Decision time is almost here, and the issue of Impact fees will soon be vetted and decided upon.
I just hope the community knows what's at stake when we make a choice. If we choose to keep the moratorium, it will insure that we are more marketable than the surrounding areas. Until we are seen as a pro-business community, it's best we do all we can to build that image.
There are some hard truths to the fact that we will not have a small short-term gain of revenue, a small chunk of money that could be gained if we don't let the moratorium expire.
The positive of keeping the moratorium on Impact Fees is that we grow our tax base at every level, which in turn, will give long term benefit. So the choice is a short term small gain or a long term focus on building our tax base that could benefit us for years to come.
In past articles I've given examples of how it affects business, affects employment and obviously that it affects the tax base and our long-term ability to provide services.
I want to use this article to demonstrate another issue, the impact on the workforce, their housing needs and how it negatively puts pressure on the ever shrinking middle class.
In the Chronicle there was an article that dealt with The “Asset Limited, Income Constrained, Employed” (ALICE) report, which suggests that four in 10 households struggle with basic needs.
It goes a little further and shows that what the average in Citrus County is 43 percent, or 25,800 of 60,541 residences.
What this means is there is a definite struggle in Citrus County for some to get by. These are the people who fix your cars, serve you food and provide so many of the services that make us comfortable in the community are barely getting by.
How does impact fees and the moratorium figure into this? I will try to explain it in a way that truly shows the negative effects of impact fees:
An impact fee is part of what is rolled into the mortgage for homeowners and when you are saving up to hopefully have that American dream. It makes it a little more costly and you may think, “if they are building a house or buying a house recently built they should be able to afford a couple of thousand more”.
I believe the ALICE report definitely disputes that factor, and that is because for every $1,000 dollars the price of a home goes up, it cuts certain people out of the ability to get financed and stops the American dream dead in its tracks.
Let's also look at if a house does get built and the homeowners do have additional money for the down payment, or can get financed. The impact fee you pay for a new home will actually not be the $1,600 to $4,600, because you have it rolled into your mortgage.
* $100,000 loan at 3% equals $151,000 total mortgage
* $101,500 loan at 3% because of impact fees equals a total mortgage $154,000
* $104,800 loan at 3% with full Impact Fees restoration equals a total
mortgage of $170,000
You can see that interest rate will have you paying an additional amount because of the impact fees, the amount of money those fees could cost could double or triple cost of the impact fees and for that increased cost, you pay potentially tens of thousands in interest and get nothing for it!
So, we are not only affecting the working class, in preventing them from having a home and making it more costly up front, you also whittle away from the money that comes out of the pockets of the middle class. We often wonder where the middle class goes and here is, yet another example, how government fees are one of the major factors of its shrinking.
Calculating the cost of government
Now, let's look at another issue for impact fees, the increase in the cost of government and how it will continue to drain the pockets of our citizens, this will be if you give government more money, the governement will spend it. As someone who has tried to fight governmental spending, I can attest that it never stops growing.
Recently the commission made tough choices to fight unneeded spending, we have gotten rid of surplus lands that will hopefully go back to the people and business and we hope this will grow the tax rolls. We need to oppose increased government now for when we are not the ones making the fiscal policy in the future, because unneeded spending can return at any time.
The last thing I want to talk about is the flawed policy when it comes to Impact Fees.
The impact fees that get paid, may not even benefit you. So say a homeowner in Sugarmill Woods, who has a house built, will likely not see any gains from impact fees. Also a senior citizen who chooses to move here and living on a limited budget in areas like the Inverness Highlands are not going to see a positive impact, just more cost.
In the past the County had to give back impact fee money to you, or at least that was what policy states. Yet that policy also states that you have to write a letter to the County and ask for it. Yes, yet another chance for government to hold onto your money and only because you missed the information in the paper.
There are no plans to change it to an automatic pro-rata share, this could be done if the 3% that is supposed to be used for administration of the fees, was in fact used to track the information (seems we know who we take it from, but not who we should pay it back to).
So let me close with this thought, you have seen the many reasons I'm against impact fees, how they affect so many more than you thought and lastly is how the government does a horrible job of dealing with and potential reimbursement of those fees. If a small, defined, targeted to a geographical area and properly administered impact fee was suggested, then I would seriously consider supporting it, but that is not what we will see and I will NOT support Impact Fees. Instead I support the working man and woman.
These are my just my thoughts, and I hope you will share your own.
Jimmie T Smith,
Citrus County Commissioner