Palm Beach County businesses leaders fended off a double-digit increase in impact fees Tuesday, persuading the county commission to spend more time studying a proposal to raise the tax on new homes and commercial buildings.

County staff proposed an increase in impact fees that would have boosted the annual take from $41 million to an estimated $55 million. However, county commissioners decided not to vote on the matter Tuesday.

Impact fees, collected on new homes and commercial properties, aim to offset the costs that growth imposes on public services. Palm Beach County

The builder of a new home of 1,400 to 2,000 square feet in Palm Beach County now pays an impact fee of $10,314. The county had proposed boosting that fee to $13,525, a 31 percent increase.

The proposal would have more than doubled the impact fee on a 50,000-square-foot office building from $177,940 to $398,050. But the tax on a new 50,000-square-foot shopping center would have fallen from $578,426 to $515,470.

Business leaders told county commissioners Tuesday that the proposed increase would hurt housing affordability and hamper economic development.

Michele Jacobs, head of the Economic Council of Palm Beach County, panned “exorbitant increases in certain categories.” Christina Morrison, a commercial real estate broker from Delray Beach, called the proposed tax hike “just astronomically huge.”

Officials from the Realtors Association of the Palm Beaches and Greater Fort Lauderdale and the Associated General Contractors Florida East Coast Chapter also opposed the increase.

County Administrator Verdenia Baker said the proposed tax hike came in response to rising construction costs for county projects. But Commissioner Melissa McKinlay worried that a steep increase would be “political suicide” given Florida House Speaker Jose Oliva’s criticism of impact fees.

“I think if we were to move forward with a 30 percent increase ... we are certainly making ourselves a target to the speaker,” McKinlay said.

The county last raised impact fees in 2014. Business leaders who spoke at Tuesday’s meeting said they hadn’t received a clear explanation from the county about the amounts of the increases or why they were necessary. Commissioners agreed to more discussions about the topic.

An impact fee is a one-time tax that builders typically pass on to buyers or tenants. Most of the fee goes to road construction, but impact fees also help fund schools, police, libraries and fire rescue.

SOURCE: PALM BEACH POST


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