Development impact fee increases may soon be on the horizon as the Plant City City Commission held the first of two public workshops Monday night to present comprehensive data outlining the necessity and projected impact of the proposed adjustments.
Impact fees, a crucial component of municipal finance, are one-time charges levied on residential, commercial and industrial developers to mitigate the strain that new developments place on public infrastructure and services such as roads, parks, library and emergency services. The fees are intended to ensure that growth pays for itself and to maintain the quality of life for existing residents. The fees were last adjusted in Plant City more than a decade ago.
A 2021 bill signed by Governor Ron DeSantis created a cap on the amount local governments can increase impact fees. The cap limits the increase to no more than 12.5% in a given year and no more than 50% over a four-year period. Because the increases exceed the limits, the city is required to provide a calculation of how it arrived at the need for the amount based on “the most recent and localized data,” and hold at least two publicly-noticed workshops dedicated to the extraordinary circumstances necessitating exceptions to the limitations. The increase must then be approved by two-thirds of the governing body.
Attendees at the sparsely-attended workshop had the opportunity to ask questions, express concerns and offer feedback on the proposed changes.
Nilgun Kamp, Principal Associate for Benesch, a professional services firm, gave a presentation about the need for the increase, citing the city’s continued growth, outdated studies, increasing costs and unfunded capacity needs as extenuating circumstances that necessitate the dramatic increases.
Proposed impact fees on new single-family homes (2,000-square feet) will increase from $3,950 to $8,107. Multi-family units (100 units) will see an increase from $301,192 to $576,400. For non-residential land uses, commercial properties (4,000 square-feet) will see an increase from $31,097 to $222,984. Industrial warehouses (one million square-feet) will see an increase from $458,250 to $720,000.
Kamp also pointed out that while the increases seem drastic, they’re in line with what neighboring cities and counties are charging developers. For example, the proposed residential impact fee of $8,107 will still be lower than fees charged by Lakeland ($8,627), Hillsborough- Urban ($11,663) and Hillsborough- Rural ($15,518).
Mayor Nate Kilton emphasized the importance of balancing the needs of both developers and residents, stating “I have some heartburn over the increase because of what the cost is to our developers but at the same time we have to keep up with our responsibilities to our citizens.”
There was some disagreement among commissioners as they discussed the changes to impact fees, with Commissioner Dodson preferring a staggered approach to the increase. “I don’t think it would hurt the city to do this in a couple stages, now and then in a couple of years,” he said. “Give it a couple years to sink in.”
Mayor Kilton expressed to make the full increase now. “I’d prefer for us to get caught up and roll back if necessary,” he said.
Commissioner Dodson remained unconvinced.
Commissioner Sparkman recalled 2008 and the effects a market turndown, and budget shortfall, had on city government. “We hd to lay people off to meet our budget and that’s not fun,” he said. “That’s the reason I would support this and the community will welcome us doing the right thing and biting the bullet and doing this.”
The Plant City Observer reached out to residential homebuilders for comment about how the changes would impact business but received no comment.
The second public workshop will be held Mon., Mar. 11 at 5:30 p.m. at City Hall.