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HomeMy WebLinkAboutAgenda - 03-21-1995 - VII-A 1 1 ORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: March 21, 1995 Agenda Abstract Item # SUBJECT: PUBLIC HEARING - PUBLIC SCHOOL IMPACT FEE DEPARTMENT: Planning PUBLIC HEARING: —X—Yes No ATTACHMENT(S): INFORMATION CONTACT: Advertisement Planning Director X2592 Proposed Ordinance Amendments Table 13 - May, 1993 Technical Report PHONE NUMBERS: Mayor Broun 2/22/95 Letter Hillsborough 732-8181 Mebane 227-2031 Durham 688-7331 Chapel Hill 967-9251 PURPOSE: To receive citizen comment on a proposed increase in the public school impact fee and proposed amendments to the Educational Facilities Impact Fee Ordinance. BACKGROUND: At its December 20, 1994 meeting, the Board of Commissioners received the Annual Report on Educational Facilities Impact Fees. Subsequently, the Board considered proposed amendments to the Educational Facilities Impact Fee Ordinance at its January 12, 1995 Work Session. The Board decided to present the following amendments at public hearing. • Amend Section 3, School Impact Fees Imposed on New Residential Dwelling Units, by increasing the amount of the public school impact fee from$750 to$1,000 per residential dwelling unit. This change has been requested because of higher public school construction costs.If the Board wishes to increase the impact fee, it may be justified on the basis of the fees calculated in the Technical Report prepared in May, 1993 (see attached Table 13). • Amend Section 4, Public School Impact Fee Exceptions, subsection 4, to include exception provisions for replacement units: where the original dwelling unit was destroyed by natural catastrophe;and where a dwelling unit was located on a lot or space during the five (5)year period prior to the effective date of the ordinance. • Amend Section 4, Public School Impact Fee Exceptions, subsection 6, to include text format changes. • Amend Section 5, Collection of Fees, subsection C, Limitation on Expenditure of Funds,to:reflect changes to the enabling legislation which permit impact fees to be used for debt service payments and payments under leases; and extend the time frame within which impact fees must be expended from five (5) years to 10 years from date of collection. The expenditure time frame is proposed for expansion to reflect the fact that both School Districts have prepared 10-year capital improvement ii s 2 programs for school construction. • Amend Section 5, Collection of Fees, subsection E, Reimbursement of Fees, to add a provision to permit reimbursement of fees collected in error or where an exception has been granted. Though not addressed through proposed ordinance amendments, the issue of affordable housing was raised at the Commissioners'December 20, 1994 meeting. Habitat for Humanity and Orange Community Housing Corporation requested that a policy regarding reimbursement of impact fees be established for homes purchased by families earning less than sixty percent of median income. Such reimbursements may be accomplished through special appropriations to such agencies,following submission of a funding request as part of the County's annual budget process. The Habitat request was considered at the January 12 Work Session, and the Board decided to consider the policy question at one of its regular meetings. Copies of the proposals are provided as attachments to the abstract. RECOMMENDATION: As the Board decides. ORANGE COUNTY PLANNING DEPARTMENT 306F REVERE ROAD 3 HILLSBOROUGH, NORTH CAROLINA 27278 NOTICE OF PUBLIC HEARING ON PROPOSED AMENDMENTS TO THE ORANGE COUNTY EDUCATIONAL FACILITIES IMPACT FEE ORDINANCE Pursuant to the requirements of the General Statutes of North Carolina, Chapter 153A, Article 18, Sections 323, 331, and 340; Chapter 460 of the 1987 Session Laws; Chapter 324 of the 1991 Session Laws;and Chapter 642 of the 1993 Session Laws,notice is hereby given that a public hearing will be held in the Community Meeting Room of the OWASA Operations Center, 400 Jones Ferry Road, Carrboro, North Carolina, on Tuesday, March 21, 1995, at 7:30 p.m.for the purpose of giving all interested citizens an opportunity to speak for or against the following item: PUBLIC SCHOOL IMPACT FEES Effective July 1, 1993,the Board of County Commissioners established a system of impact fees to help fund a portion of the school capital needs created by growth in the county.Since that date,an impact fee of$750 has been collected for each new housing unit constructed or installed in the county, including single-family homes, townhouses, two to four-family dwellings, apartments, and mobile homes. Fees collected in the Chapel Hill-Carrboro School District are deposited in a special account and used for the construction of new school facilities in that district only.A similar provision applies in the Orange County School District. Amendments proposed to the Educational Facilities Impact Fee Ordinance include the following: i • Amend Section 3, School Impact Fees Imposed on New Residential Dwelling Units, by increasing the amount of the public school impact fee from$750 to$1,000 per residential dwelling unit. This change has be requested because of higher public school construction costs. • Amend Section 4,Public School Impact Fee Exceptions,subsection 4,to include exception provisions for replacement units:where the original dwelling unit was destroyed by natural catastrophe; and where a dwelling unit was located on a lot or space during the five (5) year period prior to the effective date of the ordinance. • Amend Section 4, Public School Impact Fee Exceptions, subsection 6, to include text format changes. • Amend Section 5, Collection of Fees, subsection C, Limitation on Expenditure of Funds, to:reflect changes to the enabling legislation which permit impact fees to be used for debt service payments and payments under leases; and extend the time frame within which impact fees must be expended from five (5)years to 10 years from date of collection. The expenditure time frame is proposed for expansion to reflect the fact that both School Districts have prepared 10-year capital improvement programs for school construction. • Amend Section 5, Collection of Fees, subsection E, Reimbursement of Fees, to add a provision to permit reimbursement of fees collected in error or where an exception has been granted. r 4 All interested citizens are invited to attend this hearing and be heard. Public comment will be received during the public hearing. Changes may be made in the advertised proposal which reflect debate at the hearing. Specific questions regarding the proposed impact fee increase and ordinance amendments may be directed to the Orange County Planning Department located in the Planning&Agricultural Center,306F Revere Road,Hillsborough,North Carolina Office hours are from 8:00 am.to 5:00 p.m.,Monday through Friday.You may also call 732-8181(Hillsborough),688-7331(Durham)or 967-9251(Chapel Hill-Carrboro). Please ask for Extension 2585 or 2575. You will be directed to a staff member who will answer your questions. Marvin Collins, Planning Director PUBLISH: March 8, 1995 March 15, 1995 a 5 PROPOSED REVISIONS TO ORANGE COUNTY EDUCATIONAL FACILITIES IMPACT FEE ORDINANCE NOTE: Proposed revisions are highlighted in boldface type. The rational for the proposed change(s) is provided immediately thereafter in italics type. Sections and/or provisions recommended for deletion or change are hightlighted in stAkethpeugh type. SECTION 1 - LEGISLATIVE FINDINGS The Orange County Board of Commissioners makes the following legislative findings: 1. Orange County public school facilities are vital to the health,safety,welfare,and economic prosperity of Orange County; 2. That public school facilities in Orange County must be expanded in order to maintain current levels of service if new development is to be accommodated without decreasing current levels of service; 3. To finance the expansion of the public school facilities in Orange County necessary to maintain current levels of service while accommodating new residential growth, several methods of finance will be employed, one of which will require new residential development to pay an appropriate share of the reasonably anticipated new educational facilities in the form of school impact fees; and 4. These school impact fees will provide, in a reasonable manner, for the public health, safety,and welfare of persons residing within Orange County by providing a portion of the costs of new school facilities which bears a relationship to the benefits of the new school facilities to the new residential growth in Orange County. SECTION 2 - DEFINITIONS For the purposes of this ordinance, the following terms shall have the following definitions: Certificate of Occupancy. A certificate issued by Orange County or a municipality located therein allowing the occupancy or use of a dwelling unit and certifying that the building or structure has been constructed and will be used in compliance with all applicable codes and ordinances. Dwelling Unit. A room or group of rooms forming a single independent habitable unit with facilities used or intended to be used for living, sleeping, cooking, and eating by one family. Feepaver.The person constructing or responsible for having constructed a new dwelling unit or new dwelling units. In the case of a mobile home, the person installing or responsible for having installed a new mobile home or new mobile homes. SECTION 3-SCHOOL IMPACT FEES RKPOSED ON NEW RESIDENTIAL DWELLING UNITS In addition to all other charges prescribed by ordinance or resolution now or hereafter in effect, there shall be public school impact fees charged to new residential dwelling units located within Orange County,and within the municipalities and their extraterritorial planning jurisdictions located within Orange Impact Fee Ordinance 1 6 ' County.No person may occupy any new residential dwelling unit until all applicable public school impact fees contained in the following schedule have been paid in full. No certificate of occupancy or other type of occupancy permit shall be issued for any new residential dwelling unit until the public school impact fees hereby required have been paid in full. Payment of such fees shall not relieve the feepayer from the obligation to comply with applicable land development regulations of Orange County or the municipalities located within Orange County. Schedule of Public School Impact Fees The amount of the public school impact fee will be$X9$1,000 per residential dwelling unit.The same fee will be applicable in both the Orange County and Chapel Hill-Carrboro school districts. Comment:At its January 12, 1995 Work Session, the Board of Commisioners decided to present a fee increase of$250 for public hearing at its March 21, 1995 regular meeting. The basis for the fee increase is the rising cost of school construction. SECTION 4 - PUBLIC SCHOOL IMPACT FEE EXCEPTIONS' Public school impact fees as provided in Section 3 shall not be imposed in the following circumstances: 1. Buildings or structures, including alterations, repairs, renovations or additions thereto, which are to be occupied and used solely for non-residential purposes. 2. Residential dwelling units for which a building permit was obtained prior to the effective date of this ordinance. 3. Alterations, repairs, renovations or additions to a residential dwelling unit. ding of stRW 4. Replacement of a building, structure or mobile home used for residential purposes, including the following- a. Installation of a replacement mobile home on a separate lot or mobile home park space when an educational facilities impact fee for such lot or space has been previously paid pursuant to this ordinance or where a residential mobile home legally existed on such lot or space on or before the effective date of this ordinance. For the purposes of this ordinance,"legally existed"shall mean that a mobile home was located on the lot or space during the five-year period prior to the date of adoption of this ordinance. 'Inquiries have been received from persons who started the process of obtaining a building permit prior to the adoption of the ordinance.Due to the process; e.g.,historic district review,etc.,the applicants were unable to complete the process in time and had to pay the impact fee. No one was at fault on either side in these situations.However, if relief is to be granted in such circumstances, additional information must be collected regarding the number and merit of such occurrences. Impact Fee Ordinance 2 Y 7 b. Replacement of a building, structure or mobile home damaged, destroyed or partially destroyed by: the exercise of eminent domain; human acts, such as riot, fire, accident, explosion; or flood, lightning, wind or other natural calamity, with a new building, structure or mobile home. A residential building,structure or mobile home may be replaced with a new building,structure or mobile home of the same or dissimilar dwelling type.For example, a mobile home may be replaced with a mobile home. Likewise, a mobile home may be replaced with a stick-built structure. In either case, however, the number of dwelling units may not be increased. Comment: The provision regarding replacement units has been expanded to clarify that replacement units include those destroyed by natural catastrophe. In addition, a "grandfather" provision has been added to establish a time limit for vacant lots and spaces. The five-year period is based in part on the general amortization period for nonconforming signs and uses in North Carolina communities. It is also a period for which reliable and accessible information is available. 5. Accessory buildings and structures, including, but not limited to, garages, decks, storage buildings, and similar structures, provided they are not used for residential purposes.. 6. Temporary buildings and structures, provided they are not used for residential purposes. However, public school impact fees shall not be levied in the following cases: a. A mobile home being used to provide custodial care under the provisions of an approved Special Use Permit. b. A mobile home being used as a temporary residential dwelling during the installation of a replacement mobile home or the construction of a stick-built dwelling unit. Comment: Only format changes are proposed which permit the ordinance user to easily identify situations when impact fees are not required. SECTION b - COLLECTION OF FEES A. CREATION OF PUBLIC SCHOOL BENEFIT AREA TRUST FUNDS Public school impact fees collected by Orange County pursuant to this ordinance shall be kept separate from other revenue of the County. There shall be one trust fund established for each of the benefit areas.The benefit areas correspond to the school district boundaries as determined by the School Districts and as illustrated on the attached map labeled Public School Benefit Areas. B. RESPONSIBILITY FOR FEE COLLECTION All public school impact fees are due to Orange County and shall be paid to Orange County prior to a certificate of occupancy being issued for a dwelling unit.The fees will be collected by Orange County and/or by interlocal agreement between Orange County and a municipality located therein.All public school impact fees shall be properly identified by the appropriate benefit area and transferred for deposit in the appropriate trust account. Impact Fee Ordinance 3 t 8 Where there is an interlocal agreement in effect for collection of the public school impact fees by a municipality, the municipality shall remit the fees to Orange County as provided in the agreement, including a report of the amount of funds collected and the benefit area from which the fees were collected. Upon receipt, the County shall deposit the fees in the appropriate trust fund. C. LIMITATION ON EXPENDITURE OF FUNDS Funds withdrawn from public school impact fee trust accounts shall be used solely in accordance with the following provisions: 1. Funds shall be used for capital costs associated with the construction of new public school space, including new buildings or additions to existing buildings where the expansion is related to new residential growth. Such capital costs include actual building construction; design, engineering, and/or legal fees; land acquisition and site development; equipment and furnishings; infrastructure improvements; and/or debt service payments and payments under leases through which to finance such costs. Comment: The above provision has been revised to reflect changes to the enabling legislation made through Senate Bill 1679, Chapter 642. 2. Funds shall be used exclusively for capital improvements within the benefit area from which the funds were collected 3. Funds may be used for providing reimbursements as permitted in Section 5.E. 4. No funds shall be used for public school operating expenses, periodic or routine maintenance, or the administration of this public school impact fee program. 5. Following their collection,funds shall be expended within€we-(6)ten(10)years,the time frame coinciding with the public school facilities capital improvements program (CIP) school impact fee period. Comment The resolution adopted by the Board of Commissioners on May 27, 1993 expressed the Board's intent to establish a system ofimpact fees, including expenditure of such fees within a 10-year period.In the absence of a 10-year Capital Improvements Plan (CIP), the expenditure period was revised to five years to coincide with the current CIP. Both school boards have prepared and adopted 10-year capital improvement programs, making it possible to provide for a 10-year expenditure period. The disbursal of public school impact fee funds shall require the approval of the Board of County Commissioners upon recommendation of the County Manager. D. INTEREST ON FEES Any public school impact fee funds on deposit and not immediately necessary for expenditure shall be invested as allowed in N.C. General Statute 159-30 for other public monies. All income derived shall be deposited in the applicable trust fund E. REEKBURSEMENT OF FEES Any funds not expended within the time frame established in Section 5.C.5. shall be returned to Impact Fee Ordinance 4 9 the feepayer, or the land owner if the address of the feepayer provided to Orange County is not current, with interest at a rate not to exceed that being paid on public school impact fees deposited in accordance with Section 5.1). If the Schedule of Public School Impact Fees as contained in Section 3 is reduced, the difference between the old and new fees shall be returned to the feepayer, or the land owner if the address of the feepayer provided to Orange County is not current, with interest at a rate not to exceed that being paid on public school impact fees deposited in accordance with Section 5.D. If the Schedule of Public School Impact Fees as contained in Section 3 is increased, no additional fees shall be collected from new construction for which certificates of occupancy have been issued. Where an impact fee has been collected erroneously,or where an impact fee has been paid, and the feepayer subsequently files for and is granted an exception as permitted in Section 4,the fee shall be returned to the feepayer. Comment: No provision is made in the current ordinance for reimbursement of fees collected erroneously, or following payment of fees and approval of an exception. F. ANNUAL REPORT A report shall be made to the Board of County Commissioners each year showing where public school impact fees have been collected, what projects have been constructed with such fees, and what reimbursements have been made. The report shall also include an evaluation of this ordinance,including its effectiveness and enforcement, and the methods and data used to calculate the Schedule of Public School impact Fees contained in Section 3. The Board of County Commissioners shall review the report to determine if, within each benefit area,all areas of new construction are being benefitted by the fees.If the Board of County Commissioners determines that areas of new construction are not being benefitted, then it shall readjust the capital improvements program to correct this condition.If,after review of the methods and data used to calculate the Schedule of Public School Impact Fees, the Board of County Commissioners determines that adjustments are required in the Schedule, then it shall direct the County Manager and staff'to prepare a report which outlines recommended changes for its consideration. SECTION 6 - CREDITS Any conveyance of land for a public school site or construction of new school facilities received and accepted by Orange County,a municipality located in Orange County,and/or the Orange County or Chapel Hill-Carrboro School Board from a developer shall be credited against the public school impact fee due if the conveyance or construction meets the same needs as the public school impact fee in providing new public school facilities. If the developer wishes to receive credit against the amount of the public school impact fee due for such conveyance or construction,the developer shall,prior to the agreement to convey land for or construct new public school facilities, or the conveyance of land for or construction of new school facilities, enter into a fee agreement with the County. The fee agreement shall provide for the establishment of credits and payment of the fee in a specified manner and time. The value of land conveyed or facilities constructed by a developer and accepted by the County, municipality or school board for purposes of this section shall be determined by an appraisal based on the fair market value of the land or facilities as established by the County.Construction shall be in accordance with applicable County, municipal, school board, and/or State standards. Any land conveyed for credit under this section shall be conveyed no later than the time at which public school impact fees are required to be paid. The portion of the public school impact fee represented by a credit for construction shall be Impact Fee Ordinance 5 1 10 deemed paid when the construction is completed and accepted for maintenance or when adequate security for the completion of the construction has been provided. SECTION 7 - PENALTIES In addition to any other remedy allowed by N.C. General Statute 153A-123, the failure to pay a public school impact fee is hereby declared to subject the person responsible for payment of the public school impact fee to a civil penalty.The amount of the penalty shall be equal to the amount of the unpaid school impact fee,plus an interest charge of one-half percent (1/2%) per month compounded monthly and a service charge of one hundred dollars ($100.00). The County may assess this penalty against the land owner whereon new construction has occurred without payment of the public school impact fee. However, no service charge will be assessed when the County staff'has made an error in the fee determination. Furthermore, no penalty shall be assessed until the person or persons alleged to be in violation are served by registered mail, certified mail - return receipt requested, or personal service with notice to pay. The County Attorney is hereby authorized to institute a civil action in the name of Orange County in the appropriate division of the General Court of Justice in Orange County for recovery of the penalty. All monies recovered shall be deposited in the appropriate trust fund. SECTION 8 - LEGAL STATUS PROVISIONS All ordinances and clauses in conflict herewith are hereby repealed to the extent of said conflict. If any clause or section of this ordinance or application thereof to any person or circumstance is held invalid, such invalidity shall not affect other provisions or application of this ordinance which can be given separate effect, and, to this end, the provisions of this ordinance are declared to be severable. This ordinance shall not diminish any prior contractual or special or conditional use district zoning obligation to pay for or install road, park or other improvements required by Orange County or a municipality located therein, nor shall the fulfillment of those obligations diminish any applicable public school impact fee owed to the County.This ordinance shall not diminish any prior obligation of the County or a municipality located therein to reimburse persons for road, parks or other improvements, nor shall the fulfillment of those obligations by the County or a municipality diminish any applicable credit owed to the feepayer. SECTION 9 -APPEAL TO THE ORANGE COUNTY BOARD OF ADJUSTMENT [Reserved] This ordinance shall be effective from and after the 1st day of July, 1993.This ordinance shall only apply to residential dwelling units for which building permits are issued on and after the effective date of the ordinance. Adopted this 7th day of June, 1993. Impact Fee Ordinance 6 ' 11 TABLE 13 PUBLIC SCHOOL CAPITAL NEEDS, COSTS, AND IMPACT FEES CHAPEL HILL-CARRBORO SCHOOL DISTRICT ---------------7------------------------------------------------ r IMPACT FEES: CAPITAL COSTS LESS ADJUSTMENTS ---------------------------------------------------------------- School District ---------------------- Chapel - Orange Hill County Carrboro ---------------------------------------------------------------- Capital Cost. Per Dwelling Unit Elementary School $2,460 $1•,677 Middle School $1,324 $842 High School $1,558 $1,039 Total $5,342 $3,558 Adjustments. Per Dwellingr Unit Property Tax $521 $970 Sales Tax $393 $337 PSBF Funds $65 $42 Total $979 $1,349 Adjustment Allocation, By School Type Elementary School $816 $610 Middle School $52 $219 High School $112 $521 Total $979 $1,349 Impact Fees - All School Types Elementary School $1,644 $1,067 Middle School $1,272 $623 High School $1,446 $518 Total $4,363 $2,209 Impact Fees - Identified Need Elementary School $1,644 $1,067 ---------------------------------------------------------------- From A Technical Report on the Calculation of Proportionate Share Impact Fees for Financing Public School Capital Needs, Orange County, N.C. , May, 1993. Page - 15 . 3 �,,�} •;., 12 = DISTRIBu ED .o G T�C.4:ao� �� J Ljok TOWN OF CHAPEL HILL 44 306 NORTH COLUMBIA STREET ?60 CHAPEL HILL, NORTH CAROLINA 27516 OFFICE OF THE MAYOR (919)%8-2714 February 22, 19 9 5 FAX 919-%7-8406 Mr. Moses Carey, Jr. , Chair Orange County Board of Commissioners PO Box 8181 Hillsborough, NC 27278 Dear Moses: Re: School impact fees I'm writing on behalf of the Town Council to encourage the Board of Commissioners to increase the present school impact fees. The Council believes this fee is an equitable means of funding new school facilities which are needed as a result of new development. The Council understands that the fee was initially set below the amount which would be necessary to recover the school facility costs allocable to a new home. On behalf of the Council, I urge the Board of Commissioners to increase the school impact fee so that residents in new homes will pay more of their fair share of school costs. To the extent that owners of new residential development pay more of their share, the less they will have to be subsidized from taxes on existing development, both residential and non-residential. At the same time, the Council also supports action by the Board of Commissioners which will reduce or waive school impact fees for new housing specifically built for low-income families. I believe that school facility costs associated with housing for low-income housing can be appropriately funded through the overall tax base. Thank you for your consideration of these comments. Sincerely, K",4, S. 6" Kenneth S. Broun Mayor cc: Town Council