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St. Pete tables proposed linkage fees as Covid-19 pummels economy

Megan Holmes

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Photo by EJ Yao on Unsplash

Council member Brandi Gabbard shared Tuesday with the St. Petersburg Chamber of Commerce that the City of St. Petersburg would be tabling the discussion of linkage fees, a one-time per square foot impact fee tacked on to development to fund local affordable housing.

Gabbard said that as soon as the potential economic impact of coronavirus mitigation became clear, she had a conversation with Neighborhood Affairs Director Rob Gerdes about the linkage fees, as a formal ordinance was to be brought before council in the coming weeks and months.

“I think the administration realized that in such a large economic uncertainty and downturn, the last thing that we should be doing is looking at increasing fees on anyone for anything,” Gabbard explained. “While our affordable housing initiatives are just as important as they always have been, putting that on developers at this time really seems very irresponsible.”

“It’s no surprise that I wasn’t a big fan of it in the first place,” Gabbard said. “I did not vote in the Committee of the Whole to move it forward to the full council but as of now, it looks like administration is realizing it is not the time to be doing that anyway.”

Mayor Rick Kriseman’s administration had long been considering the possibility of imposing a linkage fee to spur affordable/workforce housing development. Linkage fees were included as a main funding source in the “For All, From All” Affordable Housing Plan announced by Kriseman in July. But the City had been tight-lipped about how much those linkage fees would cost developers above normal building costs. According to the “For All, From All” Plan, $20 million in affordable housing funds would come from linkage fees over the plan’s 10-year span.

The results of the City’s Nexus Study Draft, which studied the gap between what low, moderate, and median income residents can afford and the cost of building affordable units, showed that instating a linkage fee between $1-5 per square foot could potentially generate between $2.1 million and $10.4 million respectively in annual revenues for the city’s Affordable Housing Trust Fund.

While the Committee of the Whole moved the linkage fee forward to full council earlier this year, state legislation that would preempt the use of impact fees for affordable housing was passed by the Florida House and Senate, which has not yet been signed by Florida Governor Ron DeSantis.

The bill would limit the use of impact fees for infrastructure defined as follows: “any fixed capital expenditure or fixed capital outlay associated with the construction, reconstruction or improvement of public facilities that have a life expectancy of five or more years; any related land acquisition, land improvement, design, engineering, and permitting costs; and all other related construction costs required to bring the public facilities into service.”

Construction of affordable housing would be an allowed use.

“To my knowledge, the Governor has not signed the legislation yet so we need to monitor that issue and it will take some time to determine if there are realistic alternatives to comply with the legislation,” said Gerdes in an email. “In addition, it will take time to determine the longer term impact the COVID 19 pandemic will have on the economy. We will be working through both of these issues before we can make a determination on the appropriate timing and plan to move a linkage fee proposal forward.”

The City’s decision comes as Hillsborough County considers effectively doubling impact fees on new home construction to fund roads construction, schools and other services needed to accommodate new residents, uses that would also be prohibited under the new state legislation.

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    Bill Herrmann

    April 29, 2020at10:07 am

    There is never a good time to place a fee onto construction. In a boom “it will scare developers away” in a down cycle “it will stop development”. Council should simply enact the ordinance.

    This economic downturn will result in more people needing affordable housing.

    St. Petersburg is, and will continue to be, a hot commodity. We need to make sure that the rising tide truly lifts all the boats- especially those most effected by the economic downturn.

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