Developers may pay higher fees sooner

Council members voted 4-3 on Monday to consider altering the schedule set for increasing developer impact fees.

Instead of phasing in an increase of the one-time fee over three years, council members are considering shortening the period to two years and four months.

Mayor Connie Boardman initially asked the council to charge 100 percent of the impact fee to developers, but agreed to Councilman Jim Katapodis’ compromise of changing the fee schedule.

Chamber of Commerce President Jerry Wheeler has approached the City Council for the past two meetings and asked them to not change a fee schedule he and business owners have fought for.

“You made a deal and now you’re changing it,” he said. “What kind of message does that send to the business community?”

Developers are being charged 30% of the difference between the old fee and the new fee since September 2012. A year later, the fee would increase by another 30%. Then in September 2014, the developers would pay 90% of the recommended fee calculated by city staff in a report conducted in 2011.

Assistant City Manager Bob Hall explained: if the new fee was $200 and the old fee was $100, the difference between the two is divided by three to determine 30% of that difference. So for the first year, developers pay $133 and then $166 for the second year.

FOR THE RECORD:
An earlier version incorrectly identified Bob Hall as the city manager. He is the assistant city manager.

Should council members decide to approve this change on March 18, developers have to pay 90% of the fees starting January 2014 instead of September 2014.

The development impact fees are used to pay for police facilities, fire suppression facilities, street and traffic improvements, park facilities development and other services.

A study was conducted after council members said they felt the fees developers were paying weren’t adequate, Boardman said.

Local business owner Dianne Thompson spoke before the council, asking them leave the fee structure alone.

“The mere fact that this is on the agenda tells the business community that [the city] might not be as friendly to anyone considering doing business in our city as our marketing efforts suggest,” she said. “In an effort to check the pulse of this council on a previously resolved issue, [the city is] saying nothing we’ve done in the past can be counted on.”

Wheeler said the rehashing of the fee schedule goes against the idea of bringing business into the city.

“They missed the entire point with this message they’re sending,” Chamber of Commerce President Jerry Wheeler said.

Councilwoman Jill Hardy proposed charging developers 80% of the recommended fee starting September 2013 and moving to 90% the following year, but the motion was met with opposition.

“If it’s not broken, don’t fix it,” Councilman Joe Carchio said. “We worked hard for this.”

Wheeler is concerned that with this new proposal on the table, developers would reconsider building in Huntington Beach, he said.

“It’s not the message you want to send [to the business community],” he said. “The city has this beautiful 10-point plan of economic development that they’ve won awards for and the first thing they do is come out and raise fees.”

anthonyclark.carpio@latimes.com

Twitter: @acocarpio