Transportation Impact Fee

The City Council adopted an ordinance on February 26, 2013 which established a Transportation Impact Fee (TIF) for new development and intensified land uses that will fund transportation improvements such as new sidewalks, crosswalks, traffic signal upgrades, transit, and bicycle facilities that are necessitated by the new trips associated with land use change. The fees are based on residential units or commercial square footage. The fee is charged prior to issuance of building permits, unless state law requires the City to accept later fee payment.

The Transportation Impact Fee reflects the costs associated with transportation improvements and the amount of new auto trips that can be attributed to land use changes.

Download Final Nexus Study

Ordinance Establishing the TIF

Current TIF Rates (link to the City's Fees page; select "Planning and Community Development" under "Department" drop-down menu, and "Fees" under "Category" drop-down menu.)

Proposed Update to TIF

Shifting from LOS (Level of Service) to VMT (Vehicle Miles Traveled) is an important step in aligning the development environmental review process with local goals of GHG reduction, No Net New Trips, and housing production. 

However, recently adopted development review exemptions limit the pool of projects subject to the new VMT criteria, thus limiting the potential mitigations in compact, transit-friendly cities like Santa Monica. Balancing the SB 743 goal of GHG reduction with local sustainability and mobility enhancement goals require more than a change in how we conduct transportation review of a limited number of projects under CEQA. It will require parallel investments in local and regional policies and actions to more broadly enable VMT and trip reductions. Changes currently being explored by staff include enhancements to the City’s Transportation Demand Management (TDM) Ordinance and adjusting the Transportation Impact Fee.

As part of the shift to VMT, staff will be reassessing the fees to be VMT-based (rather than trip-based) and reviewing the current rate structure to determine if additional increases are needed to fund transportation projects that address VMT. With the vast majority of future development anticipated to be housing and the knowledge that there are very few TDM strategies that are effective for residential trips, investments in the transportation network, funded through the TIF, will become crucial for the City to be effective in reducing VMT.

Relevant Links