County projects wait for construction cash
Slump lowers impact fees, which fund construction
The new-home building crunch has made a harsh impact, on Lee County impact fees. Parks, roads and school projects are the main casualties. Take, for example, Wa-keh Hatchee Recreation Center. Construction on the $12 million park with baseball fields, a playground and dog park was targeted for groundbreaking in January.However, you can expect that land where the indoor recreation center is standing, adjacent to Lexington Middle School in south Fort Myers, to sit vacant for at least another five years.
"The big thing is that we certainly see the economy in our impact fee collections and the ups and downs of it," said John Yarbrough, parks and recreation director. "What that means is some projects are going to be delayed."Impact fees are a one-time bill on new construction to defray the cost of providing and expanding services and facilities that benefit new development. A community park impact fee in unincorporated Lee County is $795 for a single-family home. Impact fees are imposed when a building permit is pulled.
In the 2005 fiscal year the parks department collected $10.2 million for community parks, in 2006 it was $9.4 million. The recent market crash crushed the impact fees to just $3.5 million in the 2007 fiscal year, which ran from October 2006 to September.
The numbers include Fort Myers Beach and Bonita Springs."I think overall it's unwelcome," Yarbrough said. "At the same time it gives us a chance to refocus, reprioritize and not that we don't do that, but make sure our priorities are where they should be with the projects."
Impact fees can fund only new park projects, not operations and salaries, Yarbrough said. Phase three of the Ten Mile Linear Park expansion from Crystal Drive to Colonial Boulevard will be completed in about six months. Future expansion is on hold until the market recovers.
The county transportation department — for which 85 percent of the capital improvement budget comes from impact fees — has felt the wave."Our major funding source is tied to building permits, so that is the risk we run," said Dave Loveland, planning manager for Lee Department of Transportation.
Single-family home permits in unincorporated Lee, Bonita Springs and Fort Myers Beach have nosedived since fiscal year 2005 when 20,578 were pulled. In 2006 there were 17,141 and in the most recent fiscal year, 6,572.That's a 67 percent decline.
The money streaming in from impact fees is used as cash in hand to award contracts. He said bidding projects in the short term is under control, but when the department updates its capital improvement program beginning in March, some projects may be pushed back.
Transportation took in $35.5 million in fiscal year 2007 including Bonita Springs and Fort Myers Beach. That's a 28 percent drop."The plus side is we are seeing bids come in less than our budgeted amount," he said.
The market turn has made construction companies eager for work, and they have become more competitive and are offering lower bids. In November, Posen Construction of Michigan's bid on the $25 million Summerlin widening between Cypress Lake and Boy Scout drives, including a flyover at College Parkway, came in $13 million under the county's budget.On Wednesday, the low bid for a widening project for Plantation Road expected to cost as much as $7.5 million came in at $4 million.
"The cash is coming in less, but the bids are lower," Loveland said.
Michael Reitmann, executive vice president of the Lee Building Industry Association, said the downturn should make the county consider other ways to generate revenue."We need to get a handle on not just allowing impact fees to pay for infrastructure," he said.
The impact fees are deterring the building industry from pulling the permits and not to expect the new housing market to kick up anytime soon, he said."We've got to get rid of the inventory because it doesn't make any business sense to start building if you got homes out there."
Impact fees for Lee County schools raised $23.6 million this past fiscal year. It's money is used for capital improvement projects.
In the 2006 fiscal year the fees collected peaked at $54.8 million. That's a 57 percent drop. A spokesperson for the district did not return calls seeking comment.
It is interesting that I have not seen, heard or read that any one from the county has yet to admit that they have to be weened from this high fat impact fee diet which just picks the pockets of the resident's of Lee County.
