Bennett pulls back from plan to suspend impact fees

04/14/09 Mitch E. Perry
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Bradenton area state Sen. Mike Bennett’s bill that would eliminate impact fees was substantially changed today, and will no longer freeze such fees for three years.

Bennett’s bill now would limit impact fees to $2 per square foot on residential properties and $8 for commercial properties. The bill also creates a real-estate transfer fee paid for by the grantor of the property, but exempts first time sale.

After a representative from the Florida Association of Realtors said his group opposes the new proposal because of a longstanding policy opposing what are known as local doc taxes, Bennett said that his plan will be cost homeowners less than what they’re paying now, but ultimately bring more revenue to muncipalities and school districts

To illustrate, the GOP senator from Bradenton said that currently in Collier County impact fee for a purchased home is around $40,000. He said that on a 30-year fixed mortgage at 5 percent, that amounted to an additional $328 a month for that homeowner. But under his new scenario, they would pay only a 1 percent surcharge,

Rebecca O’Hara is with the Florida League of Cities. She said there was no question that impact fees are high, but there is an infrastructure deficit in Florida right now that might only exacerbate with a reduction in impact fees. She also questioned the caps that Bennett would place on impact fees.

O’Hara also worried that under the Bennett proposal, there could be a significant lag time in terms of sufficient funding coming in, since a transfer tax will not affect anybody who sells their home for the first time.

Doug Book of the Florida Homebuilders Association said his group supports the Bennett bill. He said he knows about local governments in the state right now considering doubling impact fees, which he says only makes homes less affordable.

Tampa Bay area Sen. Ronda Storms says she has consistently been against high impact fees in her career, and has actively campaigned against them in Hillsborough County. However, she was concerned that changes come extremely late in the legislative session.

Bennett’s proposal is based on the fact that that he says on average a homeowner in Florida sells their home every five to seven years, thus the opportunities to charge on resales.

But Storms says she believes that now and in the future, people will live in their homes longer, thus depriving some of the revenues that he forecasts. And she was concerned there wouldn’t be enough funds for infrastructure.

Denise Layne is executive director of the Hillsborough County based Coalition for Responsible Growth. She agrees with Storms that while the change in Bennett’s proposal has promise, it comes much too late in the legislative session.

And Layne also felt the bill’s capping impact fees at $2 per square foot for residential and $8 for commercial properties were randomly chosen, and would like more information on how that was assessed. Bennett said he originally wanted a 1$ and $5 cap.

The bill was passed through the Community Affairs Committee, with Storms opposing it.

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