LARGO — Commissioners are planning to restart a fee for residential developers to create parkland and build recreation facilities.
The fee would come out to maximums of about $4,100 for single-family homes, $2,600 per unit for apartments and condos, $2,200 for mobile homes and $1,700 per unit for congregate care, such as assisted living facilities. The fees could be less than that if commissioners decide to levy a percentage.
The money would go into a special fund to offset the strain more residents would put on the parks and recreation system. The city previously collected parkland and facility fees until 2012, when commissioners set a moratorium to spur development that's set to last through this year. In the two years prior, building permits were administered for 27 units total, according to city data. That number grew to 188 in 2012, 106 the next year, 197 in 2014 and up to almost 900 last year.
But commissioners agreed at a workshop this month that reinstating the fee is necessary to maintain a healthy parks and recreation system, considered one of Largo's major assets. They now have to decide on an amount that would bring in enough revenue without driving developers away and pushing up home prices, byproducts that several industry professionals warned could happen when the moratorium ends.
"I think it makes sense to charge for the increase in density to the developers to provide for the level of parks service that we have," Mayor Woody Brown said, "but I also think that we have to be competitive from a development standpoint."
The city paid consultant Tindale Oliver about $39,000 for a two-phase study to come up with the fee rates. The consultants looked at the number of city parkland acres per 1,000 residents — about 4.8. Then, they used the total value of land plus facilities to come up with a cost per resident of about $1,600. To get the rates, they multiplied the cost by the average number of residents living in each house classification.
Six other cities in Pinellas County charge similar fees, according to the study. Largo's, at the maximum, would be the highest in the county. Clearwater, which set its rate more than 30 years ago, charges $200 across the board. Tarpon Springs currently has the highest rate of $1,061 across the board. The county and Largo's neighbors to the south, Pinellas Park and Seminole, do not charge fees.
Several commissioners agreed they should charge a percentage rather than the maximum amounts and discussed the possibility of charging less when the moratorium initially ends, then phasing it up to a maximum amount later. There was also a consensus that the fees wouldn't be charged in the city's community redevelopment districts. City officials will make recommendations at the commission meeting on Tuesday before it goes to a final vote on Sept. 20.
One of the city's biggest needs is for more parkland east of U.S. 19, said City Manager Henry Schubert. Currently, the only city park serving that area is Datsko Park off Whitney Road.
Pat Edmond, president of the Friends of Largo Nature Parks, said the revenue could be used for more nature parks, specifically on the east end. There are also several smaller capital projects, such as a new playground for the George C. McGough Nature Park, that could benefit from the revenue.
"To me, it's the cost of doing business," she said. "At some point, the city has to decide what's important for their residents and insist that it's provided."
But developers say the cost could be higher: no development at all.
The Boulevard, a 260-unit luxury apartment complex off Seminole Boulevard, wouldn't have happened if they had to pay an additional nearly $700,000 in fees, said Tina Ayala, asset manager of Largo-based Dockside Investors. Neither would the Broadway, a 258-unit complex set to open this May from the same developers.
Ayala said both projects brought more than just property tax revenue to the city. The Boulevard was built at the site of an old RV park riddled with crime and the Broadway is going up on a former driving range off 66th Street N that sat vacant for years. Her company is also eyeing a site for a 192-unit complex in the city's Clearwater-Largo Road Redevelopment District, she said.
"Construction that never gets done is no impact fee," said Kevin Schwartz, spokesman for the Bay Area Apartment Association. "No impact fee on construction that gets done — you're still going to get revenue out of that."
Schwartz said the multifamily market is still chasing the demand pent up from the recession. The city would benefit from waiting a few years, or from levying a lower amount — if they still want apartments and condos. High fees would signal that Largo got what it wanted out of the moratorium, and there are plenty of other sites in the Tampa Bay area to build and redevelop, he said.
Like Ayala, Michael Willenbacker, president of Trinity-based Gulfwind Homes, hopes the commission goes with a lower fee and a phased approach. He has several projects in the works in Largo, including a 16-home subdivision off Ridge Road called Keystone Ridge. He's working to pull building permits on the homes before the end of the year. Otherwise, the added cost would be pushed onto homeowners.
That could be another downside of the fees: they would hit future homeowners, said Joe Farrell, director of public affairs for the Pinellas Realtor Organization.
"Balancing on the backs of real estate," he said, "the most expensive and most important investment a family is going to make in their life — it's not fair."
Contact Kathryn Varn at (727) 893-8913 or firstname.lastname@example.org. Follow @kathrynvarn.