House Bill 2550 - School District Imposed Impact Fees

On Monday, at the request of State Rep. Rich Grucela, the Borough Council approved a resolution to support his co-sponsored House Bill 2550 (read full text here).

In a letter to Council read during the workshop on Thursday and included in the resolution Monday, Rep. Grucela described the legislation as one that addressesthe effects of new residential developments on school districts and allows school districts to impost "impact fees" on developers to help defray the costs of the new students while not further burdening existing homeowners with increasing property taxes.

Having read the proposed bill, here are the key points:

• Amends the Pennsylvania Municipalities Planning Code, ARTICLE V-B 2 Educational Impact Fee and Assessment.
• The School Board will be able to create an Educational Impact Fee on each subdivision plan and building permit issued for the construction of new residential units located within its geographic boundaries, exempting affordable housing units for low-income and moderate-income individuals, permits issued for the replacement of existing dwelling units, and subdivision plans or building permits for residential dwellings built for older adult housing.
• The Impact Fee - shall be $2,500 imposed upon each bedroom in excess of one for each separate proposed residential dwelling unit in the subdivision plan, not to exceed $7,500 for any individual dwelling in the subdivision plan. For individual permits the $2,500 fee imposed for each bedroom in excess of one shall be applied - but only for bedrooms included in the permit (ie existing ones are exempt).
• Accounting - The school district shall deposit the educational impact fees collected into a separate school account. The moneys in that account may only be used for new construction for additional classrooms or renovation of existing buildings to expand classrooms or classroom space and any additional personnel costs to cover an increase in student enrollment.
  

A maximum of $7,500 per residential dwelling doesn't even cover the cost of educating one student per year in Nazareth, let alone two or three who could be in a four or five bedroom home. Of course this money is in addition to property taxes that will be paid, but they will not likely cover the cost of the district to educate those children.

The worst aspect of this bill is the exemptions. For each dwelling in a subdivision plan the following amounts can be exempted:

• Meets or exceeds the National Energy Star 4 rating - deduct $500.00 per dwelling.
• Stone or brick front on the facade of the house - deduct $500.00 per dwelling.
• Porous materials for the driveway and sidewalks - deduct $500.00 per dwelling.

And the developer can have the following taken off the total impact fee:

• provides for a designated school bus loading area - deduct $1000 from total fee.
• each acre of land preserved within the proposed development for open space uses - deduct $1500 per acre.

And naming rights, "the school district may offer the developer of the development the option to pay twice the impact fee owed in return for the option of having naming rights for any expansion required to be constructed."

Now, I think I've heard it all. A piece of legislation with the right idea until they hit the deductions and naming rights.

What do you think? You can tell me, or you can contact your state representative and school board.

Addendum - I ended a bit harsh. I ought to clarify that what bothers me about this bill is not the impact fee, but the fact that there are deductions (and naming rights). This is a case of how a well-intended bill gets hurt through the political process. Helping offset building costs will be welcomed by all, which is why I'm sure Council supported the bill last night. Keep it simple and move it through the house to the senate and off to the governor.