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Lake City News

Lake City, City Manager Recommends Another 12 Month Impact Fee Suspension

Previous suspension cost City "well over $300,000" – CM Johnson

LAKE CITY, FL – Last night, Lake City, City Manager Wendell Johnson recommended continuing the City's 23 month impact fee suspension for another year. On December 4th, CM Johnson told the County Economic Development Advisory Committee (EDAC), "The data that I’ve put together from our building department indicates that we have had a suspension of well over $300,000 in the last 23 months." Last night CM Johnson told the City Council, "I ran some numbers through the City’s Planning Department and I found the value of the suspended fees has been about $271,000." CM Johnson brought no statistical analysis to either the City Council or the EDAC showing how he arrived at his totals.

Water and sewer impact fees were implemented by Lake City in 1993 as a condition for connecting to the water or sewer system. Impact fee payments are intended to defray the cost of constructing new additions to the City’s water and sewer systems as a result of new construction.

December 4th: CM Johnson at the EDAC

On December 4th, City Manager Johnson was looking for a letter of recommendation from the County Economic Development Advisory Committee to the City Council recommending continuing the City's impact fee suspension. CM Johnson submitted no year to year statistical data to the committee which would have been helpful in making a determination.

City Manager Johnson told the Committee:

The data that I’ve put together from our building department indicates that we have had a suspension of well over $300,000 in the last 23 months. I’ve been approached by developers looking to continue the suspension.

The data that I’ve gathered, you can interpret in one of two ways. And to definitely put a yes on the report it says it has had a positive impact by suspending the fees -- that's questionable. Personally I think it has.

The major consideration that I have to have is not the little small start ups, like single family homes -- those kinds of things. What I have to be leery of is if we get a major industry or major business comes in -- is gonna be a large number of ERU's.

When I go to the Council I wanna say it is the recommendation of the Economic Development Committee that we continue this. That it has had a positive impact.

After a brief discussion and without anything to back it up, the EDAC agreed to give CM Johnson his letter of recommendation.

Last night at the City Council

Last night at the City Council CM Johnson said, "I ran some numbers through the City’s Planning Department and I found the value of the suspended fees has been about $271,000."

CM Johnson continued, "In generating those revenues, or lack of, what has happened is we’ve have had, I believe it’s 86 permits that have been generated -- new development, and it’s my belief that if we continue the waiver for another 12 months that we will continue to see some spike, a continuing spike in residential and commercial growth. I’ve been approached by two major developers who are interested in doing some residential start up this coming year and they’ve encouraged the City to continue the 12 month extension."

"It’s my recommendation tonight for the Council to continue the suspension for an additional 12 months and then that would end the suspension."

The suspension would end on December 31, 2014.

The City Council unanimously suspended City impact fees for another year.

Epilogue

City Manager Johnson knows how to build a spread sheet, do statistical analysis, and turn raw data into meaningful information with which informed conclusions can be drawn.

The City Manager also has a finance staff that can do the same.

The fact that he hasn't, or hasn't made the material available can only lead one to one conclusion. He didn't want to.

When the housing bubble collapsed in 2006 economies across America were turned into shambles. Many communities, particularly those that relied on construction, suspended impact fees as a means of spurring growth.

A study of Florida construction 4 years after the bubble burst showed that impact fee reduction as a means of spurring local economies was mainly wishful thinking. 

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