Some school districts and cities want them, and a legislator says he's out to get them: impact fees to help school districts pay for school buildings in fast-growing areas.
Rep. Steve Mascaro, R-West Jordan, says he's requested a bill to let school districts assess impact fees — but only by public vote.
He says other points in the bill, now shielded from public view, attempt to make the idea more palatable to cities and developers. He has talked about the ideas with West Jordan and Riverton mayors and the Jordan School District, and wants to put finishing touches on the language and then talk it over with other interested groups.
"With the growth anticipated in Jordan School District — my district — and the valley, the impact on property taxes really could be very, very significant," Mascaro said. "A philosophical position that people buying new homes should share in the impact fee is something I feel comfortable with, and some of my constituents feel comfortable with."
While at least one local mayor supports looking into the idea, the Utah League of Cities and Towns has concerns. And the Utah Association of Realtors is flat against it.
Utah law lets cities and counties assess impact fees to cover costs of infrastructure to accommodate new development. Fees can range from hundreds of dollars to tens of thousands of dollars, depending on the city, whether the property is residential or commercial, and often square footage.
In the early 1990s, state law was unclear on whether school districts could impose impact fees. So some growing school districts worked with cities and counties to assess the fees — a few thousand dollars per primary residence in Park City, for example — and kick revenues back to them.
Lawmakers halted the practice.
But the idea has bubbled back to the surface.
Last month, the Jordan Board of Education called on legislators to let schools assess impact fees to ease the tax burden for building new schools on homeowners and businesses already settled in fast-growing districts. At the time, a handful of local cities, including West Jordan, Midvale and Sandy, were looking at or passed similar resolutions.
On Wednesday, the Nebo School District Board of Education passed a resolution in support of school impact fees. The Alpine School District Board of Education is expected to discuss the issue next week, and possibly pass its own resolution.
"As growth has impacted Utah so significantly, more and more people have been saying, 'This makes sense,"' Nebo school board member Bonnie Palmer said.
"I think all the school boards in the state have been asked by the (Utah School) Superintendent's Association" to consider the issue, Nebo Superintendent Chris Sorensen said.
Mascaro's bill would aim to keep property taxes down for existing homeowners.
He says it would require a district wanting to assess an impact fee to put it to a public vote, like a bond election.
Developers wouldn't have to pay the impact fees up front when they apply for a building permit, Mascaro said. Rather, they'd get a lien placed on the home for the amount of the impact fee. When the house was sold, the fee would be listed as part of the closing costs, and the title company would collect it at closing. The title company then would issue a check to the school district, as it issues checks to others associated with closing costs.
Mascaro says developers already pass the fees on to consumers in the price of the home, and this way, consumers would see exactly what they're paying.
Also, cities wouldn't have to become the school districts' fee collecting agency, Mascaro said.
"Will it make it so (cities and developers) jump up and down and say, 'This is a wonderful idea?' Not at all," Mascaro said. "But it takes some of the sting out of it."
The Utah League of Cities and Towns' Legislative Policy Committee discussed impact fees last month, said Lincoln Shurtz, league director of legislative affairs. Concerns include collecting fees for school districts and questions as to whether school impact fees would impact cities' ability to assess, as there has been past talk of capping fees.
"We'd love to sit down with (Rep.) Mascaro" and discuss his ideas, Shurtz said. "Certainly there are some issues and technical issues that need to be looked at."
Shurtz also wonders whether voters should approve a tax on a group that's not part of the voting public yet, as the impact fees would be for new home buyers.
But Mascaro doesn't think that will be the case. He said many people who vote on the concept could be buying newer homes in the same area, or people living in apartments.
Realtors association CEO Chris Kyler says school impact fees wouldn't make sense because they'd be paid for by a small segment of society, affect housing affordability and slow Utah's booming housing market.
"The bill is a bad idea all the way around," Kyler said. "It's patently counter, philosophically, to the rest of our tax system, and most importantly, going to harm those who can least afford to be harmed," including first-time homebuyers and the elderly looking for smaller homes.
But Riverton Mayor Bill Applegarth favors impact fees to help build schools. His city is expected to grow from 33,000 to up to 55,000 people in 15 years. Just under half of its population is under 18 years old.
While he's unsure if more schools will be built in the area, "we need to be a team player with the Herrimans that don't have a high school and the Bluffdales that don't and the South Jordans who will need one," Applegarth said.
"I think the school is an infrastructure that's critical, just like where we have other impact fees for roads or sewers or parks," he said. "I think (Mascaro) has some very, very good ideas."