By Michael Salerno
For Hometown News
PORT ORANGE -- For local homebuilders who enjoyed relief from impact fees for new construction in the past year, the vacation may soon be over.
To stimulate development, city leaders last year approved a reduction of impact fees that provide funding for the fire department and recreational facilities, providing a savings of about $350 on construction of an average single-family residential unit. Now the City Council wants a discussion on whether the fee reductions should be scaled back or even eliminated.
"If we do it for one more year, I think we should step back what we're doing and lean backwards, do the same fees but maybe half the amount we did last year," Vice Mayor Don Burnette said. "Then if the economy turns around, we bring it back to where it was before (the moratorium)."
Council members intended to vote last week on extending the impact fee moratorium, but instead tabled the item after they felt more discussion was needed. They were mainly concerned city staff could not say whether reducing impact fees made a difference on new development and growth.
Incoming city manager Greg Kisela said in an interview it's difficult to quantify what influence, if any, that impact fees have on a person's decision to build. He said future discussions would involve whether extending the moratorium would take a realistic approach without exploring either-or options.
"(City leaders) are trying to get their minds around (the issue)," Mr. Kisela said. "Is it just really necessary, is this going to make that decision to move here or build here? I don't think it's yes or no or black or white. It's going to be more philosophical."
But local builders say the impact fee moratorium has in fact helped.
Jamie Adley, president of the Volusia Home Builders Association, said new construction started as a direct result of the City Council's approval of the impact fee reductions, which took effect March 1, 2012. He added construction of each new home creates three new jobs and has a direct impact on the local economy.
City documents show 140 building permits for single-family residential units were issued in 2012, making it the second-best year for new building permits in the last five years. The data also shows 124 permits have been issued since the impact fee moratorium took effect.
Mr. Adley said continuing the reduction is important to stimulate more building in the area, as homebuilders continue to face challenges.
"Construction costs continue to increase," he said. "Mortgages are hard to get. The appraisal environment is tough. We're still not out of the woods, we still have a lot of obstacles but we're seeing a turn."
But Mayor Allen Green disagrees with the impact fee reductions given the need for funding on both the fire and recreation sides. He cast the only "no" vote on the reductions when they were approved last year.
"You want more recreation and you want to expand recreation, (but) you're taking away the money," the mayor said. "You want more on fire, (but) you're taking away the money. I disagree."
In other business, the City Council voted 3-2 to extend a contract with Pittman Law Group, a lobbying firm that represents the city's interests in the Legislature, for $36,000. Some council members and citizens were concerned about retaining a Democratic lobbyist when Republicans control the state's legislative and executive branches.