Title
District 2 Enhanced Infrastructure Finance District (EIFD) Discussion
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FileID
File ID: 2026-00666
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Location
Location: District 2
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Recommendation
Recommendation: Review, comment, and provide direction to proceed with a District 2 Enhanced Infrastructure Finance District (EIFD) fiscal impact analysis.
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Contact
Contact: Amanda Wallace, Development Project Manager, (916) 808-5453, awallace@cityofsacramento.org; Leslie Fritzsche, Economic Investment Manager, (916) 808-5450, lfritzsche@cityofsacramento.org; Office of Innovation and Economic Development
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Presenter
Presenter: Amanda Wallace, Development Project Manager, (916) 808-5453, awallace@cityofsacramento.org, Office of Innovation and Economic Development
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Attachments
Attachments:
1-Description/Analysis
2-Council District 2 Map
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Description/Analysis
IssueDetail
Issue Detail: Many parts of District 2 lack basic infrastructure such as curbs, gutters, sidewalks, street lighting, and parks. Public infrastructure in areas ripe for commercial development and infill housing is inadequate or undersized, making it extremely difficult to attract private investment which can support commercial, mixed-use, and housing development the community needs and wants. There is no identifiable, ongoing, and predictable public funding source available to meet the requirements for improvements or additions to public infrastructure. An Enhanced Infrastructure Financing District (EIFD) is one public financing tool that the City has used in other areas of the city such as Aggie Square and the Railyards to fund public improvements which could be considered in District 2. An EIFD is a type of special financing district that utilizes a portion of tax increment revenue from a specific area to finance capital facilities or other specified projects of communitywide significance that provide significant benefits to the area within the EIFD or the surrounding community.
At the request of Councilmember Dickinson, the City’s Office of Innovation and Economic Development Staff worked with Economic Planning Systems, Inc. (EPS) to conduct a preliminary analysis to assess the financial potential of a District 2 Enhanced Infrastructure Financing District. Initially staff looked at inclusion of the entire district but soon realized the infeasibility of that approach since the general cost of City services would exceed the potential revenue these land uses would generate. Focusing next on just the commercial properties in the district, EPS estimated that this more focused EIFD could generate more than $240 million (2025 Net Present Value) over a 50-year period. This estimate does not take into consideration the cost to provide City services to the new development in those areas which would result from conducting a fiscal impact analysis.
On December 9, 2025, the Council District 2 office submitted a Councilmember Proposal Request for Committee Consideration to the Budget and Audit Committee requesting consideration of a District 2 EIFD. The Budget and Audit Committee subsequently passed a motion directing the appropriate council appointive officer to commence work on the proposed District 2 Enhanced Infrastructure Financing District with committee members and forward to the City Council for consideration without further review from the Committee.
Given this direction by the Budget and Audit Committee, staff developed cost estimates for initiating more detailed work on a potential District 2 EIFD that focuses on key development areas. Since EIFDs work most effectively for areas that have high potential for growth, staff has begun work to analyze the commercial areas in District 2 that have the highest opportunity for significant investment as the most viability for inclusion in an EIFD. Revenue generated from those areas could still be used in nearby areas, as long as an areawide community benefit could be identified.
Staff now seeks Council direction to proceed with a District 2 EIFD comprehensive fiscal impact analysis to determine with greater certainty the financial feasibility of a proposed District 2 EIFD. This analysis would require the development of a preliminary set of boundaries; development assumptions to estimate revenue; and an analysis of the cost to provide City services for that additional development. Following completion of the fiscal impact analysis, Staff will return to present the findings and potential boundaries of the district to Council and request further direction on bringing forward a Resolution of Intention to move forward with EIFD formation. That report would also outline the estimated cost to proceed with EIFD formation, which is currently anticipated to be between $250,000 and $300,000.
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PolicyConsiderations
Policy Considerations: Economic development was identified as a Council priority. An EIFD in North Sacramento could provide a stable, growing, and predictable source of funding for investment in public infrastructure, which would reduce the cost of private development and potentially incentivize investment in new commercial, mixed-use, and residential projects in a part of the city which has faced significant underinvestment and development challenges for many years. The study would determine if revenues generated by the EIFD would be greater than projected City services costs. Property tax increment assigned to the EIFD would go to the district instead of the General Fund, so EIFD’s would be a viable tool for development that would not happen but for the infrastructure funded by the EIFD.
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EconomicImpacts
Economic Impacts: Not applicable.
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EnvironmentalConsiderations
Environmental Considerations: This report seek input and direction on a potential Enhanced Infrastructure Financing District and is an administrative activity and is not a project under the California Environmental Quality Act (CEQA) per CEQA Guidelines Section 15378(b)(5).
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Sustainability
Sustainability: Establishment of an EIFD in North Sacramento would contribute to the City’s climate action goals by supporting growth in infill areas, revitalizing existing neighborhoods, and creating conditions that encourage active transportation and use of public transportation.
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Commission/Committee Action
Commission/Committee Action: On December 9, 2025, the Budget and Audit Committee passed a motion directing the appropriate council appointive officer to commence work on the proposed District 2 EIFD with committee members and forward to the City Council for consideration without further review from the Committee (File ID: 2025-01981).
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Rationale for Recommendation
Rationale for Recommendation: Council direction will provide clear guidance to staff that furthering work on a D2 EIFD is serving the Council as a whole and in alignment with Council priorities.
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FinancialConsiderations
Financial Considerations: To date the City has spent $9,000 on consultant costs and approximately 65 personnel hours to complete the initial feasibility analysis. The more in-depth fiscal impact analysis proposed in this report would involve outside consultant work estimated at $35,000; approximately 20% of a staff person’s time from both the Office of Innovation and Economic Development and the Infrastructure Finance Division of the Finance Department and 10% of corresponding management’s time for approximately three months; and approximately 5 hours of Information Technology Geographic Information Systems staff time. Sufficient funding is available (Innovation and Growth Fund, Fund 2031) in the Enhanced Infrastructure Financing District Project (I02000520) to support the fiscal impact analysis.
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LocalBusinessEnterprise
Local Business Enterprise (LBE): Not applicable.
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