Developer fees are fees that are paid by property owners and developers to school districts to mitigate the impact created by new development within a school district's boundaries on the school facilities. Fees are typically paid to the school district as a condition of a property developer or owner obtaining a building permit from the city or county for a construction project.
Level 1 (Developer Fee Justification Study) are established by the State and are considered the basic mitigation fee. Justification for the fee can be shown if anticipated residential, commercial and industrial development within a district will impact it with additional students. The SAB adjusts the rates every two years. The current rates adopted February 23, 2022 are $4.79 per square foot for residential construction and $0.78 per square foot for commercial/industrial construction. SAB will adjust Level 1 Fees on January 24, 2024. The proposed new rates are $5.17 per square foot for residential construction and $0.84 per square foot for commercial/industrial construction.
Level 2 (School Facilities Needs Analysis) apply solely to residential construction. More specifically the Level 2 fee is intended to represent fifty percent of a school district's facility construction costs per new home served, and is applicable when the SAB is apportioning state school facility funding to school districts. Level 2 studies are valid for 12 months.
To qualify for Level 2 fees the school district must meet two of the following four requirements:
30% of students on Multi-Track Year Round
Capital facility debt at 15% of bonding capacity
Held a bond election in the last four years and received at least 50% plus one vote yes
At least 20% of the district's classrooms are portables
Annual and Five Year Developer Fee Fund Report: Government Code requires that an annual report of income and expenditures from developer fees and the beginning and ending fund balances in the Capital Facilities Fund be made available to the public within 180 days, after the end of each fiscal year. Government Code 66001 requires a five year report if there are any funds remaining in the Fund at the end of the prior fiscal year.