By Carole Hawkins, [email protected]
Builders wouldn’t pay impact fees in Clay County. New homeowners would.
That’s the gist of an idea developer Jerry Agresti floated to the Clay County Commission.
His five-member audience didn’t hate the plan — a rousing success compared to many other concepts put before them.
Clay commissioners met in a January workshop to decide how to fill a $254 million gap in road construction funding. No single option raises enough money.
Ideas on the table:
• Extend past 2019 the one-cent transportation surtax, charged as part of sales tax
• Bring a $5,814 transportation impact fee out of moratorium. It’s a fee charged to builders on each new home for impacts to roads.
• Replace the transportation impact fee with a mobility fee. It’s a fee that charges builders a lower amount when developments are built near commercial centers.
• Add five cents to the gas tax.
• Increase property taxes.
• Charge a utility tax.
Agresti pitched the idea of a Municipal Service Benefit Unit assessment as an alternative to impact fees. The money would be charged to new homeowners on their tax bill for infrastructure built in their geographic area.
Raising money with more taxes and fees is politically tough.
A year-old study by the North Florida Transportation Organization gave commissioners a blueprint for new taxes and fees that could be collected to fund road projects.
But so far, the commission hasn’t acted. Meanwhile road congestion continues to be an issue for the fast-growing county.
At the workshop, a facilitator was brought in to help commissioners reach consensus on how to move forward.
He asked them — What ideas do you want to leave on the table? What do you want to take off the table?
By the end of the four-hour meeting, only two ideas stayed on the list. The one-cent sales tax extension and Agresti’s plan.
The proposal would shift most builder impact fees, including the transportation impact fee, into the MSBU assessment charged to new homeowners. The homeowner could elect to pay $14,000 up front or $881 per year for 20 years.
The cash flow to the county isn’t initially as high as impact fees. The MSBU plan raises only $4.4 million in the first year of collections, compared to about $11 million collected today in impact fees.
But by the sixth year the income stream rises to $8.8 million and becomes bondable, for a multiplying effect, Agresti said.
He also pitched the idea to builders earlier in the month. He called it “a plan that works for us and doesn’t kill the building industry.”
Payments for county infrastructure fall on new homeowners either way, he said, either as impact fees that raise the price of a house and get rolled into a mortgage or as an MSBU assessment on a tax bill.
But by charging the money after a house is bought, it gets builders off the hook for payments. By spreading payments over 20 years, it makes the county less vulnerable to housing booms and busts.
At the workshop, all five commissioners agreed to move forward with both Agresti’s plan and the one-cent sales tax extension.
Commissioner Wayne Bolla said he liked the concept, but wanted the plan reviewed “to fill out the numbers a bit more. “
Commissioner Gavin Rollins said the infrastructure financing method could keep Clay County homes competitive with its neighbor, St. Johns.
Commissioner Diane Hutchings called the one-cent sales tax extension “absolutely necessary.” That measure would raise an estimated $182.9 million over 10 years.
Clay County commissioners decided to move forward with two proposals to help fill the gap in road construction funding.
CURRENT PLAN
Builders are charged (per new home):
• $7,000 school impact fee
• $4,000 utility impact fee
• $5,800 transportation fee (currently in moratorium)
MOVING FORWARD
• A Municipal Service Benefit Unit assessment: Builders would pay $3,517 partial school impact fee per home and new homeowners would pay $14,000 up-front or $881.28 per year for 20 years.
• Extending one-cent transportation surtax, charged as a sales tax. It was scheduled to expire in 2019.