The unintended consequences of impact fees

Jimmie T. Smith, Citrus County Commissioner, District 3As a policymaker, I’m frequently questioned on what we as a community can, should and shouldn't do, and the effects of each choice.

Oftentimes, there are “unintended consequences” of our choice, and in the end, we regret the outcome of our decision.

A case in point is impact fees. As we acquiesce and assume the return of impact fees, and with it government prepares for the potential glut of money for dream projects, I’m nonetheless concerned about these unintended consequences that come with it.

For instance, as a former state representative, I have had opportunities to interact with doctors throughout the state, but I have especially enjoyed the relationship I’ve built with our local doctors. From optometrists to cancer specialists and more, all have played a vital role in informing me on important issues involving health care.

Recently, I had a conversation with a doctor who is seriously thinking about expanding his practice to two new locations; however, he said it will take two years to get through the process and, in his words, “the impact fees will cripple us” along the way. In this case, the unintended consequences of impact fees are preventing accessible healthcare to our community, not to mention the jobs that would come with his investment.

Furthermore, as many as 50 jobs — doctors, physician assistants, ARNPs, medical assistants, administrators, marketing and clerical jobs — will not be created in this one instance because of potential high impact fees. Here we have a doctor who sees an opportunity to invest in our county; however, the one lingering factor preventing it is impact fees. Ultimately, the short-term financial gain of impact fees cannot take the place of quality, high-paying jobs and more accessible health care.

Make no mistake, my position has always been in favor of impact fees, but not for the way we have utilized them, along with our intention to rely on them as a general source of revenue. I’m especially against them when the unintended consequences are negative job creation, lack of access to healthcare and the threat to our long-term financial security.

Additionally, there are unintended consequences on the commercial side.

Currently, there are many storefronts that are unoccupied; therefore, we should consider the waiving of fees, as well as streamlining the process. However, as areas grow, there will be an eventual need for development of commercial property to meet the needs of residents. Unlike residential property, which if fully brought back would be approximately $4,600 per home, commercial property impact fees are drastically higher.

A common misperception is that commercial property investors need to pay their fair share; however, these fees are passed down to tenants, who quite often are mom-and-pop business owners. In the end, the cost of projects increase, which leads to higher rental fees. With it, another barrier is created that can make it too expensive for business owners or potential young entrepreneurs to invest.

Once again we’re stymieing job creation, as well as limiting our ability to grow our tax base and, in the process, marginalizing much-needed services to our community.

A prime example: It takes months for business to get through the process; the cost at completion is higher than the cost at the beginning of projects because of government red tape. This has led to our challenging current economic situation.

By bringing back the impact fees, we are doubling down on our already anti-business image, and are simply doing as we have always done. I believe that we need to keep the moratorium on impact fees and better streamline the process to incentivize business growth. If we fail to do so, we could lose out on opportunities for small-business owners, high-paying medical jobs and reduce our accessibility to quality health care in our community.

Impact fees should not be reinstated. I hope you will join me in recognizing the “unintended consequences” of impact fees and how they actually can cost us more in the long run.