Council sets impact fee time limit

Compromise waives charges for rebuilding a home if the work is completed within 10 years

December 07, 2008|By Mary Gail Hare | Mary Gail Hare,

Rebuilding a demolished home on an existing lot must occur within 10 years, if the property owner is to avoid the impact fee assessed on new residential construction in Harford County.

The County Council enacted the 10-year limit on Tuesday despite strong objections from Councilman Dion Guthrie, who had called for giving homeowners a 15-year window to rebuild. Guthrie was advocating for a constituent with a large property, where several tenant houses were razed decades ago. The owner asked to have the fee waived for the homes he planned to build for his adult children.

"I know that each one of you on this council tries to accommodate your constituents," said Council President Billy Boniface. "What you do for one constituent affects everyone in the county. Ten years was a way for us to meet in the middle. It is a good compromise."

The time-limit issue also sparked debate on the $8,269 fee that has been in place since 2005.

Impact fees, which generated about $3.5 million in revenues last year, help fund the infrastructure, particularly schools that the county must build to meet the demands of a growing population.

Guthrie has repeatedly voted against the fee and, instead, has pushed unsuccessfully for a slight increase in the transfer tax, which buyers pay at the time any home - new or existing - is purchased. Raising the transfer tax, a proposal repeatedly rebuffed by the county's legislative delegation, is a more equitable way to generate revenue, he said.

"The impact fee does not help anybody, but we are stuck with it," he said. "It is unfair because it is only on citizens building new homes. It's a lot of money for some families."

Councilman Chad Shrodes said he, too, would like to scrap the impact fees.

Eliminating the cost from the price of a new home might help stimulate the slumping housing industry, he said.

Building permits in the county look to be the lowest in several years, with fewer than 10 housing starts last month, officials said.

"Those numbers scare me," said Councilwoman Mary Ann Lisanti. "If people don't start building homes here, all taxpayers will suffer. At the end of the day, whatever we can do to help is what we should do."

For now, the county has few options other than the impact fee and more than $200 million in school projects.

"We have no other funding sources right now, and we have to build schools," Shrodes said.

He drafted the amendment to Guthrie's original bill, which had called for a 15-year limit. The amendment, with a five-year reduction in the time, passed 4-3. When the amended bill came to a vote, Guthrie was the lone dissenter.

"This is a waste of a bill and a waste of taxpayer money," Guthrie said.

The law ends a policy that allowed county planners to decide whether a property would be exempt from the impact fee. The time limit, which takes effect in 30 days, will put an end to appeals that have come before the council from residents wanting an exemption after their home had been destroyed by fire or razed after becoming uninhabitable.

"We have been stuck with an open-ended policy, and this resolves that," Shrodes said. "This compromise bill is fair, and there will be folks who will benefit from it. Most importantly, it ends the numerous people coming here and arguing to be exempt."

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