Development Impact Fees are a monetary exaction, other than a tax or special assessment, which is charged by a local governmental agency to an applicant in connection with approval of a development project. The purpose of these fees is to defray all or a portion of the cost of public facilities related to the development project. The legal requirements for enactment of a development impact fee program are set forth in Government Code § 66000- 66025 (the "Mitigation Fee Act"), the bulk of which was adopted as 1987's Assembly Bill (AB) 1600 and thus are commonly referred to as "AB 1600 requirements".

The City must develop a five-year report, and update every five years thereafter, making the following findings with respect to any remaining funds in the fee account, regardless of whether those funds are committed or uncommitted:

Requirement 1. Identification of the purpose to which the fees are to be put.

Requirement 2. Demonstration of a reasonable relationship between the fee and the purposes for which they are charged.

Requirement 3. Identification of all sources and amounts of funding anticipated to complete financing in incomplete improvements identified as part of the City’s annual report.

Requirement 4. Identification of the approximate dates on which the funding referred to in Requirement 3 is expected to be deposited into the appropriate account or fund.