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SALT LAKE CITY — The city has waived an estimated $7 million in impact fees over the past year — and now that figure is expected to grow to more than $9 million.
The Salt Lake City Council voted Tuesday to extend the yearlong moratorium on collecting impact fees from new construction projects, money that would have been spent on roads, public safety and parks.
Now, the moratorium will end when a new fee plan is launched. That's expected to take four to five months, if everything goes according to plan.
As each month goes by, the city will forgo another $500,000.
The decision was made with less than 24 hours to spare, with the moratorium set to expire Wednesday.
While council members have expressed frustration about losing revenue from fees — despite having a year to study and implement a new fee structure before the moratorium's expiration — they were more reluctant to let the city relapse to its old fee structure without a vetted plan in place.
Last year, the City Council agreed to former Mayor Ralph Becker's proposal to halt the city's impact fees while officials ensured the city was properly collecting and spending that money, as only certain projects can be funded by impact fees under state code. Developers also complained that the fees were too high and imbalanced.
Orion Goff, building services director, told the council the study over the past year "clearly" showed the city's old fee structure had problems.
"Going back go the old fees is not an option in my mind," Goff said.
On Tuesday, the City Council reviewed Mayor Jackie Biskupski's proposal with Fred Philpot, the consultant hired to study the city's fee structure.
Biskupski's proposal calls for increased fees on single-family homes, while reducing fees on commercial, office and industrial projects.
Previously, a single-family home developer would be charged $3,459, but under the new plan the fees would amount to $5,732 per unit. For a commercial development of 1,000 square feet, a developer previously paid $3,630; under the mayor's proposal, that commercial fee would drop to $1,986.
Multifamily units would also see a slight overall increase from $3,284 per unit under the old structure to $3,538 per unit.
Councilman Stan Penfold said he expects the council to hold a public hearing on the new plan on Nov. 15, continue the discussion with any suggested changes until the beginning of December, and hopefully adopt a new plan by the second week of December.
Under state code, any fee increases wouldn't be able to take effect until 90 days after the new plan is adopted. That means it will likely be late February before the city could start collecting any new fees.
Last week, some council members expressed frustration that the mayor's office had not proposed a plan for what to do in the interim when the moratorium expired. When City Council Chairman James Rogers asked the mayor's staff if the administration would be supportive of the moratorium extension, they were given a passive nod.
"We think it's the purview of the council," said Mike Reberg, director of the city's community and neighborhoods department. "We are willing to accept and move forward with any position the council takes."
