shall be credited to the fund. 10. The schedule for payment of fees shall be provided by the municipality. Based on the cost identified in the infrastructure improvements plan, the municipality shall provide a credit toward the payment of a development fee for the required or agreed to dedication of public sites, improvements and other necessary public services or facility expansions included in the infrastructure improvements plan and for which a development fee is assessed, to the extent the public sites, improvements and necessary public services or facility expansions are provided by the developer. The developer of residential dwelling units shall be required to pay development fees when construction permits for the dwelling units are issued, or at a later time if specified in a development agreement pursuant to section 9-500.05. If a development agreement provides for fees to be paid at a time later than the issuance of construction permits, the deferred fees shall be paid no later than fifteen days after the issuance of a certificate of occupancy. The development agreement shall provide for the value of any deferred fees to be supported by appropriate security, including a surety bond, letter of credit or cash bond. 11. If a municipality requires as a condition of development approval the construction or improvement of, contributions to or dedication of any facilities that were not included in a previously adopted infrastructure improvements plan, the municipality shall cause the infrastructure improvements plan to be amended to include the facilities and shall provide a credit toward the payment of a ARS 9-463.05 A-2 development fee for the construction, improvement, contribution or dedication of the facilities to the extent that the facilities will substitute for or otherwise reduce the need for other similar facilities in the infrastructure improvements plan for which development fees were assessed. 12. The municipality shall forecast the contribution to be made in the future in cash or by taxes, fees, assessments or other sources of revenue derived from the property owner towards the capital costs of the necessary public service covered by the development fee and shall include these contributions in determining the extent of the burden imposed by the development. Beginning August 1, 2014, for purposes of calculating the required offset to development fees pursuant to this subsection, if a municipality imposes a construction contracting or similar excise tax rate in excess of the percentage amount of the transaction privilege tax rate imposed on the majority of other transaction privilege tax classifications, the entire excess portion of the construction contracting or similar excise tax shall be treated as a contribution to the capital costs of necessary public services provided to development for which development fees are assessed, unless the excess portion was already taken into account for such purpose pursuant to this subsection. 13. If development fees are assessed by a municipality, the fees shall be assessed against commercial, residential and industrial development, except that the municipality may distinguish between different categories of residential, commercial and industrial development in assessing the costs to the municipality of providing necessary public services to new development and in determining the amount of the development fee applicable to the category of development. If a municipality agrees to waive any of the development fees assessed on a development, the municipality shall reimburse the appropriate development fee accounts for the amount that was waived. The municipality shall provide notice of any such waiver to the advisory committee established pursuant to subsection G of this section within thirty days. 14. In determining and assessing a development fee applying to land in a community facilities district established under title 48, chapter 4, article 6, the municipality shall take into account all public infrastructure provided by the district and capital costs paid by the district for necessary public services and shall not assess a portion of the development fee based on the infrastructure or costs. C. A municipality shall give at least thirty days' advance notice of intention to assess a development fee and shall release to the public and post on its website or the website of an association of cities and towns if a municipality does not have a website a written report of the land use assumptions and infrastructure improvements plan adopted pursuant to subsection D of this section. The municipality shall conduct a public hearing on the proposed development fee at any time after the expiration of the thirty day notice of intention to assess a development fee and at least thirty days before the scheduled date of adoption of the fee by the governing body. Within sixty days after the date of the public hearing on the proposed development fee, a municipality shall approve or disapprove the imposition of the development fee. A municipality shall not adopt an ordinance, order or resolution approving a development fee as an emergency measure. A development fee assessed pursuant to this section shall not be effective until seventy-five days after its formal adoption by the governing body of the municipality. Nothing in this subsection shall affect any development fee adopted before July 24, 1982. ARS 9-463.05 A-3 D. Before the adoption or amendment of a development fee, the governing body of the municipality shall adopt or update the land use assumptions and infrastructure improvements plan for the designated service area. The municipality shall conduct a public hearing on the land use assumptions and infrastructure improvements plan at least thirty days before the adoption or update of the plan. The municipality shall release the plan to the public, post the plan on its website or the website of an association of cities and towns if the municipality does not have a website, including in the posting its land use assumptions, the time period of the projections, a description of the necessary public services included in the infrastructure improvements plan and a map of the service area to which the land use assumptions apply, make available to the public the documents used to prepare the assumptions and plan and provide public notice at least sixty days before the public hearing, subject to the following: 1. The land use assumptions and infrastructure improvements plan shall be approved or disapproved within sixty days after the public hearing on the land use assumptions and infrastructure improvements plan and at least thirty days before the public hearing on the report required by subsection C of this section. A municipality shall not adopt an ordinance, order or resolution approving the land use assumptions or infrastructure improvements plan as an emergency measure. 2. An infrastructure improvements plan shall be developed by qualified professionals using generally accepted engineering and planning practices pursuant to subsection E of this section. 3. A municipality shall update the land use assumptions and infrastructure improvements plan at least every five years. The initial five year period begins on the day the infrastructure improvements plan is adopted. The municipality shall review and evaluate its current land use assumptions and shall cause an update of the infrastructure improvements plan to be prepared pursuant to this section. 4. Within sixty days after completion of the updated land use assumptions and infrastructure improvements plan, the municipality shall schedule and provide notice of a public hearing to discuss and review the update and shall determine whether to amend the assumptions and plan. 5. A municipality shall hold a public hearing to discuss the proposed amendments to the land use assumptions, the infrastructure improvements plan or the development fee. The land use assumptions and the infrastructure improvements plan, including the amount of any proposed changes to the development fee per service unit, shall be made available to the public on or before the date of the first publication of the notice of the hearing on the amendments. 6. The notice and hearing procedures prescribed in paragraph 1 of this subsection apply to a hearing on the amendment of land use assumptions, an infrastructure improvements plan or a development fee. Within sixty days after the date of the public hearing on the amendments, a municipality shall approve or disapprove the amendments to the land use assumptions, infrastructure improvements plan or development fee. A municipality shall not adopt an ordinance, order or resolution approving the amended land use assumptions, infrastructure improvements plan or development fee as an emergency measure. 7. The advisory committee established under subsection G of this section shall file its written comments on any proposed or updated land use assumptions, infrastructure improvements plan and development fees before the fifth business ARS 9-463.05 A-4 day before the date of the public hearing on the proposed or updated assumptions, plan and fees. 8. If, at the time an update as prescribed in paragraph 3 of this subsection is required, the municipality determines that no changes to the land use assumptions, infrastructure improvements plan or development fees are needed, the municipality may as an alternative to the updating requirements of this subsection publish notice of its determination on its website and include the following: (a) A statement that the municipality has determined that no change to the land use assumptions, infrastructure improvements plan or development fee is necessary. (b) A description and map of the service area in which an update has been determined to be unnecessary. (c) A statement that by a specified date, which shall be at least sixty days after the date of publication of the first notice, a person may make a written request to the municipality requesting that the land use assumptions, infrastructure improvements plan or development fee be updated. (d) A statement identifying the person or entity to whom the written request for an update should be sent. 9. If, by the date specified pursuant to paragraph 8 of this subsection, a person requests in writing that the land use assumptions, infrastructure improvements plan or development fee be updated, the municipality shall cause, accept or reject an update of the assumptions and plan to be prepared pursuant to this subsection. 10. Notwithstanding the notice and hearing requirements for adoption of an infrastructure improvements plan, a municipality may amend an infrastructure improvements plan adopted pursuant to this section without a public hearing if the amendment addresses only elements of necessary public services in the existing infrastructure improvements plan and the changes to the plan will not, individually or cumulatively with other amendments adopted pursuant to this subsection, increase the level of service in the service area or cause a development fee increase of greater than five per cent when a new or modified development fee is assessed pursuant to this section. The municipality shall provide notice of any such amendment at least thirty days before adoption, shall post the amendment on its website or on the website of an association of cities and towns if the municipality does not have a website and shall provide notice to the advisory committee established pursuant to subsection G of this section that the amendment complies with this subsection. E. For each necessary public service that is the subject of a development fee, the infrastructure improvements plan shall include: 1. A description of the existing necessary public services in the service area and the costs to upgrade, update, improve, expand, correct or replace those necessary public services to meet existing needs and usage and stricter safety, efficiency, environmental or regulatory standards, which shall be prepared by qualified professionals licensed in this state, as applicable. 2. An analysis of the total capacity, the level of current usage and commitments for usage of capacity of the existing necessary public services, which shall be prepared by qualified professionals licensed in this state, as applicable. ARS 9-463.05 A-5 3. A description of all or the parts of the necessary public services or facility expansions and their costs necessitated by and attributable to development in the service area based on the approved land use assumptions, including a forecast of the costs of infrastructure, improvements, real property, financing, engineering and architectural services, which shall be prepared by qualified professionals licensed in this state, as applicable. 4. A table establishing the specific level or quantity of use, consumption, generation or discharge of a service unit for each category of necessary public services or facility expansions and an equivalency or conversion table establishing the ratio of a service unit to various types of land uses, including residential, commercial and industrial. 5. The total number of projected service units necessitated by and attributable to new development in the service area based on the approved land use assumptions and calculated pursuant to generally accepted engineering and planning criteria. 6. The projected demand for necessary public services or facility expansions required by new service units for a period not to exceed ten years. 7. A forecast of revenues generated by new service units other than development fees, which shall include estimated state-shared revenue, highway users revenue, federal revenue, ad valorem property taxes, construction contracting or similar excise taxes and the capital recovery portion of utility fees attributable to development based on the approved land use assumptions, and a plan to include these contributions in determining the extent of the burden imposed by the development as required in subsection B, paragraph 12 of this section. F. A municipality's development fee ordinance shall provide that a new development fee or an increased portion of a modified development fee shall not be assessed against a development for twenty-four months after the date that the municipality issues the final approval for a commercial, industrial or multifamily development or the date that the first building permit is issued for a residential development pursuant to an approved site plan or subdivision plat, provided that no subsequent changes are made to the approved site plan or subdivision plat that would increase the number of service units. If the number of service units increases, the new or increased portion of a modified development fee shall be limited to the amount attributable to the additional service units. The twenty-four month period shall not be extended by a renewal or amendment of the site plan or the final subdivision plat that was the subject of the final approval. The municipality shall issue, on request, a written statement of the development fee schedule applicable to the development. If, after the date of the municipality's final approval of a development, the municipality reduces the development fee assessed on development, the reduced fee shall apply to the development. G. A municipality shall do one of the following: 1. Before the adoption of proposed or updated land use assumptions, infrastructure improvements plan and development fees as prescribed in subsection D of this section, the municipality shall appoint an infrastructure improvements advisory committee, subject to the following requirements: (a) The advisory committee shall be composed of at least five members who are appointed by the governing body of the municipality. At least fifty per cent of the members of the advisory committee must be representatives of the real ARS 9-463.05 A-6 estate, development or building industries, of which at least one member of the committee must be from the home building industry. Members shall not be employees or officials of the municipality. (b) The advisory committee shall serve in an advisory capacity and shall: i. Advise the municipality in adopting land use assumptions and in determining whether the assumptions are in conformance with the general plan of the municipality. ii. Review the infrastructure improvements plan and file written comments. iii. Monitor and evaluate implementation of the infrastructure improvements plan. iv. Every year file reports with respect to the progress of the infrastructure improvements plan and the collection and expenditures of development fees and report to the municipality any perceived inequities in implementing the plan or imposing the development fee. v. Advise the municipality of the need to update or revise the land use assumptions, infrastructure improvements plan and development fee. (c) The municipality shall make available to the advisory committee any professional reports with respect to developing and implementing the infrastructure improvements plan. (d) The municipality shall adopt procedural rules for the advisory committee to follow in carrying out the committee’s duties. 2. In lieu of creating an advisory committee pursuant to paragraph 1 of this subsection, provide for a biennial certified audit of the municipality's land use assumptions, infrastructure improvements plan and development fees. An audit pursuant to this paragraph shall be conducted by one or more qualified professionals who are not employees or officials of the municipality and who did not prepare the infrastructure improvements plan. The audit shall review the progress of the infrastructure improvements plan, including the collection and expenditures of development fees for each project in the plan, and evaluate any inequities in implementing the plan or imposing the development fee. The municipality shall post the findings of the audit on the municipality's website or the website of an association of cities and towns if the municipality does not have a website and shall conduct a public hearing on the audit within sixty days of the release of the audit to the public. H. On written request, an owner of real property for which a development fee has been paid after July 31, 2014 is entitled to a refund of a development fee or any part of a development fee if: 1. Pursuant to subsection B, paragraph 6 of this section, existing facilities are available and service is not provided. 2. The municipality has, after collecting the fee to construct a facility when service is not available, failed to complete construction within the time period identified in the infrastructure improvements plan, but in no event later than the time period specified in paragraph 3 of this subsection. 3. For a development fee other than a development fee for water or wastewater facilities, any part of the development fee is not spent as authorized by this section within ten years after the fee has been paid or, for a development fee for water or ARS 9-463.05 A-7 wastewater facilities, any part of the development fee is not spent as authorized by this section within fifteen years after the fee has been paid. I. If the development fee was collected for the construction of all or a portion of a specific item of infrastructure, and on completion of the infrastructure the municipality determines that the actual cost of construction was less than the forecasted cost of construction on which the development fee was based and the difference between the actual and estimated cost is greater than ten per cent, the current owner may receive a refund of the portion of the development fee equal to the difference between the development fee paid and the development fee that would have been due if the development fee had been calculated at the actual construction cost. J. A refund shall include any interest earned by the municipality from the date of collection to the date of refund on the amount of the refunded fee. All refunds shall be made to the record owner of the property at the time the refund is paid. If the development fee is paid by a governmental entity, the refund shall be paid to the governmental entity. K. A development fee that was adopted before January 1, 2012 may continue to be assessed only to the extent that it will be used to provide a necessary public service for which development fees can be assessed pursuant to this section and shall be replaced by a development fee imposed under this section on or before August 1, 2014. Any municipality having a development fee that has not been replaced under this section on or before August 1, 2014 shall not collect development fees until the development fee has been replaced with a fee that complies with this section. Any development fee monies collected before January 1, 2012 remaining in a development fee account: 1. Shall be used towards the same category of necessary public services as authorized by this section. 2. If development fees were collected for a purpose not authorized by this section, shall be used for the purpose for which they were collected on or before January 1, 2020, and after which, if not spent, shall be distributed equally among the categories of necessary public services authorized by this section. L. A moratorium shall not be placed on development for the sole purpose of awaiting completion of all or any part of the process necessary to develop, adopt or update development fees. M. In any judicial action interpreting this section, all powers conferred on municipal governments in this section shall be narrowly construed to ensure that development fees are not used to impose on new residents a burden all taxpayers of a municipality should bear equally. N. Each municipality that assesses development fees shall submit an annual report accounting for the collection and use of the fees for each service area. The annual report shall include the following: 1. The amount assessed by the municipality for each type of development fee. 2. The balance of each fund maintained for each type of development fee assessed as of the beginning and end of the fiscal year. 3. The amount of interest or other earnings on the monies in each fund as of the end of the fiscal year. ARS 9-463.05 A-8 4. The amount of development fee monies used to repay: (a) Bonds issued by the municipality to pay the cost of a capital improvement project that is the subject of a development fee assessment, including the amount needed to repay the debt service obligations on each facility for which development fees have been identified as the source of funding and the time frames in which the debt service will be repaid. (b) Monies advanced by the municipality from funds other than the funds established for development fees in order to pay the cost of a capital improvement project that is the subject of a development fee assessment, the total amount advanced by the municipality for each facility, the source of the monies advanced and the terms under which the monies will be repaid to the municipality. 5. The amount of development fee monies spent on each capital improvement project that is the subject of a development fee assessment and the physical location of each capital improvement project. 6. The amount of development fee monies spent for each purpose other than a capital improvement project that is the subject of a development fee assessment. O. Within ninety days following the end of each fiscal year, each municipality shall submit a copy of the annual report to the city clerk and post the report on the municipality's website or the website of an association of cities and towns if the municipality does not have a website. Copies shall be made available to the public on request. The annual report may contain financial information that has not been audited. P. A municipality that fails to file the report and post the report on the municipality's website or the website of an association of cities and towns if the municipality does not have a website as required by this section shall not collect development fees until the report is filed and posted. Q. Any action to collect a development fee shall be commenced within two years after the obligation to pay the fee accrues. R. A municipality may continue to assess a development fee adopted before January 1, 2012 for any facility that was financed before June 1, 2011 if: 1. Development fees were pledged to repay debt service obligations related to the construction of the facility. 2. After August 1, 2014, any development fees collected under this subsection are used solely for the payment of principal and interest on the portion of the bonds, notes or other debt service obligations issued before June 1, 2011 to finance construction of the facility. S. Through August 1, 2014, a development fee adopted before January 1, 2012 may be used to finance construction of a facility and may be pledged to repay debt service obligations if: 1. The facility that is being financed is a facility that is described under subsection T, paragraph 7, subdivisions (a) through (g) of this section. 2. The facility was included in an infrastructure improvements plan adopted before June 1, 2011. 3. The development fees are used for the payment of principal and interest on the portion of the bonds, notes or other debt service obligations issued to finance ARS 9-463.05 A-9 construction of the necessary public services or facility expansions identified in the infrastructure improvement plan. T. For the purposes of this section: 1. "Dedication" means the actual conveyance date or the date an improvement, facility or real or personal property is placed into service, whichever occurs first. 2. "Development" means: (a) The subdivision of land. (b) The construction, reconstruction, conversion, structural alteration, relocation or enlargement of any structure that adds or increases the number of service units. (c) Any use or extension of the use of land that increases the number of service units. 3. "Facility expansion" means the expansion of the capacity of an existing facility that serves the same function as an otherwise new necessary public service in order that the existing facility may serve new development. Facility expansion does not include the repair, maintenance, modernization or expansion of an existing facility to better serve existing development. 4. "Final approval" means: (a) For a nonresidential or multifamily development, the approval of a site plan or, if no site plan is submitted for the development, the approval of a final subdivision plat. (b) For a single family residential development, the approval of a final subdivision plat. 5. "Infrastructure improvements plan" means a written plan that identifies each necessary public service or facility expansion that is proposed to be the subject of a development fee and otherwise complies with the requirements of this section, and may be the municipality's capital improvements plan. 6. "Land use assumptions" means projections of changes in land uses, densities, intensities and population for a specified service area over a period of at least ten years and pursuant to the general plan of the municipality. 7. "Necessary public service" means any of the following facilities that have a life expectancy of three or more years and that are owned and operated by or on behalf of the municipality: (a) Water facilities, including the supply, transportation, treatment, purification and distribution of water, and any appurtenances for those facilities. (b) Wastewater facilities, including collection, interception, transportation, treatment and disposal of wastewater, and any appurtenances for those facilities. (c) Storm water, drainage and flood control facilities, including any appurtenances for those facilities. (d) Library facilities of up to ten thousand square feet that provide a direct benefit to development, not including equipment, vehicles or appurtenances. (e) Street facilities located in the service area, including arterial or collector streets or roads that have been designated on an officially adopted plan of the municipality, traffic signals and rights-of-way and improvements thereon. ARS 9-463.05 A-10 (f) Fire and police facilities, including all appurtenances, equipment and vehicles. Fire and police facilities do not include a facility or portion of a facility that is used to replace services that were once provided elsewhere in the municipality, vehicles and equipment used to provide administrative services, helicopters or airplanes or a facility that is used for training firefighters or officers from more than one station or substation. (g) Neighborhood parks and recreational facilities on real property up to thirty acres in area, or parks and recreational facilities larger than thirty acres if the facilities provide a direct benefit to the development. Park and recreational facilities do not include vehicles, equipment or that portion of any facility that is used for amusement parks, aquariums, aquatic centers, auditoriums, arenas, arts and cultural facilities, bandstand and orchestra facilities, bathhouses, boathouses, clubhouses, community centers greater than three thousand square feet in floor area, environmental education centers, equestrian facilities, golf course facilities, greenhouses, lakes, museums, theme parks, water reclamation or riparian areas, wetlands, zoo facilities or similar recreational facilities, but may include swimming pools. (h) Any facility that was financed and that meets all of the requirements prescribed in subsection R of this section. 8. "Qualified professional" means a professional engineer, surveyor, financial analyst or planner providing services within the scope of the person's license, education or experience. 9. "Service area" means any specified area within the boundaries of a municipality in which development will be served by necessary public services or facility expansions and within which a substantial nexus exists between the necessary public services or facility expansions and the development being served as prescribed in the infrastructure improvements plan. 10. "Service unit" means a standardized measure of consumption, use, generation or discharge attributable to an individual unit of development calculated pursuant to generally accepted engineering or planning standards for a particular category of necessary public services or facility expansions. ARS 9-463.05 A-11 APPENDIX B Fire Analysis FY 2020-21 FY 2021-22 Total Revenues Impact Fees $88,687 $804,979 $893,666 Interest Income 2,737 3,292 6,029 Total Revenues 91,424 808,271 899,695 Expenditures Capital Outlay (120,939) 0 (120,939) Advance Repayments & Debt Service 0 0 0 Total Expenditures (120,939) 0 (120,939) Development (EDUs) FY 2020-21 FY 2021-22 Total Single Family Residential 25 156 181 Multifamily Residential 195 353 548 Commercial/Retail 0 5 5 Office 0 0 0 Industrial/Warehouse 0 1,062 1,062 Public/Institutional 0 0 0 Expenditure Detail (1) Fire Stations (120,939) 0 (120,939) Fire Station Land 0 0 0 Fire Vehicles & Equipment 0 0 0 Record Management System 0 0 0 Total (120,939) 0 (120,939) (1) Represents IIP identified costs for 2020 through 2029 Fire - Northwest Fire - Northwest Fire B-1 FY 2020-21 FY 2021-22 Total Revenues Impact Fees $578,614 $343,258 $921,872 Interest Income 21,934 16,682 38,616 Total Revenues 600,548 359,940 960,488 Expenditures Capital Outlay 0 0 0 Advance Repayments & Debt Service 0 0 0 Total Expenditures 0 0 0 Development (EDUs) FY 2020-21 FY 2021-22 Total Single Family Residential 364 339 703 Multifamily Residential 34 230 264 Commercial/Retail 0 0 0 Office 0 0 0 Industrial/Warehouse 0 0 0 Public/Institutional 549 95 644 Expenditure Detail (1) Fire Stations 0 0 0 Fire Station Land 0 0 0 Fire Vehicles & Equipment 0 0 0 Record Management System 0 0 0 Total 0 0 0 (1) Represents IIP identified costs for 2020 through 2029 Fire - Northeast Fire - Northeast Fire B-2 FY 2020-21 FY 2021-22 Total Revenues Impact Fees $1,536,672 $1,911,956 $3,448,628 Interest Income 39,216 31,482 70,698 Total Revenues 1,575,888 1,943,438 3,519,326 Expenditures Capital Outlay 754,530 1,096,147 1,850,677 Advance Repayments & Debt Service 0 0 0 Total Expenditures 754,530 1,096,147 1,850,677 Development (EDUs) FY 2020-21 FY 2021-22 Total Single Family Residential 1,834 1,553 3,387 Multifamily Residential 377 912 1,289 Commercial/Retail 72 67 139 Office 8 6 14 Industrial/Warehouse 442 1,345 1,787 Public/Institutional 16 4 21 Expenditure Detail (1) Fire Stations 754,530 1,096,147 1,850,677 Fire Station Land 0 0 0 Fire Vehicles & Equipment 0 0 0 Record Management System 0 0 0 Total 754,530 1,096,147 1,850,677 (1) Represents IIP identified costs for 2020 through 2029 Fire - Southwest Fire - Southwest Fire B-3 FY 2020-21 FY 2021-22 Total Revenues Impact Fees $78,111 $209,286 $287,397 Interest Income 4,499 3,658 8,157 Total Revenues 82,610 212,944 295,554 Expenditures Capital Outlay 0 0 0 Advance Repayments & Debt Service 0 0 0 Total Expenditures 0 0 0 Development (EDUs) FY 2020-21 FY 2021-22 Total Single Family Residential 150 18 168 Multifamily Residential 0 0 0 Commercial/Retail 10 420 429 Office 0 0 0 Industrial/Warehouse 0 0 0 Public/Institutional 6 9 14 Expenditure Detail (1) Fire Station - 19th Ave & Chandler Blvd 0 0 0 Fire Vehicles & Equipment 0 0 0 Record Management System 0 0 0 Total 0 0 0 (1) Represents IIP identified costs for 2020 through 2029 Fire - Ahwatukee Fire - Ahwatukee Fire B-4 APPENDIX C Police Analysis FY 2020-21 FY 2021-22 Total Revenues Impact Fees $65,061 $468,964 $534,025 Interest Income 12,230 8,041 20,271 Total Revenues 77,291 477,005 554,296 Expenditures Capital Outlay 0 180,197 180,197 Advance Repayments & Debt Service 0 0 0 Total Expenditures 0 180,197 180,197 Development (EDUs) FY 2020-21 FY 2021-22 Total Single Family Residential 25 156 181 Multifamily Residential 195 353 548 Commercial/Retail 0 5 5 Office 0 0 0 Industrial/Warehouse 0 1,062 1,062 Public/Institutional 0 0 0 Expenditure Detail (1) Police Precincts 0 0 0 Police Station Land 0 0 0 Police Vehicles 0 0 0 Police Radios 0 0 0 Record Management System 0 180,197 180,197 Total 0 180,197 180,197 (1) Represents IIP identified costs for 2020 through 2029 Police - Northwest Police - Northwest Police C-1 FY 2020-21 FY 2021-22 Total Revenues Impact Fees $335,383 $195,905 $531,288 Interest Income 20,110 13,592 33,702 Total Revenues 355,493 209,497 564,990 Expenditures Capital Outlay 0 285,587 285,587 Advance Repayments & Debt Service 0 0 0 Total Expenditures 0 285,587 285,587 Development (EDUs) FY 2020-21 FY 2021-22 Total Single Family Residential 364 339 703 Multifamily Residential 34 230 264 Commercial/Retail 0 0 0 Office 0 0 0 Industrial/Warehouse 0 0 0 Public/Institutional 549 95 644 Expenditure Detail (1) Police Precincts 0 0 0 Police Station Land 0 0 0 Police Vehicles 0 0 0 Police Radios 0 0 0 Record Management System 0 285,587 285,587 Total 0 285,587 285,587 (1) Represents IIP identified costs for 2020 through 2029 Police - Northeast Police - Northeast Police C-2 FY 2020-21 FY 2021-22 Total Revenues Impact Fees $899,380 $1,118,830 $2,018,210 Interest Income 30,644 25,632 56,276 Total Revenues 930,024 1,144,462 2,074,486 Expenditures Capital Outlay 0 519,285 519,285 Advance Repayments & Debt Service 0 0 0 Total Expenditures 0 519,285 519,285 Development (EDUs) FY 2020-21 FY 2021-22 Total Single Family Residential 1,834 1,553 3,387 Multifamily Residential 377 912 1,289 Commercial/Retail 72 67 139 Office 8 6 14 Industrial/Warehouse 442 1,345 1,787 Public/Institutional 16 4 21 Expenditure Detail (1) Police Precincts 0 0 0 Police Station Land 0 0 0 Police Vehicles 0 0 0 Police Radios 0 0 0 Record Management System 0 519,285 519,285 Total 0 519,285 519,285 (1) Represents IIP identified costs for 2020 through 2029 Police - Southwest Police - Southwest Police C-3 FY 2020-21 FY 2021-22 Total Revenues Impact Fees $56,922 $152,289 $209,211 Interest Income 1,600 1,525 3,125 Total Revenues 58,522 153,814 212,336 Expenditures Capital Outlay 0 45,832 45,832 Advance Repayments & Debt Service 0 0 0 Total Expenditures 0 45,832 45,832 Development (EDUs) FY 2020-21 FY 2021-22 Total Single Family Residential 150 18 168 Multifamily Residential 0 0 0 Commercial/Retail 10 420 429 Office 0 0 0 Industrial/Warehouse 0 0 0 Public/Institutional 6 9 14 Expenditure Detail (1) Police Precincts 0 0 0 Police Station Land 0 0 0 Police Vehicles 0 0 0 Police Radios 0 0 0 Record Management System 0 45,832 45,832 Total 0 45,832 45,832 (1) Represents IIP identified costs for 2020 through 2029 Police - Ahwatukee Police - Ahwatukee Police C-4 APPENDIX D Parks Analysis FY 2020-21 FY 2021-22 Total Revenues Impact Fees $224,907 $750,301 $975,208 Interest Income 32,982 17,243 50,225 Total Revenues 257,889 767,544 1,025,433 Expenditures Capital Outlay 0 0 0 Advance Repayments & Debt Service 0 0 0 Total Expenditures 0 0 0 Development (EDUs) FY 2020-21 FY 2021-22 Total Single Family Residential 25 156 181 Multifamily Residential 195 353 548 Commercial/Retail 0 0 0 Office 0 0 0 Industrial/Warehouse 0 76 76 Public/Institutional 0 0 0 Expenditure Detail (1) Park Development 0 0 0 Land Acquisition 0 0 0 Total 0 0 0 (1) Represents IIP identified costs for 2020 through 2029 Parks - Northwest Parks - Northwest Parks D-1 FY 2020-21 FY 2021-22 Total Revenues Impact Fees $694,909 $678,962 $1,373,871 Interest Income 68,098 48,137 116,235 Total Revenues 763,007 727,099 1,490,106 Expenditures Capital Outlay 0 526,212 526,212 Advance Repayments & Debt Service 0 0 0 Total Expenditures 0 526,212 526,212 Development (EDUs) FY 2020-21 FY 2021-22 Total Single Family Residential 364 338 702 Multifamily Residential 34 230 264 Commercial/Retail 0 0 0 Office 0 0 0 Industrial/Warehouse 0 0 0 Public/Institutional 550 8 558 Expenditure Detail (1) Park Development 0 526,212 526,212 Total 0 526,212 526,212 (1) Represents IIP identified costs for 2020 through 2029 Parks - Northeast Parks - Northeast Parks D-2 FY 2020-21 FY 2021-22 Total Revenues Impact Fees $3,115,851 $2,633,254 $5,749,105 Interest Income 128,934 79,730 208,664 Total Revenues 3,244,785 2,712,984 5,957,769 Expenditures Capital Outlay 6,279 762,595 768,874 Advance Repayments & Debt Service 0 0 0 Total Expenditures 6,279 762,595 768,874 Development (EDUs) FY 2020-21 FY 2021-22 Total Single Family Residential 1,834 1,553 3,387 Multifamily Residential 377 912 1,289 Commercial/Retail 4 4 9 Office 1 1 2 Industrial/Warehouse 32 96 128 Public/Institutional 1 0 2 Expenditure Detail (1) Park Development 6,279 762,595 768,874 Total 6,279 762,595 768,874 (1) Represents IIP identified costs for 2020 through 2029 Parks - Southwest Parks - Southwest Parks D-3 FY 2020-21 FY 2021-22 Total Revenues Impact Fees $110,236 $47,730 $157,966 Interest Income 3,937 2,994 6,931 Total Revenues 114,173 50,724 164,897 Expenditures Capital Outlay 0 0 0 Advance Repayments & Debt Service 0 0 0 Total Expenditures 0 0 0 Development (EDUs) FY 2020-21 FY 2021-22 Total Single Family Residential 150 18 168 Multifamily Residential 0 0 0 Commercial/Retail 1 26 27 Office 0 0 0 Industrial/Warehouse 0 0 0 Public/Institutional 0 1 1 Expenditure Detail (1) Park Development 0 0 0 Total 0 0 0 (1) Represents IIP identified costs for 2020 through 2029 Parks - Ahwatukee Parks - Ahwatukee Parks D-4 APPENDIX E Libraries Analysis FY 2020-21 FY 2021-22 Total Revenues Impact Fees $2,945 $47,384 $50,329 Interest Income 5,315 3,488 8,803 Total Revenues 8,260 50,872 59,132 Expenditures Capital Outlay 0 0 0 Advance Repayments & Debt Service 0 0 0 Total Expenditures 0 0 0 Development (EDUs) FY 2020-21 FY 2021-22 Total Single Family Residential 25 156 181 Multifamily Residential 195 353 548 Commercial/Retail 0 0 0 Office 0 0 0 Industrial/Warehouse 0 76 76 Public/Institutional 0 0 0 Expenditure Detail (1) Library Plan Cost 0 0 0 Total 0 0 0 (1) Represents IIP identified costs for 2020 through 2029 Libraries - Northwest Libraries - Northwest Libraries E-1 FY 2020-21 FY 2021-22 Total Revenues Impact Fees $59,061 $55,935 $114,996 Interest Income 12,810 693 13,503 Total Revenues 71,871 56,628 128,499 Expenditures Capital Outlay 0 0 0 Advance Repayments & Debt Service 0 0 0 Total Expenditures 0 0 0 Development (EDUs) FY 2020-21 FY 2021-22 Total Single Family Residential 364 338 702 Multifamily Residential 34 230 264 Commercial/Retail 0 0 0 Office 0 0 0 Industrial/Warehouse 0 0 0 Public/Institutional 550 8 558 Expenditure Detail (1) Library Plan Cost 0 0 0 Total 0 0 0 (1) Represents IIP identified costs for 2020 through 2029 Libraries - Northeast Libraries - Northeast Libraries E-2 FY 2020-21 FY 2021-22 Total Revenues Impact Fees $270,657 $261,847 $532,504 Interest Income 37,824 13,589 51,413 Total Revenues 308,481 275,436 583,917 Expenditures Capital Outlay 0 0 0 Advance Repayments & Debt Service 3,847,320 3,847,320 7,694,640 Total Expenditures 3,847,320 3,847,320 7,694,640 Development (EDUs) FY 2020-21 FY 2021-22 Total Single Family Residential 1,834 1,553 3,387 Multifamily Residential 377 912 1,289 Commercial/Retail 4 4 9 Office 1 1 2 Industrial/Warehouse 32 96 128 Public/Institutional 1 0 2 Expenditure Detail (1) Library Plan Cost 0 0 0 Total 0 0 0 (1) Represents IIP identified costs for 2020 through 2029 Libraries - Southwest Libraries - Southwest Libraries E-3 FY 2020-21 FY 2021-22 Total Revenues Impact Fees $1,052 $3,428 $4,480 Interest Income 2,787 1,840 4,627 Total Revenues 3,839 5,268 9,107 Expenditures Capital Outlay 0 0 0 Advance Repayments & Debt Service 0 0 0 Total Expenditures 0 0 0 Development (EDUs) FY 2020-21 FY 2021-22 Total Single Family Residential 150 18 168 Multifamily Residential 0 0 0 Commercial/Retail 1 26 27 Office 0 0 0 Industrial/Warehouse 0 0 0 Public/Institutional 0 1 1 Expenditure Detail (1) Library Plan Cost 0 0 0 Total 0 0 0 (1) Represents IIP identified costs for 2020 through 2029 Libraries - Ahwatukee Libraries - Ahwatukee Libraries E-4 APPENDIX F Major Arterials Analysis FY 2020-21 FY 2021-22 Total Revenues Impact Fees $2,123,184 $6,751,532 $8,874,716 Interest Income 128,730 103,011 231,741 Total Revenues 2,251,914 6,854,543 9,106,457 Expenditures Capital Outlay 2,962,550 1,572 2,964,122 Advance Repayments & Debt Service 0 0 0 Total Expenditures 2,962,550 1,572 2,964,122 Development (EDUs) FY 2020-21 FY 2021-22 Total Single Family Residential 389 495 884 Multifamily Residential 229 584 812 Commercial/Retail 0 8 8 Office 0 0 0 Industrial/Warehouse 0 1,214 1,214 Public/Institutional 427 74 500 Expenditure Detail (1) Major Arterial Roads 2,789,129 1,572 2,790,701 Culverts 0 0 0 Bridges 173,421 0 173,421 Total 2,962,550 1,572 2,964,122 (1) Represents IIP identified costs for 2020 through 2029 Major Arterials - Northwest Major Arterials - Northwest Major Arterials F-1 FY 2020-21 FY 2021-22 Total Revenues Impact Fees $4,757,343 $7,750,519 $12,507,862 Interest Income 37,054 58,508 95,562 Total Revenues 4,794,397 7,809,027 12,603,424 Expenditures Capital Outlay 2,296,010 109 2,296,119 Advance Repayments & Debt Service 0 0 0 Total Expenditures 2,296,010 109 2,296,119 Development (EDUs) FY 2020-21 FY 2021-22 Total Single Family Residential 1,835 1,545 3,380 Multifamily Residential 377 912 1,289 Commercial/Retail 109 101 210 Office 7 5 12 Industrial/Warehouse 473 1,537 2,010 Public/Institutional 13 3 16 Expenditure Detail (1) Major Arterial Roads 2,296,010 109 2,296,119 Storm Drains 0 0 0 Bridges 0 0 0 Total 2,296,010 109 2,296,119 (1) Represents IIP identified costs for 2020 through 2029 Major Arterials - Southwest Major Arterials - Southwest Major Arterials F-2 APPENDIX G Storm Drainage Analysis FY 2020-21 FY 2021-22 Total Revenues Impact Fees $0 $0 $0 Interest Income 0 0 0 Total Revenues 0 0 0 Expenditures Capital Outlay 0 0 0 Advance Repayments & Debt Service 0 0 0 Total Expenditures 0 0 0 Development FY 2020-21 FY 2021-22 Total Single Family Residential (1) 0 0 0 Multifamily (1) 0 0 0 Retail (2) 0 0 0 Office (2) 0 0 0 Industrial (2) 0 0 0 Public/Institutional (2) 0 0 0 (1) Dwelling units (2) 1,000's of square feet Expenditure Detail (3) NE Phoenix/Rawhide Wash 0 0 0 Total 0 0 0 (3) Represents IIP identified costs for 2020 through 2029 Storm Drainage - Northeast Storm Drainage - Northeast Storm Drainage G-1 FY 2020-21 FY 2021-22 Total Revenues Impact Fees $2,267,955 $2,602,809 $4,870,764 Interest Income 69,158 58,314 127,472 Total Revenues 2,337,113 2,661,123 4,998,236 Expenditures Capital Outlay 1,106 2,333 3,439 Advance Repayments & Debt Service 0 0 0 Total Expenditures 1,106 2,333 3,439 Development (EDUs) FY 2020-21 FY 2021-22 Total Single Family Residential 1,833 1,559 3,392 Multifamily 135 333 468 Retail 61 58 119 Office 8 5 14 Industrial 382 1,033 1,414 Public/Institutional 42 0 42 Expenditure Detail (1) Estrella 1,106 2,333 3,439 Laveen 0 0 0 Total 1,106 2,333 3,439 (1) Represents IIP identified costs for 2020 through 2029 Storm Drainage - Estrella & Laveen Storm Drainage - Estrella & Laveen Storm Drainage G-2 APPENDIX H Water System Analysis FY 2020-21 FY 2021-22 Total Revenues Impact Fees $4,395,444 $12,359,603 $16,755,047 Interest Income 279,378 192,751 472,129 Total Revenues 4,674,822 12,552,354 17,227,176 Expenditures Capital Outlay 365,544 10,102 375,646 Advance Repayments & Debt Service 0 14,000,000 14,000,000 Total Expenditures 365,544 14,010,102 14,375,646 Connections (EDU) FY 2020-21 FY 2021-22 Total Water D Single Family 392 495 887 Multifamily 116 296 412 Commercial/Retail 4 25 29 Office 0 0 0 Industrial/Warehouse 11 890 902 Public/Institutional 107 0 107 Water L Single Family 0 0 0 Multifamily 18 58 76 Commercial/Retail 47 78 125 Office 0 0 0 Industrial/Warehouse 4 11 15 Public/Institutional 18 0 18 Expenditure Detail (1) New Transmission Mains 365,544 10,102 375,646 New Booster Stations 0 0 0 New PRV Stations 0 0 0 New WTP 0 0 0 New Wells 0 0 0 Total 365,544 10,102 375,646 (1) Represents IIP identified costs for 2020 through 2029 Water - Northern Water - Northern Water System H-1 FY 2020-21 FY 2021-22 Total Revenues Impact Fees $15,405,901 $10,408,838 $25,814,739 Interest Income 271,708 228,657 500,365 Total Revenues 15,677,609 10,637,495 26,315,104 Expenditures Capital Outlay 8,794,496 6,743,232 15,537,728 Advance Repayments & Debt Service 0 0 0 Total Expenditures 8,794,496 6,743,232 15,537,728 Connections (EDU) FY 2020-21 FY 2021-22 Total Single Family 1,979 1,675 3,654 Multifamily 191 462 653 Commercial/Retail 68 108 176 Office 11 4 15 Industrial/Warehouse 167 175 342 Public/Institutional 18 0 18 Expenditure Detail (1) New Transmission Mains 8,794,496 6,743,232 15,537,728 New WTP 0 0 0 New PRVs 0 0 0 Total 8,794,496 6,743,232 15,537,728 (1) Represents IIP identified costs for 2020 through 2029 Water - Southern Water - Southern Water System H-2 APPENDIX I Water Resources Analysis FY 2020-21 FY 2021-22 Total Revenues Impact Fees $1,892,318 $2,510,968 $4,403,286 Interest Income 209,353 148,795 358,148 Total Revenues 2,101,671 2,659,763 4,761,434 Expenditures Capital Outlay (15,925) 0 (15,925) Advance Repayments & Debt Service 0 0 Total Expenditures (15,925) 0 (15,925) Connections (EDUs) FY 2020-21 FY 2021-22 Total Single Family 1,472 1,550 3,022 Multifamily 271 423 694 Nonresidential 1,075 1,845 2,920 Expenditure Detail (1) Arizona State Land Department CAP Allocation (15,925) 0 (15,925) New Service Area ASR Wells 0 0 0 Total (15,925) 0 (15,925) (1) Represents IIP identified costs for 2020 through 2029 Water Resources - Off-Project Water Resources - Off-Project Water Resources I-1 APPENDIX J Wastewater Analysis FY 2020-21 FY 2021-22 Total Revenues Impact Fees $18,117,281 $4,804,090 $22,921,371 Interest Income 212,677 88,472 301,149 Total Revenues 18,329,958 4,892,562 23,222,520 Expenditures Capital Outlay 0 0 0 Advance Repayments & Debt Service 0 16,226,928 16,226,928 Total Expenditures 0 16,226,928 16,226,928 Connections (EDUs) FY 2020-21 FY 2021-22 Total Single Family 381 470 851 Multifamily 39 133 172 Commercial/Retail 0 27 27 Office 0 0 0 Industrial/Warehouse 12 993 1,005 Public/Institutional 90 0 90 Expenditure Detail (1) New Sewers 0 0 0 WWTP Expansion 0 0 0 New Force Mains 0 0 0 New Lift Stations 0 0 0 Total 0 0 0 (1) Represents IIP identified costs for 2020 through 2029 Wastewater - Northern Wastewater - Northern Wastewater J-1 FY 2020-21 FY 2021-22 Total Revenues Impact Fees $145,603 $308,211 $453,814 Interest Income 425 1,378 1,803 Total Revenues 146,028 309,589 455,617 Expenditures Capital Outlay 0 0 0 Advance Repayments & Debt Service 0 147,367 147,367 Total Expenditures 0 147,367 147,367 Connections (EDUs) FY 2020-21 FY 2021-22 Total Single Family 5 24 29 Multifamily 127 231 358 Commercial/Retail 0 0 0 Office 0 0 0 Industrial/Warehouse 0 0 0 Public/Institutional 0 0 0 Expenditure Detail (1) WWTP Expansion 0 0 0 Total 0 0 0 (1) Represents IIP identified costs for 2020 through 2029 Wastewater - Deer Valley Wastewater - Deer Valley Wastewater J-2 FY 2020-21 FY 2021-22 Total Revenues Impact Fees $188,586 $258,878 $447,464 Interest Income 722 1,151 1,873 Total Revenues 189,308 260,029 449,337 Expenditures Capital Outlay 0 0 0 Advance Repayments & Debt Service 0 190,593 190,593 Total Expenditures 0 190,593 190,593 Connections (EDUs) FY 2020-21 FY 2021-22 Total Single Family 0 0 0 Multifamily 0 0 0 Commercial/Retail 12 2 14 Office 0 0 0 Industrial/Warehouse 85 111 196 Public/Institutional 0 0 0 Expenditure Detail (1) WWTP Expansion 0 0 0 Total 0 0 0 (1) Represents IIP identified costs for 2020 through 2029 Wastewater - Estrella North Wastewater - Estrella North Wastewater J-3 FY 2020-21 FY 2021-22 Total Revenues Impact Fees $2,324,433 $1,367,143 $3,691,576 Interest Income 119,391 66,987 186,378 Total Revenues 2,443,824 1,434,130 3,877,954 Expenditures Capital Outlay 0 134,762 134,762 Advance Repayments & Debt Service 0 9,739,915 9,739,915 Total Expenditures 0 9,874,677 9,874,677 Connections (EDUs) FY 2020-21 FY 2021-22 Total Single Family 903 548 1,451 Multifamily 171 177 347 Commercial/Retail 30 11 41 Office 12 0 12 Industrial/Warehouse 89 51 140 Public/Institutional 0 0 0 Expenditure Detail (1) New Sewers 0 134,762 134,762 WWTP Expansion 0 0 0 New Force Mains 0 0 0 New Lift Stations 0 0 0 Total 0 134,762 134,762 (1) Represents IIP identified costs for 2020 through 2029 Wastewater - Estrella South Wastewater - Estrella South Wastewater J-4 FY 2020-21 FY 2021-22 Total Revenues Impact Fees $3,261,607 $3,451,896 $6,713,503 Interest Income 89,659 37,826 127,485 Total Revenues 3,351,266 3,489,722 6,840,988 Expenditures Capital Outlay (25,822) 52,489 26,667 Advance Repayments & Debt Service 0 9,901,769 9,901,769 Total Expenditures (25,822) 9,954,258 9,928,436 Connections (EDUs) FY 2020-21 FY 2021-22 Total Single Family 740 831 1,571 Multifamily 76 419 495 Commercial/Retail 22 39 61 Office 0 4 4 Industrial/Warehouse 10 0 10 Public/Institutional 12 0 12 Expenditure Detail (1) New Sewers (17,257) 52,489 35,232 WWTP Expansion 0 0 0 New Lift Stations (8,565) 0 (8,565) Total (25,822) 52,489 26,667 (1) Represents IIP identified costs for 2020 through 2029 Wastewater - Laveen West Wastewater - Laveen West Wastewater J-5 FY 2020-21 FY 2021-22 Total Revenues Impact Fees $232,489 $420,470 $652,959 Interest Income 1,447 1,737 3,184 Total Revenues 233,936 422,207 656,143 Expenditures Capital Outlay 0 0 0 Advance Repayments & Debt Service 0 308,382 308,382 Total Expenditures 0 308,382 308,382 Connections (EDUs) FY 2020-21 FY 2021-22 Total Single Family 179 263 442 Multifamily 0 0 0 Commercial/Retail 0 19 19 Office 0 0 0 Industrial/Warehouse 0 0 0 Public/Institutional 0 0 0 Expenditure Detail (1) WWTP Expansion 0 0 0 Total 0 0 0 (1) Represents IIP identified costs for 2020 through 2029 Wastewater - Laveen East Wastewater - Laveen East Wastewater J-6 FY 2020-21 FY 2021-22 Total Revenues Impact Fees $208,551 $91,321 $299,872 Interest Income 849 749 1,598 Total Revenues 209,400 92,070 301,470 Expenditures Capital Outlay 0 0 0 Advance Repayments & Debt Service 0 217,811 217,811 Total Expenditures 0 217,811 217,811 Connections (EDUs) FY 2020-21 FY 2021-22 Total Single Family 150 10 160 Multifamily 0 0 0 Commercial/Retail 7 43 51 Office 0 0 0 Industrial/Warehouse 0 0 0 Public/Institutional 0 7 7 Expenditure Detail (1) WWTP Expansion 0 0 0 Total 0 0 0 (1) Represents IIP identified costs for 2020 through 2029 Wastewater - Ahwatukee Wastewater - Ahwatukee Wastewater J-7 APPENDIX K Permit Sampling Sample No. Location Receipt Development Type Fee Category App Date Assessed Fee Fee in Effect Difference Notes FY 2020-21 1 Ahwatukee 21021283 Single Family Fire 6/25/2021 $470.00 $470.00 $0.00 2 Northeast 21003304 Multifamily Fire 1/29/2021 2,067.00 2,067.00 0.00 5 units 3 Northeast 21004316 Single Family Fire 2/8/2021 551.00 551.00 0.00 Sample No. Receipt Development Type Fee Category App Date Assessed Fee Fee in Effect Difference Notes FY 2021-22 1 Deer Valley 21042354 Multifamily Fire 12/12/2021 $387.00 $387.00 $0.00 1 unit 2 Estrella-South 21035386 Single Family Fire 10/18/2021 487.00 487.00 0.00 3 Laveen-West 22003763 Single Family Fire 2/1/2022 487.00 487.00 0.00 4 Northwest 22000569 Single Family Fire 1/6/2022 516.00 516.00 0.00 Residential Residential Permit Sampling K-1 Sample No. Location Receipt Development Type Fee Category App Date Assessed Fee Fee in Effect Difference Notes FY 2020-21 1 Estrella-South 21002686 Single Family Library 1/26/2021 $105 $105 $0.00 2 Estrella-South 20029656 Single Family Library 7/30/2020 105 105 0.00 3 Laveen-West 21020373 Single Family Library 7/30/2020 105 105 0.00 Sample No. Receipt Development Type Fee Category App Date Assessed Fee Fee in Effect Difference Notes FY 2021-22 1 Estrella-South 21042373 Multifamily Library 12/13/2021 $79 $79 $0.00 1 unit 2 Laveen-West 21035352 Single Family Library 10/18/2021 105 105 0.00 3 Laveen-West 21031675 Single Family Library 9/20/2021 105 105 0.00 Residential Residential Permit Sampling K-2 Sample No. Location Receipt Development Type Fee Category App Date Assessed Fee Fee in Effect Difference Notes FY 2020-21 1 Estrella-South 20044447 Multifamily Parks 12/4/2020 $3,723 $3,723 $0.00 4 Units 2 Laveen-East 20040461 Single Family Parks 11/3/2020 1,241 1,241 0.00 3 Laveen-West 20033825 Single Family Parks 9/8/2020 1,241 1,241 0.00 4 Northeast 20043486 Single Family Parks 11/25/2020 1,236 1,236 0.00 Sample No. Receipt Development Type Fee Category App Date Assessed Fee Fee in Effect Difference Notes FY 2021-22 1 Estrella-South 21039437 Single Family Parks 11/18/2021 $1,241 $1,241 $0.00 2 Northeast 22001580 Single Family Parks 1/14/2022 1,236 1,236 0.00 Residential Residential Permit Sampling K-3 Sample No. Location Receipt Development Type Fee Category App Date Assessed Fee Fee in Effect Difference Notes FY 2020-21 1 Estrella-South 21017439 Single Family Storm 5/25/2021 $770 $770 $0.00 2 Laveen-East 20040388 Single Family Storm 11/2/2020 1,037 1,037 0.00 3 Laveen-West 20027075 Single Family Storm 7/8/2020 1,037 1,037 0.00 4 Laveen-West 21000155 Single Family Storm 1/4/2021 1,037 1,037 0.00 Sample No. Receipt Development Type Fee Category App Date Assessed Fee Fee in Effect Difference Notes FY 2021-22 1 Laveen-West 21022448 Single Family Storm 7/6/2021 $1,037 $1,037 $0.00 2 Laveen-West 21037188 Multfamily Storm 11/1/2021 601 601 0.00 0.14 acres Residential Residential Permit Sampling K-4 Sample No. Location Receipt Development Type Fee Category App Date Assessed Fee Fee in Effect Difference Notes FY 2020-21 1 Laveen-West 20043062 Single Family Major Arterials 11/23/2020 $1,928 $1,928 $0.00 2 Laveen-West 20046922 Multifamily Major Arterials 12/23/2020 2,892 2,892 0.00 2 units 3 Laveen-West 20046922 Single Family Major Arterials 3/3/2021 1,928 1,928 0.00 4 Northeast 20017676 Single Family Major Arterials 7/14/2020 3,080 3,080 0.00 Sample No. Receipt Development Type Fee Category App Date Assessed Fee Fee in Effect Difference Notes FY 2021-22 1 Estrella-South 22009303 Multifamily Major Arterials 3/15/2022 $1,446 $1,446 $0.00 1 unit 2 Laveen-West 22016863 Single Family Major Arterials 5/6/2022 1,928 1,928 0.00 3 Laveen-West 22006742 Multifamily Major Arterials 2/23/2022 23,136 23,136 0.00 16 units 4 Northeast 22013509 Single Family Major Arterials 4/13/2022 3,080 3,080 0.00 Residential Residential Permit Sampling K-5 Sample No. Location Receipt Development Type Fee Category App Date Assessed Fee Fee in Effect Difference Notes FY 2020-21 1 Estrella-South 20032537 Single Family Wastewater up to 1" 8/25/2020 $3,787 $3,787 $0.00 2 Estrella-South 20038652 Single Family Wastewater up to 1" 10/19/2020 3,787 3,787 0.00 Sample No. Receipt Development Type Fee Category App Date Assessed Fee Fee in Effect Difference Notes FY 2021-22 1 Estrella-South 22000822 Single Family Wastewater up to 1" 1/10/2022 $3,787 $3,787 $0.00 2 Laveen-West 22011000 Single Family Wastewater up to 1" 3/28/2022 3,630 3,630 0.00 Residential Residential Permit Sampling K-6 Sample No. Location Receipt Development Type Fee Category App Date Assessed Fee Fee in Effect Difference Notes FY 2020-21 1 Estrella-South 20033747 Single Family Water Up to 1" 9/4/2020 $4,016 $4,016 $0.00 2 Laveen-West 21010157 Single Family Water Up to 1" 3/29/2021 4,016 4,016 0.00 Sample No. Receipt Development Type Fee Category App Date Assessed Fee Fee in Effect Difference Notes FY 2021-22 1 Estrella-South 22012231 Single Family Water Up to 1" 4/5/2022 $4,016 $4,016 $0.00 2 Laveen-West 21037188 Multifamily Water 11/1/2021 2,788 2,788 0.00 2 units 3 Northeast 21024903 Single Family Water Up to 1" 7/26/2021 6,330 6,330 0.00 Residential Residential Permit Sampling K-7 Sample No. Location Receipt Development Type Fee Category App Date Assessed Fee Fee in Effect Difference Notes FY 2020-21 1 Estrella-South 20034561 Single Family Police 9/14/2020 $285 $285 $0.00 2 Laveen-East 20040461 Single Family Police 11/3/2020 285 285 0.00 Sample No. Sample No. Receipt Development Type Fee Category App Date Assessed Fee Fee in Effect Difference Notes FY 2021-22 1 Estrella-South 21021990 Single Family Police 7/1/2021 $285 $285 $0.00 2 Laveen-East 21033423 Single Family Police 10/4/2021 285 285 0.00 3 Laveen-West 21041572 Single Family Police 12/7/2021 285 285 0.00 4 Northeast 2104903 Single Family Police 7/26/2021 314 314 0.00 Residential Residential Permit Sampling K-8 Sample No. Receipt Development Type Fee Category App Date Assessed Fee Fee in Effect Difference Notes FY 2020-21 1 21010582 Multifamily Water Resource 4/1/2021 $221 $221 $0.00 1 unit Sample No. Receipt Development Type Fee Category App Date Assessed Fee Fee in Effect Difference Notes FY 2021-22 1 21038834 Single Family Water Resource 11/12/2021 $583 $583 $0.00 2 21032872 Single Family Water Resource 9/29/2021 583 583 0.00 Residential Residential Permit Sampling K-9 Sample No. Location Receipt Development Type Fee Category App Date Square Feet DIF/sqft Assessed Fee Fee in Effect Difference Notes FY 2020-21 1 Paradise Ridge 21019289 Pub-Inst Police 6/10/2021 9,247 $0.182 $1,683 $1,683 $0.00 Sample No. Receipt Development Type Fee Category App Date Square Feet DIF/sqft Assessed Fee Fee in Effect Difference Notes FY 2021-22 1 $0.00 Non-Residential Non-Residential Permit Sampling K-10 Sample No. Receipt Development Type Fee Category App Date Meter Assessed Fee Fee in Effect Difference Notes FY 2020-21 1 2016160 Off-Project Water Resource 12/21/2020 4-inch Compound $24,707 $24,707 $0.00 2 21008202 Off-Project Water Resource 3/12/2021 2-inch Displacement 6,584 6,584 0.00 3 21012047 Off-Project Water Resource 4/14/2021 3/4-inch 1,235 1,235 0.00 4 20034860 Off-Project Water Resource 9/16/2020 1.5-inch Displacement 4,114 4,114 0.00 Sample No. Receipt Development Type Fee Category App Date Meter Assessed Fee Fee in Effect Difference Notes FY 2021-22 1 22009844 Off-Project Water Resource 3/18/2022 3-inch Compond $14,416 $14,416 $0.00 2 21032965 Off-Project Water Resource 9/30/2021 1.5-inch Displacement 4,114 4,114 0.00 3 21039704 Off-Project Water Resource 11/192021 1.5-inch Displacement 4,114 4,114 0.00 4 22017428 Off-Project Water Resource 5/10/2022 1-inch Displacement 2,063 2,063 0.00 Non-Residential Non-Residential Permit Sampling K-11 Sample No. Location Receipt Development Type Fee Category App Date Square Feet DIF/sqft Assessed Fee Fee in Effect Difference Notes FY 2020-21 1 $0.00 Sample No. Location Receipt Development Type Fee Category Receipt Date Square Feet SDF/sqft Assessed Fee Fee in Effect Difference Notes FY 2021-22 1 Estrella-North 21024101 Com-Ret Major Arteials 7/20/2021 4,984 $2.35 $11,722 $11,722 $0.00 Non-Residential Non-Residential Permit Sampling K-12 Sample No. Location Receipt Development Type Fee Category App Date Square Feet DIF/sqft Assessed Fee Fee in Effect Difference Notes FY 2020-21 1 $0.00 Sample No. Location Receipt Development Type Fee Category App Date Square Feet DIF/sqft Assessed Fee Fee in Effect Difference Notes FY 2021-22 1 Estrella-South 22004718 Com-Ret Library 2/8/2022 2,200 $0.01 $11 $11 $0.00 Non-Residential Non-Residential Permit Sampling K-13 Sample No. Location Receipt Development Type Fee Category App Date Meter Assessed Fee Fee in Effect Difference Notes FY 2020-21 1 $0.00 Sample No. Location Receipt Development Type Fee Category App Date Meter Assessed Fee Fee in Effect Difference Notes FY 2021-22 1 Estrella-South 22012215 Ind-WH Water 4/5/2022 2-inch Displacement $47,661 $47,661 $0.00 2 Northwest 22020728 Ind-WH Water 6/7/2022 8-inch Compound 735,506 735,506 0.00 Non-Residential Non-Residential Permit Sampling K-14 Sample No. Location Receipt Development Type Fee Category App Date Acres DIF/Acre Assessed Fee Fee in Effect Difference Notes FY 2020-21 1 $0.00 Sample No. Location Receipt Development Type Fee Category App Date Acres DIF/Acre Assessed Fee Fee in Effect Difference Notes FY 2021-22 1 Estrella-South 2212215 Ind-WH Storm 4/5/2002 25 $3,080 $76,815 $76,815 $0.00 Non-Residential Non-Residential Permit Sampling K-15 3190 S. 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