Manatee County commissioners ensured future growth pays its own way by approving an increase in county impact fees, which bankroll the cost of new infrastructure and certain services that land development brings with new residents and businesses. Despite displeasure from homebuilders and developers, this follows long-standing county policy.
The increase offsets the reductions the county wisely granted when the real estate market crashed during the Great Recession. Commissioners aimed to spur the market and encourage economic development with the lower impact fees but growth continued to sputter then.
But on Thursday commissioners took a somewhat slow glide path by raising the fees first by 80 percent of the amount recommended by a consultant starting in April. The levy will increase to 90 percent the second year and reach 100 percent the third year. Thus, the fee hike will not shock the market all at once.
During the public comment period before the 5-2 commission vote, members of the construction industry advanced an argument that the economy has not completely rebounded and the recommended increase could harm the homebuilding industry.
While that is a possibility, the facts point to a thriving industry. The Manatee-Sarasota market is heading toward a three-year high in the number of construction permits issued. The markets in both counties are surging this year. Through August, Manatee issued more than 1,500 permits, up 7 percent over 2014. Homebuilders are enjoying robust sales. Lakewood Ranch sits in the epicenter of the boom.
Commissioner Robin DiSabatino suggested the county has to look at other funding streams, too. Ideas on options to supplement impact fees should be put on the table now with developers and builders a part of the conversation.
Fees will be determined by the size of the house or commercial building and its location in the county.
Manatee County resident Ed Goff said at the commission meeting that impact fees are "an investment. People that are getting these services and infrastructure should be paying for services and infrastructure."
This Editorial Board has long advanced that argument as the justifiable way to pay not only for new roads and other additional transportation costs, but also for increased outlays that growth causes in law enforcement, public safety and parks. New this year is a library fee, and a branch in Lakewood Ranch would be a boon for residents.
County Administrator Ed Hunzeker recommended the commission adopt impact fees at only 90 percent of the amount proposed in the TischlerBise study. Larry Bustle, John Chappie, Robin DiSabatino, Charles Smith and Carol Whitmore voted for the 80-90-100 percent plan while Vanessa Baugh and Betsy Benac favored Hunzeker's 90 percent mark. The construction industry found no friends on the commission.
While some developers and builders urged the commission to delay the fee vote to allow for more discussion and seek alternative solutions, this issue has been a hot topic for almost a year -- giving builders plenty of time for input. The county's process has not been a rush to judgment, and fresh ideas on alternatives should have been advanced before the vote. But there's still time.
The county could ill-afford to delay action and miss out on impact fee revenue during a strengthening market. Discussions on alternatives will take time, likely quite a bit, too. Putting off a vote on the levy increase would be costly.
The worrisome aspect to the hike is Manatee County apparently will rise from one of the Gulf Coast counties with the lowest fees to a county with some of the highest. Options to supplement and lower impact fees are warranted.
County government and commissioners have built a business-friendly environment over the years, encouraging economic development at every turn. Whether the increase in impact fees stalls the real estate market remains to be seen. Nonetheless, today's vibrant market should pay its own way while additional revenue mechanisms are considered.
For the record, Hunzeker clarified an issue that current property owners often misconstrue. Since he became Manatee's administrator, the county has never put property tax revenue into the Capital Improvement Program to pay for infrastructure.
"We don't supplement with property taxes any infrastructure construction," Hunzeker said Tuesday. Current property taxpayers "are not subsidizing new growth on the capital side. We just built less."
On another matter, the commission is slated to consider school impact fees at the Jan. 7 Land Use meeting. The school board is recommending a 50-75-100 percent glide path. Commissioners hold approval power over school levies.