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Developer dollars slightly up, but have yet to rebound
Developers paid $40,000 in 2011
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The new Cheddars and Olive Garden are recent developments that paid impact fees for the costs of their development on city infrastructure. - photo by Tom Reed

An electrocardiogram of Gainesville's economy is showing signs of a stabilizing heartbeat.

Revenues from impact fees, which the city government charges to developers for the assumed cost of their developments on city services, are on the rise.

Collections of the fees are a barometer of development in the city as each developer applying for a building permit must pay an impact fee before the permit is granted.

The fees can be spent on big-ticket items for the city's police and fire departments. Residential developers also pay impact fees that fund improvements to city parks.

Most recently, officials have used the fees to replace playgrounds in city parks and to develop walking trails connecting city parks.

But as development in Gainesville stalled, collections of the fees dipped to a low of $36,560 between July 2009 and July 2010.

The amount collected last fiscal year was about 6 percent of what the city collected in impact fees at the peak of the housing boom. Data the city is required to keep on the fees shows developers shelled out nearly $640,000 on impact fees between July 2006 and July 2007.

But after that, collections — and the development associated with the fees — took a nosedive, dropping more than $430,000 in the following fiscal year and down to $62,407 in the fiscal year lasting from July 2008 to July 2009.

In response, local governments across the region shied away from the fees they previously said would help them keep their public safety and
recreation infrastructure up to speed with development.

Just last week, a majority of Hall County's Board of Commissioners voted to give developers the option of when to pay impact fees, whether it be when they apply for a building permit or for a Certificate of Occupancy.

County officials had originally considered eliminating the fees altogether, an idea that followed suit with decisions in Dawson and surrounding counties.

Also afraid to scare away developers, Flowery Branch officials opted not to implement impact fees late last year, citing a desire not to hit developers in an already-down economy. Oakwood officials do not charge impact fees for development in their city limits, but are considering the possibility.

But Gainesville officials, who have been charging the fees since July 2006, don't have any plans to change the way they collect the fees or the amount they charge, according to Rusty Ligon, director of the city's development services department.

"We feel like our fees now are very competitive with other similarly sized communities in the state," Ligon said.

The city charges $1,654 per dwelling for developers of residential properties and charges commercial developers based on the type and size of their developments, Ligon said.

And the fees haven't seemed to scare developers away from Gainesville.

Since January of this year, developers with intentions to build in the city have paid more than $40,500 in impact fees for commercial and residential developments. Collections for the first six months of this year almost mirror collections during the same time period in 2009 when the city collected $41,642 in impact fees.

"We have seen, in our fees, an increase in activity since the first of the year," Ligon said. "Permit numbers are up."

And Ligon said he expects the situation will continue to improve.

"We're going to see strong numbers in June as well," Ligon said.

 

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