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HomeMy WebLinkAboutAgenda - 04-03-1995 - IX-A 1 ORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: AAril 3. 1995 Agenda Abstract Item # —� SUBJECT: PUBLIC SCHOOL IMPACT FEES DEPARTMENT: Planning PUBLIC HEARING: Yes X No ATTACHMENT(S): INFORMATION CONTACT: Proposed Ordinance Amendments Planning Director X2592 Table 13 - May, 1993 Technical Report Citizen Correspondence/Comments PHONE NUMBERS: Draft 3/21/95 Public Hearing Minutes Hillsborough 732-8181 (To be distributed sepwwdy) Mebane 227-2031 Durham 688-7331 Chapel Hill 967-9251 PURPOSE: To consider proposed amendments to the Educational Facilities Impact Fee Ordinance,including a proposed increase in the public school impact fee from$750 to $1,000. 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 3 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 hightghted in stAkethreegh 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 IMPOSED 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 5 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 where impact fees are not required. SECTION 5 - 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 7 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 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 5.1). 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 collect what projects have been constructed with such fees and what P� � P of 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 9 TABLE 13 PUBLIC SCHOOL CAPITAL NEEDS, COSTS, AND IMPACT FEES CHAPEL HILL-CARRBORO SCHOOL DISTRICT ---------------------------------------------------------------- IMPACT FEES: CAPITAL COSTS LESS ADJUSTMENTS ---------------------------------------------------------------- School District ---------------------- Chapel - Orange Hill County Carrboro ---------------------------------------------------------------- Capital Cost. Per Dwelling Unit Elementary School $2,460 $1•,67' Middle School $1,324 $842 High School $1,558 $1,039 Total $5,342 $3,558 Ad s ju tments, Per Dwelling Unit Property Tax $521 $970 Sales Tax $393 $337 PSBF Funds $65 $42 Total $979 $1,349 Adjustment Allocation, By School Tyne Elementary School $816 $610 Middle School $52 $219 High School $112 $521 Total $979 $1,349 Impact Fees - All School =es 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. ?age - 15 . 3 . 11 ORANGE COUNTY AFFORDABLE HOUSING COALITION P . 0 . Box 1057, Chapel Hill, NC 27514 March 21, 1995 Orange County Commissioners 200 S . Cameron Street Hillsborough, NC 27278 Dear Commissioners : Thank you for this opportunity to comment on the proposed School Construction Impact Fee increase . Our Coalition has been working to advocate creation of rental and home- ownership opportunities for many of those who labor in our county who, because of the escalating cost of housing, are increasingly forced to commute. -from outlying areas . Obviously any increase in the cost of a home purchase impacts those at the lower economic scale the most. At the same time, we recognize the need to obtain additional funds to cover the added education services new homeowners require . Impact fees meet that need . However, we cannot endorse the proposed increase in the impact fee to $1, 000 without the inclusion of a progressive system of implementing the tax. We recommend that a method be established to insure the impact fee does not place a larger burden on those least able to pay. That method could include, but not be limited to, using indexing, a sliding fee, or tax credits to insure fairness . In your deliberations, we urge you to keep in mind the goal of providing housing possibilities for those in the lower economic levels . They should have a choice to be a part of Orange County during their non-working hours, to share in its festivals, to join its houses of wokship, to educate their children in our school system, and to give back to the community where they work . We urge you to make whatever effort is necessary to establish a progressive tax plan that insures that Orange County remains a welcoming, diverse community, enjoying the benefits of the energies, talents, and dreams of people of every income level who want to live here . SiJe rely yours, Chs E. Zi for Ora County A fordable Housing Coalition 13 1508 Jones Ferry Road Chapel Hill, NC 27516 March 15, 1995 Orange County Board of County Commissioners P.O. Box 8181 Hillsborough, NC 27278 Dear County Commissioner: I am enclosing a position statement on the impact fee that was recently unanimously approved by the members of the Chapel Hill-Carrboro PTA Council. As the members of the PTA Council are elected by the parents in each individual school PTA, the position on f the parents of over 7500 children enrolled in the Chapel the impact fee is representative o Hill-Carrboro City Schools. On behalf of all PTA members, I wish to thank you in advance for seriously considering our position in your not hesitate to contact me. fee. Should you have any questions about our statement, Very truly yours, Harvey Al Goldstein President, PTA Council 15 1508 Jones Ferry Road Chapel Hill, NC 27516 March 15, 1995 Orange County Board of County Commissioners P.O. Box 8181 Hillsborough, NC 27278 Dear County Commissioner: I am enclosing a position statement on the impact fee that was recently unanimously Hill- boro approved by the members of the Chap el Carr PTA Council. As the members of the PTA Council are elected by the parents in each individual school PTA, the position on the impact fee is representative of the parents of over 7500 children enrolled in the Chapel Hill-Carrboro City Schools. On behalf of all PTA members, I wish to thank you in'advance for seriously considering our position in your deliberations on the impact fee. Should you have any questions about our statement, do not hesitate to contact me. Very truly yours, Harvey Goldstein President, PTA Council 17 T A Call for Action Schools in Chapel Hill, Carrboro, and Orange County have been playing "catch-up"for too long. SOS recommends the following strategies for ensuring that future residential growth is linked to responsible and timely expansion in school capacity. (1) The areas'school boards,school administrations, and elected officials must accept mutual responsibility for joint planning and establish procedures to formalize the relationship. Specifically, elected officials should be advised by the school districts about the impact a proposed development(or rezoning for higher density) will have on the utilization of the neighborhood schools before new projects are approved. (2)Higher revenues from impact fees are needed, and other funding sources must be found to more adequately fund the construction of new schools. The need for affordable housing is an important issue, which must also be addressed by elected officials,but it does not counteract the need for good schools. SOS believes that a sliding scale for impact fees would be more equitable and more effective. (3) A school impact study should be required for proposed developments to allow officials to assess the demands on our educational resources and infrastructure, so necessary plans and accommodations can be made prior to project approval. (4) Concurrency should be considered as an effective planning tool for orderly growth. Under this strategy,rezoning for higher densities and residential building permits should not be approved until schools can accommodate the additional students, or unless plans have been adopted for permanent school construction to accommodate the proposed growth. (S)Developers of sizable subdivisions could be required to donate land towards a public school to accommodate the families purchasing their homes.This could fit in with planned open space and would be an attractive selling point as well. Such a plan would be coordinated with impact fee structures.In other parts of the country this policy has been incorporated into the land use ordinances and is working effectively. Cooperation Needed We recognize that these are challenging times for our schools and community and that politically and fiscally creative and effective solutions must be found. SOS recognizes that growth is inevitable. We are committed to working cooperatively with the school administrators and elected officials in the pursuit of well planned,coordinated growth in school infrastructure and residential development. Rampant growth must not be allowed to destroy the high quality and fine reputation of our schools. SOS welcomes your input and assistance. For more information about SOS and upcoming meetings,please call Debbie Wahlen(968-3920)or Gloria Faley (942-2939). 3/0 _ 19 r m 3 m L7 m > �'• N L w L + U L O C 3 C-i •• 3 c� v ° m m T 1 CQ € o O L LO .. a w m �.i T c 9) C) LO ` O w CD CD CL a Om m �: : a U E T _ X v CIS 75 IOD CD a- OL CD CIS 0 Uwa W❑ `0 O ® � U V u) m CIS m CIS a a E U W O 0 co ww- O 0 o m U L O �p O _ a c E U U 4t 0 0 0 0 0 0 0 0 Cl CD Ln o In o Ln o In o cc r` r, m m in to a v 21 IRt O_ tt. Via, iV �;1: N �. M Ir co ° O ;•. 4 rd Hi O Q N t.<r} s N c� O s N C rF °° N _ N a,. r � ch CM C4 0 C4 - s N ON _ •T ~ — _ h In INC � d 01 o " -_ - a— C6 a SO .� o 23 UNDERSTANDING IMPACT FEES IN ORANGE COUNTY What are public school impact fees? A public school impact fee is charged for every new residential dwelling unit constructed in Orange County after July 1, 1993.A newly constructed single-family house,individual condominium unit,or a mobile home newly installed on a lot or on a trailer park rental space is charged an impact fee. Duplexes pay fees for two units. Apartment buildings and complexes pay fees for however many rental units they contain.The current fee is$750 per dwelling unit, although the County Commissioners are considering raising it to$1,000.Legally, there is no limit to how high the impact fee can be,as long as the Commissioners can demonstrate that it does not exceed the financial impact of new dwellings. What is the reason for charging a public school impact fee on new dwellings? Residential development fuels population growth.Impact fees require new residential development to pay a share of the costs of new school buildings needed to maintain current levels of educational service in the face of increasing enrollments. What is the financial impact of a new dwelling on school construction costs? In 1992,county staff estimated that$3,400 was the average financial impact of a new dwelling on school construction costs (using building costs at that time of$65/sq. ft.). This figure is not very useful for current purposes,however,in part because of the dramatic rise in construction. costs since 1992. Undoubtedly,the current fee of$750 is far below the current financial impact of a new dwelling. How can the county use money collected from impact fees? The county can use the money only to pay for construction costs of new public school space, where expansion is related to new residential growth.Costs may include building construction, design,engineering and/or legal fees;land acquisition and site development;equipment and . furnishings;and/or debt service payment to finance such costs.Funds must be spent on projects within the school district where the fees are collected,and collected fees must be expended within a limited time(currently,five years)or else returned,with interest,to the fee payer. What does the county do with.money collected from impact fees until the funds are spent? Public school impact fees collected by Orange County are kept separate from other county revenue. Two trust funds have been established,one for each of the two "benefit areas" (defined by the boundary between the two school districts).Fees collected from each area are deposited in the appropriate trust find.Funds on deposit are invested,as allowed by N.C. statute, and all derived income is deposited into the applicable trust fund. (over) 25 Re-calculation of the impact fees for financing new school construction in the Chapel Hill/Carrboro school district. ibis position paper describes some updates to the Technical Report regarding impact fees. The full title of the report was"A Technical Report on the Calculation of Proportionate Share Impact Fees for Financing Public School Capital Needs in Orange County,N.C.". It was prepared by the Orange County Planning and Inspections Dept., June 1993. But the report is now out of date, and the latest available numbers are used here to re-calculate the financial impact ofnew dwellings. The calculations are done only for the Chapel Hill/Carrboro school district. In faimess to the residents of the Orange County School District,the impact fee for the Chapel H WCarrboro City School district must be computed separately from the orange County School district,where less rapid expansion is occurring. What has changed? $58 3 $65 1 • 0.68 0.3 1993 1995 Bldg cost per sq.ft StxW is per house ® Schools needed Why costs have gone up: The North Carolina average school construction costs per sq. & have increased from$65 in 1993 to $78 in 1994,with the state Dept. of Public Instruction projecting the cost will reach$88 per sq.& in 1995. Explanation:the general economic boom is leading to higher material and labor costs, as weIl as higher profit margins. Why there are more students coming into the system: The number of students(grades K 12)per nit dwelling unit was not calculated in the Technical report. Instead,it used the 1990 census value of 0.29 students per dwelling for all emsting dwellings, and then just assumed that the new dwellings would have the same number of students per dwelling. The Carrboro planning office,based on a survey of 5 subdivisions, is currently using a figure of 0.68 students per dwelling,more than double. Explanation: little apartment or retirement housing is being added. Most new construction is single-huffy, 3-4 bedrooms. T AL COST PER STUDENT edhricaI S Updato I S Updats, edrnlol S U b • rt 27 • • ddl• set" Sdh001 575•at 1993 993 1993 1993 1993 1993 __._:.A60: Tao ° _ ',_ __'700; t2oo is = ;=800 •Now I. sludart 117 117 128 126 138 133 area M a7273 76030 -- 98280 8x200 182000 87300 cost f sq.tt 983 sEB_ 193 Note 2 rsfhtton cost 84,372.873 18,892.400 98.388.200 $7 761,800 110.330.000 1 13.940.000 dit•cl8a1, 1 10 10 10 1 10 wt. 1 10 1 10 10 1 otal consbha:ton cost 93$47.450 $8.030,880 87,883.840 99.313.920 112,838.000 $7.128,000 acres 15.73 17 22.3 22 42 10 ass,Note 3. cost par acre 123.000 123.000 925.000 $23,000 $23.000 925.000 nd cost 9593.730 $423,000 $870,000 $350,000 $1.030.000 $230 000 devellopmard 13 15 13 13 13 13 develloWert cost $797,118 $1204.832 $1,149,878 $1,397.088 81,895,400 $1.009= ofai coot $8,428.318 39,8x0.312 89,3x5,718 $11281.008 813,381,400 $8,447.200 •Nor 4, otal cost ..shMort $11 180 .�3 $12,033^.. . :.. .. s1Z985 4 ' ry reference:Table 4 of the T•c rival Report ole 1.1996 School sizes are*am OCS024 the draft 1995.2005 School Board's 110W CapIN Improvornart Plan ote 2Avg.NC.bLddkV cost per sq.R projected for 1995 by NC D of Pubtc know ten,School Phwrft offks. ofe 3.Larhd cost Is kckxlod oven for adMom to extOM sltp since the bwwffl of the sorter excess land acqU2111on is poily to the hawndanes of the ote 4.Total ,, ' tj rtan coals shown here are believed to be eorservadve In at about 80%of What the CIP has alloeatsd e Tedmlcal Report khdcates that It Is undesimble to-charge Impact fees for the com fad83es com a olds of the schools, MAMA. AL COST PER DWELLING UNIT _ skxw*Per di—my 0.3 school 0.151 0.31 0.07 0.161 0.08 021 a Note S. kdX=bn-t per school 10 10 ($219 -_.._ . �T 324_ $1,039-1� _ : a cost school 61 877"._. - 042::@0===— 19 1 I Nor 6. m ct two school $1.087 '^ 308 1818' 1}< mpect fee per&YWM-Idsrollied need $1.087 Note 7. ry retweres:Table 13 of the Tec rieal Report o0,:MwX better aafai data,the asaen was made that the sfudwt Y dh Mbut d all the asrent kdka of famt8ss seems somw ut heavier an the lower lip,but tie b a otosrveton whkih need to b• with a corers. or 8:The main a defkod In the Tedw*W R credits now home owners for the sales and taxes "a kh the near future hWdh M be u off bonds for b fadtltes.This avoids dohbl•-c ha ob T:At the tms of to 1993 TsdwkW R the WentMd need Into adhool CIP was for arts arbool. e 1993 Scfhoob CIP now IdwMes needs for Blow d School i8.Wddle School 04 and an addMon to tw now SdhooL E ROJECTED REVENUE-TYPICAL CALCULATIONS OT FROM THE TECHNICAL REP M*3A=W,Olg N 1994 1994 s Nets 8. of new x 243 145 m d fee -Idenrted need $9,374 $9,374 otalIm fee-Iden9tedrwed $2277,823 $1,359,196 obi corokuctor cost 1 $40.000,000 $19.388,041 of .ft of onskue9or , , 717,000 347.136 res.combustion cost per sq.IL $83.79 $55.79 $55.79 mpact fee-id rtMd npd, 33.42 mpect fee set at 70%of WerMed need $730 $2.39 •verve.at 70%of Wn9Md reed 3291,000 12,513.913 rots 8:CH c"M Dept pv~1904 figures for residential kAdrV pand 717,000 .ft/243 detadwd •da homes-2960 Par hems - 29 • SOS Position on Impact Fees 1. The county planning department should annually update its analysis of the financial impact of new development on area schools. 2. A sliding scale for impact fees should be devised, in order to more equitably distribute the costs of new schools among the new development, while addressing concerns about affordable housing. 3. Impact fees in the CH/Carrboro District should be calculated sevar, ately form the Orange County District. 4. Impact fees should be reasonable and substantial, 5. All sources of revenue for new schools should be considered: general taxes, the special district school tax, certificates of participation, bonding, and impact fees. W hat you can do: Call or write the Orange County Commissioners, and urge them 1. to raise the impact fee, and 2. to vigorously seek additional ways to ensure that school construction keeps pace with residential development. ORANGE COUNTY COMMISSIONERS Moses Carey(D,1996),Chair Stephen Halklotls(D,1998)Vice Chair 901 Lystra Lane CH 27516 '1007 Panther Court HB 27278 929-8513(H);933-8494(VII) 644-6863(H)732-2017(W) WHHam L Crowther(D,1998) Don WBihoit(D,1996) 372 SL Mary's Rd HB 27278 203 Lpd*w Rd CH 27516 732-7537(H);732-6886(V) -942-2571 (H):962-5507(VI) ABU M.Gordon(D,1998) 282 Edpewood Dr CH 27514 933-0550 Attend the Commissioner's Public Hearing on impact.fees, Tuesday, March 21, 1995, 7:30 PM, at the OWASA building on Jones Ferry Rd- in Carrboro Brealdng new ground 31 j Irnpact fees for school facilities are an idea whose time and restrictive (in Texas and Illinois,for example) to very might come some day. But,say those familiar with the brief.general laws (New Jersey and Indlana) that give local fees and their use,that day hasn't arrived yet governments considerable latitude,says Leitner,a special- According to Mary Fulton,a policy analyst for the Den- ist in zoning and.land-use law.California,a leader in they ver-based Education Commission of the States,school field,levies impact fees not only on residential develop- Ieadvr,;and other policy makers have discussed the idea of ment but also on nonresidential development such as o`- using impact fees as an option for generating more school fices and retail stores,based on square footage,says Leit- revenne. But. Fulton says,she hasn't seen many examples ner,who predicts an"'Inexorable tide"toward the levying of of impact fees for school construction levied around the impact fees. country. "Not many districts have moved in this area,"she Even-without statewide enabling legislation,he notes, says.")Impact fees) won't apply to many districts-unless. ___impact fees atre:used-all the time:Local governments ofi-en they are rapidly growing and can make arguments as to can levy them under their home rule or planning and zon- why these fees are necessary." ing powers.Flbrida,for example,has no legislation that ex- Still,say some school board officials,the practice of as- plicitly allows Impact'fees;but local governments in that sessing impact fees for school facilities is one school state have levied such fees;including those for new school boards might welcome.Randy Quinn,executive director of construction,since the midA970s;such fees are used more the Colorado Association of School Boards,says schools in widely in Florida than in any other state in the country. his state,would benefit from impact fees because the state Still when they have been imposed,school impact fees does not provide money for renovations or new buildings. have not always successfully withstood'court challenges. "If new people come in and bring new students.they Last summer,a district judge in Colorado struck down the should help finance the costs,"Quinn says.Impact fees will fees that Douglas County,a high-growth school district near ! assist schools that can't keep up with growth using the tra Denver,had imposed in 1992 to ensure that new residential ditional means,including borrowing money. development bore its share of the cost of building new Although school impact fees still are relatively tare,they schoolar-1be judge held that the county did not have the au- could be part of a growing national trend toward impact thority to impose impact fees,according to an article in the fees in general.Nineteen states now have general legisW- Denver Post.The-judge also said that Colorado's school fi- lion allowing the assessment of impact fees,compared with nance law,which was in effect when Douglas County levied ! 1986.when only three—Arizona,California;and New Jer= its impact fees,was created to ithprove equity among school sey—had such laws on the books.Two other states,Mary- districts and among property-tax payers in school districts. land and Tennessee,have adopted special legislation that According to state law,the judge said,all school districts allows individual counties to impose impact fees,according had to operate under the same finance formula. to attorney Martin Leitner,author of a survey of relevant For more information about using impact fees for school legislation published in the summer 1993 edition of the facilities, contact: Martin Leitner, managing pal'tner, Urban Lawyer. Freilich. Leitner and Carlisle, Suite 1000, 4600 Madison. Laws vary widely from state to state,however.Vermont, Kansas City, Mo..64112-3012.Telephone: (816) 561-4414. I for example•allows unrestricted impact fees that can be can also provide information.Write me at Park City Schr.of used for any public facility,but Virginia's Impact flees can District, P. O. Box 680310, Park City, Utah 84060. 'Ce!e be used only for roads.Other laws range from very specific phone: (801) 645-5600,ext 125; fax: (801) 645-5609.—mi.F. I tl` • !nt t`1. ht•cati,v \sty stayed focused un the desired out- courts in California. Florida. Illinois, aml Wisconsin I-llt• !n, -list. !t \'t Iltpnu nt and imposition of impact fees to legal test usually applied to these fees—called tht- ratimial 1 `!tell rl• \ t las�rolmis (or children. (Some differences of nexus test—requires that impact fees be charged in propw— t,lnl nl :11 I.t• I)VI-r Who would determine the exact amount tion to the facilities needed by the development and Ihat •,I !hl• !, I. and whether "affordable housing" would be ex- they be used for the benefit of the ne\e deceloprnt•nt. mp1. Hit tttrnit•r was resolved legally:•Ihe city and county The courts usually examine six factors \\ht•n Iooking •!! ­I till. !I'I•. but Ito -�o on the recommendation of the district. impact fees: I !i, :;wt r nl tilled in the derision not to exempt any 1. Distance—the distance between the lacililc bt•im! 1)11111 and the new development. Pit lure! and final -tivp in Park City was the formal ap- 2. 1•ime—the time between the collt•ction 111 tilt- It-sand ;•t t\:1i ,tl Iht• impart Irv,; and the agreements by all three the building of the new facility: ,tl:t rnn!t nlal h.nlit:: our final plan—which galled for a fee :3. Cost—the amount of funds collt•cted Irolu the fvft• ;Intl ullt Itt r ptimat-v (Iwelliog unit—•complied with all ap- the cost of the new facility: !i :Ill.• I;rt• Iwxc .,local ordinance•:,and district polities. .1. Need—the relationship between the lict•d for-mch it Ia- cilily and tilt-type of developnn•nt payintr III,-It•. It ! l frsnu\ trk . i. I,t•nt•fll—Iht• ht-tit-til lu 111r• lt1 \\' d. ct InI tut nt 1• t i1`. :..1, /:!.t• tl<Illt It gal hallo `.\nrk for -choul lacil type n1 lacility built:aIld t•! ,•!t ' !t t•. %hich I-� l•Ilrri-nd\• 1)cing flute in I Iltltn1wr 6 F.armarklrt,l—Ilit- pr vii o deal Ict- l\Ill ht• 11-1! . 11�\ 1t. .•• ! '- '1• 't-It- .It 1'1011 Iht• t IItllllr\ :I11d Ilan I)I•I•tl tlplIvId by build Illy IVI)e III lacllll\ Idly\\IIIt'll Ill.- w, - !11 It I•!. t` II a tl.!;I t\lilt !t t! I;\.\I. \I\I\I !! !..• 33 : 33 CHAPEL HILUCARRBORO SCHOOL DISTRICT SCHOOL FACILITIES PLANNING March 21, 1995 Present Situation With the influx of some 360 students per year from 1990 to 1995 and an inadequate rate of new school construction, the present facilities are being utilized over their design capacity. At the Ephesus Road school where my wife and I tutor, we started the school year at 634 students, and as of this week are at 686. We're now up to five trailers, holding classes in the library as well as the atrium, and last week I found classes in the lunch room. Beyond the approved high school and the McDougle school to open August 1996, there are no funded elementary or middle schools on the drawing boards. New schools seem to be planned at the 650-700 capacity level. You'll note that with.360 new students added each year, the system needs the equivalent of a new school every two years even to stay at today's overcrowded level. Commentary , . The growing need for additional schools is apparent. The investment in a new elementary school is about $14 million...a new middle school will cost some $18 million for a total of$32 million and a capacity of 1350 students. The average capital investment for each new student is, therefore, $23,700. To deal with the problem of building and financing the construction of these urgently needed facilities calls for an objective, careful examination of the true impact of new home construction on student population growth. Developers are required to build roads, bridges, sidewalks, sewage and water systems to avoid having the general public picking up the capital coasts. The same should apply to the added school facilities these developments provoke. For example, if three new homes bring two additional students into the system, the three homes should cover the actual capital outlay of two times $23,700 divided by three, or $15,800. Today's impact fee is a mere $750. Recommendation I urge the County Commissioners meet with authorities of Chapel Hill and Carrboro as well as the local School Board and school officials to quickly measure the level of today's overcrowding, agree upon a forecast of student population growth through 2002 and establish a realistic building program. Secondly, after reviewing the true impact of new home construction on the school system, hold public hearings to arrive at a new, fair impact fee that more accurately assesses those costs to new home construction. Prepared by: Robert P. Foley THE INK 5rru i 1L Jl 35 206 Adams Way Chapel Hill, NC 27516 January 20, 1995 Office of the County Commissioners Hillsborough, NC FAX # 6443004 Orange County Commissioners: Lille many Orange County residents, I an very concerned about the effect of our rapid growth on education in Chapel Hill and-Orange County.We simply cannot keep and their quality is rapidly slipping due to up with the need for new schools, overcrowding. I believe the time has come to increase the impact fee on new construction.Just _ as it costs more to buy a new car than a used one, it should be expected that a new house will cost more than an existing one. I would like to see the fees tied to the size of the new house. My suggested plan is $.50 per square foot, which would actually decrease the fee on a 1000 square400t home, and rise,for example,to a fee of$2,000 on a 4000 square-foot home. Sounds like a lot of money? it would barely be noticed in the cost of that house. And let's be honest,the builders who are opposed to raising the impact fees are not the ones who will be paying it; it's passed along to the buyer. Think R's an unfair tax? Local real estate agents will be happy to show you some of the lovely resales that are on the market.And I'm certain that there will be plenty of demand for new houses anyway. In case it sounds like I'm passing the tax burden along to newcomers to our area, I am planning to build a new house here in the next year or so. When it comes to planning for the rapid growth In our area, consider zoning, transportation, and services, but please,think about the children first! Sincerely, Betsy Spaulding 37 Severe overcrowding is detrimental to the feeling of"ownership" and community among teachers, children and parents, thus adversely affecting the working/learning environment. Additionally, overcrowding poses difficulties in effective management of the daily school program for which administration and staff is responsible. Those most affected are the least able to advocate for themselves: the children. For example, in each of our child's last three grades there have been textbook shortages, due, in part, to sheer numbers of children. She has regular school library visits only every other week due to numbers of children needing to be served, especially the younger ones needing basic library skills instruction. We have excellent teachers who are trying to do their best but their efforts are compromised by the overcrowded conditions out of their control and out of control. Flagship school system? I don't think so. Regardless of how and why elected officials (council, aldermen, county commissioners, school board,) and advisory boards (planning, zoning, public works,) kept out of each other's affairs in the past, the children need you to work together effectively from this point forward to address the situation of land use planning, population growth and school overcrowding. Parents, students, teachers, and the business community will also need to participate. This community has come together to tackle many issues during the twenty five years I've lived here. We can do it! School children deserve more than cursory bottom-line treatment. Their quality of education should be a top priority. They are the future. �'`�� 01" 39 `4. Demand zero-based budgeting and program accountability from the Chapel IUI- Carrboro City Schools as requested in the past two years of budget hearings. Once the school system has demonstrated fiscal responsibility, submit a bond issue to the voters and accelerate the proposed building program to prevent the projected overcrowding outlined in the current capital plans. 5. Fund new schools through bond issues and not Certificates of Participation. Trust the voters who trusted you by putting you there. Putting Children First sees that real solutions to our immediate and long-term overcrowding situation are possible. We are encouraged by the Orange County System's creative consideration of using existing school buildings to deal with their overcrowding situation. We encourage our system to consider similar creative solutions such as using the Lincoln Center to alleviate overcrowding. We hope that our Board of Education and Board of Commissioners will consider our proposal a real solution to the overcrowding problem. Presentation to Orange County Commissioners by Peter Morcombe at the OWASA building on March 21,1995 41 ddle and it to have Most of us are here tonight to express our.concern about the over crowding of our .s. In PCF, we believe the problem can be solved without raising taxes. In spite of )n t have any constructive proposals, PCF has been 3rlisrepresented in the media as people t a single :lo not care about education. In fact, we care passionately about it. Most of us I the gap t to have children in the public schools fot many, many years. For example, my es in the Best son will graduate from high school in the year 2012. In PCF, we know that money will not help when financial acumen is lacking. The proposed impact fee increase is not sufficient to fill the financial hole created rs will be to Chapel Hill-Carrboro City Schools. Raising property taxes by an amount that is beyond :ient to solve the problem will face massive. opposition from many sectors of the :al steps nunity. The only viable option is to reduce costs. Last year our Board of Education itened to cut funds for the Blue Ribbon Task Force, the debating beam, the band an y other popular programs unless taxes were raised. The Orange County ig. The imissioners were not fooled by this ruse and refused their request Insbead of 'lar debt. sing your clear message, they are back again with the same old solution. We ask you e it by a lemand more creativity. There are ways to save large sums of money without Is would cting instruction or successful programs. On March 18, the Herald-Sun reported that Durham Schools, faced with large capital costs, propose to cut many administrative Itions. Here are just a few that weie listed: councils reliance POSITION SALARY stration. Associate superintendent for curriculum&instruction $98,683 rt while. Assistant superintendent for innovative programs $92,515 budget. Executive director for auxiliary programs $72,162 opacity, + "de ten times more funds than the proposed hike in Savings of this kind can prove Provide npact fees. Besides the salary costs, these positions have fringe benefits, secretarial There are no equivalents of apport and fine offices which will no longer find that e do not need them either. It we are iese positions in private education and we will ien you i time for Neil Pedersen to start working on a similar list hovel. 43 Dear Commissioners, March 21 , 1995 My wife Robin and I do not support the proposed increase in the impact fee for new homes from $750 to $1000 or beyond. According to the annual report for the FY 1993-94 revenues collected in the Orange County School District represented only 27%, for the Chapel Hill-Carrboro School District only 28% of the Planning Department's projected revenues. The supporters will angry that due to the shortfall this should warrant the increase in the impact fee. There was a rush to obtain building permits in May and June before the impact fee became effective on July 1 , 1993. The Planning Department's technical report provided projections of impact fee revenues based on past building trends, without any consideration for the expected rush to obtain a permit before the fee became effective. The Orange County Planning Department demonstrated a total lack of COMMON SENSE in estimating the revenues to be generated by the fee. At least the County Budget Department demonstrated some sense when it cut the revenue projections in half for the capital improvement program. Errors by the planning Department should not constitute action on our part. Any projections by the Planning Department should be fully scrutinized. I know some people will say, yea tax those outsiders coming in. If that was only true, it would gain a lot of support. The truth is that it does not matter if you have lived here one week or all your life, such as my wife Robin who has lived some 30 plus years in Orange County and whose family dates back well over 200 years. If you buy or built a new home you pay an impact fee. The fact is the majority of the newcomers purchase resale homes and there are more resale homes on the market than new homes being built. How many people who have paid the impact fee have lived in the County 5 years. or more? How many newcomers have actually paid the impact fee?! What really needs to be done is to tax those newcomers who have lived here less than five years whether they buy a home just completed or one that is 100 years old. As it stands right now if that family of four who just moved here buys that 100 year old home they pay no impact fee. How would you administer such a program? Simply put if you paid county taxes less than 5 years you pay an impact fee. In my opinion this would also deal with the affordable housing issue to a great deal . Granted it would not solve the issue but it would reduce it to a level that is more manageable. Another possibility is a transfer fee for each deed that can be base on a-flat fee or a percentage of the price of the property.