Vail Daily guest column: Impact fees have a chilling effect on development
The following is an excerpt from a report by the Vail Homeowners Association board of directors. The association keeps a close eye on economic and political trends in and outside of the Vail community. The electronic version with links to supporting documents is available at http://www.vail homeowners.com.
The Vail Town Council has adopted transportation impact fee legislation and set the amount of the fees. The council made one significant modification. Because of the chilling effect of impact fees on the development of affordable housing, affordable housing will be exempt from any impact fees. That creates a $2.5 million funding deficit in the projected revenues. How that will be made up remains to be seen.
But the chilling effects of an impact fee are not confined to just affordable housing. It will be felt across future development as the cost of projects grows. The assumption that there will be large-scale commercial development is highly speculative.
A significant part of the commercial space is projected to come from the Ever Vail property, where the infrastructure project fees are very high. With Vail Resorts no longer planning to develop the Ever Vail Property, it is hard to envision a buyer, who would be facing both project and millions of dollars of impact fees, taking on all or even some of that project (given the Lionshead Redevelopment Master Plan, it would be very difficult to develop that property piecemeal).
Another significant part of the commercial development is projected to come from redevelopment of the West Vail commercial areas, which cannot command the high rents of core properties so impact fees could have an even greater chilling effect there. Unless the town council is going to waive significant parts of the impact fees, which would render the provision of the fees illusory or the purpose of imposing impact fees is to tamp down development, the effects of this plan need some serious thought.
Aside from the potential chilling effects of an impact fee, the financial assumptions of the plan are also suspect. An additional 2,000 residential units would equate to 4,000 to 6,000 full or part-time additional residents for the town (based on the per unit residents indicator from the TOV 2016 Housing Plan); 500,000 square feet of additional commercial space would be a 40 percent increase in commercial space in the town (based on current commercial space per the Eagle County tax records compared with the additional space forecast under the plan).
It is hard to imagine that those levels of increases could be accommodated within the town of Vail. And it’s not just the growth numbers that are suspect. Notably absent in the financial projections of the plan are any contributions from the state or federal governments to the roadway projects, and there are no forecasted philanthropic contributions to the pedestrian walkways. One would think that the town would exhaust all potential sources of other funding before imposing impact fees.
Also absent from the plan is any explanation of what would happen if government or philanthropic contributions were received. Impact fees can only be used for the specific purpose they were collected. What will happen to the collected or to be collected fees if such contributions were to occur? Would the funds be reimbursed to those that paid the fees? It would seem that an explanation of that nature should be an integral part of the plan.
There is, also, no time limit or sunset provision setting a limit on how long the fees would be collected. Is this a fee to be collected in perpetuity? The transportation plan calls for a 23-year build out (to 2040). Will the impact fees sunset then or will there be new projected growth and a continuation of the fees?
If you are an eligible voter in Vail, then there will be an election in November for four town council seats — those currently held by Jenn Bruno, Dave Chapin, Dick Cleveland and Greg Moffet, all of whom are eligible to run for re-election.
All candidates must file their paperwork by Aug. 28. The Vail Homeowners Association urges you to get informed — various council members hold different positions on the various issues.
The association will provide more information as the election gets closer.
The Vail Homeowners Association Board is Gail Ellis, president; Judith Berkowitz, secretary; Rob Ford, treasurer and directors Jamie Duke, John Gorsuch, John Lohre, Andres Nevares, Trygve Myhren, Larry Stewart and Doug Tansill.
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