IMPORTANT NEWS ON IMPACT FEES:
What are impact fees? Impact fees are fees collected by developers to cover the cost of providing infrastructure like roads and libraries for incoming residents. Impact fees are simply the cost of doing business in an area.
What is the problem? As stated in prior newsletters, impact fees charged in Forsyth County do not come close to covering the cost for new infrastructure. To add insult to injury, the Georgia State Constitution does not allow developer impact fees to be charged at all.
News on impact fees updates: Over the past several months, a County Commissioner appointed Impact Fee Committee has been meeting and evaluating the recommendations of a taxpayer funded private study by Duncan and Associates. The Committee, made up of more than 50% representatives of the development industry, recently made their recommendations to the County Commissioners. Due to the makeup of the Committee, it is no surprise to anyone that the average taxpayers on the Committee were overruled with regards to the timing of implementation for the new fees. On Thursday, November 19th, there will be a public hearing on impact fees. This is a chance for taxpayers to stand up and be heard. Information about this hearing is posted below under “Mark Your Calendars.”
Road Impact fees are the point of contention here. Currently Forsyth County does not charge ANY road impact fees. We get right of way donation during the zoning process. Under the recommended process, we would charge Impact Fees, and give them a credit for fair market value of the right of way donated.
Commissioner Tam is sure to bring up (as he already has at a work session) “Well we got 5 miles of Windermere Parkway for free under the old system. It costs $1M a mile.” He, of course, picks an extreme example and what sounds like a large number to try to defend the old system. What he will not mention is Windermere had 3,000 homes and at $7k per home in Road Impact Fees, the County would have had $20M in total fees and $15M after paying for Windermere Parkway to put towards the other roads the Windermere residents would drive on.
A zero sum gain: These impact fees only maintain our current level of service. They are a direct expense to new development for the cost of new development. They are not placing an undue burden on new development. Given our current traffic congestion, we can’t afford to get behind any further. We must maintain our current level of service, and impact fees are the fairest way to do this.
Without them, the cost is still there: The infrastructure need placed on the system by these new homes does not go away if we discount impact fees.
Therefore, any discount in fees is a subsidy: Every penny not charged in impact fees will be passed along to other citizens. This is corporate welfare with current home owners subsidizing the development industry in the form of increased taxes and/or bonds.
IMPACT FEES ENSURE TAXES STAY LOW!
School impact fees are illegal in Georgia, so developers are still getting a HUGE discount to do business in Forsyth: Even if we charge the full impact fee allowed by law, the law does not allow impact fees for schools. Of course, this should be changes as the burden of new school construction is tremendous. However, until that time, even with the full impact fees recommended by the study, the developers are still being subsidized by tax payers.
Vesting: The Developers are going to push to allow any zoned lot to be grandfathered in as long as they get their land disturbance permit (LDP) in 2 years. That means we will not collect any road impact fees for 5-7 years, as they will front load the LDP process to avoid the fee, and a development normally takes 3 years to complete anyway. This is not acceptable. Milton just implemented new impact fees and they went into place overnight. We need to do the same.
Nominal Fee: The average new home size in Forsyth County is 3,190 square feet. The full road impact fee is $2.85 per square foot. The difference between what the developers proposed (50% of the fee) and the full fee is $1.43 per foot. If the average home sells for $150 a square foot, we are talking about less than a 1% delta between what we are asking for and what the developers are asking for.
The difference between what we are asking for and what the developers already agreed to is only about $15 on a 30 year mortgage!
Pass Through: This cost will be passed through to new home owners, most of who will pay for it over 30 years, if they stay in the home that long. We know most will not, so the actual cost is paid for by a few different home owners over a long period of time.
Claims this will hurt the development industry are false: See the rebuttal letter for quotes from multiple studies stating Impact Fees have little to no impact on the rate of growth. This is proof we are not calling for fees to somehow punish the development industry.
Conclusion: Impact fees are a pure and just form of taxation. They tax a direct consumption/use and apply the tax to the use. The law requires money collected for road impact fees will be used for roads within 6 years or it must be refunded. This is as “pure” of a tax that we have, it’s a direct application of tax to burden.
Any Impact Fee not collected gets paid by us… the taxpayers. This has been happening for years, and it is time for that to stop. Any Impact Fee paid by you and I is subsidizing the development industry, and is unjust corporate welfare.