BY MARK J. CRAWFORD
Starke has green lit an updated impact fee study, which could lead to fees on new development to pay for growth.
Jerry Dabkowski, vice president for Florida governmental services at ICE Infrastructure Consulting and Engineering, appeared to discuss the process updating a prior study to reflect the rising infrastructure costs.
Reading from the statutory definition, Dabkowski said, “An impact fee is a one-time capital charge levied against new development. An impact fee is designed to cover the portion of capital costs of infrastructure capacity consumed by the new development.”
Simply put, growth, whether residential or commercial, places demand on public infrastructure, sometimes requiring expansion. There is more traffic on the streets. There are additional calls for emergency services. More space may be needed for parks and recreation. Water and wastewater systems may need additional capacity.
Rather than expect the public to pay for these costs, impact fees place that responsibility on developers, whether it’s a retail franchise opening a new location or a family building their dream home. Governments can use these fees as a source of revenue to carry out their capital improvement plans.
Dabkowski said he was before the commission to focus on roadway impacts. Determining an impact fee involves looking at trip generation rates to and from a new development as well as the length of the trips to and from the site. Consultants also take into consideration the cost to construct each lane mile, the price for which has been “going through the roof, he said.
Prior impact fees enacted but the city commission in 2007 for roads, parks, police, fire and public buildings were $3,080 for every new home constructed, while fees for businesses were based on size and intensity. A new restaurant would have paid more than $7,300 for every 1,000 square feet, while a restaurant with a drive-thru window would have paid more than $10,000.
Starke placed a moratorium on impact fees in 2013 as a way of incentivizing new development. Updated fees have been considered since then but never adopted.
Since then, Dabkowski said there has been a “dramatic change” in construction costs.
“Concrete is what I would call out of control. Asphalt is the highest it’s ever been. Trying to buy right of away. All those types of things are very, very expensive right now. So, you could even look at, say, a restaurant with a drive-thru maybe 5,000 square foot. You might be looking at an impact fee of $100,000,” he said, estimating it’s what Wawa would have paid had the fees been in place before that project got started.
Commissioner Danny Nugent asked about the residential costs, since those fees are typically passed on to buyers and affect housing prices. Without providing a number, Dabkowski said the cost would also take into consideration trip generation and length as well as housing size. Exemptions could only be granted for affordable housing, according to Chris Brimo, a principal planner working for Infrastructure Consulting and Engineering. As for increasing the cost for home buyers or renters, it also depends on the market, he said.
“Some markets have not felt that — they have still grown and expanded — and some markets have contracted a little bit because of those increases in the fees where developers have not put in. But you know, overall, Florida has grown substantially in the residential housing market. So, I don’t know specifically for the city of Starke how your how your numbers are, but yes, it does have an impact,” Brimo said.
The city could also offer credits to developers who contribute in other ways such as donating property or creating community parks, thereby lowering their impact fee, he said.
Commissioner Bob Milner said the city is beyond the real estate market crash of 2008 and beyond the COVID pandemic, and while growth is not exploding here as it has elsewhere, Starke is growing. He said he supports having impact fees because the fees are paid by newcomers, not an additional tax on existing residents and businesses. People who have lived here for years, paying taxes and utility bills, shouldn’t also have to bear the cost of building or improving roads to accommodate growth, he said.
“I welcome the growth. You all know my stance on economic development. We’re all after it, but there’s got to be some semblance of fairness in who pays for that, without the rest of us absorbing and subsidizing all of that new growth,” Milner said.
Commissioner Scott Roberts agreed, saying that Starke’s fees don’t have to be the highest or the lowest. Determining what is fair will be up for debate, he said.
Mayor Andy Redding agreed.
“Impact fees are not meant to be punitive. They’re not meant to suppress growth, but it’s a preparation for the future, and it’s somewhat of a pay to play, pay it forward kind of thing. And that way the people, as Commissioner Milner said, are not negatively impacted for being here, and it gives us a plan forward,” he said.
Redding called for a motion for staff and legal counsel to work with the consultants in preparing an up-to-date impact fee study. With all commissioners present in agreement, the motion passed 4-0.
