Agenda 10/26/2010 Item #10GAgenda Item No. 10G
October 26, 2010
Page 1 of 5
EXECUTIVE SUMMARY
Recommendation to review the options related to the application of reduced impact fee
rates to building permits that have not been issued and are currently in "Apply" or
"Ready" status, prepared in accordance with direction provided by the Board of County
Commissioners on October 12, 2010
OBJECTIVE: That the Board of County Commissioners (Board) review the options related to
the application of reduced impact fee rates to building permits that have not been issued and are
currently in "Apply" or "Ready" status, prepared in accordance with direction provided by the
Board on October 12, 2010, and provide direction to the County Manager, or his designee, and
the County Attorney as to any such changes that will be implemented.
CONSIDERATIONS: On September 28, 2010 the Board adopted Ordinance No. 2010 -38,
with and effective date of October 8, 2010, thereby providing a decrease in Road, Community
Parks and Regional Parks Impact Fees for building permits applied for on or after the effective
date.
On October 12, 2010, the Board of County Commissioners accepted the recommendation by the
District School Board of Collier County to reduce the current, adopted School Impact Fees by
50 %. This action was taken by way of the adoption of Ordinance No. 2010 -39, with a
retroactive effective date of October 8, 2010.
Additionally, on October 12, 2010, the Board considered a request by Mr. Bruce Anderson to
allow the reduced impact fees to apply to building permits in process that have not been issued.
The Board directed the County Manager, or his designee, to develop options, including cost,
financial impact, processing requirements, sunset date, etc. and present the options to the Board,
for review and consideration, at the next meeting. The Board also directed that the County
Manager, or his designee, contact the District School Board to seek their input on this matter.
The following is the background and analysis that has been utilized in developing several
options:
Background: Section 74 -108 of the Collier County Code of Laws and Ordinances (The
Collier County Consolidated Impact Fee Ordinance) provides:
"Impact fees are assessed using the rates in effect when the building permit application is
submitted."
In the past this rule provided the customer the ability to apply for a building permit and
"lock -in" existing impact fees when fees were scheduled to increase. As of September
30, 2010, there are 42 commercial permits, totaling approximately 528,000 square feet,
in apply or ready status (not issued) that may be subject to impact fee assessment. There
are also 61 residential permits consisting of 126 units. Impact fees have not been paid for
these permits, with the exception of the upfront portion of the Road Impact Fees. The
impact of allowing the impact fees to be calculated at the new rates is the potential loss of
revenue related to the difference in the rates. The estimated loss of revenue: Road =
Agenda Item No. 10G
October 26, 2010
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$1.9 million. School = $503,000. Parks = $44,086. The estimated loss of revenue
reflects the "worst case scenario' and assumes that all permits above will commence
construction based on the rate reduction.
In consideration of the information above, the following options have been developed to mitigate
this issue:
1) Allow applicant to request a re- calculation of the impact fees, pay a re- calculation fee
of $50.00 for single - family homes or $250.00 for multi - family or commercial
construction, based on staff time and administrative costs, for those permits that are in
apply or ready status (not issued). Re- calculation could be completed within 5
business days of submittal of the request/payment of re- calculation fee. Allowing the
re- calculation of the impact fees does not waive any requirements related to plan
review, Building Code requirements, permit expiration, etc. This option would be
available for permits currently in process (not issued) due to the extraordinary
circumstances of two large scale impact fee reductions occurring simultaneously.
In the event that another large reduction occurs, this option could be re- implemented.
Customer Impact: This is a simplified process with a projected cost of $50 to
$250.00, depending on the type of construction, and. minimal wait time for impact
fees to be re- calculated. This would delay a project approximately 5 working days.
County Impact: This will create a short term overtime demand on staff which would
be offset by the proposed re- calculation fee. Financial exposure will depend on the
number of applicants that take advantage of this process.
2) Utilize the structure of Option 1, customer requested re- calculation and associated
fee, but amend the Code to reflect this procedure. Language similar to the following
could be included:
Section 74 -108. Definitions.
Impact fees are assessed using the rates in effect when the building permit
application is submitted. However, an applicant may request a re- calculation of
the impact fees, based on revised impact fee schedules prior to the issuance of the
building permit. In order to request a re- calculation the applicant must submit: 1)
a written request to re- calculate the impact fees including permit number and 21
payment of a re- calculation fee of $50.00 for a single - family home or $250.00 for
multi - family or commercial permits. Re- calculations will be completed within 5
business days of receipt of the required request and payment of re- calculation fee
Agenda Item No. 10G
October 26, 2010
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3) Utilize the current process and allow the applicant to re -apply under the revised rates.
Staff would work with applicants to minimize the time and expense related to this
option. Building permits that are not active or those that require updated plans due to
Building Code or Fire Code changes may incur a greater expense and new plan
reviews.
Customer Impact: Estimated costs for a cancellation and re- application are $110 per
discipline ($440 max). This does not include any fees that may be assessed by outside
agencies (Health, Fire, etc.). It could delay the project two to four weeks.
Count pact: Limited. Process is already established. Financial exposure is
related to the potential revenue loss of the difference between the rate based on
application date and the new reduced rate. The financial impact is listed in the
background narrative above.
These options apply to building permit that are in process but have not been issued. Permits that
have been issued, including those that have commenced construction, may elect to follow the
current process to cancel a building permit, re -apply for a building permit and request a
reimbursement of a portion of the impact fees previously paid.
Staff has contacted representatives of the District School Board of Collier County to solicit their
input on this matter and will provide the Board with that information during the discussion on
this item.
FISCAL IMPACT: As discussed above, there are 42 commercial permits, totaling
approximately 528,000 square feet, in apply or ready status (not issued) that may be subject to
impact fee assessment. There are also 61 residential permits consisting of 126 units. If each of
the applicants elected to follow a process to have the impact fees re- calculated using the revised
impact fee rates the fiscal impact is the loss of revenue between the rate in place at time of
building permit application and the new revised rates. The estimated amount of this loss is $1.9
million for Road Impact Fees, $503,000 for School Impact Fees and $44,086 for Parks Impact
Fees. This is the worst case scenario as it assumes that all of the above permits will be issued and
commence construction.
There are no cash reimbursements related to the above options. The building permits in question
have not been issued and therefore have not paid impact fees.
The financial impact on the customer is minimal and ranges between $50.00 and $440.00,
depending on the option selected. This does not include any fees that may be assessed by outside
agencies (Health, Fire, etc.). The reduction to Road Impact Fees for a mid -size Single - Family
home is $3,387.00, the reduction to School Impact Fees, for the same size home, is $5,378.00
and the reduction to Parks Impact Fees is $349.00 (Total: $9,114).
The re- calculation fee will be used to offset the staff hours related to re- calculation of the impact
fees, administrative cost and hours related to ensuring that information contained in permit files
and other records accurately reflect the basis for the change and revising procedures and
generating audit reports to ensure that impact fees are correctly assessed and paid. The amounts
are based on the staff time to be allocated to the entire re- calculation process, based on a fully
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October 26, 2010
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weighted salary of $75.00 per hour. The City of Naples is assessing an administrative fee of
$250.00 for their process related to this issue.
GROWTH MANAGEMENT IMPACT: Impact fees generate funds to be expended for
capital improvements to public facilities necessitated by growth which is consistent with Policy 2
of the Capital Improvement Element (CIE) of the Collier County Growth Management Plan
(GMP), which states: "Future development will bear a proportionate cost of facility
improvements necessitated by growth."
LEGAL CONSIDERATIONS: This item is legally sufficient for Board action. -JAK
RECOMMENDATION: That the Board of County Commissioners selects Option One (1) and
directs staff to implement the recalculation process and fee immediately for all projects in "apply
& ready" status.
Prepared by: Nick Casalanguida, Deputy Administrator, Growth Management Division —
Planning and Regulation
and
Amy Patterson, Impact Fee and Economic Development Manager, Growth
Management Division — Planning and Regulation
Agenda Item No. 10G
October 26, 2010
Page 5 of 5
COLLIER COUNTY
BOARD OF COUNTY COMMISSIONERS
Item Number. 10G
Item Summary: Recommendation to review the options related to the application of reduced impact fee rates
to building permits that have not been issued and are currently in Apply or Ready status,
prepared in accordance with direction provided by the Board of County Commissioners on
October 12, 2010 (Amy Patterson, Impact Fee and Economic Development Manager, Growth
Management Division)
Meeting Date: 10/26/2010 9:00:00 AM
Prepared By
Amy Patterson
Manager - Impact Fees & EDC
Date
Community Development &
Environmental Services
Business Management & Budget Office
10/19/2010 10:34:08 AM
Approved By
Judy Puig
Operations Analyst
Date
Community Development &
Community Development &
Environmental Services
Environmental Services
10/19/2010 11:01 AM
Approved By
Nick Casalanguida
Director - Transportation Planning
Date
Transportation Division
Transportation Planning
10/19/2010 11:24 AM
Approved By
Jeff Klatzkow
County Attorney
Date
10/19/2010 12:53 PM
Approved By
Norm E. Feder, AICP
Administrator- Transportation
Date
Transportation Division
Transportation Administration
10/19/2010 1:02 PM
Approved By
OMB Coordinator
Date
County Manager's Office
Office of Management & Budget
1011912010 1:47 PM
Approved By
Susan Usher
Management/Budget Analyst, Senior
Date
Office of Management &
Budget
Office of Management & Budget
1 011 9/201 0 4:50 PM
Approved By _
Leo E. Ochs, Jr.
County Manager
Date
County Managers Office
County Managers Office
10/20/2010 8:58 AM