Meeting Type: BCC Work Session
Meeting Date: 7/23/2019
Item Status: New
From: Wayne Dyess, County Administrator
Submitted by: Miranda N. McKinnon, Administrative Support Specialist
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ITEM TITLE
Title
Impact Fee Discussion
Body
STAFF RECOMMENDATION
Recommendation
Discussion - County Administrator, Wayne Dyess, wishes to discuss Impact Fees.
End
BACKGROUND INFORMATION
Previous Commission action/date: N/A
Background: The Baldwin County Commission and municipalities within Baldwin County were authorized to collect impact fees through Senate Bill 296, sponsored by then State Senator Byrne, in 2006. The Impact Fee Bill (Act 2006-300) was passed by the Alabama Legislature in 2006 and codified in the Code of Alabama as §45-2-243 Division 4. Currently, five municipalities (Gulf Shores, Orange Beach, Robertsdale, Summerdale and Fairhope) impact fees. The County performed an impact fee study in 2008, but due to the recession, chose not to implement the impact fee at that time.
In accordance with the Act, impact fees can be collected to offset the impact of new growth on public infrastructure. The impacted public infrastructure subject areas in which this applies is: storm water, drainage, flood control, roads and bridges, capital expenditures related to law enforcement and public safety, fire protection, emergency medical services, public park and recreational facilities, public schools and maintenance and upkeep of facilities or resurfacing of roadways where needed because of the impact of new development.
Impact fees are generally defined as a fee assessed against new development to recoup the costs of required governmental infrastructure needed to support new development. The amount of the impact fee is limited by the act so that the fee charged does not to exceed one percent of the estimated fair and reasonable market value of the new development after completion. For example, a new home with a value of $250,000.00 would pay an impact fee $2,500.00 ($250,000.00 x .01%). Typically, the fee is assessed at Building Permit stage but the Act does allow the collection to occur at the time of the transfer of a lot. The Act also allows for impact fee credits for a developer based on work deemed a “public benefit” in leu of paying the fee. Examples of this could include intersection improvements, land set aside for public parks or schools or similar activities.
In order to collect impact fees, a study must first be performed. This process will require the Commission to determine the governmental infrastructure subject areas they wish to collect an impact fee for i.e. roads or parks. The consultant will then perform the study determine the extent of impacted area geographically and the amount and how the fee is split between chosen subject areas. Typically, an impact fee study will determine where the impact fees can be assessed geographically. It is unlikely that an impact fee could be supported in an area of the County not experiencing growth as the impact fee is to offset the impacts of growth.
Once the study is completed, the County will draft and ordinance with the impact fees and administrative process to collect the impact fee. This ordinance will also contain details of credits, or work deemed a “public benefit” performed by a developer to mitigate demands caused by the development on public infrastructure. It is estimated that an impact fee study will generally take 3-6 months.
Code of Alabama, §45-2-243-81(1) (a, b, c, and d)
Code of Alabama, §45-2-243-81(2)
Code of Alabama, §45-2-243-81(3)
Code of Alabama, §45-2-243-84(a)(1)
Code of Alabama, §45-2-243-84(c)
FINANCIAL IMPACT
Total cost of recommendation: N/A
Budget line item(s) to be used: N/A
If this is not a budgeted expenditure, does the recommendation create a need for funding? N/A
LEGAL IMPACT
Is legal review necessary for this staff recommendation and related documents?
N/A
Reviewed/approved by: N/A
Additional comments: N/A
ADVERTISING REQUIREMENTS
Is advertising required for this recommendation? N/A
If the proof of publication affidavit is not attached, list the reason: N/A
FOLLOW UP IMPLEMENTATION
For time-sensitive follow up, select deadline date for follow up: N/A
Individual(s) responsible for follow up: N/A
Action required (list contact persons/addresses if documents are to be mailed or emailed): N/A
Additional instructions/notes: N/A