Development fees tek |

Development fees tek

When Jim Moule built his paint and glass company on East Main Street in Grass Valley 20 years ago, he paid $1,026 in fees to the city.

Last year, as he moved ahead on plans to build his new facility up the street, he planned to pay more than $100,000 in development impact fees.

Those fees are still going up – but not as much as had been anticipated.

Late Tuesday, Grass Valley City Council members unanimously approved fees for parks and for general government facilities.

But they also voted to spend more time studying the source of the largest increases: fees for local road projects and traffic impact.

Before that vote, all of the proposed new fees together would have cost Moule $238,000.

Moule’s first building “didn’t cost me $238,000 for the entire project and now the fees are that much,” he said. His biggest worry is whether his bank would loan him the money to cover the 137 percent increase.

“For someone who’s a small businessman looking to expand, it puts you out of reach of the financing,” Moule said. “That extra $100,000 would probably be a project-killer because I’m already at the max” of his credit.

But the traffic portion of the fee is now likely to come down. In the next six months, the city will work with business people and those concerned about traffic to pick only the most important projects and the ones that have the best chance of getting completed.

All together, the fees pay for improvements to roads, water and sewage facilities, parks, fire and police protection, and government facilities that are affected by growth.

City officials have said the fees have not kept pace with the city’s growth. They are needed to pay for new signals and deteriorating roads.

But some business people bristle about the way the money has been spent. Moule already has seen the road fee for his project rise from $14,000 to $40,000.

The draft plan to increase the road fee again would have pushed his fee to $146,000. With Tuesday’s vote, however, the increase is expected to be smaller.

“They’ve been collecting money for 20 years and we haven’t seen where it’s going,” Moule said. “I don’t mind paying some road mitigation fees, but I don’t want to pay $40,000 that’s going into the pocket of some consultant.”

City finance planners and a Maryland-based consultant, TischlerBise, looked at how the draft proposed fee structure would raise costs for certain projects, including Moule’s.

According to the calculations, the fees affect different projects in different ways. The biggest areas of increase for all of them is in the cost for local road projects and fees charged based on the number of driving trips a business is expected to generate.

Originally, the draft fee structure proposed raising the bill for road improvements by as much as 769 percent for some projects.

A proposed medical office building could have seen the road fee rise from nearly $30,000 to nearly $260,000.

The road fee for a proposed single-family home would have risen from $336 to nearly $3,000.

If Matthew Weaver had had to pay fees at that level when his project to expand Weaver Auto & Truck Center went through more than a year ago, he may not have been able to swing it, he said.

He already has paid close to $200,000 in fees for that project, which is similar in size to Moule’s, Weaver said.

“I have to take out a loan to do my work,” said Weaver, who is co-owner and chief financial officer of the East Main dealership. “There’s a limit to what the bank will do.”


To contact staff writer Trina Kleist, e-mail or call 477-4231.

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