Steamboat Springs With the city hoping to augment its cash-strapped capital projects budget and local business people worried about the cost of development in Steamboat, City Council will take its final vote on impact fees tonight. And because the voters do not need to approve impact fees, City Council's final vote will be the final vote.
The fees, which are meant to fund the city's capital needs created by new development, could cost builders of single-family homes $4,454 per home and $1,186 per 1,000 square feet for office buildings, among other fees for various developments. The city's stance on impact fees is premised on its opinion backed up by a consultant well-versed in the practice that growth is not paying for itself. When a developer builds a new condo complex or office building, the city must be able to serve the new development. That may mean hiring new police officers or people to guide street sweepers, but it also means the city has to expand and modernize its capital facilities to deal with its new needs.
Some in the business community scoff at the idea that growth is not paying for itself, pointing to the sewer and tap fees assessed on new development in addition to sales and use taxes. Jon Peddie, a local developer, sees the impact fees, as proposed, as an unfair burden on certain strata of the community. Rob Dick, the executive director of the Regional Affordable Living Foundation, notes that the tax hits poorer people harder than the well-off. That's because the fee on a single-family detached home is the same whether the home is a 1,500-square-foot modular or a 6,000-square-foot trophy home.
The fees could be put to one of four broad uses: parks, city buildings and equipment, public safety and transit. They would not be able to pay for operations costs, such as salaries and benefits or for deferred maintenance on existing capital facilities. The city would also have to establish a "rational nexus" a connection between the new development and the need for new facilities and other capital items.
Even with the potential for $1.5 million per year in impact fees, the city would come in about $3 million short each of the next four years for its projected capital needs, based on numbers from the city finance department. The impact fees, then, may be part of a larger plan that could include a property tax or another revenue source to make up at least a portion of the shortfall.
"We have no city property tax, no Real Estate Transfer Tax, and until now no impact fees," said City Council President Kevin Bennett. "The city of Steamboat Springs can no longer simply subsidize new development. By not being at the table we are once again subsidizing growth and it is has been our policy to try to get out of the business of subsidizing growth."