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The Town Council received an update Dec. 19 on progress being made to bring the town’s development fee program into compliance with new state law.
The town has relied heavily on development fees to fund capital projects that are associated with community growth. The town has had six fee categories since it initiated the fees.
However, with changes to the law that were adopted in 2011 the town must make adjustments or stop collecting the fees altogether.
The town has until August this year to implement its new program.
Rick Giardina with Raftelis Financial Consultants is preparing the town’s new impact fee program.
After the revamp of the fee program there will be just three categories remaining for the town to use – those will include parks and recreation, fire and EMS and streets.
Giardina explained that due to a lack of future infrastructure need, “streets” is also effectively going away as a category.
Funds currently being held in existing categories will be used.
The law enforcement fund has $201,896, which will be used for law enforcement needs in the relocation of Fire Station #2.
The current street fund has $157,517, which is going to be used in the Saguaro Boulevard reconstruction project.
There is $42,348 remaining in the library/museum fund, which will go toward paying down the facility’s debt.
The existing open space fund has more than $1.6 million, all of which is expected to be used for construction of a trailhead in the Fountain Hills McDowell Mountain Preserve.
The town has until 2020 to use those funds.
Parks and recreation has $47,859 in its fund, and there is currently $43,624 in the fire and EMS fund.
Giardina explained how the new law is being implemented through an infrastructure improvement plan, based on land use assumptions, which the town will need to adopt and maintain.
In February the council will hold a public hearing regarding the LUA and IIP, with the council to consider adoption of the documents in March.
The new fee structure is scheduled for a public hearing in April, with council considering adoption in May.
Raftelis is currently reviewing data that will be used to calculate new fees.
Currently development fees are approximately $8,000 for a single-family home, according to Giardina. He expects they will be coming down simply because the town will be collecting fewer fees.
Mayor Linda Kavanagh said she hopes a reduction in the fees will help to spur new development.
Councilwoman Ginny Dickey said the legislature made the change because the homebuilders association felt that municipalities were abusing the fee structure.
“This has been an expensive intrusion into local affairs,” Dickey said.
She added that municipalities need a way to pay for expensive infrastructure to meet the needs of growth that is not a burden on existing homeowners.
“I’m happy we are on schedule to comply with this new law so we can continue to collect,” Dickey said.
