Developers, builders and land-use planners lambasted a proposed change in fees meant to ensure that Santa Maria city services keep up with growth, contending that new rates three times higher would chill future housing and other projects.
A public finance consultant, DTA, crafted the Development Impact Fee Justification Study that sparked concerns aired at recent meeting.
“I’ll just tell you the document that was generated scared the bejeebers out of the development community,” land-use planner Laurie Tamura from Urban Planning Concepts said. “We need a lot of work on this.”
“To expect a 300% increase in fees at one jump is going to have an extremely chilling effect,” a builder said, suggesting that the city’s study is flawed.
“Provide your comments and we’ll address your issues. We have a responsibility to make sure that we’re building proper infrastructure, and this is an attempt to do that,” Public Works Director Brett Fulgoni said.
While higher fees would provide funding for the city, the increase also would boost costs for buying and renting homes, leading to unintended consequence of stopping projects, developers said.
Along with city fees, developers and builders also pay fees for local school districts to help serve additional students.
“We don’t have a housing crisis. We have a housing policy crisis, and this is the perfect example of that, so let’s get to the table and work on that,” said Lindy Hatcher from the Home Builders Association of the Central Coast.
“We are the table. This is the table,” Fulgoni said, adding that the next meeting was scheduled before the inaugural session started. “We’ll continue to work together on that.
“We want to make sure that this is an equitable program and that we’re moving forward in a way that is simpler than the current world.”
The fees cover various city services and facilities such as parks, water, sewer, storm drain, city administration and others. The effort also simplified traffic mitigation fees.
Storm drain fees would be based on acreage, water and sewer on meter size, and hotels on a per-room basis.
Instead of the $22,017 fee now charged, the first draft of the proposal would bump the fee to $61,286, much higher than neighboring areas, including those where house prices are twice as much as Santa Maria’s.
Fulgoni said the city would continue to pursue grants and other funding sources to help defray the costs of various projects.
In addition to city staff, attendees at the July 17 meeting included representatives of various projects, including Blosser Ranch, Richards Ranch and others.
Fulgoni said the revised fee program featured a new formula that includes costs for facilities for future services supplied by the city.
“The idea is as the city grows, it will need more administrative space for City Hall. It will need more administrative space for XYZ service,” he said.
Tamura disagreed with the formula for level of services, doubting the assumptions about future office space needs.
“The use of libraries now is 30% less than 20 years ago, but you extrapolated the library use in a linear fashion,” she said. “So, are we just building buildings for the sake of building buildings?”
“We certainly will not,” Fulgoni said.
Any projects still would require City Council approve through the budget process, he added.
As the city looks to switch from a project-based formula to a level-of-service method, the funding wouldn’t just cover future fire stations, but also firetrucks, apparatus and more, city staff said.
Those costs also are rising. For instance, a police vehicle that once cost $80,000 has risen to $120,000, while a firetruck, once available for $650,000, now costs $1.3 million.
“We participate in the inflationary environment as well,” Fulgoni said
Compared to counterparts across the Central Coast, Santa Maria historically has had a more favorable relationship with developers.
Without planning for expanded city services to meet the needs of new residents, Santa Maria’s quality of life could deteriorate, Fulgoni added.
“That’s kind of the two big economic questions — how do we find the middle ground here, and how do we make sure that projects still get sold but make sure we that build a quality city? That’s what we’re trying to do here,” Fulgoni added.
Another meeting on the proposed growth impact fee program changes is set for 10 a.m. to noon Aug. 20 at Shepard Hall in the Santa Maria Public Library, 421 S. McClelland St.