Beware of lobbyists and industry association heads bearing numbers; their figures often have little to do with the facts.
The latest example of math only an Enron exec could love is Billy Ward’s misinformation campaign against Baton Rouge’s newly implemented traffic impact fees.
Mr. Ward, president of the Capital Region Builders Association, his fellow house builders and other real estate professionals are none too happy with Mayor Kip Holden’s across-the-board assessments on new construction in the parish. They say it’s unfair, will make affordable housing extinct and will have a chilling effect on both the housing market and the overall local economy.
The mayor’s office (dating back to the Bobby Simpson administration), with the support of the developer- and engineer-laden Growth Coalition, counters that the old fee structure was even more unfair and this new system is necessary not only to mitigate development’s impact on the existing and overburdened infrastructure but also to help pay for new road construction.
It’s a ping-pong debate that’s been going on for more than four years as both sides vainly tried to negotiate a behind-the-scenes compromise.
Realizing peace in the Middle East has a better shot, Walter Monsour, the mayor’s right-hand man, declared last month the talking was over and—bypassing approval from the Metro Council—instructed the Department of Public Works to simply implement the new traffic impact policy.
The new regulation calls for a fee to be paid for pretty much everything built in the parish, with the dollar amount determined by the size of the structure and type of tenant. Banks, pharmacies, restaurants, big-box retailers and hotels each pay different per-square-foot amounts.
Builders of your typical single-family home are getting popped for $732 per. That’s why people who make a living playing in big houses haven’t been this upset since Appalachian State knocked off Michigan.
Ward and other builders say impact fees are ridiculous considering the economic impact of the construction industry and all the sales and property taxes that result from the stuff they build. OK, then somebody please explain the sorry state of our roads and the need for additional taxes to pay for what new ones we do get built? Also keep this argument in mind when the mayor rolls out a serious road construction bond proposal within the next 12 to 18 months.
The opposition also claims the cost of every home in the parish, thanks to this new fee, will jump by $732 as builders will simply pass the fee along to home buyers. The last time a figure was that inflated was when Pamela Anderson visited her plastic surgeon.
There’s no question, fees increase the costs of housing. The city requires developers to build roads and install sewer lines before approving a subdivision. Those costs factor into the price the developer charges for a lot and ultimately what the builder charges a person to construct a home.
What Ward isn’t saying is that traffic impact fees have been around for decades. What they haven’t been is uniformly applied. Previously a developer would present his plans to DPW and someone over there would randomly determine how much to assess the project. Some paid a little, some paid a lot and others paid nothing at all. The industry’s worst-kept secret was that builders and developers who were friendly with the mayor’s office paid less than those who were not.
Then there was the ridiculous rule where any retail or office structure under 30,000 square feet was exempt from traffic impact fees.
To me, the question regarding the new impact fees is whether they will stand up to a legal challenge. Not because they are unfair but because the mayor is implementing them without council approval. If that’s allowed, what’s stopping a future mayor from raising the fee to $3,000 per house?
People involved with the process say Holden was adamant that the matter not be brought to a vote of the Metro Council in late August. Was that because Holden didn’t have the votes, or was this the mayor doing council members a favor by not asking them to cast such a controversial vote so close to an election?
We’ll get the answer if this ends up on the council agenda in November or December.
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