Commission to make decisions on impact fees
By Jake Martin
Posted at 6:20 AM
St. Augustine Record
St. Johns County commissioners are expected to make some decisions regarding possible adjustments to impact fees for residential and commercial development Tuesday.
Impact fees —levied on developers to offset the costs of providing additional public services to new developments — and concurrency agreements pay for much of the recent growth the county has seen, at least in theory.
It’s unclear what any increase in residential or commercial impact fees would actually do, but many in the county feel that the current fee schedule isn’t stopping, or even curbing, the negative effects of the county’s rampant growth.
Many current residents see the fees as a fair way to pay for the increased strain on roads, schools, fire/police services and parks. While builders have argued that increasing the fees too much could negatively impact the county’s ability to attract business and new residents, jeopardizing future job growth and tax revenue.
At the board’s Feb. 20 meeting — which included a review of an impact-fee assessment from consultant James C. Nicholas — commissioners expressed some hesitation about raising impact fees on commercial building. Considering economic development has consistently been identified as the board’s priority from year to year, the hesitation is not surprising.
Nicholas’ study called for increases in impact fees for commercial building by about 75 percent in some categories.
Commission Chair Henry Dean said he couldn’t support the fee schedule as proposed and said the best course of action, instead, would be to reduce non-residential impact fees by 40 percent.
According to county documents, a 40 percent reduction would result in flat or reduced impact fees for 14 non-residential categories and modest increases ranging between 3.7 and 18.8 percent in the remaining 12 non-residential categories. This would have an annual budget impact of about $725,000, but Dean and others believe the financial benefits of attracting new or expanded businesses would offset whatever is lost by reducing the fees.
Should the board opt to reduce commercial impact fees, it must identify which revenue sources to use in order to subsidize the reduced rates.
Dean also said that about 87 percent of the county’s ad valorem property tax revenues comes from residential properties. The state average is 65 percent.
Commissioner Jeb Smith spoke favorably of Dean’s plan to reduce non-residential impact fees by 40 percent and added that he thinks non-residential concurrency fees should be abolished altogether. It’s unclear what that would cost the county in terms of lost revenue.
Residential fees would be recast from using two size categories — 1,800 square feet and under, and over 1,800 square feet — to seven size categories. These new categories break down as follows: under 800 square feet; 801 to 1,250 square feet; 1,251 to 1,800 square feet; 1,801 square feet to 2,500 square feet; 2,501 to 3,750 square feet; 3,751 to 5,000 square feet and over 5,001 square feet.
Most residential developments would see an increase in what they contribute toward services provided by the county, ranging between 15 and 68.9 percent. Only homes under 800 square feet would be paying less, with an 11 percent decrease overall. Others would see increases ranging from about 3.1 percent (for homes 1,801 to 2,500 square feet) to 68.9 percent (for homes 5,000 square feet and up).
At the request of several builders, the board is weighing the possibility of phasing in the updated residential fees, except for schools, over time.
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