Commissioners seek to assess impact fees on new construction

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Posted February 5, 2025 | By Jennifer Hunt Murty
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In the coming months, the Marion County Board of County Commissioners will decide whether to assess additional impact fees for transportation needs and restart assessing fire/medical impact fees on new construction to offset the financial effects that new residents and businesses have on Marion County’s infrastructure.

During a public workshop held on Jan. 29, the commissioners listened as their consultant Megan Camp, from the Benesch engineering firm, made recommendations and offered comparison analysis about impact fees charged in other counties.

The county suspended impact fees for fire services in 2015; and Commission Chair Kathy Bryant acknowledged during the workshop that the board had waited too long to reinstitute them.

According to Assistant County Administrator Tracy Straub, the conversation about impact fees has been languishing since 2022.

Currently, the commissioners are limited to increasing fees by no more than 50% unless they have a study within the past 12 months demonstrating extraordinary circumstances, hold two public workshops to discuss those circumstances, and have an affirmative vote by two-thirds of the commissioners, in accordance with a 2021 law signed by Gov. Ron DeSantis.

The commissioners were presented a study during the workshop that reflected extraordinary circumstances. The question was whether they would adopt the recommendations from the consultant and take steps to implement 100% of the recommended impact fees or set them at a reduced rate.

The board’s consideration of impact fees follows the school district’s implementation of them last year after a 13-year hiatus. In the case of the school district, the impact fees were only assessed against new residential construction that would result in additional students—excluding developers of commercial and 55+ retirement communities from having to pay the one-time fee. However, the county commission’s imposed impact fees would include all new residential and commercial construction because both place increased demands on Fire/EMS and roads.

Through that process, the “Gazette” reported the school district faced significant headwinds from the county, local business interests and the city of Ocala before agreeing to accept 40% of the rate the consultant recommended. Additionally,  the school district first sought impact fees  before asking voters to approve a half-cent sales tax  Recently, voters approved the county’s one-cent sales tax for 20 years. Commissioner Michelle Stone pointed out that the initiative reduced the impact fees now recommended because it factored in both community needs and other funding streams.

Commissioners have restrictions on how impact fees can be spent and collected.

The fees aren’t collected when the development is approved by the commission but rather when building permits are pulled. This often means that local governments are behind in funding to meet the impact of new growth.

Impact fees can be used for capital improvements to meet the needs associated with new development; however, the money cannot be used for prior debt or projects unless “there is a nexus showing use for need due to new growth,” explained the county’s consultant during the workshop.

Impact fee and sales tax revenue cannot be used for operations costs, which means that growing personnel costs to meet growth needs must be funded elsewhere.

Transportation

The transportation impact fees were calculated on a consumption basis. The consultant recommended the following impact fees for transportation:

Land Use	Unit	Current Impact Fee	Recommended Calculated Impact Fee	Legislatively capped impact fee
Residential single family	2,000 sq ft	$1,397	$5,318	$2,095
Light industrial	1,000 sq ft	$428	$2,145	$642
Office	1,000 sq ft	$676	$4,766	$1,014
Retail/Shopping Center	1,000 sfgla ft	$676	$4,766	$1,014

 

Bryant asked fellow commissioners whether they were willing to explore supporting a bid for extraordinary circumstances so that they could assess a higher rate than $2,095, which legislative restrictions capped them at, and be closer to what the consultant recommended.

Although most of the commissioners responded noncommittally to Bryant’s request for feedback, Matt McClain responded emphatically that he would not favor it.

Additionally, McClain inquired whether county administration had polled the business community to find out how they felt about impact fees.

McClain’s extended family is in the home construction business—including his father, State Sen. Stan McClain, who has also worked in the past for the Marion County Builder’s Association.

Fire/EMS

The impact fees proposed by the consultants were broken into Fire/EMS:

Land Use	Unit	Current Impact Fees for Fire Rescue or EMS	Recommended calculated Fire Rescue impact fee (countywide except for Ocala)	Recommended calculated EMS impact fee (countywide)
Residential single family	Each dwelling unit	$0	$667	$202
Light industrial	1,000 sq ft	$0	$190	$56
Office	1,000 sq ft	$0	$401	$119
Retail/Shopping Center	1,000 sfgla ft	$0	$1,156	$343

 

Fire impact fees would be assessed on all new construction outside the Ocala city limits. However, since the city relies on the county for EMS, those impact fees could be assessed countywide.

Marion County Fire Chief James Banta was in attendance to answer questions about the need for more fire stations. Banta and Camp, the Benesch consultant, explained to the commission that those who live outside the five-mile radius of a fire station are paying much higher property insurance rates due to a low ISO rating—as much as “35% more,” according to Camp.

In addition to growing residential needs, Banta told the commission that commercial calls are also increasing. The county’s large warehouses and multistory buildings over the past 10 years have created the need to have increased training and fire suppression apparatus to meet those unique needs, he said.

The last time the county charged fire impact fees based on a study from 2005 totaled $289 for each dwelling.

During the workshop, it was acknowledged that the cost of building fire stations had significantly increased, and the commissioners asked the consultant to bring back revised numbers based on those new construction costs.

The needs of Marion County Fire Department remain large.

“I can tell you where I need the first five fire stations right now,” Banta emphasized to the commission.

Yet, the stations take approximately three years to build, according to Banta.

The penny sales tax and the potential to collect impact fees alone will not fully address the department’s needs, however, because both can only be used for capital projects—not operations.

The county’s fire assessment, a fee tacked on to every property tax bill outside the Ocala city limits, has remained at an average of $199 per household. In the last couple of years, Ocala has increased its fire assessment fee to $364.15 for a single-family home with a square footage between 1,601 and 2,500.

Banta is expected to return to the commission with a request to increase fire fee assessments. These fees can be used for operations, and operational costs will continue to increase as more are hired to meet the growing Marion County population’s needs.

County staff indicated they would bring back the updated fire impact fee study during the board’s first meeting in March and address EMS impact fees with Ocala leaders during a joint workshop on March 13.

This is what it could look like

Based on the initial recommendations for impact fees, Bryant asked county staff to compare the amount of impact fees in 2009 before the county and schools suspended collecting them.

During the workshop, county staff quickly estimated 2009 impact fees at $10,053 for a single-family residence.

When Bryant added up the school’s current impact fees, transportation and fire/EMS proposed impact fees for a single-family residence the increase was approximately $441 from 2009 total impact fees- $10,494.

Bryant told the commissioners, “I just want the board to think about that as you’re thinking about all of this and think about how different the costs of things are, and the growth that we’ve seen and the impact. We’ve had to ramp up our departments in order to provide the services.”

“[Think about] the roads that we are expected to build from the people who are moving to our community, the capacity that we’re expected to add.”

Stone responded, “But we’ve got the sales tax, and that’s what’s driving down some of these costs today.”

However, to implement that much in impact fees, the commission would have to make the case for exceptional circumstances regarding transportation impact fees.

Commissioners express concern

The impact fee workshop followed a morning budget workshop where many department heads cited increased needs and rising operating costs. During that workshop, County Administrator Mounir Bouyounes confirmed to the commissioners that sales tax revenue alone could not fund all the county’s current and projected needs.

Commissioner Craig Curry told the commissioners, “I’m not opposed to this. I know we need it…. but this is just a lot to figure out in one or two days.”

Curry asked for a single sheet that would identify the different taxes, assessments, and impact fees being considered so he could consider the cumulative impact on the community and have a “bird’s-eye view of how it affects all departments.”

But Bryant said seeing all funding possibilities summarized on one page wouldn’t change her mind about impact fees because those fees were on new growth and different than assessments paid by property owners.

“We need to do this,” Bryant said.