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1. What are transportation impact fees?

Transportation Impact Fees ensure that new development and redevelopment pays a proportional fair share contribution for the cost of new transportation infrastructure that is deemed necessary and reasonably related to accommodating the impact of new development within the City limits of Menlo Park.  State law allows cities to impose Transportation Impact Fees on new development to help effectively manage the growth of our community.  Menlo Park has implemented a Transportation Impact Fee system by City ordinance (#964, Municipal Code Section 13.26) with associated transportation impact fees imposed on new development and redevelopment since October, 2009 and updated in December, 2019.  The types of developments subject to the Transportation Impact Fee are: 

1. All new development in all land use categories identified in the City’s zoning ordinance
2. Any construction adding additional floor area to a lot with an existing building
3. New single-family and multi-family dwelling unit
4. Changes of use from one land use category to a different land use category.

2. How much do transportation impact fees cost?

The Transportation Impact Fees are adjusted each year, based on the ENR Construction Cost Index % for San Francisco.  As an example, a new single family detached residential house that generates 1.00 p.m. peak vehicle trips/unit would be charged a Transportation Impact Fee of $15,973.62.

3. Is there any way to pay less transportation impact fee?

Yes.  If a project produces less transportation impact, then there is a corresponding reduction in Transportation Impact Fee cost.  The Public Works Director may adjust the fee imposed in consideration for certain facilities or improvements constructed or paid for by the developer.  A developer is entitled to credit for the reasonable cost of the improvements, as determined by the Senior Transportation Engineer, if the improvement was identified in the Transportation Impact Fee Study.

For new construction, a developer shall receive credit toward the fee based on the gross floor area of existing buildings and/or the number of residential units which are being demolished and the predominant historical use as determined by the Senior Transportation Engineer.

For a change of use, a developer shall receive credit toward the fee based on the gross floor area of existing buildings and/or number of residential units for which there is a change of use based on the predominant historical use as determined by the Senior Transportation Engineer.

4. When are transportation impact fees paid?

Fees are paid in full to the City of Menlo Park before a building permit is issued.  

5. Do transportation impact fees change?

Yes.  The Transportation Impact Fees are adjusted each year, based on the ENR Construction Cost Index % for San Francisco.  Rates are updated July 1st of each year.  Contact the City Transportation Department at 650-330-6770 for the latest fee rate schedule.  The City is also posting the rate schedule on the website.

6. What are transportation impact fees used for?

Transportation Impact Fees may only be used for building new arterial streets, sidewalks, bicycle lanes, and other physical improvements to the City’s multi-modal transportation network.  New development and redevelopment means more people making capacity demands on the transportation system and the collected Transportation Impact Fee money may be used for publicly-funded city-wide transportation projects on municipal Transportation Improvement Programs (TIPs) that are reasonably related to the impacts of development and urban growth.  Menlo Park’s Transportation Impact Fees are collected and allocated to transportation projects that add multi-modal capacity to the overall transportation network.  Transportation Impact Fees cannot be used for street maintenance, transportation, administration, or transportation demand-management programs, such as car-pooling, incentives for non-auto commuting, or additional transit bus service hours.

7. When a developer pays the fee, will they be required to provide any additional transportation improvements to mitigate project impacts?

Yes.  By paying the fee, a development project will have contributed their “fair share” to mitigating their project’s impacts to the Citywide transportation system.  Additionally, a development project may be conditioned to provide local transportation and streetscape improvements to mitigate the local impacts caused by that development. Staff will calculate rates if the rate is not shown on the table below.

Current Rate Schedule
Land Use	Unit	2020 Fee Amount*
Office	Sq. Ft.	$18.55
Research and Development	Sq. Ft.	$7.91
Manufacturing	Sq. Ft.	$10.81
Warehousing	Sq. Ft.	$3.07
Restaurant	Sq. Ft.	$10.81
Retail	Sq. Ft.	$10.81
Single Family	Units	$15,973.62
Multi-family	Units	$5,383.85
Hotel	Room	$9,680.98
Medical Office	Sq. Ft.	$55.83
Childcare	Sq. Ft.	$0.00
Secondary Dwelling Unit	Units	$0.00
* As of June, 2020, ENR Construction Cost Index % Change for San Francisco = 5.4
If land use is not one of the above, use this formula: $16,134.97 * Total PM Peak Hour Trips