New impact fees on real estate developments approved Oct. 18 by the Sandy Springs City Council are among the highest in northern metro Atlanta. The city says the fees could raise more than $300 million by 2040 for parks, transportation and public safety, but an organization of developers warns they could inhibit the city’s economic growth.

The new residential fees were boosted more than 300 to 500 percent, to up to $6,854 on houses and condos. The fee structure also includes exemptions, described as “affordable housing,” that are intended to encourage middle-income “workforce” housing and the demolition of older apartment complexes and replace them with ownership developments. Other fees apply to commercial, office and other types of development.

Mayor Rusty Paul said at the council meeting that “largely what we’re doing is rationalizing and modernizing” the impact fees, which had not been updated since 2008.

The Council for Quality Growth, a Sandy Springs-based developers’ organization, has “concern” about the amount of the impact fee increase, said James Touchton, the group’s policy and government affairs director. That concern is focused on the park-related impact fee increase, which formerly was $165 and applied only to new housing, but now is more than $4,500 on new housing.

“While we believe parks and recreation, as well as multi-use path systems, are highly beneficial to the quality of life in our communities, we have serious concerns the approval of a 2,600 percent increase in these impact fees by Sandy Springs potentially inhibits economic development activity in this thriving community,” Touchton said in an email.

Impact fees are intended to offset the increased costs the city pays to support new developments with services such as policing or infrastructure such as roads and sidewalks. In Sandy Springs, separate fees go to transportation, public safety and parks and recreation, with an amount that may vary depending on the development’s type and size.

According to a city presentation last year, Sandy Springs had some of the lowest impact fees among nearby cities. Under the previous fee rates, the highest total impact fee for a new residential unit in Sandy Springs was about $1,646. That was higher than Atlanta’s, which is about $1,500, but Milton and Roswell may charge over $4,000 and Alpharetta may charge nearly $6,500, according to the presentation.

The newly adopted Sandy Springs fees are among the highest in the region in many categories.

The City Council approved the new impact fee structure Oct. 18 without any presentation or discussion of their actual amounts. Asked later why the city chose to set the new fees at the high end, Assistant City Manager Jim Tolbert in a written statement described the process and purpose of impact fees rather than giving a specific reason. The rates will help to fund the city’s official list of eligible capital improvement projects, he said.

Impact fees are calculated with formulas that can be complex, but by law they cannot be arbitrary and must be based on the city’s actual costs for public services and infrastructure.

According to Bill Ross, an impact fee consultant hired by the city, the city could collect up $306 million under the new fee structure, could be applied to an estimated $700 million in various pending city projects. In some categories, it could include $120 million for parks and recreation, $50 million for paths and sidewalks, and $72 million for roads.

The new fee structure includes two exemption categories. One is for business-related projects that are also eligible for city tax incentives, which essentially mean job-creating developments. The other exemption category is “affordable housing,” which the council discussed briefly before its vote.

One of those exemptions applies to projects creating at least 150 new or replacement housing units and where at least 20 percent of the total units are priced to be affordable to households making up to 120 percent of the Sandy Springs annual median income. That median income is currently about $63,000, so that rate would mean housing for households making up to around $75,000. The median income would increase as more expensive housing is built in the rest of the development and around the city.

The other exemption applies to projects that replace at least 150 existing rental housing units with at least 150 new units and where at least 75 percent of the new units are for-sale, not rental, units.

Councilmember Gabriel Sterling called the affordable housing exemptions a “strong incentive” for developers to tear down the city’s older apartment complexes and replace them.

John Ruch is an Atlanta-based journalist. Previously, he was Managing Editor of Reporter Newspapers.

3 replies on “Impact fee hike could mean $300M for Sandy Springs projects”

  1. Notice that the City Council approved the increases AFTER major developments are underway in the city. Can you imagine what increased amounts the city would have received for the present construction underway? This increase serves notice to developers that you have to pay us more for all of the aggravation the public has put us through.

  2. Just when I thought it was time to praise a Sandy Springs Private Company Town.

    Now, it’s time for the Reporter to file a public documents request. Why? Median income plus 120% equals $75K and that $75K is “strong incentive” to tear down older developments. If we’re establishing an affordable housing figure 120% above median income as incentive to replace older rentals then the Sandy Springs council is trying to push out all those below 120% of median income. I assume this will see the remaining apartments on “lower Roswell Rd” removed and “those people” eliminated from our citizen list. This is basically the old racist South, same as the new racist South.

    I predict if The Reporter doesn’t file this open records request and get to the bottom of it another organization, PAC, will. The doors have been opened to begin holding Sandy Springs to account. An Ex HUD Official should know better.

  3. Sandy Springs,

    Can you explain why the maximum of 120% is the number you chose? The elimination of the bottom of the rental pool is obvious to those of us who’ve been here all along. Is it another Aspen or Buckhead we should expect where those who own the small businesses can’t afford to work here? Most of the service employees who will then have to drive or use public transportation to get to work in Sandy Springs is good why? Roswell road is lined with shops who’s employees under this new scheme will not be able to live here. Would love to see the emails back and forth regarding why the effort to push the bottom out while legally walking that fine line.

    All you in need of money for new parks like Windsor Parkway where each flood will require a rebuild? That same walkway you announced across the river there is being done while the bridge for cars is in need of total repair if the visual structural cracks are any indication. Couldn’t the road bridge be replaced and a sidewalk to nowhere be incorporated in the bridge?

    Given the number of roads now overburdened and in need of repair, widening to accommodate traffic or both why are parks listed as getting nearly a 2 to1 funding support above roads?

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