Leader Blues

Monday, November 19, 2007

TOP STORY >>Council may end fees for builders

By JOAN MCCOY
Leader staff writer

The impact fees on new construction that the Cabot City Council put in place in November 2006 are scheduled to almost double this month, but the council that is now made up of mostly new members is considering either halting the collection of the fees temporarily or freezing it at the current level until they figure out if it has played a part in the slowdown in residential construction.

A committee of council members working on the 2008 budget Thursday told City Attorney Jim Taylor to draft two ordinances for the Monday night council meeting, one calling for a moratorium on the fees and another freezing them at the current level. If neither is passed, the impact fees on a 3,000 – 3,999 -square-foot house will increase from $1,272 to $2,196.

The fees are also scheduled to increase in 2008 and 2009. By the third increase, the impact fees on a 3,000 – 3,999- square-foot house would be $4,037.

The council appears divided on which ordinance to pass, but all agree that the fee should be restructured so that none of the money collected goes to the wastewater department.

When the study for the impact fee was started, Cabot desperately needed a new wastewater treatment plant.

But before the fee was implemented, city voters approved a one-cent sales tax to pay for that plant, which is scheduled to open this year.

The commission that runs Cabot WaterWorks said when the impact fee ordinance was passed that wastewater should be included because growth would require improvements to the system.

But recently the commission has changed its position and now says wastewater can manage without its part of the money collected.

The council committee also talked at length about the impact fee when it met Tuesday night. At that time, Alderman Ed Long called for a moratorium on the fee until spring to try to determine whether the economy or the impact fee is causing the building slowdown.

In recent years, the city has averaged selling about 35 residential building permits a year.

This year, the average has been closer to 25 with 11 sold in September and eight in October.

“To me this is front burner on high. I need to know something,” the alderman said.

He reasoned that if the fee is the cause for the decline in building permits, a moratorium on the fee should slow the building boom now going on in Austin and Ward.

Alderman Tom Armstrong, one of two aldermen who were on the council when the impact fee was passed, said he didn’t vote for it and doesn’t want to keep it.

“It’s making the builders leave,” Armstrong said.

Alderman Eddie Cook, the other holdover from the 2006 council, voted for the impact fee ordinance and said he is opposed to a moratorium but not necessarily opposed to a temporary freeze.

Cook said he had talked to builder Tommy Ray who has left Cabot because there is no more land to build on.

Alderman Becky Lemaster said she talked to builder Barry Weathers who has left Cabot because of the impact fee.

Alderman Teri Miessner said a moratorium while a determination is made about how the fee affects the building industry is pointless because no one will actually study it.

Miessner said the committee of mostly builders and bankers who made up the committee that recommended the fee in 2006 should be asked to take another look at it.

Jerrel Maxwell, the head of public works, said Tuesday that although the sale of building permits is down, the sale of occupancy permits is up, which means houses are being sold.