Key points:
- Staff concluded that it is premature to require a microgrid in the Village Farms and Willowgrove projects.
- Staff recommends project-specific traffic impact fee program for the developments.
- Staff recommends applicants bear costs for traffic fee program and microgrid decision.
DAVIS — The Davis City Council on Tuesday will receive a staff presentation outlining policy considerations for two major peripheral projects, Village Farms Davis and Willowgrove, and is expected to provide direction on traffic impact fees and climate and energy issues tied to those developments.
Staff, led by Community Development Director Sherri Metzker, Economic Development Director Katie Yancey, and Public Works Director Ryan Chapman, recommended that the council pursue a project-specific traffic impact fee program and defer the question of requiring a community microgrid until the city’s General Plan update is complete.
The recommendations reflect staff’s efforts to balance new state housing and climate mandates with the city’s aging policy framework, while also responding to the immediate need to process applications for the two large housing projects on the edge of Davis.
At the heart of the report is the question of how the city should handle roadway impact fees for Village Farms and Willowgrove. Both projects have completed traffic analyses conducted by the consulting firm Fehr & Peers. The firm provided the city with two options: a citywide update of transportation impact fees, which would cost $360,000, or a focused update specific to the two projects, which would cost $185,000.
Staff recommended the less costly and narrower approach, known as Alternative 2. Under this option, the fee program would be developed only for Village Farms and Willowgrove and would be based on the issues identified in their Local Traffic Analyses.
The report noted that the costs of the study should be paid by the applicants for the two projects, not by the city.
A citywide fee update could still occur after the completion of the General Plan update, which is currently in its early stages. Staff said that a broader update would provide a more comprehensive framework for future growth, but given the urgency of processing these two projects, a focused update would be faster and more efficient. The report noted that because the projects are outside current city limits, the city’s existing fee programs and master plans do not cover the infrastructure improvements they would require.
Historically, Davis has not extended its development impact fee programs to unincorporated areas in anticipation of annexations. That practice has created challenges when peripheral projects come forward for approval. Without an updated system, staff warned, the city risks making ad hoc decisions that lack consistency and equity across different projects.
The second major question before the council concerns climate resilience and energy policy, particularly whether the city should require Village Farms and Willowgrove to include a community microgrid.
The city’s 2001 General Plan, which remains the overarching policy framework, encourages energy-efficient development but does not address newer concepts like microgrids or solar farms. Since then, the state has significantly expanded building and energy codes, including requirements that all new single-family and multifamily construction be solar-ready.
In 2023, the Davis City Council adopted the 2020–2040 Climate Action and Adaptation Plan, which set out more ambitious goals for reducing carbon emissions, investing in renewable energy, and improving grid resiliency. That plan calls for exploring community solar and microgrid options but does not specify who should develop, own, or manage such systems. Staff concluded that it is premature to require a microgrid in the Village Farms and Willowgrove projects.
The Draft Environmental Impact Report for Village Farms has already been circulated, and adding a microgrid requirement would force a rewrite and recirculation of the document. Staff recommended deferring the issue until the General Plan update is complete, when the city will have a clearer policy foundation. As with the traffic impact fees, staff recommended that the costs associated with deferring the microgrid decision be borne by the applicants, not the city.
Much of the staff report highlights the limitations of the city’s current General Plan, which was adopted in 2001 to guide growth through 2010. While some elements have been updated — including the Transportation Element in 2013 and the Housing Element in 2023 — the overall plan is outdated and does not reflect many of the state laws and policy priorities that have emerged over the past two decades.
The California Constitution requires cities to maintain comprehensive and regularly updated general plans as the foundation for land use decisions. Staff noted that in the last decade alone, state laws have significantly changed the landscape for local governments.
The dissolution of redevelopment agencies in 2012 stripped cities of a key tool for financing affordable housing. The 2017 Housing Accountability Bills reshaped how cities must plan for housing and emphasized the role of local governments in accommodating regional growth.
In the current RHNA cycle, which runs from 2021 to 2029, Davis was assigned 2,075 units — nearly double its previous obligation. Another key change was AB 602, enacted in 2021, which overhauled how cities conduct and justify their development impact fee programs.
Davis last updated its development impact fees in 1998, amended them in 2002, and last indexed them for inflation in 2009. Staff underscored that the city’s fee structure is overdue for a major update.
Staff said that even if the city were to maintain the 2001 General Plan’s overall vision, it must still reconcile these external factors when considering new projects. Without a unifying framework, staff warned, the process for approving peripheral projects is unduly burdened and inconsistent.
The report outlined three types of direction the council could provide for both traffic and climate policy. The council could defer the issues until the General Plan update is complete, handle them in an ad hoc manner as each project comes forward, or halt processing of any peripheral project applications until the General Plan and related documents are updated.
Staff did not recommend the third option, saying it would effectively put all annexation projects on hold. Instead, they recommended a mix of deferral and project-specific solutions: a focused fee program now, and postponement of the microgrid issue until the broader General Plan process can address it.
Under the recommendations, the costs of both the traffic fee program and the deferred microgrid decision would be paid entirely by the applicants for Village Farms and Willowgrove. Staff stressed that these costs should not fall on the city.
The recommendations, staff wrote, are consistent with several of the City Council’s stated goals: shoring up the housing continuum, maintaining high-quality infrastructure and services, strengthening climate resilience, and achieving greater fiscal stability.
The council’s decisions on Tuesday will not finalize either project but will provide crucial direction for how staff engages with the applicants and structures the approval process. The broader context is the city’s need to reconcile outdated planning documents with newer state mandates, climate goals, and housing pressures.
With Village Farms and Willowgrove already moving through the review process, the council must decide how to manage immediate project needs without undermining the longer-term effort to update the city’s General Plan.
The outcome of Tuesday’s workshop could shape how Davis handles peripheral growth for years to come, particularly as the city grapples with rising housing obligations, infrastructure demands, and the imperative to transition toward a more resilient and sustainable energy system. The Davis City Council is scheduled to take up the item at its September 30 meeting.
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