Southern Utah News Articles
Kanab City to explore impact fees
While Kanab City’s growth in the past few years has been nothing short of phenomenal, it hasn’t been without a few growing pains!
“Building permits for fiscal year 2016 were a record 114,” said Kanab City Manager Joe Decker. Additionally there have been two large new hotels built in Kanab in the past two years, with another under construction.
Needless to say, all that construction and new growth have impact!
Decker said just dealing with residential growth, Kanab needs to continually upgrade its water and sewer. “For instance our sewer needs more upgrades than it has in the past. Specifically, aeration and treatment of the sewer ponds on Kanab’s south side.” He said that’s true even though neither the Ranchos nor Cedar Heights use it. “Forty percent of the homes are still on septic,” added Decker.
Kanab City gets revenue from the TRT’s (Transient Room Tax), paid by visitors staying in town. “The TRT’s are up,” said Decker. He added that the city doesn’t get nearly as large a share as the county. “But with the increase in rooms and visitation, we ended 35 percent more in collections in fiscal 2016. Basically, that amounted to about $220,000 up from $161,000 the previous year.”
But again, new growth is placing some fairly significant demands on Kanab City’s infrastructure.
Impact fees are a legal method the state allows to help communities like Kanab deal with growth and its impact on infrastructure. Utah Code, Title 11, Chapter 36a, Part 2, Section 20, (2) states that a local political subdivision and private entity may establish impact fees only for specified public facilities.
According to Decker, impact fee revenue can be used for specific facilities including: water, sewer, transportation, parks and trails, public safety, and storm drainage. (That subject has commanded much attention over the past two years due to heavy monsoonal rains.)
“Impact fees are designed for new impacts to systems. For instance, I can’t hire employees with the money, and the revenue can’t be used for daily maintenance,” said Decker. “It can be used for bricks, mortar, and equipment that have extended life like fire engines, facilities and any new construction.”
With the larger demand on Kanab City facilities, the general fund and water/sewer funds are taking a hit. “We are trying to absorb all the new growth with what we have now,” said Decker.
Kanab City has had impact fees in the past. In response to a revenue crunch and moderate growth at the time, impact fees were set at a rate many believed too high. Be it a normal economic downturn or the fees truly were too high, growth dried up dramatically. In response the Kanab City Council, at its January 21, 2009 meeting, voted to place a moratorium on impact fees. They voted to remove it for six months, and then revisit the issue. The issue has been dead for the past eight years.
“The problem they had before was they had them too high,” commented Kanab City Mayor Robert Houston. “We’ve got to get them moderate and leave them.”
While it’s water under the bridge and nothing they can do about it, Decker and Houston said that if those impact fees had been in effect this past year, they would’ve collected $1.2 million.
That brings us to what is happening now. The Kanab City Council recently authorized contracting with the engineering firm, Civil Science Infrastructure, Inc., to see what needs to be done to resume charging fees for new construction. The firm has offices in numerous locations, but Kanab will be interacting with the St. George office. The $266,000 contract provides for the firm to make the study and subsequently project what future infrastructure will be needed, and impact fee recommendation.
The initial step mandated by the state is to prepare an Impact Fee Facilities Plan. That gives service providers and stakeholders including citizens an opportunity to provide input into the plan. The engineering firm will study Kanab City’s infrastructure and calculate what will be needed at certain population points.
“We’ve just started that process,” said Decker.
After that is complete, the engineering firm does an Impact Fee Analysis. They compare what impact fees other communities (of similar size) charge. “With this they calculate certain things to determine what the costs to the city for the growth will be,” said Decker.
When the six to nine month study is complete, Civil Science Infrastructure, Inc. will present its findings to the Kanab City Council. The analysis will tell the city the maximum impact fees allowed by law that they can charge.
“The council still makes the decision,” said Mayor Houston, “and we all want to promote growth.”
Once given the analysis, the council has wiggle room to determine how much or little of the impact fees they’ll charge. For example, they may decide that commercial permits could be charged at a greater rate than residential.
“People forget the developer pays for its own, but the growth around them impact others,” said Decker. “Commercially, we are the only municipality that doesn’t charge any impact fees currently.”
“It’s only fair that the people impacting the whole (water, sewer, drainage), help pay for improvements,” said Mayor Houston. “It’s just the growing pains of going from a small town to a small city.”