County to consider raising impact fees
Published in Cape Coral Daily Breeze Feb. 27, 2015 issue
The Lee County Board of County Commissioners will begin its discussions about a possible impact fee increase this Tuesday during a public hearing.
“I can only hope that it goes well,” Commissioner Frank Mann said of the public hearing. “I’m nervous to say the least.”
The current fees are set at 20 percent of the estimated cost of constructing such things as roads, parks and schools necessitated by growth.
Building Industry Association Executive Vice President Brenda Thomas said they would love the impact fees to remain at 20 percent because they feel the market is still emerging.
“People who have been struggling for more than five years to find a job are now going to be threatened. That is hard to take,” she said.
The biggest issue the Building Industry Association is having right now is the uncertainty of where the impact fee rate will fall.
“Builders are in contracts with homeowners right now and they don’t know what to put in the contract,” Thomas said of impact fees.
The fees were reduced 80 percent two years ago when the commission agreed to a temporary reduction to spur the economy.
“The reason we changed it (was) while the building industry was on its back, but those days are gone,” Mann said. “Permits for construction are flying off the shelves. The industry is very healthy and alive and the impact fees need to be restored.”
The starting point for Tuesday’s hearing would bring the charges on new construction up to 45 percent of cost or more than double the current amount charged.
While commissioners will start their conversation at the 45 percent rate, county staff is recommending that the commission provide a 15 percent discount, or 85 percent of cost, which would bring the fee from $2,900 to $11,000 on a new home.
If the county commissioners approve 45 percent impact fees, Thomas said it will have a very negative impact on the building industry at this point.
“At 45 percent, you are looking at almost a $3,200 increase for a single family home, depending on which is the basis point for 45 percent,” she said.
Mann said he is in favor of restoring back to 100 percent because Lee County desperately needs revenue for new infrastructure because thousands of people are moving into the area and permits for new homes are up again.
Thomas, on the other hand, said although they are seeing an increase, they are not on “fire yet” regarding the number of permits pulled. She said a lot of the permits have been for multi-family apartments and commercial properties.
Mann said where ever he goes, he has 100 percent support on his position from the residents of Lee County.
“I knew it was the right thing to do from the beginning,” Mann said, adding that overwhelming support from the community it only reaffirms his belief.
Mann voted against the one-year reduction with the option for a second year in March 2013.
At 100 percent, including a cost adjustment, the fee would be $12,985 to build a new home. At 85 percent the fee would be $11,116 for a single family home. Currently, at 20 percent, the fee is $2,942.
“It worked very well for 20 years, so why would we change that?” Mann asked. “It needs to be a part of our revenue stream now. Impact fees have never kept anyone from moving here. The 20 years we have had them was the fastest expansion period in the history of the county.”
Mann said he does not see how it is fair to ask residents of Lee County to subsidize its growth requirements when there is a perfect example of a program that works – impact fees.
“It’s only fair that growth pays for growth, and the new people coming here pay for the roads and school classrooms they are demanding,” he said.
School Board member Steve Teuber said the school board voted unanimously to support 100 percent restoration.
“We had three things happen over the last five years, which was kind of the perfect storm,” he said.
Property values declined over those five years, the school district’s capital millage was cut from 2.0 mills to 1.5 mills and the County Commission reduced impact fees, including those for schools, by 80 percent.
Teuber said $640 million was lost in potential income. He said the district is carrying a $450 million capital debt with an annual debt service of $42 million.
“We need money from any source possible,” Teuber said.
He said if the school district gets $9 million from impact fees, they still need $300 million more.
“Nine million isn’t going to make the road,” Teuber said. “We need about $40 million a year.”
Even with an increase in impact fees, the school board’s needs still are not met.
“I certainly know that whatever the Board of County Commissioners do is not going to be the answer,” he said.
With that said, Teuber expressed that the school board wants the county commission to do what they feel is right based on their collaborative work.
“If they give us 55 percent, we are going to say thank you very much,” he said.
Thomas said the biggest issue is the commissioners have a big infrastructure need in Lee County and Southwest Florida. She said impact fees are just a small portion of solving that problem.
The impact fee covers only the new infrastructure that would have to be built to accommodate additional population.
By law, the money collected from impact fees cannot be used for maintenance or regular government operations. The money can only be used to add capacity. In other words, the funds can be used to add a lane to a road, but not to repave a road. They can be used to construct a new bridge but not repair an old bridge.
Thomas said the amount of money that it would take to fix road congestion could not be solved with impact fees. She said the traffic congestion on 41 or on the way to the beach could not be fixed with impact fees.
“Many issues we are facing cannot be solved with one solution,” Thomas said. “You don’t want to solve a problem by hurting someone else. A true community solves the problem together.”
Thomas said another issue with raising impact fees is the effect it will have on the valuation of all properties in Lee County.
She said the issue at hand is how do they manage growth in a productive way that leads to a better, more user friendly community without taking the No. 1 economic drivers and throwing them under the bus.
“Raising impact fees to the maximum will not fix the problem,” Thomas said.
The board will meet at 9:30 a.m. in the Commission Chambers, 2120 Main St,. Fort Myers.