Ozark voters consider impact fees April 5

Fair vs. unfair
Ozark’s April 5 ballot will propose an impact fee jump from $300 to $1,800, a 500 percent increase per new home built and connected to the sewer system.
“They need the sewage treatment facility, but it’s an unfair way to fund it,” said Matt Morrow, executive officer of the Home Builders Association of Greater Springfield.
Collin Quigley, Ozark’s city administrator, said the ballot addresses issuing revenue bonds for a new waste-water treatment plant and expansion of the existing plant and the increase in sewer impact fees for new construction.
The impact fee, he said, is not a fee to hook up to the sewer system.
“The $1,800 per unit is an impact fee for the impact that sewer has on our system that we’re currently paying off,” he said. “For that, (home buyers) are getting the treatment plant, they’re getting the ability to treat that waste-water, and the main collection lines that the city has had to pay (for) and build over time.”
Existing homes, he said, paid their
one-time impact fees when building permits were issued, although those impact fees weren’t as hefty as the proposed increase.
Morrow said he understands the need for funds to cover improvements. “However, if new homes in general are assessed a fee or a tax that would pay for, say a new sewer system for the town, that’s what’s called off-site infrastructure, and that’s not fair, because it’s something that serves the entire community and is financed only on the backs of a small minority,” he said. “If the entire community benefits, the entire community ought to support the cost of it.”
Rick Ramsey of Ramsey Building Company LLC agreed. “Why not distribute this impact fee to all of the community, not just affect the people buying a new home, the people taking out a new permit? Why not find a way to distribute these fees … and break it up throughout the town to give the city those funds needed?”
Brian Bingle, Nixa’s city administrator, said, “Those (additional) services wouldn’t be necessary unless the population exceeded the existing population. It is not to sustain the current levels of services, but to provide future levels of services to those future residents.”
Nixa leaders are considering impact fees with a maximum of $3,000 per new home. Bingle anticipates discussing potential impact fees with Nixa’s Board of Aldermen within the next two weeks, and then scheduling a public hearing.
However, impact fees will likely not be voted on by citizens.
“The board would be left with making a decision at a future meeting as to whether it will or will not be implemented,” he said.
The impact of impact fees
Ramsey, who builds homes from $130,000 to $1.1 million and has nine under construction in Nixa, is concerned impact fees would affect his business.
“It may seem like, ‘A few hundred dollars here and there, how is that going to make a big deal?’ But … you’re pricing these first-time home buyers, especially, out of range,” Ramsey said.
A first home is usually the hardest one to get into, Morrow said, and delaying that purchase can delay moving up to higher end homes.
“Once you’ve got that (first home), you’ve got some equity that you can roll into the next one,” Morrow said.
Morrow said that U.S. Census data indicates that every $1,000 increase to the price of a new home means about 500,000 American families won’t qualify for a first-time home loan. The standard for affordability set by the Department of Housing and Urban Development, Morrow said, is 30 percent of income spent on housing costs.
The effects of impact fees, Morrow said, could tempt people to buy outside of established communities, contributing to urban sprawl. “Others would move away from the area altogether, or those who were thinking about moving here might not. Ultimately you’re talking about job loss and a slowed economy. That hurts everybody,” he said.
Quigley isn’t concerned about higher impact fees making Ozark less attractive to potential home buyers.
“There’s myriad reasons why Ozark is attractive, and $1,800 built into the cost of building a house is not the issue,” he said. “That’s the cost of treating the wastewater and without that, there wouldn’t be homes in Ozark. It’s as simple as that. If we don’t have the ability to pay for expanded wastewater facilities, we simply can’t issue building permits.”

Alternatives
Local governments, Morrow said, need to consider alternatives to impact fees. He said that there are innovative and effective ways of financing future infrastructure by creating new revenues. Many options, he said, are outlined in a study released by the National Association of Realtors, “Building for Tomorrow: Innovative Infrastructure Solutions,” which is available at www.real
tor.org.
Other options include bonds, tax exempt municipal lease financing, special financing districts, tax incentives and tax credits.