Subsidize Developers at Our Expense? No Thanks.

By: Lowell
Published On: 2/16/2008 6:53:28 AM

I received the following from the Virginia League of Conservation Voters and agree that ending the proffer system is a really bad idea.  To see who voted yea or nay on this, click here. Thanks.

Developer Subsidy Moves to the House of Delegates

Take Action!
Urge Your Delegate to Oppose SB 768

The fight over Senate Bill 768, a backdoor tax increase on Virginians, has moved to the House of Delegates. This bill would shift the cost of growth away from developers and onto us, Virginia's taxpayers. It would end the proffer system and make developers pay far less for infrastructure and other service needs generated by new development.

The bill squeaked by the Senate on a 21-19 vote and now moves on to the House.

Despite some small changes, SB 768 would still subsidize sprawl and is being opposed by citizens and local governments all over Virginia. The impact fees being proposed are not enough to cover the cost of development, and there are so many loopholes that the actual payments could be very small.


Come to Richmond on Monday to let them know that SB 768 is a  bad bill.  VCN will hold an "Assembly Update" Briefing and Lobby Day at 9 am in 4th Floor West Conference Room in the GAB.

If you can't come to Richmond, click "Take Action" above to contact your Delegate.

Talking Points for SB 768:
1. SB 768 is a major threat to local growth management.
2. The bill would severely cut developer contributions to affordable housing, parks, trails, libraries, schools, historic preservation, transportation, and public safety.
3. This bill and its fiscal impacts should be extensively studied for at least a year.
4. This is a back-door property tax increase that will also lead to higher state taxpayer costs for transportation.

The Senate vote was extremely close and there is a real chance of beating this bill in the House.

Contact your Delegate and tell them to oppose SB768!


Comments



SB 768 (martin lomasney - 2/16/2008 10:46:43 AM)
Lowell

I missed the memo. When did the Democratic Party become the champions of exclusionary, snob zoning. That's normally the province of the Republicans.

Local governments in Northern Virginia have abused the almost unlimited power given them by the General Assembly in zoning and land use law to prevent the people who work in their jurisdictions from living in those jurisdictions.

Instead my accounts payable clerk has to commute from Hardy County, WV to Fair Oaks.  My wife's collegues commute from Harrisburg, Pa to her office on the west side of Dulles Airport.  And when they go home at night they take their income tax payments with them. So our legislators have less revenue to build roads and pay school teachers.

There is a 50 years history of exclusionary zoning in Northern Virginia that has perverted commuting partterns and exacerbated air quality problems.

Prof. Steve Fuller of George Mason has done multiple studies that show that, from a fiscal perspective, even before counting the $51,000 in cash proffers which some local governments demand, new housing more than pays for itself.

Unless our party becomes advocates for affordable houseing close to jobs, we will lose the support of the average voter.

Further regulation is not the answer.  This problem is cause by abusive regulation in the first place.  Unless a brake is put on the abusive proffers charges by these irresponsible local hacks, our children will not be able to live near us.



if it costs the same to build one mile of road (Alter of Freedom - 2/16/2008 12:21:05 PM)
in NVA as it does in Richmond I cannot understand why it is there is 30K differences in cash proffers in some instances. Most proffers are geared toward services and begs just how much more it really can be to provide services or build them out in these two different localities.
I believe that my County (Chesterfield) is in such a state that it NEEDS cash proffers to remain if not raise them in order for them to address any issues facing the County like major school overcrowding otherwise monies that would go to overcrowding and schools and police and emergency services will have to go elsewhere without the revenues from proffers being directed where they must go. The impact fees it is feared will not adequetely address the long term needs of the locality and capping it does not help.
The solution is a mix of proffers and impact fees on those lots that were zoned before the cash proffer system originated if a citizen or developer wishes to develop a parcel regardless of zoning date. All of us have to hookup to county services and we all should have to share the burden whether buying a new home with the fees built in to the home value or building a new home on a lot zones twenty years ago before proffers.
I am certainly no expert but it does not take a genius to see that growth does not always pay for itself but a defer to BACONS REBELLION on critical analysis of this issue.


Local governments have the right to control their jurisdictions (Kindler - 2/16/2008 6:36:00 PM)
You know, I find it fascinating that so many alleged conservative champions of federalism -- devolving power from the federal government to the states -- draw the line when it comes to allowing local governments the slightest power to control what happens within their boundaries.

Proffers and impact fees allow local governments to control development and pay for the impacts of it -- e.g., an influx of new people requires new roads, new schools, new utility lines, and so on.  

The American way, too often, is to allow businesses to pass all the costs of such "externalities" onto the taxpayer.  I totally support the right of local governments to refuse to allow such costs to be passed on to me and you in such a way.



New homeowners are subsidizing existing voters (martin lomasney - 2/16/2008 7:20:33 PM)
Local governments have more power in VA than their cohorts in 46 other states.

Local governments are "mere administrative subdivisions" of the state. Federalism addressess the relationship between the states and the national government and has no application to the powers of local government.

Based on all of the research done by Prof. Fuller, in Virginia, new housing not only pays for itself but generates a surplus; and that's before the proffers are included.

Proffers are a hidden tax which cannot be deducted from new homeowners federal tax returns.

It is one of the urban myths of snob zoning advocates that new housing doesn't pay its own way.



the dillon rule shining through (Alter of Freedom - 2/16/2008 7:36:01 PM)


SB 768 is (asmith - 2/19/2008 10:47:15 PM)
SB 768 is not pro-locality legislation, regardless of how the hombuilders spin it.  It uses the new impact fee legislation against localities and reverses many of the gains localities and the Commonwealth made last session with the passage of HB 3202. That is why numerous localities and organizations have publicly opposed it, including; the Coalition of High Growth Communities, Culpeper County, Fairfax County, Loudoun County, the Northern Virginia Transportation Authority, Prince William County, Spotsylvania County, and the Virginia Association of Counties.

The impact of SB 768 will be substantial.  But the precise impact is unknown because there has been no real discussion or study of the bill.  Existing taxpayers will be forced to subsidize new development to maintain or improve service levels.  Otherwise, if taxes are not raised, already-overstressed existing services will have to serve even more households.  The bill will also restricts what services the impact fees can fund.    

Generally impact fees are better than proffers.  But the builders are now using the impact fees, which they fought for years against the localities.  The fees are capped at an arbitrary amount that bears no relationship to actual infrastructure costs ($12,500 for single family in NoVa, $7,500 for townhouse, etc.)  Localities would be prohibited from limiting fees to the one or two areas where funds are most needed.  Localities' ability to accept non-cash proffers for off-site improvements, which is critical to transportation improvements in NoVa and other suburban/urban areas will be significantly restricted.  

This is not about exclusionary/snob-zoning, this is about adequately funding essential public services.  Proffers are voluntary (whatever the builders may say to the contrary) and allow for back and forth negotiation between localities and developers to ensure that the locality can offer adequate public infrastructure and services and the builders still make a sufficient profit.  This is not to say that proffers are perfect.  They are not, and there may be better a better way, but SB 768 is simply not it.  Land use is a complicated issue, and NoVa's land use/transportation problems have many causes.  SB 768 is not the magic bullet - as the builders claim - it will only serve to exacerbate these problems.                

SB 768 will also reignite the zoning wars which took place during the 1970s and 1980s.  During these wars, localities simply denied rezonings, developers sued and both spent years and untold sums on legal fees and costs fighting it out in the courts.  The proffer system was created specifically to end this costly and wasteful process.  The builders now want to reopen this Pandora's box.

Professor Fuller's study is reported to be deeply flawed.  It used a timeframe that was particularly generous to the builders and the results still indicate a significant revenue shortfall for localities.  Fuller has also apparently refused to discuss his methods and results with local government officials.  

Finally, Senator Mark Herring (Loudoun) should be applauded for being the strongest, most vocal, and most consistent opposition to SB 768 so far.