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Too High or Too Low?

BARNEY BRANTINGHAM

Too High or Too Low?

From the Santa Barbara Coastline

6/17/98

I was very surprised to open the News-Press Monday and find a letter from developer Michael Towbes tweaking me about development fees.

If Towbes had called me directly, I could have shared some astounding information.

Towbes, a longtime, highly respected builder, came up with the conclusionthat fees charged by the county and other agencies are a ``windfall for those who already own theirhomes."

Actually, it appears that fees are so low that present property owners are really subsidizing thedevelopers, who can thereby keep home prices lower than they would be with realistic fees.Builders, Towbes points out, pass the costs on to homebuyers.

Take Hope School District.

Two years ago voters celebrated after approving a $6 million bond measure officials figured wouldtide the district over for future growth, well into the 21st century.

But now a large housing project has been proposed on the St. Vincent's property. It will create theneed for the equivalant of four more classrooms.

Yet the state-mandated school fee will produce only about $90,000, and you can't build fourclassrooms for that, according to Hope Superintendent Les ImeL.A.nd another large Hope districtdevelopment is being proposed north of Foothill east of Highway 154.

In fact, according to one study, fees charged by Santa Barbara County, schools, water and seweragencies and the like may be a third or more too low to cover the costs of new classrooms, roadimprovements, water and sewer capacity, law enforcement, fire protection and other infrastructureto accommodate growth.

Present fees range from $11,014 for a new 1,865 square-foot home in Santa Maria, $19,746 inGoleta and $20,500 in Orcutt.

County supervisors first decided to set Orcutt fees at $8,246, but then cut them to $7,800, whileadmitting that the fee won't cover costs. Add school and other fees and the total is $20,500.

Three supervisors - Jeanne Graffy, Tom Urbanske and Tim Staffel - approved zoning last year for6,000 new housing units in Orcutt. The town is clearly on the brink of a major spurt ofdevelopment.

According to a study by Energy and Environmental Planning Associates of Eugene, Ore., theinfrastructure cost of a new home in Oregon was $24,500.

Assuming a typical family size of 3.1 persons, that meant it costs about $9,000 to add each newperson to the Portland area, based on housing costs there, according to Focus, a newsletter put outby Carrying Capacity Network, a Washington, D.C., group interested in growth issues.

Then, using Santa Barbara-Lompoc-Santa Maria average home price figures, CCN came up with acost of $11,200 for each person added to the area.

Assuming an average of three persons per home, that means that fees here should be more like$33,600, to cover costs without passing them on to present residents.

Of course, making such extrapolations can be pretty risky. If anything, the figures are probablylow, considering our high state water costs.

As an example of how state water costs are affecting us, Marshallia Ranch Golf Course gets itswater from Vandenberg Air Force Base, which ordered a large amount of costly state water.

As a result, the 1998 golf course bill for the same amount of water as in the past would be$444,000 instead of $40,400. So the course slapped on a $4 per player fee and is cutting use untila base pipeline is built to allow the links to tap into a welL.A.s towns across the U.S. havelearned, ``Growth doesn't pay for itself,'' in the words of Florida columnist Charley Reesereprinted by CCN. Winners are builders, bankers and others who profit, he said.``The losers arethe rest of the existing residents who have to pay for growth. They lose not only money in theform of higher and higher taxes but quality of life.``They get more crowded roads and schools,more crime, more pollution, more inflated property values, more loss of farmland and more loss ofwildlife habitat."

Gee, Mike, we could have had a nice talk.

Read Barney's Bits at www.silcom.com/~barney/

This story was provided by teh Santa Barbara Coastline Online with permission of Mr. Brantingham.