Anne Arundel County in Maryland is looking to raise it’s impact fees for new construction from nearly $5,000 to $21,000. The fees are governments way of recouping money they invest to support the homes with city infrastructure.
You have to wonder if the motivation now for these fees are twofold. First, with the housing slowdown in the region tax revenue have decreased dramatically as property values are decreasing and sales are slower. The need to find revenue to feed the bureaucratic beast is veracious.
And that leads into the second point. By raising the impact fees by $16,000 dollars they essentially raised (or supported) the property values in the county by the same $16,000. Think about it, if you have to spend more on a new home that raises the value of present inventory.
Multiply $16,000 by the amount of homes in the county and then by the local tax rate and you will see that they have just created a tax increase and only impacted the newer residents.
When it comes to government actions, always follow the money.
A proposal to tack more than $21,000 onto the price of building a four-bedroom home in Anne Arundel County has incensed homebuilders and developers, who predict a sweeping bundle of increases to impact fees could deflate the growth boom around Fort Meade and drive them into other jurisdictions.
County Executive John R. Leopold has said the current impact fee of $4,904 a house – typically passed on to buyers – is long overdue for an increase because it doesn’t cover the “full freight” of building roads and schools and providing county services. He has said that if higher fees, such as $1 million more for a 200,000-square-foot office complex, slow down “meteoric” growth, “that is not an undesired outcome.”
His proposal, which would make Anne Arundel’s impact fees perhaps the highest in Maryland, has won cheers from environmentalists and civic leaders, and has helped him fend off criticism that he’s too cozy with developers, who gave his campaign more than a quarter-million dollars last year. via baltimoresun.com.
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