There is much talk about Howard County current local bill 3-19, regarding increasing impact fees to developers. Many realize that our County has very low fees compared to other growing counties, by high factors; however, there is much disagreement about who ends up "paying" this fee. This topic has been near and dear to my heart for some time. During the APFO Task Force work, I, and others, attempted to address a fee increase many times, indicating our comparatively extremely low fees, and budget needs for improving public services.
I have an undergrad degree in Economics and a Masters in Finance, so these types of subjects are always of great interest to me. Concerns have been expressed about developer fee increases simply being passed through to the home buyer. That is not able to be done without a monopoly on supply. Howard County developers do not have a monopoly on the supply of housing. Many things affect home prices, including increasing a large group of suppliers' costs, but they cannot just pass through this increase in short-term large amounts. It's not like current housing prices are below market value, with wiggle room to jack them up to cover cost increases.
Low income home buyers are not helped by low impact fees. The incentive to build in Howard County, having high market values and low impact fees, creates pressure on our infrastructure and delays in providing good quality of life services, that often disproportionately affect lower income groups. But what about affordable housing one may ask? Getting a tiny portion of affordable housing in new development, which is often avoided via fees-in-lieu of providing it or "alternative compliance" measures has concentrated supply in lower market priced areas. An amendment to the updated APFO legislation last year, exempted certain affordable housing plans from school testing delays, in an effort to get more supply; however, where do you think those developments are going to be placed? They will go into the most crowded school areas, so as to skip the line, having avoided school testing. This means those needing affordable housing will be getting it only in the most crowded school districts.
Economically, and socially, it is needed and just, to increase these fees, and have those who create the impacts have more responsibility for their costs. I am quite hopeful the current Bill will be passed and fees will be increased, and our local County Council will be given the authority to control them, because of how many of our current Honorable Howard County Delegation Members went on record last year, indicating their positions on this topic.
Below is a copy of a letter I sent to the Delegation, thanking them and asking for their continued support. You can see their positions therein.
------------------------------copy of letter --------------------------
January 9, 2019
The People’s Voice
3205 B Corporate Court
Ellicott City MD 21042
Re: Howard County Local Bill 3-19 Increasing Developer Fees
Dear Honorable Howard County Delegation Members:
Good luck with your upcoming work session on Saturday January 12th on this matter. I will be present at this work session, so, if needed, I can answer any questions you may have of an APFO task force member. I truly appreciated having met with Delegate Atterbeary prior to the drafting of this Bill, and commend her effort and that of others on this issue.
The People’s Voice Board is unanimously in favor of increasing developer fees in Howard County by at least three times the current rate. We also prefer that language in legislation include the authority for future changes in fees be given locally, without caps. During this past year’s election season, our questionnaire for the Ethics Ballot included this topic. Please find below, the various positions taken therein, at the time.
Source: www.EthicsBallot.org Ethics Ballot tab, Questionnaires drop down, See Question 9.
Question posed was: Do you believe that development fees should be increased in Howard County? Would you be willing to sponsor or vote for a Bill that allows Howard County to increase those fees? Would you be willing to enable Howard County that right in perpetuity? For all, why or why not?
Katie Fry Hester:
“The quality of our educational system is a major driver of economic growth. If we don’t maintain and improve our schools, we risk entering a cycle of economic decline in the county. I would vote in favor of giving counties the right to raise development fees as they see fit.”
“I do believe that development fees should be increased in Howard County. Development brings with it an increased need for infrastructure, schools, and county services. Particularly when it comes to schools, I am concerned that school needs are not being met at the pace of new development, and this will eventually lead to insufficient schools, crowded classrooms, and students traveling farther to reach their school. For that reason, I would be willing to sponsor or support legislation that permits Howard County to increase developer fees. I believe it is reasonable for the County to set and increase those fees because the primary responsibility of development decisions lies with the County, and so if the County is making development decisions (via planning and zoning codes), then the County should be responsible for increasing those fees. I would be willing to enable Howard County that right in perpetuity for very similar reasons: these responsibilities of development, zoning, and local planning will remain County responsibilities in perpetuity, and so the decision on developer fees should also remain with the County.”
Senator Guy Guzzone was unopposed and was not sent a questionnaire in the past election season.
“I believe Howard County already has this ability.”
"Yes, I believe the County is best suited to determine the need for building excise tax changes because the County Executive develops the General Plan, which sets the rate and pace of growth, and the County Council that approves it. Building excise taxes flow to the capital budget for school construction and renovation. I believe the state having this authority is a vestige from the past."
“Yes. We need to move deliberately as we have seen. The recommendations of the county executive’s commission were unpopular and slowed the process down. I believe the county council should have the ability to regulate, but I believe the more eyes on this the better. There should still be input from the state delegation.”
“Yes, I believe that new development should cover the costs it imposes on Howard County’s public facilities, including schools, roads, and other facilities. I believe Howard County should have the authority to set adequate fees at the local level, and I would support legislation to give the County that authority.”
“I think development fees should be competitive with those charged in neighboring and comparable Maryland jurisdictions and should reflect the relative desirability of Howard County to developers. I have not considered the question of perpetuity and would need more information to form an opinion.”
“Absolutely! Howard County’s development fees are significantly below similar counties, including neighboring Montgomery County. I am horrified that developers can pay a nominal fee and overdevelop in areas, which in turn results in overcrowding in our schools. I have 3 children, ages 6, 4 and 3. My children will be in the Howard County Public School System for a long time. I do not want my children or other children to be subjected to overcrowded classes, portables, budget cuts and other negative ramifications due to over-development.”
“Yes. Howard County developer fees are low in relation to what development costs the County and also in comparison fees in other similar jurisdictions. The state legislature must give the County authority to charge more. However, I do not believe those higher fees should allow for development to move forward in schools with up to 120% of school utilization capacity. Schools should not be allowed to get this crowded because that type of crowding can negatively impact education. I think it makes sense for the State to enable Howard County to set fees as appropriate. There is no legitimate need for the County to have to go the state first before raising fees as it deems appropriate.”
Delegates Shane Pendergrass and Trent Kittleman did not return our questionnaire.
It seems a majority of Delegates and Senators were in agreement on the issues in local Bill 3-19, to increase fees and allow local control without cap. We are very hopeful that after completion of your research and review of information via meetings and work sessions, we will see this needed change made.
President, The People’s Voice
Vice-President, The Howard County Citizens Association
APFO Task Force Member
Zoning Regulation Assessment Steering Committee Member