Orange County approves abatement of the CEA process for delayed residential developments

Orange County commissioners voted to abate an old growth management process, relating to school crowding, that has postponed at least 18 residential developments, because it conflicts with a state law that passed last year.

The old capacity enhancement process was a way for developers to move their projects forward if school capacity was not available. The applicant then had the opportunity to seek to enter into a Capacity Enhancement Agreement (CEA), which is a fixed, proportional formula for mitigation payment that goes into a fund for things like leasing school portables.

But House Bill 7103, a state law that passed last year, negates the dollar value of the capital contribution, and put Orange County Public Schools in conflict with a charter provision, originally approved in 2004 by 74 percent of voters and reauthorized by 66 percent of voters in 2012.

“If we just go ahead and say we’ll count that CEA as if we have capacity, it’s problematic,” Teresa Jacobs, Chair of the Orange County School Board, said at a previous school board meeting.

“There’s no additional mitigation,” she said. “This whole idea of saying schools are overcrowded now let’s do a CEA, get the same amount of money and tell our citizens ‘everything’s okay we mitigated it,’ it just doesn’t pass the straight face test at all.”

There are 18 projects on hold — identified by GrowthSpotter in a previous story — while 25 have passed capacity determinations as of May 8, 2020. And without a CEA process in place, developers and local leaders have struggled to follow through with an alternative.

“This is such a multifaceted issue here, and it was a unique situation that really helped Orange County move ahead,” Commissioner Christine Moore said at the meeting. “This is what happens when folks go to Tallahassee and try to do work around.”

Of the 67 counties in Florida, Orange County is unique in terms of having the current growth management process, along with the school overcrowding provisions and the charter. Other counties and municipalities follow school concurrency and utilize school impact fees to deal with overcrowding.

Currently, in Orange County, if projects are not certified by the school board, developers must rely on an undefined multi-jurisdictional approval process as originally contemplated in the charter.

It would require the approval of all significantly affected local governments, only it hasn’t been used by any developers or practiced in any Orange County jurisdiction yet.

At the Orange County commission meeting held Tuesday, commissioners discussed what an alternative may look like in the absence of available capacity, while still trying to preserve the will of the electorate by not rescinding the ordinance they voted for.

But mandating a multi-jurisdictional approval process via an ordinance right away could create uncertainty in the development community.

“One of the cons is that it opens the county up to potential challenges on deferring its land use decisions without a defined process,” Mayor Jerry Demings said. “I think we just end up in an abundance of litigation.”

As part of the solution, Orange County commissioners unanimously voted to abate the 2006 school capacity ordinance, which would essentially hit the pause button on the school capacity process for the 18 projects on hold.

Commissioners also voted to set a six month timeframe for staff to work with municipalities and stakeholders to try to define what the multi-jurisdictional process would look like, modify current standing agreements and bring recommendations back to commissioners and before the public.

The ordinance with the abatement language will now go before a public hearing later this year.

In the midst of this, Orange County is also in the process of updating the school impact fees. Staff recently received a newly updated analysis by Tindale Oliver that is scheduled to go to the school impact fee advisory committee next week.

“When we bring that forward we’ll have that kind of matrix that shows how we fit in and fall in with the other jurisdictions in terms of schools,” Chris Testerman, Orange County director of government relations, said at the meeting.

“We can bring you those comparisons, but they range from $3,000 to $14,000,” he said. “We fall in today’s fees just over $8,000.”

Raising the school impacts fees in areas over capacity, may offer a solution to try to get sufficient funding for schools.

“With HB 7103, even if developers wanted to provide land or they wanted to create a trust to add land to provide to the school board at discounted prices, I think ultimately that legislation would preclude those kind of creative solutions,” Testerman said.

“We are somewhat hamstrung, but we’ll continue to look at creative solutions around our sister states and communities and around the country in terms of providing schools.”

Have a tip about Central Florida development? Contact me at arabines@GrowthSpotter.com or (407) 420-5427, or tweet me at @amanda_rabines. Follow GrowthSpotter on Facebook, Twitter and LinkedIn.