Determine the appropriate, not arbitrary, amount to be paid.
Investment and new development requires the government to balance a number of competing desires. It is important to encourage new investment into the community, which creates and maintain jobs, increases the tax base, and contributes to an economically healthy community. At the same time, since this development is a change in the status quo, it is also important to ensure that the new development does not diminish quality of life for our existing residents and that the new development pays its fair share for any impact to our infrastructure. This is why appropriate impact fees are part of this balance.
Impact fees are not taxes. They are assessed based on a determination of the potential impact of new development on the capacity of the infrastructure, including roads, parks, water, sewer and other items that government provides. The goal is to ensure that development pays for its impacts and that the infrastructure of a community is not negatively affected by new growth. So, as an example, although a development may cause new residents to move into a certain area, the impact fee payment allows for government to provide for additional infrastructure to maintain existing capacity and level of service with the new residents. I believe this is fair.
However, impact fee rates must be based on studies that provide a scientific basis for determining the actual impacts caused by development. If the cost of those impacts increases, and that is established via an appropriate study, then the cost of the fees should be increased appropriately. Of course, the same would apply if the cost of impacts were reduced.
It is logical that the cost of impacts has potentially increased since the last review. The cost of construction has gone up dramatically, so impact fees may rise. This is part of the social compact that protects property rights, encourages a good economy, but also mitigates the impact of our growth.
It is clearly important that the public understands that development pays the full costs of its impacts and that the amount paid is appropriate. It is also important that the public understand that much of the existing capacity issues and problems were created prior to impact fees or, more often by traffic from other communities traveling to our tourist destinations and not contributing to resolving those impacts. This is a major issue as communities around our area continue to grow and utilize our roadways. This may be why a proposed sales tax, which is paid in large part by tourists, may eventually be a very appropriate method to add income for road construction.
Although it is not appropriate for impact fees from new development to be charged for more than their actual impacts, it is appropriate to continue to review and update the impact fee schedule to determine the appropriate, not arbitrary, amount to be paid. I believe most of the development industry and the public would agree with that fair standard. A process that allows the county to direct an updated impact fee study would then allow the adoption of the findings of that study and continue to provide for new development to pay its own way and maintain our quality of life and a growing economy.
Storch is a real estate and land-use attorney in Daytona Beach.