Beware the #8216;impact fee#8217;

Published 12:00 am Tuesday, January 29, 2008

Southampton County officials, who wisely have embraced a pay-as-you-go approach on residential development, should keep a wary eye on Richmond.

That’s where state lawmakers are considering a bill that would scrap “proffers” — cash payments by developers to localities to cover the cost of infrastructure expansion and other services — in favor of “impact fees” assessed by the state.

Local governments — not to mention owners of existing homes - should hold on to their wallets. Creating a middleman — especially a greedy one like state government — means that money collected ostensibly to build water lines, sewerage and schools and to hire additional police officers and firefighters is far less likely to serve that purpose.

And if the “impact fees” collected by the state never make it back to the local level, or make it back only partially, who do you think will pay for the services required by new residential development? That overtaxed bunch called “we who already live here,” of course.

I am, for the record, a capitalist at heart and “pro-growth,” both of the residential and commercial varieties. It’s my belief that communities like Franklin, Southampton County and Isle of Wight have three prospective futures: responsible growth, irresponsible growth or death. The “status quo,” as some advocate, is in reality just a slow death, as stagnation inevitably leads to decay.

My own preference among the three options is responsible growth — slow, steady economic progress that pays for itself and doesn’t compromise the small-town, rural lifestyle that most of us enjoy. It’s a view seemingly shared by Southampton County supervisors and planning commissioners, who have decided to tell residential developers: Build as you wish, but make the cost of infrastructure and other government services part of your business plan. The developer, of course, passes along those costs to the people who buy his lots and spec houses. It’s a clean, fair way to do business.

Sen. John Watkins, R-Chesterfield, has sponsored a bill to tie the hands of local governments by taking away their right to negotiate with developers. The Home Builders Association of Virginia, not surprisingly, loves the idea.

Not so keen on it are the Virginia Association of Counties and the Virginia Association of Realtors, both of whom fear a detrimental effect on current property owners. To add insult to injury for that group, Watkins’ bill also would raise the “grantors tax” property owners pay when they sell commercial or residential real estate.

The “best government,” if there’s such a thing, is local. The bigger the government, the more inefficient and the less accountable. All factors being equal, I’d rather give my tax dollars to the city of Franklin than to Richmond or Washington.

In covering the cost of residential development, one size does not fit all. The “impact” of a new subdivision varies greatly from one locality to the next. Southampton County, Franklin and Isle of Wight County know that cost better than Richmond — and should maintain the right to collect it directly.

Steve Stewart is publisher of The Tidewater News. His e-mail address is