LETTERS: I recall that in the late-70s, early-80s, interest rates rose to nearly 20% and nobody could afford to buy a house. Entire housing developments that had been built were moth-balled for 6 or 7 years because there were no buyers. (Example: Forest Rim in Issaquah) From 1978-1983, inflation caused prices of most commodities to double and triple. The price of a pound of hamburger went from $.69 to $1.49 in less than a year.
If builders are allowed to postpone their impact fees for many years, will the impact fees be indexed to inflation? The price of building roads, sidewalks, sewers, parks and schools will continue to increase, while the impact fee will be set when the builder first applies for the permit. The school impact fee for a single family residence today is about $3,000. If a building permit is issued today, and the house isn’t completed and sold until 9 years from now when school impact fees have increased to, say, $15,000 per house, will the builder be required to pay $3,000 or $15,000? Allowing builders to pay impact fees when the house finally sells sounds like a bad deal for everyone, except the builders.
--By RNB Reader, 11/22
--submitted to RNB by comment under "Council considering impact fees to time of closing."
UPDATED:
from the desk of Councilmember John Stilin, Ombudsman for the month of November, 2011.
"....The scenario your letter writer [above] presented may be the case in Issaquah. But here in Redmond impact fee amounts are calculated on the day the fee is paid, not the date the permit is issued. If impact fees increase after a house is built and the fees have not been paid, the builder will need to pay the higher fee. So in some cases, it might behoove the builder to pay the fee early to avoid a fee increase..."
--Councilmember John Stilin, 11/22
If builders are allowed to postpone their impact fees for many years, will the impact fees be indexed to inflation? The price of building roads, sidewalks, sewers, parks and schools will continue to increase, while the impact fee will be set when the builder first applies for the permit. The school impact fee for a single family residence today is about $3,000. If a building permit is issued today, and the house isn’t completed and sold until 9 years from now when school impact fees have increased to, say, $15,000 per house, will the builder be required to pay $3,000 or $15,000? Allowing builders to pay impact fees when the house finally sells sounds like a bad deal for everyone, except the builders.
--By RNB Reader, 11/22
--submitted to RNB by comment under "Council considering impact fees to time of closing."
UPDATED:
from the desk of Councilmember John Stilin, Ombudsman for the month of November, 2011.
"....The scenario your letter writer [above] presented may be the case in Issaquah. But here in Redmond impact fee amounts are calculated on the day the fee is paid, not the date the permit is issued. If impact fees increase after a house is built and the fees have not been paid, the builder will need to pay the higher fee. So in some cases, it might behoove the builder to pay the fee early to avoid a fee increase..."
--Councilmember John Stilin, 11/22
"....The scenario your letter writer [above] presented may be the case in Issaquah. But here in Redmond impact fee amounts are calculated on the day the fee is paid, not the date the permit is issued. If impact fees increase after a house is built and the fees have not been paid, the builder will need to pay the higher fee. So in some cases, it might behoove the builder to pay the fee early to avoid a fee increase..."
ReplyDelete--Councilmember John Stilin, 11/22, Redmond City Ombudsman for the month of November, 2011