The House Ways & Means Committee in a 12-2 vote Monday advanced a bill that would block increased impact fees from being levied on pending building permits, require each local government to create an impact fee review board and streamline approval processes.
Florida builders are assessed impact fees by cities, counties and special districts to finance infrastructure improvements for water and sewer, roads, schools and parks that local boards deem necessary to accommodate population growth spurred by new development.
But, according to House Bill 637 sponsor Rep. Nick DiCeglie, R-Largo, state builders have long maintained local governments “have not used these fees as intended. This is a lot of money for these folks.”
HB 637, previously cleared by the House Local, Federal & Veterans Affairs Subcommittee, is slated for a State Affairs Committee hearing before it goes to the House floor.
A Senate companion, Senate Bill 1066, filed by Sen. Joe Gruters, R-Sarasota, has not been heard in committee.
The bill would require local governments to segregate impact fee revenues into accounts for each improvement category, calculate impact fees with data no older than 36 months, create seven-member committees to review how fees are allocated and exclude costs from fees that don’t meet a revised definition of infrastructure.
DiCeglie said the bill will prevent builders ensnared in permitting and review delays before city and county boards from being assessed new or increased impact fees not factored into anticipated costs when they first submitted proposed projects.
“Say, for example, impact fees are $15,000. We want to make sure that fee stays that fee and you can’t come back and say the fees are now $25,000,” he said.
DiCeglie introduced an amendment that “tightens up language to ensure impact fees are used for new infrastructure and costs” by placing them into separate accounts for each category rather into lump infrastructure trust funds.
The bill was supported by representatives of the Florida Home Builders Association, the Florida Roofing & Sheetmetal Association, Associated Builders and Contractors of Florida, Highland Homes, MI Homes of Tampa and the Volusia Building Industry Association.
HB 637 is opposed by cities and counties, although Florida League of Cities (FLC) lobbyist David Cruz and other municipal officials praised DiCeglie for addressing their concerns in Monday’s amendment and willingness to continue tweaking the bill.
But, Cruz said, “there are areas that we need to work on,” such as the transferability of impact fees to different needs in different jurisdictions and the creation of a new board that adds “another layer of bureaucracy” that small cities, such as St. Martins – population 300 – won’t have enough qualified residents to staff.
“We have a long, substantial amount of case law that stipulates how impact fees can be spent that already places the burden on local governments to ensure they are spent properly,” Cruz said.
Untrue, said Rep. Blaise Ingoglia, R-Spring Hill. Audits “do not have to attest that impact fees have been used for the intended purpose in intended jurisdictions,” he said, asking Cruz if there are transparency safeguards in place to ensure this is so.
“I am not sure,” Cruz said. “I’d have to get back to you.”
“I can answer that. The answer is no,” Ingoglia said. “Right now there is no such oversight [and] then we wonder how we get Taj Mahals – schools that look like mini-universities. ‘Hey, my kids didn’t learn anything, but the school they went to, that was beautiful.’
“In the absence of a review committee,” he continued, “how can local taxpayers have faith in local governments when there is no process or procedure to verify that local governments are spending impact fees as intended?”