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Local News

New Study Tallies Building Industry’s Added Value to Communities

Construction study reveals benefits to the tune of a quarter-billion dollars in Santa Barbara and San Luis Obispo counties.

New construction in Santa Barbara and San Luis Obispo counties contributed more than $250 million in the five fiscal years between 2002 and 2007 toward new and better schools, roads, parks and other public improvements that add value to Central Coast communities, according to a newly released study.

The study, “New Construction: Adding Value to Our Communities,” released by the Home Builders Association of the Central Coast, shows the amount of dollars paid by new residential and commercial construction through development impact and school fees to build the infrastructure needed to serve growing, economically healthy communities.

“The study illustrates one of the many ways that the home-building industry contributes toward making neighborhoods and towns better places to live today and tomorrow,” said Maury Froman, association president.

The information presented in the study was compiled from municipalities, school districts, special districts, and Santa Barbara and San Luis Obispo counties by Cal Poly Construction Management student Michael Pearson. The California Homebuilding Foundation supplied a grant to fund the study.

“I was surprised to learn how much the building industry pays for each new home and building,” Pearson said. “The study helped me understand how local governments and the building industry work together to create the infrastructure that communities need.”

The study found that new construction paid a total of $262 million in development impact and school fees during the study period, including $180.7 million in San Luis Obispo County and $81.3 million in Santa Barbara County with $187 million of the total going for general public improvements and $75 million toward school construction.

The study also found that the most fees paid in any single year during the study period to all San Luis Obispo County governments was $39.9 million in fiscal 2005-06 and to all Santa Barbara County governments was $17.9 million in fiscal 2003-04. The most paid to any single city during the full five years studied in San Luis Obispo County was $50.2 million to Paso Robles and in Santa Barbara County was $30.9 million in Santa Maria.

“We chose the 2002-2007 time period because it included both high and low economic conditions — a residential construction boom and a slump, allowing the industry’s normal cycles to even out and make the data reliable and representative,” Froman said. “We only surveyed the communities that had substantial construction. The actual total fees paid would increase if all communities were included.

“The association deliberately chose not to use the study or our research to analyze or imply that fees were too high or too low,” Froman added. “We simply wanted to see the total dollars in fees paid and wound up being surprised with the answer.”

Jerry Bunin is the government affairs director of the Home Builders Association of the Central Coast.

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