Measuring Impact  
By Martin Harris

More than twenty years ago, according to my possibly imperfect memory, the little city of Stuart, Florida was the first in the nation to draw up and establish a detailed set of impact fees to be paid by new construction, residential or otherwise, the actual amounts determined by a careful analysis of the demands for various sorts of municipal services which a particular new building would be statistically likely to generate. The set ran the gamut from space in schools to space in libraries, from housing for fire service equipment to installation of underground utilities. In then-fast-growing Stuart, the debate wasn’t about who should bear the new infra-structure investment costs generated by new development, old-timers or newcomers –the latter, it was decided by vote of the former—nor was it about what percentage of the costs they created by buying in should be billed to the newcomers –all of it, as I recall—it was about developing a set of formulae for figuring out –not just blindly guessing-- how much cost in each of various categories a new building of various type and use might generate.

Before Stuart’s pioneering effort made impact fees somewhat famous, one aspect of them had existed in another form: hook-on fees. In the case of new utility services to older neighborhoods, for example, it has historically been the practice to assess property owners for the new pipes-in-the-ground on the basis of a per-frontage-foot charge based on projected costs for excavation, pipe and fittings installation, backfill, and re-paving if needed. Land-owners could avoid the fee by choosing not to hook on, but couldn’t expect to get the new service on the cheap later, after all the neighbors had already paid for its installation. It wasn’t called an impact fee, but it was based on the same reasoning: as new services are needed, their installation costs should be paid by those directly benefiting, not all taxpayers as a whole subsidizing a favored few. For one basic reason, hook-up fees never triggered the sort of visceral hostility which later arose, in almost every case, Stuart being a rare exception, whenever impact fees were proposed: scale. The cost of new pipes-in-the-ground isn’t much compared to the cost of new seats-in-the-classroom. In both cases, the numbers are easy to run. We know, historically, what levels of new-student impact various sorts of new residential development will trigger, and we also know (or used to, particularly in Vermont with educators’ new determination to keep school building sizes and capacities as secret as possible) the average gross square footage per pupil for elementary, middle, and high schools. An annual detailed report in School Planning & Management offers a detailed view by school type, by geographical region, by quartile of spending, and so on. Right now, for example, SP&M reports that the national average for new high schools is 166 SF/pupil, and that the average cost per SF is $171.43, producing a cost-per-new-seat of $29, 289.

You can almost as easily get school-age-child-per-household data for a given neighborhood or town –regional planning commissions are (in Vermont, were) good sources for these data—and so, if you find that, in your part of town, new housing in, say, the $260,000 range will send .5 of a new student to school, you can see that the statistically-probable impact of that new house will be about half of $29, 289, or just under $15,000. It would be substantially higher in Vermont because, in recent decades, Vermont school districts have been building much more than the traditional square footages per pupil into their buildings, but its also substantially harder to determine exactly how much because of the new edu-crat refusals to release square-footage and capacity numbers for their schools. I’ve tried, recently, without success, to get such numbers for Middlebury, Bristol, and Rutland, but you’re welcome to see whether you can be more persuasive than I or my appointed delegates whom I sent out for the numbers.

Once you know, for example, that the real Impact Fee created by an average new house is about $15 grand for schools alone, you can then decide what, if anything, you care to do about an IF proposal. That becomes a matter of politics, not cost analysis. Some one will pay: the question is who. As such, it gets beyond the scope of this column.
 

Martin Harris is a former Chairman of Citizens for Property Rights