BY ALEXANDER WILLIS
The Spring Hill Board of Mayor and Aldermen discussed Monday night implementing an update to the cities development fees which could increase by more than 500 percent in some cases, surpassing all of Brentwood’s current development fee amounts.
The proposal comes amidst continued discussions among city leaders as to how the city will be able to afford it’s long list of development projects, which, just from the 20 or so projects deemed to be a top priority, will cost more than $180 million.
The proposal outlines an increase in the two primary development fees: the adequate facilities tax, and traffic impact fees.
Regarding the adequate facilities tax, the city’s current rate charges developers a base fee of $500, plus 50 cents per square foot. The proposal does not include an increase to these amounts, but instead suggests limiting the fees’ use to “being spent on arterial street capacity improvements,” as to further separate the uses of revenue from the adequate facilities tax and the traffic impact fees.
Regarding the traffic impact fees, the proposal outlines increases across the board for different types of development, with increases ranging from just 18 percent, to over 600 percent. For example, the current traffic impact fees associated with single-family development, meaning residential homes, sits at $521. Were this proposal to be implemented, that same development would see a new traffic impact fee of $3,048.
For comparison, Brentwood’s traffic impact fee on single-family development is currently $1,230, a nearly 60 percent difference.
John Maher of John Maher Builders, a prominent developer in the city, voiced his disapproval of the proposal during Monday night’s meeting, arguing that developers are constantly being singled-out and targeted unfairly.
“We continue to incentivise, have the taxpayers subsidize corporations that come into our area, but what never gets talked about is that when these corporations come, they bring people,” Maher said. “When they move into our area, who we penalize are the folks that provide them housing. We carry the bill, it’s our fault. You may not say that, but the way you tax, that’s what it says. My question is, how much is enough?”
To further illustrate his point, Maher reminded the board of when General Motors moved into Spring Hill in the late 1980s, and pointed out that they were given a 40-year tax abatement, which is a reduction of taxes to encourage development.
“Most of you know this, but there was a 40-year tax abatement given to GM, and rarely is that talked about. I’ve done a lot of research on it, and my information on it may not be correct, but the taxes on that Saturn Corporation would have been $8,750,000 a year. But they were granted a 40-year tax abatement, and they were going to pay $287,500 a year.”
“I just ask you to try to be fair when you’re making these decisions, and realize that we taxpayers are subsidizing the big boys,” Maher said. “When this 40-year thing runs out, you all know they’ll come back to us and threaten to leave, and you’ll bow down and you’ll say, ‘OK, you can have another 40 years, taxpayers will pay for it.’”
Maher continued by emphasizing the contributions developers have made to the city, who Maher said had built more roads than the city itself.
“It’s not fair, we’ve become the whoopin’ boy,” Maher said. “I’ve checked how many roads has Spring Hill built since Saturn came here, and the private sector has built many times more roads that people travel on every day than Spring Hill has. I, personally, have built more roads in Spring Hill than Spring Hill has. And yet we’re the whoopin’ boy, we’re the reason for the problem. There’s got to be a common-sense solution.”
Alderman Matt Fitterer spoke of some of his concerns with the proposal, saying the rapid increase on fees related to office and retail development could be counter-intuitive to the types of development the city has been trying to attract.
“Spring Hill [has] traditionally been known as a very affordable city to live in, especially compared to some of our surrounding municipalities,” Fitterer said. “Pushing some of the fees higher than where Brentwood is, specifically in the retail and office sectors, is a little bit concerning when those are industries and uses that we’re asking staff to expend a lot of effort to bring to Spring Hill. I have concerns if a 500-percent increase at once is digestible in the market. That’s not to say that final number isn’t appropriate, but just the rate at which we get there is the concern.”
Alderman Clint McCain spoke in favor of increasing some development fees, but was wary to approve the proposal without more information on the city’s further plans when it comes to other revenue sources.
“It’s a lot to digest,” McCain said. “I think while we do need to increase some of our fees, I would like to see a bigger picture of what we’re looking at across the board from all of our fee increases before we just vote on this one. I’m hesitant to support to increase this and not know what the bigger picture looks like moving forward.”
Alderman Susan Zemek said she believed the proposal was fair, and that Spring Hill as a city had earned the right and the value to ask for such an increase.
“I think Spring Hill’s worth it, I think we are worth what we’re asking for now,” Zemek said. “I think we’ve proven that, I think that we have staff in place that knows what they’re doing, and doing it.”
Alderman Kevin Gavigan also spoke in favor of the proposal, and counter to McCain’s concerns, said he believed the data was comprehensive and detailed enough to warrant a quick approval.
“I’m a supporter of this,” Gavigan said. “To any concerns that my colleagues have about it not being part of the bigger picture, the report that we got from the study [was] really comprehensive, and I think does a really good job of justifying the implementation of these fees. In my opinion, this is making our city a lot better, a lot more mature. I think this is one of the best things that are city could do.”
As the meeting Monday night was a nonvoting meeting, no ultimate decisions were made on whether to implement the development fee increases.
Given the gravity of the decision, city leaders decided to continue the discussion during a specially called meeting at 6 p.m. on Tuesday, March 26, at City Hall. The meeting will be open to the public, and have opportunities for public comment.