Many cities have shrinking budgets to improve infrastructure and have trouble paying for roadway improvements to meet increasing demands resulting from new developments. As such, many cities collect impact fees from new developments to help pay for roadway improvements made necessary by such developments, according to a report from consultant Freese and Nichols Inc.
Several developers spoke at the meeting in opposition to the impact fees, calling it another tax.
The council agreed the fees are a tax but said it is better for developers to pay their own way rather than the cost fall on residents.
“This is definitely a new tax, but the best kind of taxes are the ones that are applied directly to the people causing the expenditure,” Council Member Nick Long said.
Under the impact fee ordinance, League City is divided into four roadway service areas. Area 1 is on the east side, 2 is on the north-central side, 3 is on the south-central side, and 4 is on the west side, which is largely undeveloped land.
According to the ordinance, the impact fee rate for Area 1 is $323 per service unit. The fee for areas 2-4 is $1,120 per service unit for residential developments and $560 per service unit for nonresidential developments.
A service unit is based on a formula that includes the number of cars that pass along a road during a peak-traffic hour, the road’s length in miles and other factors. Service units for each type of development are predetermined in the report. For instance, the service unit for a general office building is 6.21.
By multiplying a roadway service area’s impact fee rate by the service unit for a proposed development, the developer is left with a total fee that must be paid to recover some of the cost of road work their development will necessitate. The impact fee for a general office building in Area 1 is $2,005 and $3,477 in areas 2-4, for example, according to the report.
In other business
Council on Jan. 8 also approved repealing a 1,705-acre planned unit development, or PUD, west of Calder Drive, south of League City Parkway and north of FM 517 to create a new one that includes a 42-acre parcel previously not part of the PUD.
According to the city’s future land-use plan, the Duncan PUD is classified to have a mixture of suburban residences, parks, larger lots and open spaces, and homes and commercial buildings. Once fully built out, the PUD could hold more than 4,200 residences.
