Developers building in Kissimmee — who would pass on the costs to those buying new homes and other construction — may be paying higher impact fees City leaders discussed the matter during two meetings earlier this month, citing extraordinary circumstances that may make those fees double.
Those impact fees, one-time charges, cover the costs of the local impact of growth, like public facilities used by the new residents or workers that would use them.
At the July 18 City Commission meeting, commissioners discussed the concept, and, with input from its Parks and Recreation director Steve Lackey, held a workshop last week to further discuss it.
A consultant firm hired by the city has recommended Kissimmee increase its Parks and Recreation Impact Fees from $1,200 to $2,410 per dwelling unit for single-family and from $985 to $2,048 per dwelling unit for multi-family. The Rafeltis study also recommended creating a new Police and Fire Impact Fees of $489 and $529 per single-family unit (slightly less for multi-family units).
If all are implemented, the total of impact fees in Kissimmee would be $3,428, higher than Osceola County fees ($2,696) but still lower than St. Cloud’s ($47.96), the highest among municipalities listed in the region. They would generate $39.2 million in fees over a decade, more than triple than the $12.3 million under the city’s existing fee structure.
City Manager Mike Steigerwald said that, because of effects of the pandemic and inflation, the City Commission is being asked to approve an “extraordinary circumstance” measure to allow for such an increase in fees.
Joe Williams spoke for Rafeltis and said impact fees must be at proper levels in order for, “New growth to pay its own way.”
“I think everybody knows that inflationary costs for projects have … increased by 50%, double, triple,” he said. “Talking with staff about the considerable amount of development in the pipeline, we can look out and forecast over 30,000 additional people. There are major investments you’re going to have to make to serve those people — police, fire and parks services.
“By setting impact fees to the appropriate level, based on the investments your making, you’re having growth pay its own way toward expansions.”
The study assumed an additional 1,114 residential units would be built annually for the next several years, growing at just over 3% per year, pushing the city’s population over from 82,000 to over 112,000 in the next decade.
The study cites, “Recent large inflationary cost increases plus additional capital improvements based on a considerable increase in population growth … if Parks and Recreation Impact Fees were increased pursuant to the phase-in limitations, growth would pay around a maximum of $20,637,700. If the Commission approves the proposed Park and Recreation Impact Fees, growth would pay around $25,206,000.”
The city has earmarked about $39 million for its Lancaster Ranch recreational site along south John Young Parkway, and upgrades to the Mark Durbin Recreational Area.
State Statute 163.31801 states that if a county or municipality wants to increase their fees by more than 50%, it must state the circumstances, and hold public forums to discuss the matter. And, the city must wait at least 90 days to implement the higher fees after approving them. Adoption will require at least a two-thirds majority, which will be four of five city commissioners when it comes up for a vote.
Commissioner Carlos Alvarez raised opposition to the increases, citing high rents that would only increase if the cost of development increases.
“I’m seeing folks moving out rather than coming in, nobody’s banging on the doors of the rental projects we’re doing,” he said. “Can this come back this year, maybe? I’m just looking at that reality for why I’m opposing it.”
Commissioner Angela Eady said she supports them.
“We need that revenue for additional parks, and servicing them. Developers should pay their fair share. We are all going to pay, be it through development or for goods and services, if we don’t take this step,” she said. “It isn’t about holding one sector accountable, because we all have skin in the game.”
