First things first, here's the bottom line: Florida developers and builders are very, very interested in what the local county will be charging in impact fees because it can be a big, big number. So what is happening in Osceola County Florida and the possible end to impact fees there is big news.
What are impact fees exactly?
Impact fees are fees set by the county on new building - whether it's an expansion of something that already exists or whether it's a new development of custom homes, a new residential neighborhood, a shopping mall, an office building, a condo, or some other type of business structure.
The impact fee is an amount that the county levies against whatever is being developed or built so the county can take that money and use it against the county's costs to meet the added use on county utilities, etc. -- in other words, it's a fee to cover the added impact of the build upon the county's services.
What is happening to impact fees in Osceola County, Florida?
Osceola County has been hit hard in this Great Recession. It had one of the highest foreclosure rates in the nation. Its tax base was slipping: from 2011 to 2012, it fell 5.45%.
So, Osceola's powers that be decided that one way to spur new growth in the area was to waive impact fees -- and it worked. Osceola County saw an increase in commercial construction as a result of allowing developers to build without this cost to their bottom line.
Here is the Osceola County Impact Fee Office explanation of its commercial construction impact fee waiver (there's also one for residential construction):
OSCEOLA COUNTY IMPACT FEE WAIVER FOR COMMERCIAL CONSTRUCTION
Transportation and Fire/Rescue Impact Fees are currently waived for new commercial construction. To qualify for the commercial impact fee waiver:
Building permits need to be issued between December 13, 2010 and September 30, 2012
Initial inspection needs to be called in within 60 days of permit issuance
Certificate of Occupancy must be issued within 18 months from the date the building permit is issued
The County Manager may approve an extension of the completion date:
6 additional months for projects of 20,000 to 100,000 square feet
12 additional months for projects of more than 100,000 square feet
(Example: For a building permit issued on January 31, 2012, the C.O. would not be due until July 31, 2013, with the possibility of an extension ranging from December 31, 2013 thru July 31, 2014)
The current Building Permit Fee Waiver program will continue to be in effect on both residential and non-residential construction for permits issued by September 30, 2012.
Water and Sewer Impact Fees are assessed and collected by Toho Water Authority (TWA) and can be contacted at 407-944-5000.
Permanent Moratorium Up for a Vote
Now, Osceola is considering making that temporary waiver of impact fees into a permanent moratorium. It's hopefully up for a vote next month.
Expect it to pass: with a moratorium, it does not mean that the county will never have the power to assess impact fees in the future, but it does mean that builders and developers can count on the fact that for the near future, Osceola County may be a cheaper option for a project than other parts of the state that are still assessing impact fees on new growth.