Lake Commissioners considering 500-percent hike to road impact fee

Lake County Commissioners are scheduled to vote June 5 on an ordinance that could more than quintuple transportation impact fees across two thirds of the county, matching the rates now charged in the southern third of the county and bringing them closer to those charged by neighboring jurisdictions.

The transportation impact fee for a new 1,500-square-foot single family home could go from $500 to $2,706. New apartments would be charged $1,240 per unit, up from $229.

The current impact fees are the lowest in the region by far, but both the Greater Orlando Builders Association and Apartment Association of Greater Orlando told GrowthSpotter that such a large increase should be phased in incrementally.

"We can all agree that probably an increase is warranted, but 500 percent all at once is a pretty bitter pill to swallow,"  AAGO President Chip Tatum said on Wednesday.

Commissioner Josh Blake has already said he would oppose any fee hikes, and even voted against setting the public hearing. Commissioner Wendy Breeden has questioned whether the fees should be uniform countywide. All of the cities and towns in Lake County also participate in the county program.

"I've talked to some people in the Central District, and they're not seeing the same growth pressures that the Clermont area is and the Mount Dora-Sorrento area is," she said during the May 22 board meeting.

County Attorney Melanie Marsh told commissioners they could adopt the ordinance Tuesday with a lower impact rate than what was published if they choose.

But Commissioner Sean Parks said the higher fees charged in the county's South District have not impeded new development. "I've yet to see a subdivision not be built because of our impact fees," he said.

The county implemented the higher impact fees in the South District in 2014 after having suspended all impact fees for three years. But the rates in the Central and North districts are so low they generated around $700,000 last year.

County Engineer Fred Schneider said the county has $22 million in necessary impact fee-funded road projects in the Central District and $41 million in the North District. The county has already maxed out its gas tax to pay for road maintenance, he added.

"We don't have another revenue source to build roads, and I think the board recognizes there is additional growth coming in some of these areas they'd like to be prepared for," he told GrowthSpotter.

Commissioners already voted May 22 to eliminate the longstanding practice of accepting pre-payment of impact fees, so the window has closed for developers to pre-pay the lower fee prior to the ordinance unless they pull a building permit before the ordinance takes effect Sept. 15.

Tara Tedrow, a land use attorney with Lowndes, Drosdick, Doster, Kantor & Reed, said elimination of the pre-payment option could dramatically change the proformas for developers who have projects in the pipeline.

"Moreover, if financing has been secured for projects based on the projected rates under the old fee structure, this increase could lead to setbacks for developers," she said. "The more expensive it is to do business in a jurisdiction, the more difficult it becomes to attract development of all sizes."

Payment of impact fees for commercial and industrial buildings are only to be collected when the county issues a Certificate of Occupancy (CO) for the building. For residential construction, the fees can be deferred for 12 months after the issuance of a building permit.

In August, commissioners will hold a workshop to discuss transitioning to a mobility fee program, which allows greater flexibility in how the money is spent. They also could consider adding more categories to differentiate between different types of non-residential uses.

For example, the new county-wide impact fee for all commercial and retail uses would be $3,080 per 1,000 square feet. Most of the other counties in the region charge different rates based on the size of the project and/or the use.

"We need to look at what types of uses are statistically variant from the norm," Schneider said. "We need to provide fairness."

The Lake County proposal follows votes earlier this year in Orange, Osceola and Seminole counties to raise impact fees on new development.

Have a tip about Central Florida development? Contact me at lkinsler@GrowthSpotter.com or (407) 420-6261, or tweet me at @LKinslerOGrowth. Follow GrowthSpotter on Facebook, Twitter and LinkedIn.