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Decatur explores developer impact fee program

Business Decatur

Decatur explores developer impact fee program

Decatur City Hall.
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This story has been updated. 

By Cathi Harris, contributor 

Decatur, GA – The city of Decatur is in the process of determining whether and how to implement a program of impact fees for new residential development to offset the city’s increased costs for providing services and infrastructure to those new residents.

In March, the Decatur City Commission is expected to consider a proposal from an outside firm to study what fees the city could assess to developers as well as recommend a proposed maximum impact fee schedule, David Junger, the city’s assistant manager for public works services told Decaturish Friday.

“Impact fees are used to distribute the costs of what all is involved in providing services to the new people that move in, but also providing for infrastructure that may not exist there today but would need to be put in to support it,” Junger said.

Implementing an impact fee program is not as simple as it might seem on the surface. While developer impact fees are used in different ways nationwide, Georgia state law sets specific requirements for which local governments can assess impact fees, how local programs are maintained, and what the fees can be collected for.

The Developer Impact Fee Act of 1990 (DIFA) also requires cities and counties that want to assess impact fees to meet certain planning requirements as well as establish a local advisory committee to oversee the program. This study would also cover how the city needs to modify its comprehensive plan and establish an advisory committee in order to have an approved program and comply with the law.

Decatur first began looking at the issue of developer impact fees around the time of the redevelopment of the Avondale MARTA station property, Junger said. Because the area around that development had been primarily industrial and commercial, it lacked a lot of infrastructure necessary to support residential development. 

An initial report was prepared in 2017, but ultimately no action was taken at that time. With increased development pressure around the East Decatur Station area and elsewhere in the city, leaders deemed it a good time to move forward.

In January, the city issued a request for proposals (RFP) from firms that would be able to perform a Phase 2 impact study. Three proposals were received that met the requirements and city staff is in the process of evaluating the proposals to make a recommendation to the City Commission about how to proceed.

“The Phase 2 study would give us a whole cookbook to launching a program, should the commission decide to do it,” said John Maximuk, Decatur’s director of design, environment and construction. “At the end of the study, what [the commission] will have before them is what the proposed fees would be and what they would be used for. In Georgia, they are primarily used for parks — recreation, open space — public safety for both fire and police protection. Those are the big three.”

Decatur’s RFP also asked that the study assess whether an impact fee program could assist the city in meeting its affordable housing goals, either directly or indirectly. A recent report by the Affordable Housing Task Force notes that while impact fees can’t be used directly to support more affordable housing, but the fees could free up general fund money that could be reallocated towards that purpose. 

“We added that because we wanted to kind of stretch the envelope of the law and make sure that we are able to use these funds for as many things as possible,” Maximuk added.

Once the study report is complete, the city staff would draft an ordinance that would be voted on by the City Commission. The new ordinance would establish an impact fee program for the city. Only developments that apply for a permit for construction after the passage of the impact fee ordinance would be subject to the fees.

Despite the long process, it can be well worth it for Decatur to do this, Maximuk said. “Impact fees will reduce the overall expenditures of the local government for a whole lot of things.”

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