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Capacity Fee Deferral Program

On Monday, October 27, 2025, the City Council approved the expansion of the City's Water and Sewer Capacity Fee Deferral Program to extend beyond the Central Business District to all commercial zoning districts (CBD, CG, CH, CO, CN, IL, or IH). The Program is designed to help small, locally owned businesses overcome one of the biggest early hurdles by allowing qualified businesses to defer upfront water and sewer capacity fees for up to five years, with repayment secured over time instead of all at once. 

Eligible small businesses include:

  • Food service businesses (restaurants, cafés, coffee shops, and tasting rooms, small eateries)

  • Retail and specialty goods businesses (visitor-serving shops, boutiques, galleries)

  • Arts, cultural, and creative uses (studios, cultural spaces, maker spaces)

  • Neighborhood-serving businesses (salons, fitness studios, bookstores, personal services)

  • Commercial Office Zones

  • Light manufacturing and artisan production, such as kombucha and vinegar producers, coffee roasters,
    bakeries, craft beverage makers, and makerspaces (with a cap on the total amount deferred) 

To keep the program focused on truly local enterprises, eligibility is limited to: 

  • Businesses with 25 or fewer full-time equivalent employees

  • Annual gross receipts of $3 million or less

  • Project valuation of $2.5 million or less

  • Locally owned and operated businesses (national chains and large franchises are not eligible)


How the Program Works
The Capacity Fee Deferral Program is:

  • Voluntary – Businesses can choose whether or not to participate

  • Time-limited – The program is available for new applications through June 30, 2027; deferrals may only be requested in connection with building permits issued between June 30, 2025 and June 30, 2027.

  • Structured & Secure – Deferred fees are documented in a recorded agreement and must be repaid, with simple interest, over time. 


Key features include:

  • Deferral Term: Up to 5 years from Certificate of Occupancy or project completion

  • Interest: Simple (non-compounding) interest tied to market rates

  • Security: Recorded lien or agreement to ensure repayment

  • Annual Program Cap: Approximately $200,000 total deferrals per year, to protect the City’s enterprise funds


This expansion is consistent with the City’s Strategic Plan and Business Expansion, Attraction, and
Retention (BEAR) strategy, and aligns with SB 937, which authorizes cities to defer impact and capacity
fees for qualifying projects.

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Apply
Read our Program Guidelines to find out more information.
Download the Application Form here or ask for a hard copy in person at City Hall. Email completed applications to ed@fortbraggca.gov or drop them off with Economic Development Department staff in person at City Hall.​​

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