County impact fee increase has minimal effect in the Cape
Although Lee County increased its impact fees last month, new construction in the city of Cape Coral will not see the same increases as the unincorporated areas.
That’s because the city has its own impact fee rates, meaning the only impact the Lee fees will have is for schools.
Bill Johnson Jr. executive director of the Cape Coral Construction Industry Association said in a letter to members that the new fees means builders will only see an increase in the school portion of the impact fees of $424.80 per home.
That is because Cape Coral did not reduce its fees during the housing bust.
“The change is going to be minute here in the Cape. It will be felt more for the rest of the county. I haven’t gotten any pushback from the builders. For them it’s the cost of doing business,” Johnson said. “I just wanted to put that issue out.”
Joe Mazurkiewicz, of BJM Consulting, agreed with Johnson’s assertion that the school portion’s impact will be minimal.
Mazurkiewicz added the city has been consistent in the way it has charged them, which has been at between 80 and 90 percent of what it can charge, even during the toughest times during the recession.
But in a city where 92 percent of its tax base comes from residential, it’s easy to forget about non-residential construction.
Mazurkiewicz said impact fees have had a huge impact there.
“The county’s reduction created a huge increase in non-single-family home construction and its lagged behind in Cape Coral,” Mazurkiewicz said. “That number can get into the millions when you’re talking about putting in a shopping center in North Fort Myers as opposed to Cape Coral.”
Mazurkiewicz said, however, the city’s economic development incentives can knock a lot of money off that initial number.
Johnson said Cape Coral builders are paying between $10,000 and $16,000 in impact fees and costs per house including the building permit; it’s much less in the county.
Despite that, Johnson said there is no slowdown in the number of houses being built in Cape Coral.
On March 5, the Lee County Board of County Commissioners agreed to a five-year plan that will raise impact fees sharply the first year by about $2,400, then go up by about 2.5 percent in each of the next four years.
The county is currently collecting 45 percent of a base fee of $13,000. Under the new structure, the base will be adjusted to nearly $18,000 and the percentage collected will bump up to 47.5 percent, 50 percent and so on up to 55 percent in 2023.
Impact fees are fees paid for new construction to offset the “impact” that construction has on needed infrastructure such as new schools roads and parks.
Fees collected may not be used for operations and must be used to benefit the area from which the fees were collected.