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Business Owner's Appeal Stirs Fee Review
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A Riverbank business owner appealing system development fees has persuaded city council members to review all development fees with a view to their reduction.

Leonard Lovalvo of Thunderbolt Lumber Treatment came before the council on May 14 to protest the imposition of $26,250 in fees for streets/public works, water, wastewater, and storm drain and police/general government services.

City Development Services Director J.D. Hightower argued Lovalvo has replaced a building of 1,600 square feet that was damaged by a fire with a 4,950 square foot post metal beam building. While giving full credit for fire damage replacement, his department had correctly charged for 3,350 square feet of new development.

However, he added, the fees may be unduly high because in the 2007 fee update study, the fees were based on an predicted annual population growth rate of 3.5 percent between 2005 and 2020. But the latest draft study by the eight county Central Valley Council of Governments revised the predicted growth rate down to only 1.4 percent.

The fee study recognized the need to reevaluate the study every two or three years but this hasn't yet been done due to workforce and budgetary constraints.

Hightower's initial recommendation was to deny the appeal and require the full $26,250 in fees. But seeing the poor economy undoubtedly has reduced the growth rate, he suggested the alternative of maintaining a lien on the property and having Thunderbolt agree to pay a fee based on what the city expects the growth rate to be according to the COG forecast.

City officials expect a revised study of system development fees by a consultant to take a couple of months, after which the applicant will be responsible for paying the adjusted fee.

Lovalvo said he had done business in this community for more than 40 years, the current poor economy was not helping business and he strongly objected to having a lien placed on this property. Consulting attorney for the city Doug Smith said liens are a recognized legal method of preventing sale or transfer of property while there is a financial issue unsettled but a lien in no way damages credit worthiness or reputation. Council members decided to leave the lien in place.

Lovalvo also noted a large part of the development fees (about $12,000) was assigned to street development and the city assumed the new industrial building space would generate 23 more average daily trips. However, this building is a warehouse for drying lumber and he did not expect any new traffic as a result of its construction.

As a warehouse, the building also has no water pipes and no bathroom, he added in querying fees levied for the city's water capital investment. Hightower noted the building is a fire risk, Lovalvo has agreed to pay fire impact fees but now is appealing a water system fee that is an essential fire prevention tool.