College Station City Council members unanimously adopted and approved a 10 percent increase above the current rate in impact fees across residential versus commercial homes, based on the semi-annual report on system-wide impact fees for water, wastewater and roadway services at their regular meeting on Monday.
The wording for the 2021 semi-annual impact fee report was approved by a 5-2 vote, with Mayor Karl Mooney and council member Linda Harvell opposing.
Multiple people not in favor of impact fees spoke during the public hearings. There was constant back and forth from all council members regarding whether or not to increase impact fees or keep them the same.
Impact fees were created by the state legislature in the 1980s in order to account for the infrastructure cost for new development in housing and commercial projects. Impact fees are a charge or assessment imposed by a political subdivision against new development in order to generate revenue for funding or recouping the costs of capital improvements or facility expansions necessitated by and attributable to the new development.
The city of College Station has been utilizing impact fees for more than five years. The last impact fee report was done in 2016 and every five years an assessment report must be made to update the study. In the report, overall costs will be assessed, future developments that may come in are assessed and the collection rate is set.
Components that can be paid for through an impact fee program include: construction cost of capital improvements on the impact fee CIP, roadway to thoroughfare standard, upsized water/wastewater line, traffic signals, bridges, sidewalks, etc., survey and engineering fees, land acquisition costs, including court awards, debt service of impact fee CIP, and planning studies.
Jason Schubert, the transportation planning coordinator for the city, and Richard Weatherly, who is the engineer consultant from Freese and Nichols, presented the impact fee study update to the council during one of the public hearings regarding the calculation of maximum accessible impact fees.
The council approved the revenues annually that were collected in total: for water, $1.5 million, wastewater, $7.2 million and $2.7 million collected in roadway impact fees.
Weatherly said the maximum allowable impact fees per living unit equivalent or a single family home is $3,877, which is about an $800-900 increase from 2016. For wastewater, the maximum allowable impact fee is $5,572. For roadways there are four categories to break down roadways in the city. Single family homeowners, depending on where they live, may pay from $499-$3,452.
The newly adopted motion will take effect March 1, 2022. The water impact fee is set at $550, wastewater at $3,300 and roadway fees at $1,650 across the board in each category. Grandfathering in the current collection rate is to be determined at a later date.
Mooney said he objects to the “methodology and the impact they [impact fees] would have based on the numbers that are shown in the semi-annual report on impact fees.”
Doug French, the CEO of Stylecraft, spoke regarding impact fees during one of the public hearings. French said there are currently four residential developments occurring in this city, and was opposed to impact fees.
“We plan on building 30 homes in the city. I feel that part of every vibrant community is important. It saddens me that people of this city cannot get a new home. If I get a road impact fee credit, and if I don’t use it, I should get a credit back to me,” he said.
Hunter Goodwin, the president and COO of Oldham Goodwin Group LLC, also opposes impact fees.
“I am here to beg for mercy,” he said. “Emotionally I am struggling, I have never asked for mercy. It is very discouraging to me, I believe what we have delivered, if you take my fees from $5,000 to $30,000, I am dead in the water, I will have to tell homeowners the plan we promised, we will have to change the rules on that.”
Fred Dupriest, a College Station resident, spoke in favor of impact fees.
“We are over $300 million dollars in debt; our problem is our level of debt and the trajectory we are on,” he said. “When you have high debt you are fragile, we can’t fix a swimming pool because of our debt. Not only are you funding subsidizing, you are not letting the value of the land. Can we subsidize to the degree we have been subsidizing?”
Charles Vesperman, a College Station resident, said “new construction costs the city real dollars and the cost of the city is growing.”
“My house is undersized and the dozens of water repairs if over the years, if developers would be prepared. Somebody has to pay the developers to develop. I am sick of having to pay for infrastructure for new fancy homes that are not servicing my home. The fees can’t directly repair my neighborhood, but maybe those fees can be used elsewhere,” he said.
Regarding the collection rate and impact fees, Austin McKnight, who is the branch manager of Primary Residential Mortgage, said “impact fees affect businesses as well.”
“Impact fees will push people outside of the city, and create urban sprawl,” he said. “We aren’t getting to collect their taxes in college station. Rising impact fees have hurt the average person’s American dream of owning a home. I oppose raising impact fees.”
James Murr, founder of Midtown City Center, said “this is a city proposed project asking the developer to participate, the city should help and not make it more difficult.”
“All impact fees violate our deals, the market can handle a reasonable amount, I am asking council to waive all impact fees,” he said.
Craig Regan, a College Station resident, spoke on the debt that is in College Station and said impact fees are not the focus the city should be looking at.
Dennis McMillin, resident of College Station, said impact fees will increase property taxes for current homeowners, and urged the council to vote against impact fees.
Council member John Crompton prepared a motion that failed regarding residential impact fees. Crompton’s motion showed an increase in impact fees for water and roadways, but remained the same for wastewater fees.
Council member Bob Brick was in favor of raising impact fees, while council member John Nichols said “developers are going to be impacted.”
“I think we are building a sustainable community that will last,” Nichols said. “We aren’t trying to eliminate the opportunity of growth at all. We do now have impact fees, we are a fast growing city and we have invested a lot of money in infrastructure and we borrowed a lot of it. Impact fees aren’t about keeping people out. I think we need to provide the city staff with some direction and make a decision tonight.”
Council member Elizabeth Cunha said she was “not against impact fees.”
“I now worry what impact fees do to everyone else,” she said. “My property tax rate I pay I can control, impact fees are just there. I think we are talking about the burden we put on everyone. I think property taxes will go up because your values went up. I am not an economist, but I am a taxpayer and I don’t think this is the right time to raise impact fees.”
After much back and forth debate, Mooney made the final motion to approve the impact fee rate.
In other business, the council approved renewing an annual contract for gasoline and diesel fuel with Fikes Wholesale Inc., for the amount of $1,400,000; approved a professional services contract with Kimley Horn & Associates in the amount of $279,750 for the design of the Francis Drive Rehabilitation Phase III project; approved a construction manager at risk contract with Jacody Construction, LP for the construction of the 1207 Texas Avenue Renovation project; approved the City’s Annual Price Agreements for Distribution Poles for CSU Electric, with estimated annual expenditures through Techline Inc. for an amount not to exceed $7,352,580. In addition, Mayor Mooney and the council commemorated the city of Bryan on its 150th anniversary.