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Impact Fees Capped

FWC photo by Carol Lyn Parrish / Courtesy FWC Flickr
A Florida Double Rainbow

Last Friday, Governor Ron DeSantis signed a bill that will severely limit the ability of local governments to raise impact fees, the primary tool local governments use to finance required infrastructure for new developments.

Impact fees pay for the cost of infrastructure needed to support new development such as new roads, sewer lines, schools, and fire safety and emergency medical services. These fees are paid by developers in order to extend public services, especially when creating a new development in rural regions far from where such services and amenities already exist. Having developers pay impact fees keeps existing taxpayers from shouldering the financial cost of new developments.

However, Florida HB 337 limits how much a local government can charge developers, capping impact fee increases at just 12.5%.

It typically costs more to extend infrastructure to developments far from urban centers, which is why Jane West is sounding an alarm. She’s the Policy and Planning Director of 1000 Friends of Florida.

"Someone needs to pay for that growth and that infrastructure and if it's not going to come from the developer in impact fees, then you're going to see your taxes rise in order to pay for that on the existing residents," said West. "We're basically going to be subsidizing new development to come onto our raw undeveloped land and that seems inherently unfair."

West said the measure, now signed into law by Governor Ron DeSantis, will cause particularly harsh impacts in Southwest Florida, where developer Collier Enterprises is planning two new residential developments and a new town in Eastern Collier County. Collier County commissioners voted, Tuesday, to approve two villages called Bellmar and Longwater. They also conceptual approval to plans for an adjoining town dubbed Big Cypress, although Collier Enterprises is yet to file a formal application for construction of the town.

"This is a really bad bill for local governments throughout the entire state of Florida," said West.

"They are now going to have their hands completely tied when it comes to imposing impact fees to help offset the cost of new sprawling development."

The bill is retroactive to January 1, 2021, which means currently approved developments in eastern Collier will benefit while Collier County taxpayers will pay.