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Home My WebLink About250327 -- City Council -- Agenda QuestionsV/Q�� C=oF Coo EGE S=ioN Xmv of Tmw AcW Uaimmy' Council questions and staff responses for items on March 27, 2025 City Council Meeting 8.10 Impact Fees Sponsors: Carol Cotter Question 1: How do impact fees affect Habitat for Humanity? Response 1: Impact fees can be waived for non -profits under the current council policy. "Impact fee waivers or reductions for housing affordability. System -wide impact fees for water [Sewer and Roadway as well] services may be waived or reduced for the purpose of promoting affordability in housing in accordance with state law and pursuant to administrative guidelines promulgated by the City which may be amended from time to time." Question 2: Where, within the city limits, is there land that is not being developed that could be? In terms of single-family housing? Response 2: This is a complicated question depending on if you look at the comp plan or zoning map. Of property currently zoned to be developed as single family (Estate zoning or denser), there is not any tract of land that is not currently in the development process. If you look at the comprehensive plan for large areas that are pinned in the 20 year plan for residential development: The Animate Habitat track and Windham tract are the largest — and we have heard interest in those very recently. The Bill Rice property on Rock Prairie and some various properties on the west side of the tracts on RP are additional tracks planned for the residential development per the comp plan, but have not shown interest in developing. Question 3: What do impact fees pay for? Response 3: Currently the City has citywide impact fees on water, sewer and roadways. As required by state law, the City has a capital plan which lays out exactly what projects the impact fees can be used on. These tend to be the larger roadway, water and sewer trunk line and treatment or production facilities that are needed with additional growth. Question 4: Do we have a way to show if they have helped keep taxes lower for citizens? Response 4: The chart below was shown to council back in June of 2024. This shows the current estimated cost of projects —just the ones in the Impact Fee capital plan, which is not every project the City needs. The middle column shows what is estimated to be collected at full build out of the City in impact fees. The far right column shows what the current Tax payer or Utility rate payer deficient need is. Roadways improvements are paid out of the GF and by tax dollars. Water and Sewer improvements are paid out of the enterprises fund and by rate payers. Currently the we have collected around $22.5M in total impact fees since 2016, meaning that this $22.5M does not have to be generated by a tax rate or utility rate increase. Total Estimated Recoverable Costs at Impact Fee Collection Rate Capital Costs (2021— 2031) Water $67.7M $11.8M Wastewater $189.7M $24.2M Roadway Totals $215.OM $23.7M Tax/rate-payer Burden $55.9M $165.5M $191.3M Question 5: What in our new home inventory like? Are we struggling to sell? Plat? Is our "housing crisis" worse or in line with national numbers? State numbers? Response 5: From data from the Texas Realtors for the entire year of 2024, which I've attached to this email, may best answer this question. Compared to state numbers: • College Station median home price is up 4.6% compared to 2023, compared to the state up 1.2% - however the median price is the exact same. • Home sales in CS are up 10.1% compared to 2023, while the state is only up 0.7% • College Station's Active Listings are up 56.5% compared to 2023, the state is up 30.5%. • College Station has 2.9 Months of Inventory, up by 0.4 compared to 2023. The State is up 0.7 compared to 2023 at 4.1 months of inventory. • College Station homes are on the market an average of 90 days compared to the state average of 60 days. Up by 12 and 5 days respectively. Additionally, currently in the review process with Planning and Development Services is around 512 lots pending completed review or construction of improvements. There are also approved preliminary plans for Southern Pointe, Mission Ranch, Midtown Reserve and Greens Prairie Reserve that have on going platting activity. Generally speaking, SP and GPR are well less than 50% platted and Midtown and MR are a little over 50%. Question 6: How would removing impact fees affect bond ratings and the like? Resoonse 6:. The ability to pay back the bonds is always reviewed by the bond rating agencies. If certain revenues were not available, we would cover the debt service costs through the utility rates, any available cash for the projects, and/or a reduction in the amount of debt that is issued and a corresponding reduction in project scope. This information along with all other relevant financial information would be reviewed by the rating agencies in the analysis of the bond rating for the city. Question 7: Do impact fees apply to used homes? Response 7: Impact fees do not apply to existing homes. They only apply to newly built homes. However, if there was an existing home on that property that was torn down and a new home built, impact fees are credited to the property and would not apply either for that particular new home construction. Question 8: How much of the overall impact fees are made up of residential compared to commercial? Response 8: The way the system collects impact fees this is hard to give a exact percentage without some additional work which we are happy to put together and get to the council when able. This stims from all the different permit types we have and needing to ensure that the reporting software is tracking them correctly. From what we've put together this far, it is estimated that around 80-85% of impact fees have been paid by residential uses (includes high rises) and 15-20% has been paid by commercial. Question 9: What is our current capture rate? Response 9: Please see the below charts. The first group show the overall capture rate of the current collection rate as it compares to first the max rate we could collect in impact fees, and second the capture rate in comparison to the capital needs of the City. Impact fees will potentially cover anywhere from 11-17% of the needed estimated project cost of the City projects listed in the IF CIP. RccovcrabluC�)stat Capturc Rocovcrablc Cost at Max Ratc CurrentCollcctionRatc Rato Wator 54,457,437,00 11,800,000.00 22% Sovror 71,917,188.00 24, 200, 000.00 34% Roadway 112,254, 065, 00 $ 23, 700, 000.00 21% RccovcrabluC)stat Capturc Total Capital Cost Curront Collucti on Ratc Rato W@tor 8 67,72-2,554.00 $ 11,800,000.00 17% Sowor S 189,745,166.00 S 24,200,000-00 13% Roadway S 215, 048, 599.00 S 23, 700, 000.00 11% The second chart shows the percentage of the max assessable rate that is paid per LUE for both Residential (Res) and Commercial (COM). Max Collection Collection Porcont Percent Impact Foo Assossablo Rato Ros 2025 Rato COM Ros COM Water $3,877 2,150.00 500.00 55.5% 12.9% Sowor $5,572 $ 3,300.00 $ 3,000.00 59.2% 53.8% Ro a dwa y A 499 $ 499.00 $ 80.00 100.0% 16.0% Roadway B $1, 61 $ 1,163.00 $ 80.00 92.2% 6.3% Roadway C $2,127 $ 1,163.00 $ 80.00 54.7% 3.8% Roadway D $3,452 $ 1,163.00 $ 80.00 33.7% 2.3% *Roadwayis porvoh milo Question 10: If impact fees are eliminated, how can that revenue be made up? How much would our tax rate increase? How would building fees/taps increase? Would GO bonds be used? Response 10: Losing the revenue from impact fees would mean either additional cash or debt would be needed to fund the projects. There would be about a 2.5% rate impact on the water side, and an approximate 10% rate increase on the wastewater side. Eliminating the roadway impact fees would be the equivalent of 0.4 cents on the tax rate. GO bonds, certificates of obligation, utility revenue bonds, or fund balance could be used for all infrastructure projects.