Flagler County Commission Extends Impact Fee Moratorium

GoToby.com spoke in support of the extension and the elimination of impact fees during the public comment portion of the agenda. Read comments.

Palm Coast, FL – October 8, 2014 – Citing an economy that has turned around but not quite yet robust, the Flagler County Commission on Monday extended its moratorium on County Impact Fees for another year.

Referencing a tepid recovery, County Commissioner Barbara Revels put it in plain English, “This is a no-brainer.” She got support from several members of the public who spoke at the County’s regular Commission meeting Monday October 6, 2014.

“Fees do affect the decision to build,” Commercial Developer Mark Langello said.

GoToby.com's public comment summary:

Impact fees are like red light cameras, Each is more about revenue than they are about control. The most common argument in favor of impact fees is the one claiming that growth should pay its own way. That argument resonates particularly well in Western and Southern states where growth has been the greatest. It also explains why most states that have enacted legislation to implement impact fees are from those regions.

History tells us that during the period of the county’s greatest growth period, the increase in total taxable value, fueled by both new construction and rising prices, greatly outpace population growth, allowing the county and Palm Coast to enjoy significant budget increases while holding tax rates steady.

I have several problems with impact fees in general:

1. Studies used to support the need and size of impact fees are typically performed by consultants who notch their guns and enhance their reputations by justifyoing the largest fees. The result is often a fee structure that aggressive and capricious.
2. Residential mpact fees are regressive, with the greatest burden falling on individuals with the least  ability to pay.
3. Impact fees increase the cost of both residential housing and commercial property.
4. By increasing housing costs, impact fees artificially inflate the “value” of all housing and commercial buildings and skew the area’s affordability index.
5. By reasing the price of new construction, impact fees increase construction financing costs.
6. Impact fees are an impediment to economic development, They discourage migrating businesses, start-ups and companies wishing to expand their local presence.

Impact fees are imposed by the government. Payment of impact fees is not optional. Sounds kind of like a tax, doesn’t it?

An average single family residential home pays approximately $1,700 in County Park and Transportation impact fees, but the real impact is in commercial construction. A convenience store or gas station will pay $17,000 for each 1,000 square feet of space in County transportation impact fees at the time of construction.

The County isn’t the only entity that charges impact fees. Cities in Flagler County and the Flagler County School Board also charge impact fees. Flagler County is the only entity that put their impact fees on hold during the recession until the economy improves. Revels said there is some evidence that the move has boosted construction in the County versus Palm Coast.

Impact fees are used to offset the “impact” directly related to new developments. Under state law, use of the proceeds of impact fees is limited to new roads and other improvements to serve the new development. For example, park impact fees can be used to provide new parks and park expansion but cannot be used for repairs to existing parks.

Flagler County Commission voted unanimously to extend the moratorium for one year. It will expire next year if not renewed by the County Commission.