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Hernando Today

To impact or not to impact — that is the question

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By RON RAE

The Rae Way

Published: November 8, 2009

To give or not to give in to the interests of building contractors? That is the question. The answer is forthcoming on Tuesday when the Hernando County Board of County Commissioners host a public hearing to consider reducing current impact fees to levels set in 2001 and not seen since 2005.
On Oct. 27, the BOCC unanimously agreed to discuss further the prospects of discounting impact fees by slightly more than $4,300 for each new house built during the next 12 months.
Not unexpectedly, on Nov. 3, the Hernando County School Board gave a majority vote in support of the commissioners to nearly cut in half school impact fees at a variable reduction of between $3,255 and $4,266 per new construction.
What school provisions will be impacted by the loss of an estimated $600,000 in fees for each of the next two years? Funds are allocated toward the construction of new schools plus the maintenance of, and renovation to, existing structures. School impact fees are also used to maintain student activity facilities — swimming pools; baseball and multi-purpose sport fields; tennis, basketball and volleyball courts; picnic tables. Plus the paving of new, and the upkeep of existing, roadways in each of the five school zones. Lost funds from the reduction of impact fees means fewer dollars spent toward the needs of K-12 students. Expressing support of reducing school impact fees, HCSB Chairman John Sweeney explained, "The only reason we're considering this is because it's very important to us to lend a hand if we can, but we have to be really careful on how far we go with this. A year seems the best we can do." Board member James Yant was in full agreement that the reduction should be reviewed after a year's time.
Coincidence or not, that one year period will end the week following the 2010 mid-term elections, at which time Sweeney, Nicholson and Bonfield are up for re-election, as are commissioners David Russell and Rose Rocco. All's fair in the politics of garnering the support of influential partners; the construction industry has the sway to play upon the needs of every incumbent elected public servant.
A wink and a nod from blind-sighted county commissioners is all that's necessary to gain the favor of construction interests. Hopefully we'll be spared the trite comment from the commissioners that, "It's the right thing to do." It isn't.
Statements from the Hernando Builders Association are questionable, including the claim that building new houses at cut-rate prices will stabilize existing home values. No one can argue that by reducing impact fees there will be less of an effort to rid the county of unoccupied and never-occupied homes — er, I mean houses. A house is not a home until warm-hearted people take ownership and become tax-paying residents.
Putting new houses on the market will not increase the worth of existing homes that have seen as much as a 50 percent loss in market value. Ridding the county of the glut of empty houses is the only way the trend will come to an end for home values to equal the assessed value as determined by the Hernando County Tax Collector. Check out the property tax statement that you just received in the mail. Check out the assessed value. Then check out what price your home might sell for. You'll see red.
The HBA seems to be pleased that, if the BOCC enacts the proposed fee reductions, it will be the largest tax reduction ever seen in Hernando County. The number of recipients of such a gift would be too narrow. The payoff would be much too self-centered to benefit the community as a whole.
Getting down to the skinny, the $8,000 tax credit for first-time homebuyers that was set to expire at the end of November has been extended through next April.
Most importantly, the program has been expanded to include anyone who hasn't owned a home in the last three years. Furthermore, buyers who have owned their current home at least five years will be eligible to receive tax credits of up to $6,500.
Income eligibility has also been raised from $75,000 to $125,000 for individuals and from $150,000 to $225,000 for couples.
With the additional prospective homebuyers, federal incentives should suffice for the construction industry. Just as HBA member have vowed to lower their house prices equal to what would be reduced in impact fees, the same should apply to federal dollars. Otherwise, it will have become a flimflam industry.
The arguments for have already been made. Has an arrangement already been agreed upon? Or will the BOCC vote sensibly and dispense with the communal nepotism and stand strong for the electorate at large?

Ron Rae, a regular columnist for Hernando Today, lives in Spring Hill. He can be contacted at hernandoron@yahoo.com.

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