Manatee County vote increases impact fees. Did developers and homebuyers get a break?

Manatee County commissioners recently voted to adopt a 50% increase in impact fees over the next four years.

Impact fees are one-time fees paid by developers that help support the cost of infrastructure required by new development, including roads, sewer lines and emergency services. The fees must be spent in the part of the county where they are collected.

But critics say the county is letting developers off the hook and potentially missing out on millions in infrastructure improvements by not seeking a bigger increase.

Under Florida law, impact fees can only be increased once every four years. The maximum increase allowed is 50% — unless the county commissions a study showing “extraordinary circumstances” that merit a higher increase.

The county commissioned a study by Tampa consulting company Benesch in 2023 that helped shape the new impact fee schedule.

Kruse, residents push for higher impact fees

Commissioner George Kruse, who cast the only vote against the new impact fee schedule, argued that the study justified a much higher increase than 50%. By his calculations, the county will miss out on almost $585 million in potential impact fees over the next five years.

“We are not increasing to the maximum allowable by the state,” Kruse said. “They allowed for a maximum above the 50%,” he said of state legislators, who updated impact fee laws in 2021. He pointed to other counties that have raised impact fees over the 50% maximum.

Kruse made a motion for county staff to write a report demonstrating the “extraordinary circumstances” needed to explore a higher impact fee increase, but he did not receive support from his fellow commissioners.

Several residents who submitted written comments or spoke during public comment also asked county leaders to reconsider the new impact fee schedule and seek higher rates.

David Dean, a Myakka resident, called the county’s decision not to seek higher fees a break “for the rich and powerful.”

“For four more years, you’re locking us into this. It would be better to table this vote today and come back with a full impact fee ... rather than continue to dig a financial and infrastructural hole that we, Manatee County citizens, pay for while the developers walk away with all the profits,” Dean said.

“Developers paying their fair share of the costs not only alleviates the financial burden on existing residents but also promotes sustainable growth,” said Diana Shoemaker, a Democrat who is running for the District 3 commission seat.

Commissioners: Time to ‘move forward’ with impact fees

But the county attorney’s office advised that commissioners would have to begin the process of adopting new impact fees from scratch if they opted to pursue higher rates, including holding more public workshops and meetings.

Other commissioners said it is not a process they are willing to start over again.

Commissioner Amanda Ballard looked up Citrus County’s study to justify impact fees higher than 50% and reported to the board that it was a three-month process.

“I’m not for extending this again,” said Commissioner Mike Rahn. “I believe we’re at the right place at the right time to move what we have forward. It’s just going to delay the process even further to take the chance that we might have a consultant say we have extraordinary circumstances in Manatee County.”

Rahn also argued that developers would pass on the cost of higher impact fees to home buyers with higher prices.

Kruse countered that Manatee County residents may wind up subsidizing infrastructure upgrades to a greater degree under the county’s current plan. He pointed to a June budget workshop where staff said the county is facing a budget shortfall that will cause some infrastructure upgrades to be delayed.

Staff also suggested floating $300 million in bonds to cover the shortfall. Kruse said that would put all Manatee County taxpayers on the hook to pay off debt for new infrastructure to support development in East Manatee County — unlike impact fees that are only collected from the area where the development is occurring.

“Only the people who benefit from the impact fees are the ones paying those impact fees. But what you’re proposing is to charge the collective Manatee County to do the improvements. Even the people ... who aren’t going to benefit,” Kruse said.

Commissioners voted 5-1 to adopt the new fee schedule, which will incrementally increase impact fees by 50% from 2025 to 2028.

For example, to build a 1,200-square-foot single-family home in Northeast Manatee County, a developer currently pays $6,093 in impact fees. That amount will now increase to $8,183 by 2028.

Manatee County Government collected over $62 million in impact fees last year, according to public records.

This story was originally published August 19, 2024 at 5:50 AM.