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George's Information and Comments Growth Impact Action Committee ________________________________________________________________________________________________________________________________________________________ |
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To view this in the context of other growth management tools click Growth Management Tools 3/13/08 Update: March 3 Horry County Council Impact Fee Workshop and PowerPoint Presentations has added links to access the PowerPoint presentations given at the impact fee workshop at the end of the first section below. 2/25/08 Update: In line with the renewed consideration of impact fees, words in the general discussion in blue text have been inserted and the section - Impact Fee Statute and Selected Quotes has been added to replace no longer functioning 2004/2005 hyperlinks. Click here to see the 2/11/05 Sun News Article on Impact Fees. You can go to the particular section you want to read by clicking its title below:
March 3 Horry County Council Impact Fee Workshop At an Horry County council impact fee workshop on March 3, 2008, planning staff gave a PowerPoint presentation on revised guidelines for the imposition of impact fees. Then staff gave a presentation concerning impact fees imposed in other South Carolina jurisdictions before and after the S.C. Impact Fee statute was passed. Major points in the discussion involved the changed situation since Summerville received S.C. Supreme Court approval of its impact fee ordinance saying it and its capital improvement plan were in substantial compliance with the S.C. Impact Fee statute. The TischlerBise company was a key partner in the development of the Summerville ordinance and its capital improvement plan that makes the preparation of such much more reasonable than as precisely stated in the S.C. Impact Fee statute. Click here to view the PowerPoint presentation on revised guidelines for the imposition of impact fees. Click here to view the Power Point presentation concerning impact fees imposed in other South Carolina jurisdictions before and after the S.C. Impact Fee statute was passed. General Discussion on Impact Fees Two major points: 1. Impact fees
are not new taxes; they are not fees on existing homeowners. They simply
transfer costs that would otherwise be borne by existing homeowners to those who
require new or expanded public facilities -- such as new home buyers. Those that argue this can not argue the demonstrable fiscal impact on the county budget that requires either added taxes or reduced county services. And the fairness of placing the burden of any possible demonstrable economic gains on existing homeowners is, at the least, questionable. Development impact fees will ultimately be passed on to the benefited newcomers requiring new public facilities, thereby transferring some of the tax burden of population growth from locals. We recognize that this is only one of many issues our elected officials will have to deal with, but a potential representative's position on impact fees tells us much of his or her overall perspective. One objection raised to impact fees is that they could stop a local just starting out from buying his first home. In some cases this may be a red herring, in others it may be a sincere concern.
But state law allows counties to exempt affordable housing
from impact fees -- ("affordable
to families whose incomes do not exceed eighty percent of the median income for
the service area"). Some feel that impact fees are an unfair way to enhance the coffers of local government. But state law requires that the financial impact be proven and that if they are not used to offset the additional costs caused, they must be returned. Furthermore, state law precludes impact fees being charged for any item costing less than $100,000, such as police cars or ambulances and it precludes impact fees being charged for new school construction, period. The bottom line is that impact fees only partially pay for the added costs of population growth. They merely require some of the cost for increased facilities otherwise unrequired to be borne by those who benefit.* * As to the economic costs to local residents, as a whole, because of population growth, refer to the book Better not Bigger by Eben Fodor. This book cites many statistics and studies on this issue. As to the costs to Horry County government, reflected in your tax increases, refer to the various reports on impact fees and revenue issues by impact fee consultants Tischler & Associates, Inc. (These have been effectively updated since this was originally written in the developed Tischler-Horry County software that computes the net fiscal costs of new development to Horry County.) To view a report Tischler & Associates, Inc. (Horry County Council's paid expert consultant) gave to the Horry County Impact Fee task force on impact fees, South Carolina law on impact fees, and Horry County's situation (in 2005), click 2nd. Impact Fee Task Force Mtg - (Tischler Presentation) 1/16. Click here to return to the top of this page Impact Fee Statute Text and Selected Quotes --- George Edwards I have discovered that the hyperlinks to the statute in its entirety have expired, apparently years ago. In an attempt to prevent from another link becoming outdated: Click here (www.scstatehouse.net). Then on the screen that appears, scroll down and under the SC Code of Laws item in the left menu, click Title/Chapter List; then on the screen that appears, click Title 6 (in blue text); then on the screen that appears in line with CHAPTER 1 GENERAL PROVISIONS, click HTML or Word (in blue text); on the new screen, scroll down to 6-1-910. Below that is the text of the "South Carolina Development Impact Fee Act" I have quoted below portions that strike me as most critical with comments in some places. DEVELOPMENT IMPACT FEES SECTION 6-1-910. Short title. This article may be cited as the "South Carolina Development Impact Fee Act". (2) "Capital improvements" means improvements with a useful life of five years or more, by new construction or other action, which increase or increased the service capacity of a public facility. (3) "Capital improvements plan" means a plan that identifies capital improvements for which development impact fees may be used as a funding source. (6) "Development" means construction or installation of a new building or structure, or a change in use of a building or structure, any of which creates additional demand and need for public facilities. 8) "Development impact fee" or "impact fee" means a payment of money imposed as a condition of development approval to pay a proportionate share of the cost of system improvements needed to serve the people utilizing the improvements. The term does not include: . . . 14) "Level of service" means a measure of the relationship between service capacity and service demand for public facilities. (17) "Proportionate share" means that portion of the cost of system improvements determined pursuant to Section 6-1-990 which reasonably relates to the service demands and needs of the project. (18) "Public facilities" means [note that public schools are not included]: (a) water supply production, treatment, laboratory, engineering, administration, storage, and transmission facilities; (b) wastewater collection, treatment, laboratory, engineering, administration, and disposal facilities; (c) solid waste and recycling collection, treatment, and disposal facilities; (d) roads, streets, and bridges including, but not limited to, rights-of-way and traffic signals; (e) storm water transmission, retention, detention, treatment, and disposal facilities and flood control facilities; (f) public safety facilities, including law enforcement, fire, emergency medical and rescue, [emphasis added] and street lighting facilities; (g) capital equipment and vehicles, with an individual unit purchase price of not less than one hundred thousand dollars including, but not limited to, equipment and vehicles used in the delivery of public safety services, emergency preparedness services, [emphasis added] collection and disposal of solid waste, and storm water management and control; (h) parks, libraries, and recreational facilities. (19) "Service area" means, based on sound planning or engineering principles, or both, a defined geographic area in which specific public facilities provide service to development within the area defined. [Arguably? the entire governed locality, e.g. a county] (20) "Service unit" means a standardized measure of consumption, use, generation, or discharge attributable to an individual unit of development [emphasis added] calculated in accordance with generally accepted engineering or planning standards for a particular category of capital improvements. (21) "System improvements" means capital improvements to public facilities which are designed to provide service to a service area. (22) "System improvement costs" means costs incurred for construction or reconstruction of system improvements, including design, acquisition, engineering, and other costs attributable to the improvements, and also including the costs of providing additional public facilities needed to serve new growth and development. System improvement costs do not include: (a) construction, acquisition, or expansion of public facilities other than capital improvements identified in the capital improvements plan; (b) repair, operation, or maintenance of existing or new capital improvements; (c) upgrading, updating, expanding, or replacing existing capital improvements to serve existing development in order to meet stricter safety, efficiency, environmental, or regulatory standards; (d) upgrading, updating, expanding, or replacing existing capital improvements to provide better service to existing development; (e) administrative and operating costs of the governmental entity; or (f) principal payments and interest or other finance charges on bonds or other indebtedness except financial obligations issued by or on behalf of the governmental entity to finance capital improvements identified in the capital improvements plan. SECTION 6-1-930. Developmental impact fee. (A)(1) Only a governmental entity that has a comprehensive plan, as provided in Chapter 29 of this title, and which complies with the requirements of this article may impose a development impact fee. If a governmental entity has not adopted a comprehensive plan, but has adopted a capital improvements plan which substantially complies with the requirements of Section 6-1-960(B), then it may impose a development impact fee. A governmental entity may not impose an impact fee, regardless of how it is designated, [emphasis added] except as provided in this article. SECTION 6-1-940. Amount of impact fee. A governmental entity imposing an impact fee must provide in the impact fee ordinance the amount of impact fee due for each unit of development in a project for which an individual building permit or certificate of occupancy is issued. The governmental entity is bound by the amount of impact fee specified in the ordinance and may not charge higher or additional impact fees for the same purpose unless the number of service units increases or the scope of the development changes and the amount of additional impact fees is limited to the amount attributable to the additional service units or change in scope of the development. The impact fee ordinance must: . . . (4) inform the fee payor that: (a) he may negotiate and contract for facilities or services with the governmental entity in lieu of the development impact fee as defined in Section 6-1-1050; SECTION 6-1-950. Procedure for adoption of ordinance imposing impact fees. (A) The governing body of a governmental entity begins the process for adoption of an ordinance imposing an impact fee by enacting a resolution directing the local planning commission to conduct the studies and to recommend an impact fee ordinance, developed in accordance with the requirements of this article. Under no circumstances may the governing body of a governmental entity impose an impact fee for any public facility which has been paid for entirely by the developer. SECTION 6-1-960. Recommended capital improvements plan; notice; contents of plan. . . . B) The capital improvements plan must contain: (1) a general description of all existing public facilities, and their existing deficiencies, within the service area or areas of the governmental entity, a reasonable estimate of all costs, and a plan to develop the funding resources, including existing sources of revenues, related to curing the existing deficiencies including, but not limited to, the upgrading, updating, improving, expanding, or replacing of these facilities to meet existing needs and usage; [in addition to many other stated requirements – the actual need for a capital improvement plan if impact fees do no more than maintain the current level of services may be arguable in light of a Tishler Associates representative indicating that was all that was required in the Summerville impact fees approved by the courts] SECTION 6-1-970. Exemptions from impact fees. . . . (7) all or part of a particular development project if: (a) the project is determined to create affordable housing; and (b) the exempt development's proportionate share of system improvements is funded through a revenue source other than development impact fees. SECTION 6-1-980. Calculation of impact fees. (A) The impact fee for each service unit may not exceed the amount determined by dividing the costs of the capital improvements by the total number of projected service units that potentially could use the capital improvement. If the number of new service units projected over a reasonable period of time is less than the total number of new service units shown by the approved land use assumptions at full development of the service area, the maximum impact fee for each service unit must be calculated by dividing the costs of the part of the capital improvements necessitated by and attributable to the projected new service units by the total projected new service units. SECTION 6-1-990. Maximum impact fee; proportionate share of costs of improvements to serve new development. (A) The impact fee imposed upon a fee payor may not exceed a proportionate share of the costs incurred by the governmental entity in providing system improvements to serve the new development. The proportionate share is the cost attributable to the development after the governmental entity reduces the amount to be imposed by the following factors: (1) appropriate credit, offset, or contribution of money, dedication of land, or construction of system improvements; and (2) all other sources of funding the system improvements including funds obtained from economic development incentives or grants secured which are not required to be repaid. . . . SECTION 6-1-1020. Refunds of impact fees. (A) An impact fee must be refunded to the owner of record of property on which a development impact fee has been paid if: (1) the impact fees have not been expended within three years of the date they were scheduled to be expended [emphases added] on a first-in, first-out basis; or SECTION 6-1-1040. Collection of development impact fees. A governmental entity may provide in a development impact fee ordinance the method for collection of development impact fees including, but not limited to: (1) additions to the fee for reasonable interest and penalties for nonpayment or late payment; (2) withholding of the certificate of occupancy, or building permit if no certificate of occupancy is required, until the development impact fee is paid; [emphasis added] (3) withholding of utility services until the development impact fee is paid; and (4) imposing liens for failure to pay timely a development impact fee. SECTION 6-1-1050. Permissible agreements for payments or construction or installation of improvements by fee payors and developers; credits and reimbursements. A fee payor and developer may enter into an agreement with a governmental entity, including an agreement entered into pursuant to the South Carolina Local Government Development Agreement Act, providing for payments instead of impact fees for facilities or services. That agreement may provide for the construction or installation of system improvements by the fee payor or developer and for credits or reimbursements for costs incurred by a fee payor or developer including interproject transfers of credits or reimbursement for project improvements which are used or shared by more than one development project. An impact fee may not be imposed on a fee payor or developer who has entered into an agreement as described in this section. [emphasis added] Click here to return to the top of this page Further Information on Impact Fees: Click one of the links below for further information on impact fees (former main menu entries).
For further information on an effort to allow imposing impact fees on new school construction, click Impact Fees for Schools. Click here to return to the top of this page . |