Impact fee plan raises eyebrows City calls for audit

Staff Writer

When a bond to build a new high school, a sixth elementary school, and make other improvements around the district failed for a third time this spring, some longtime Valley residents said they’d voted against it because they felt that new development should fund the new schools.

According to law, though, impact fees can only pay for a specific fraction of school facilities that are needed due to new development, said Ron Ellis, finance manager for the Snoqualmie Valley School District.

Each year, the district projects its enrollment, figures out what its costs will be to accommodate new students, and asks King County and the cities of North Bend and Snoqualmie to collect development impact fees on its behalf.

Between 1993, when the district started proposing fees, and 2006, the impact fees for each single family residence hovered around $3,000 to $4,000. The proposal for this year, however, surged to $9,977, raising some eyebrows among city officials and builders, who all have an interest in keeping impact fees low. Municipal governments generally don’t want to discourage development in their communities, and builders don’t want to get saddled with the interest from the impact fees while they’re waiting for the homes to sell. Garrett Huffman of the Master Builders Association said the impact fees are ultimately passed on to the consumer.

“The assumption is it goes out of builders’ profit margins, but it gets added to the carrying cost,” Huffman said.

Ellis said the district has used the same formula all along to come up with the impact fees. Among other things, the complicated formula takes into account construction costs, which have been skyrocketing at a rate of 12 percent a year, Ellis said.

“The district doesn’t have any control over it,” Ellis said. The formula is determined by state and county laws.

The North Bend City Council asked for an audit of the construction cost numbers that the district plugs into the formula. Ellis said the district’s land use attorneys are taking another look at the figures, and may come up with a revised, possibly lowered impact fee proposal for the school board to consider.

Meanwhile, the Master Builders Association has hired a consultant to investigate the fees.

“Theoretically, the school district is using the numbers correctly,” Huffman said. “But we have to do our own due diligence. The numbers are not always as accurate as we’d like.”

Huffman said he believes in the maxim that growth should pay for growth, but he’s concerned the impact fees could go beyond that.

“It looks to us like, ‘We’re not getting it that way, so we’re going to get it this way,’” Huffman said. “We don’t want to make up costs that were slighted on the other end.”

The school district, meanwhile, also hears from voters who think new development should bear a larger share of the burden.

“We’re sitting at the vortex of a perfect storm of conflicting points of view,” said Ellis, as students at Mount Si High School start a new year at an overcrowded campus.

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