Ordinarily, city impact fees that remain constant for 13 years would be good news for developers. In Rock Hill, however, it has made the effort to increase fees considerably more difficult.
Rock Hill officials plan to levy the first impact fee increase in 13 years, primarily to help pay for a series of improvements to the city’s water filter and wastewater treatment plants over the next few years. Improvements include expanding the water filter building and adding additional filters to expand service and keep up with demand.
With the improvements, the plant would be able to raise the amount of water it processes from 36 million gallons a day to 48 million gallons a day.
Local developers say they can understand why the city needs to raise fees and why the improvements to water treatment systems are necessary to accommodate growth. Nonetheless, they are flinching from sticker shock and say they are worried that the fees might discourage some projects.
We can sympathize about the increases, which ultimately will range from 200 to 300 percent. But city officials plan to phase in the increases over the next three years.
Once the new fee schedules are in place, they will be close to those of other South Carolina cities and counties. And that doesn’t account for potential increases in impact fees over the next three years in those cities and counties.
The city, we think, has been responsive to the concerns of developers. When a group of developers objected to the fee increases in June, the City Council decided to delay a final vote to further study the issue and get more feedback from those affected.
The decision to phase in the increases over three years is a significant concession to developers. In addition, we think the city has made a good case that its proposed impact fees would be in line with those in other fast-developing parts of the state and that, even with the increases, the city would remain competitive.
We think impact fees are a legitimate cost of doing business for developers. New construction, whether residential or commercial, puts added demands on public services, and developers need to help pay for that.
City officials note that the alternative would be to charge water customers more for water system improvements. The city also might be forced to cut back on other smaller projects, such as replacing aging underground pipes throughout the city.
We think it is fair to ask developers, who will greatly benefit from city services, to help shoulder the burden.
The city might have been better off gradually increasing impact fees over the past 13 years – like slowly boiling a frog – but despite the high percentage of the increase, we think the final result is both warranted and fair.