Fresno Adopts Vehicle Miles Traveled Fees, Alters Development Costs

The Fresno City Council approved a new Vehicle Miles Traveled policy on Nov. 6, 2025 after extended debate, voting 4 to 2 with one abstention to adopt a fee framework that assesses charges on some new residential projects and large commercial developments outside the urban core. City staff reported a baseline VMT fee of $295 that can multiply depending on a project specific VMT analysis, a formula that may raise costs by thousands or even tens of thousands of dollars per unit for some developments. Large commercial projects greater than 50,000 square feet could face substantially higher assessments depending on location and traffic impacts.

Council members framed the measure as a tool to steer development inward and reduce vehicle travel, encouraging infill projects that align with local land use and climate goals. City staff emphasized that in some respects the council adopted a less stringent threshold than state guidance, and that the policy includes proposed exemptions and options to phase payment timing to ease immediate impacts on certain projects. The ordinance establishes a process for project specific VMT analyses that determine final fees, creating a variable outcome for applicants.

Builders and developers who attended the meeting said they were surprised by the speed of the council action and by limited outreach leading up to the vote. Local industry representatives cautioned that the complexity of the fee formula and the need for project specific data make it difficult for developers to estimate liabilities in advance. Several developers said the policy could stall projects already in the pipeline or shift planned investment to neighboring cities with different fee structures, potentially reducing new housing supply within Fresno.

Business groups and experts who reviewed the approach described the assessment calculation as complex and hard to apply without detailed traffic and land use data. That difficulty raises concerns about predictability for builders and potential administrative burden for city staff tasked with reviewing VMT analyses. The council and staff signaled that implementation details, including exemption criteria and payment schedules, will be refined as the city begins applying the policy to pending and new projects.

For Fresno residents the immediate implications include possible impacts on housing affordability and the pace of construction. If fees substantially raise per unit costs, they could be passed through to buyers or renters or deter some developments entirely. Conversely, city leaders argue the policy could help concentrate growth in areas with existing services and transit, reducing long term traffic congestion and emissions.

The council vote sets a new regulatory environment for development outside Fresno's central neighborhoods. Developers, planners and community groups will be watching implementation closely as the city moves from adopting policy to applying fees to specific projects and as staff refines administrative procedures.