The city of Atlanta could be raising its impact fees in the near future.
That decision will be determined by a comprehensive update to its impact fee program.
“We must make sure our impact fee structure is practical, effective and fiscally responsible,” District 7 Atlanta Councilman Howard Shook, who represents part of Buckhead and introduced legislation calling for the update, said in a news release. “We haven’t updated our impact fees since 1993 (their inception). This legislation ensures the steps are taken to review our impact fee program and get it on the right financial footing.”
At its meeting Jan. 6 at City Hall, the council voted to approve the legislation calling for the update (Legislative Reference No. 19-O-1728).
The city levies impact fees on new developments to help fund expanded capital facilities mandated to serve new residents and businesses that will occupy those developments. Impact fees are assessed for transportation, parks, police and fire facilities.
In an interview, Shook said he expects the fees to increase.
“I have been telling developers that because the fees have never been adjusted since their inception, that more than a quarter century has gone by without infrastructure support really getting the proper amount of revenue it should from impact fees,” he said. “So it’s hard to imagine them doing anything other than going up.
“There’s a classic formula to determine the fees. They have a lot to do with land costs. Well, we all know what’s happened there with land values going up (since 1993). There’s also a (formula) component with transit trips, and obviously our traffic has gotten a lot worse over the years.”
Shook said the city is working with a consultant to update the impact fee program and work as an independent analyst so the new fee program “would be able to survive any legal challenge.”
“I believe it’s the administration’s intent that council members and the consultant can sit down in a public work session maybe near the end of this month,” he said. “All they have to do is update over the last three years. The last thing this group did for us was update all the land value costs and (transit) trips that we submitted in a 2017 report. They don’t have to go back that far. Hopefully they won’t have to reinvent the wheel.”
Shook said the program update could include adding a park-related provision.
“I think there’s a widespread interest to use parks’ impact fee money not just for land acquisition but also to help fund park improvements, which is allowable under state law,” he said. “But for whatever reason in 1993 the city declined to provide for that option.
“That will be huge for Buckhead because we’ve picked up quite a lot of additional land for parks, but to build them out from a wooded lot into a park relies on an awful lot of (private) stakeholder equity for communities to make that money. This will lighten that burden and we can, hopefully, build those parks a lot more quickly.”