An attorney representing area builders says a decision will be made after the County Commission’s Dec. 8 vote on the fees
The Sarasota County Commission is scheduled to vote Dec. 8 on a request by the Sarasota County School Board to impose impact fees the School Board approved this week on a 3-2 vote, Scott Ferguson, communications specialist for the Sarasota County Schools, told The Sarasota News Leader this week.
In the meantime, Sarasota attorney Morgan Bentley of Bentley & Bruning said in an Oct. 20 interview with the News Leader that a legal challenge of the School Board’s action might arise. Bentley, who appeared before the School Board on Sept. 15 and again during the Oct. 20 meeting on behalf of the Manatee-Sarasota Building Industry Association, told the News Leader he does not believe the imposition of the new impact fees is warranted on the basis of studies undertaken for the district by the Tampa consulting firm Tindale Oliver.
Further, he pointed out in the interview, the fees approved on Oct. 20 are based on a 12-year-old study. The data supporting them, he added, “is so far out of date that it has no relevancy for today.”
In an email follow-up on Oct. 21, Bentley added that no decision about legal action had been made yet. “The real deadline for that is after the County Commission votes [the School Board request] up or down and then there is a 30 day window to appeal,” he wrote in the email. “So we will see how this goes before making that decision.”
The County Commission approval of the School Board’s request for the implementation of the new fees, which is required by law, is set for the morning session of the county board’s regular meeting on Dec. 8 at the R.L. Anderson Center in Venice, Ferguson said; it will begin at 9 a.m. He had just verified that information before he spoke with the News Leader on Oct. 21.
It took one failed motion and two tries at the motion that ultimately passed before the School Board approved the request for the County Commission to reinstate impact fees reflecting the 2004 level.
Chair Frank Kovach and School Board member Bridget Ziegler were in the minority, while member Jane Goodwin made the motion that succeeded. Vice Chair Shirley Brown seconded the motion, and board member Caroline Zucker cast the deciding vote.
No fees have been imposed for the School Board for the past five years, a decision made because of the Great Recession’s effects on the community’s economy.
Reading from a prepared statement during the approximately 75-minute regular School Board meeting on Oct. 20, Zucker said, “I tell you, this is not an easy thing for me. … Students have to come first whenever I make a decision.” She added that her conscience just would not allow her to vote to keep the moratorium in place.
Goodwin revised her initial motion at the direction of the board’s attorney, Art Hardy, so it would reflect the fact that each of the new impact fees would represent approximately 26 percent of the legally defensible amounts presented in the impact fee study undertaken for the district by Tindale Oliver.
The fee for a multi-family dwelling will be $561, while the fee for a mobile home will be $188. No fee will be assessed until a Certificate of Occupancy has been issued for a new home, Kathie Ebaugh, the school district’s director of planning, explained during the board’s workshop earlier in the day on Oct. 20.
During the regular meeting that afternoon, School Board members pointed out to the audience that the fees will not apply to affordable housing or to developments with stipulations that residents must be 55 years of age or older. A lawsuit settlement made the latter type of projects ineligible for the fees, Kovach told audience members.
Regarding the affordable housing point: Superintendent Lori White explained during the board’s morning workshop that when the impact fees were implemented in 2004, the School Board members at that time were adamant about not assessing the fees on affordable housing. “It was a deal-breaker,” she said.
“Certainly, we all care about affordable housing,” Kovach responded during the workshop. However, it seemed to him, he continued, that many of the families who would be moving into the county with children would be buying affordable homes.
And, “unfortunately,” he continued, “most of the neighborhoods that attract kids are [those] that have been here 30, 40, 50 years, I’m thinking, like Southgate, Gulf Gate,” but those people would not be assessed the fees, either.
Brown said she would be willing to address the affordable housing issue, as she was not on the board in 2004.
Ebaugh noted that the first permit application for affordable housing in Sarasota County “in a long time” recently had been submitted.
Brown first made a motion to implement new impact fees representing 50 percent of the legally defensible amounts based on the study undertaken for the district by Tindale Oliver. Those numbers, recommended by Superintendent White, would have imposed a fee of $3,917 on a single-family home; $1,082 on a multi-family dwelling; and $362 on a mobile home.
Tindale Oliver had calculated the maximum impact fee as $7,835 per single-family home, $2,165 for a multi-family dwelling and $722 for a mobile home.
Brown’s motion died for lack of a second.
Then Goodwin offered her motion calling for an end to the moratorium and bringing back the fees the board implemented in 2004, including $2,032 for a single-family home. After discussion, Goodwin revised the motion at the direction of board attorney Hardy.
The vote this week followed several board discussions about the report Tindale Oliver delivered after the board hired it in January of this year to conduct studies of growth management and impact fees.
Tindale Oliver projects another 14,569 students in the district by 2040. Its analysis says the district may need to build up to seven more elementary schools, two new middle schools and two more high schools to accommodate that growth. Over the next 10 years, the firm projects the district will need to fund up to four more elementary schools, one new middle school and another high school at a cost of about $326 million.
During the public comments portion of the meeting, Sarasota attorney Dan Lobeck, president of Control Growth Now, urged the board to set the fees at the full level indicated by the Tindale Oliver study. In an interview after the meeting, he told the News Leader that, by his calculations, the revenue from the fees the split board approved would bring in only about $43 million, or 13 percent of the funds the district will need over the next 10 years. The remaining 87 percent will have to come from some other place, he pointed out.
In its report, Tindale Oliver explained the board could opt to defer some of the projects funded in its five-year capital plan and use the money instead to build new schools. Among those deferred projects, Lobeck said, are renovations, sidewalk repairs, purchases of new technology and “accelerating the upgrades of the security network backbone [and] accelerating school physical security with better access controls and fencing,” referring to a section of the report provided to the School Board members in August.
The district does not have the funds in hand right now to cover all the costs in that capital projects budget for the next five years, Lobeck said. “Yet, [the School Board members] are going to be robbing that same revenue source to pay for new schools.”
School Board members and a number of the 15 speakers who addressed the issue during public comments at the board’s Oct. 20 meeting questioned the validity of Tindale Oliver’s student growth projections. Nonetheless, Deputy Superintendent Scott Lempe told the board members during their workshop that the district’s elementary schools — with one or two exceptions — already are close to or over capacity, and the high schools are nearing capacity.
Planning Director Ebaugh, pointed out that the board has five options to pay for anticipated growth:
- Defer maintenance.
- Defer long-term projects, such as the construction of a new classroom wing planned at Gocio Elementary School in north Sarasota.
- Depend on increasing property values and the resulting climb in ad valorem tax revenue, though she cautioned against counting on that source of money.
- Borrow funds.
- Impose impact fees.
While some capacity is available in the district’s middle schools, she noted, it is not spread across the county. Therefore, she said, the board would have no choice but to undertake redistricting of students for the middle schools. And while the board’s emphasis long has been on community schools, Ebaugh pointed out that redistricting would lead to students from North Port going to Venice Middle School, for example.
During his public comments as part of the regular meeting, attorney Bentley pointed out that the rational nexus test, which results from a Florida Supreme Court case regarding impact fees, requires demonstration of the need for new schools and use of appropriate methodology to arrive at the figures. However, he continued, the Tindale Oliver study “fails on both counts. … You still don’t know [the answer to the question], Do we need schools next year, two years from now, three years from now, four years from now. … Until you know those answers, you don’t pass the dual rational nexus test at all.”
He added, “Look, we all know that the population’s getting older. We all know that Sarasota County is going to get older than most counties. We know that charter schools are taking up more kids. We know that more people are homeschooling. We know that there are more private schools. None of those things are in your report.”
Without that information, he told the board, the report should not serve as the basis for a tax. Only a small percentage of people pay the impact fees, he said: the people who build new construction. “It’s a very specific tax that’s tied to a very specific need, and this report doesn’t address that need.”
He urged the board to keep the moratorium in place and, instead, consider redistricting, adding, “Do it right the first time, and you won’t have to have any kind of second-guessing after the fact, by the courts or otherwise.”
However, district Planning Director Ebaugh told the board new development is taking place in the county, and all the new schools would go into areas where those houses are being constructed, primarily close to or east of Interstate 75.
Offering their views
After School Board member Goodwin made her initial motion calling for the end to the moratorium, Brown seconded it for discussion. When Kovach then recognized Ziegler, she noted her concerns about whether the district actually will see the level of growth predicted in the Tindale Oliver study and about the inequitability of the tax, with all new homes being assessed the same amount at the time the Certificate of Occupancy is issued.
Although she noted that she did not want to see any decline in the quality of the district’s facilities, Ziegler continued, and she has “no doubt that the economy is bouncing back, we’re not quite there quite yet.”
Goodwin then explained her reasoning. “We have had a moratorium for five years, and we have run out of money, and we are going to have to buy some land.” She added that she did not want to see any of the district’s facilities “go into disarray.” Goodwin also advocated for continuing to use Certificates of Participation (COPs) to borrow funds for new construction to supplement the revenue from the impact fees.
“I have a torn heart about this,” she said, having worked in the building industry herself in years past. However, she continued, “Two thousand thirty-two dollars is not a great deal of money to pass on to a new home,” and that will assist with the new construction the board will have to undertake within the next 10 years.
Goodwin also referenced points the board discussed during its workshop that morning: The elementary and high schools in the district are close to exceeding capacity. The middle schools “are the only place we have much space for the growth in the future.”
Reading from her prepared statement, Zucker explained that the only sources of revenue the district has for new schools are its capital millage rate of 1.5, its quarter of a penny of the county’s sales tax and impact fees. “It would be tragic if the Legislature eliminated any one funding source for us. Why should we eliminate a funding source for the district’s capital budget?”
Brown pointed out that while charter and private schools in past years had seen higher enrollment, that trend appears to be declining. In the Sarasota district, no new charter schools opened this year, she added, and only one began operations last year. As for private schools: Although she had no local figures, she said Florida Department of Education projections show enrollment in those facilities was higher 10 years ago. And even the Bureau of Economic and Business Research at the University of Florida projects about 5,000 new students in the Sarasota district over the next 20 years. “Every 800 kids is a new elementary school,” Brown said. “That’s a lot of elementary schools, and they have to be paid for.”
As he had during the morning workshop, Kovach told audience members attending the regular meeting that he felt the fees — which he referenced consistently as taxes — would be imposed largely on the wrong people. “We seem to be throwing this huge net out here,” he said.
Additionally, he told the audience, “It seems to be the feeling that the big bad developers are the ones that get hurt, [but] very small builders” will have to pay the fees as well.
Other public comments
Ivory Crofoot, community relations and government affairs coordinator for Neal Communities, was among the 13 speakers representing builders who urged the board not to let the moratorium end. Reading from a letter sent by Frederick Derr & Co. to the School Board, she said, “Although our volume of work is improved,” it remains well below the levels seen in 2004 and 2005. The letter added that the re-imposition of impact fees “will put a financial burden on a very volatile industry.”
Jon Mast, chief executive officer of the Manatee Sarasota Building Industry Association, told the board, “We have just left behind the greatest recession of our lifetime.” More building permits are being issued, he added, but the volume is nowhere near the level seen prior to the economic downturn.
On the other side of the issue, Kafi Benz, president of the Sarasota County Council of Neighborhood Associations (CONA), pointed out, “You’ve not heard many people talking about the welfare of the students. That’s your charge, not to take care of the developers, but to take care of the students. … Not to provide your students with the best possible education they can have is the worst crime a society and a family can commit against their children.”
Pat Neal, owner and president of Neal Communities, told the board members, “The data itself is deeply flawed.” Tindale Oliver, he continued, used a growth rate that was twice what the county had seen in the past five years.
Further, Neal said, the impact fee is not equitable, because the same amount is applied to every house, regardless of size. He builds and sells homes in Venice starting at $174,900, he pointed out, and those houses would incur the same impact fee as a 30,000-square-foot residence on Lido Key.
Referencing a comment Brown made that morning about news media reports that Neal Communities marked a record month in September, he continued, “But we’re sure not selling homes to families in Sarasota, Fl.”
(A press release issued by Neal Communities said the builder sold 73 new homes in September “and broke its previous home closing record with 101 closings last month.” The release adds that 2015 has been a record-breaking year for the company overall, with 10 new community openings throughout the state.”
About 70 percent of its growth is in selling homes to people 70 years of age or older, Neal told the School Board.