TAMPA — A Hillsborough County commissioner has a single goal when it comes to two impact fees — she says it is time to stop giveaways to private developers.
Toward that end, Commissioner Mariella Smith wants residential developers to pick up a greater share of the costs of water and sewer service fees for new homes, and she is seeking a do-over on the county paying transportation assessments for some new commercial projects.
Both ideas are scheduled to come to a head Wednesday during a Hillsborough County Commission meeting, in which a public hearing on higher charges for utility services will mark the third time the commission has debated impact fees since March.
Impact fees, which vary according to the size and type of a new building and the location it is built, are one-time assessments on new construction to help pay for the roads, utilities and other services needed to accommodate new residents and businesses. New homes also are assessed impact fees for schools and parks.
A county proposal calls for raising water and wastewater impact fees from $3,550 to nearly $5,600 in the south county and for re-instituting a separate development fee that was reduced to zero in 2014. It would be set at $1,822 per home. That charge, called an accrued guaranteed revenue fee, or AGRF, is a multi-year assessment charged at the front-end of planned projects to reserve utility capacity for the eventual home-buyers.
The county is seeking the higher fees to help finance hundreds of millions of dollars worth of utility improvements in the fast-growing south county area.
Smith, however, thinks the homeowners end up carrying too much of the financial burden. The water and sewer fees are spread out over 20 years on property tax bills, where the principal accrues nearly double-digit interest and collection fees annually. The result is the current $3,550 impact fee costs the developer $225 and the homeowner $5,800 over the life of the 20-year payment plan that charges $290 annually, according to information Smth provided to the rest of the commission.
"It’s outrageous,'' said Smith. "... It’s wrong on so many levels to do it this way.''
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It doesn’t get much better under the county’s proposal, in which the homeowner’s annual payment jumped to $471 to cover their share of a $5,594 impact fee that ends up costing $9,412 over the two-decade repayment.
Smith is floating her own plan to keep the homeowners’ annual cost at $290, Doing so requires developers to pay more money upfront. Her idea calls for developers to pay $4,362 while maintaining the homeowner’s share at $3,325.
The Tampa Bay Builders Association so far hasn’t objected to the proposed utility fee increase as it did the recent jump in transportation fees. But Executive Vice President and CEO Jennifer Motsinger said the builders still don’t understand why the county didn’t seek industry input before moving forward.
"We are a job creator for the community. We are not the problem. We are part of the solution,'' said Motsinger.
Job creation is a significant part of the debate over Smith’s other idea. She said the county has been too generous in giving out incentives in which the county buys down the transportation fees that would be charged on some new commercial developments.
On June 3, the commission deadlocked 3-3, with Commissioner Ken Hagan absent, on a proposal to pay $213,000, or 75 percent of the transportation fee owed, for the planned construction of a 100,167-square-foot warehouse and office space on Tech Boulevard. The $6 million development plans to target small companies as tenants.
Commissioners Smith, Pat Kemp and Kimberly Overman voted against the measure.
The commission then delayed discussion of a larger incentive, $438,000 worth of transportation fees for an Atlanta company. It plans to build a 492,156-square-foot warehouse for a national home improvement retailer at the southeast intersection of Big Bend Road and U.S. 41. The company said the project represented a $63 million capital investment and would create 42 jobs. The county said the project would result in $577,000 in new property tax payments annually to the county and other taxing authorities.
"These businesses are a great investment, actually, in our community,'' said Commissioner Sandra Murman. "... You vote against these, you’re voting against creating jobs,.''
Kemp and Smith both pointed to the traffic-choked area as a site where the county shouldn’t be waiving transportation fees.
"What we need in infrastructure there will never be built unless we, unless the county, would do it and pay for it. That mean it’s again put on the back of the general taxpayers,'' said Kemp.
Smith says companies like a national home improvement retailer and Coca-Cola will come to Hillsborough regardless of the incentive. In March, Smith cast the only dissenting vote against a $5 million transportation fee buy down for Florida Coke, for a warehouse/distribution center that would bring 182 jobs.
“We’ve just falling all over ourselves to give them our tax dollars. They would build here anyway,’’ Smith said.
The commission adopted the transportation fee incentive program in 2016 and it’s been used nearly a dozen times since.
"This is an extremely valuable and targeted — I want to emphasize targeted — economic development tool that has greatly assisted our economic development efforts,'' Commissioner Ken Hagan said prior to the March vote on the Florida Coke project. He said this week he planned to vote for the warehouse incentive packages when they are reconsidered Wednesday.
The failure to approve the incentives earlier this month could be considered problematic for future industrial recruiting.
"It’s a very confusing communication with the business community,'' said Ron Barton, the assistant county administrator overseeing the program.
Both Barton and Craig Richard, CEO of the Tampa Bay Economic Development Council, noted Tallahassee’s frowning attitude toward economic development incentives over the past several years.
“We just don’t have the tools we used to have to compete for economic development projects,’’ said. Richard. "Anytime a local municipality can muster up tools to attract a competitive project and advance it is a good thing.''
Smith suggested the ordinance be rewritten to remove warehouse and distribution sites from incentive eligibility. She said the county needed to put a greater focus on "industries with high-paying, good quality jobs and good benefits and good deals for the workers of our county.''
And, the county government, she said, should not be offering transportation fee incentives in areas of the county already suffering from severe traffic congestion.
"I’m just trying to get them to pay their fair share of the cost of doing business there,'' Smith said.
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