The Folsom City Council voted late Tuesday to more than double the fees charged on new home construction to pay for parks.
The fee hikes affect various types of development in Folsom; on a single-family home, fees will go from $2,910 to $6,501 starting July 1.
City staff last month proposed a larger increase, to $7,874, drawing opposition from the construction industry. Builders said the increase was too much, especially as they try to recover from the recession.
City staff reduced Folsom’s original proposal to $7,223, and then the City Council further cut that amount. City officials say the increase is necessary because the fees stagnated during the recession and are now lower than in other cities in the Sacramento region.
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A staff survey of park fees in nine cities and unincorporated Sacramento County found that the fees proposed by Folsom staff would be the fifth highest, and near the average for all of the fees considered. The survey also looked at other fees charged to developers and found that Folsom’s fell in the midrange.
“The overall fee package still makes Folsom an attractive place to build,” Councilman Jeff Starsky said just prior to the unanimous vote.
The North State Building Industry Association criticized the action.
“While we appreciate the openness of the city to negotiate a slightly lower fee than originally proposed, it’s still a matter of too much too soon,” Michael Strech, the group’s president and CEO, said in a written statement. “Although our industry has started to see some positive signs in the housing market, we’re still very much in a recovery state of mind and increased fees could hurt that recovery.”
He said higher fees will also hurt consumers, as the costs are passed on to them.
Councilman Steve Miklos recommended the final fee schedule approved by the board.
“I’m trying to be fair and equitable and consider all the discussion points,” he said. “This is a reasonable fee that gets things built.”
Fees will also increase for commercial development and multifamily housing. Responding to a developer planning to build senior housing in Folsom, the council agreed to reduce the proposed increase for senior multifamily housing, in part because city staff said seniors are thought to use parks less than most people.
As originally proposed, the increased fees were projected to raise $21.6 million for new and improved parks in Folsom as part of a $36 million parks master plan approved by the council last month. The fees would apply to development in the existing city north of Highway 50 and pay for parks in that part of the city.
Miklos said his revised fee plan will raise $17.5 million. According to the parks master plan, the city can obtain about $4 million from other fund sources, which, along with the park fee revenue, would leave the city about $14 million short of the $36 million needed to make improvements to 11 parks and build 12 parks. Most of the money, almost $23 million, would go to new parks.