Ashland is playing catch up to fees that haven’t been updated since 1999. These fees are called transportation system development charges (TSDC). New developments are charged the fee to pay for the impact they have on the community’s transportation system.
In a City Council meeting Aug. 7, Public Works Director Paula Brown clarified what that means.
“Every street that we have, as you grow in capacity with new population, new businesses in Ashland, has a direct impact on the ability to safely drive and conveniently drive on streets. Just as pedestrians and kids walking to school, just as bicycle paths going to and from for different transportation use,” Brown said. “As we allow for that growth it adds even more complications on our roadways, sidewalks, etc. So, you assess a charge on new development, so they pay for their impact to the existing system and help you build towards the future.”
The council approved new methodology which will bring the charge up to speed with current inflation rates, as well as take advantage of a pool of revenue that wasn’t tapped before. According to a staff report, staff recommended these new charges be phased in over a period of three years, “to lessen the burden on the community.” The council approved this direction at its Nov. 6 meeting.
Beginning Jan. 1, the first year (2019) will increase by 50 percent of the difference, the second year (2020) will increase by another 25 percent of the increase and the third year (2021) will increase by the remaining 25 percent, Brown said.
The current SDC is about $2,000 for single-family homes. With the phase-in option, the first year would take the fee to about $3,000.
There’s specific state statutes and guidelines regarding the development of SDCs, according to Brown at the August meeting.
There are three components that are allowed under Oregon law. First the reimbursement fee for costs and improvements that have already been constructed but have the capacity for growth and was funded by the city. The second is the improvement fee for projects that are on an adoption list and have the capacity for growth in the future. Finally, the compliance fee allows reimbursement of money spent working on the methodology to pay for the time spent on the project.
Brown said the city has never used the reimbursement fee.
The uncollected revenues for single-family and multi-family dwellings equal $857,600 due to inflation alone, the staff report states.
“It is not a revenue that we will be able to collect because we were behind, and we stayed behind,” Brown said. “With the phasing you would still under recover, but you can’t make that up. State law doesn’t allow you to recover from the past.”
Galardi Consultingv was hired to work with the SDC committee on drafting the new changes.
At the August meeting, Deb Galardi said the reimbursement fee could be very beneficial to the city.
“It’s an important component of the fee because it’s not restricted in terms of what you spend it on,” Galardi said. “You’re recovering costs that have already been incurred so basically you can spend the money on any capital improvement related to the system. So, it becomes a nice additional funding mechanism with greater flexibility.”
Brown said Mayor John Stromberg asked her how Ashland would compare to other Oregon cities once this update takes place.
“We are smack dab in the middle,” Brown answered. This would be the case even if the council decided to not phase in the new fees but instead implement them all at once.
Because each city does this slightly differently, Brown used the numbers for single-family dwellings for the comparison.
“It’s very difficult to compare apples to apples,” Brown said.
Councilor Dennis Slattery asked Brown if she’d received feedback from builders, developers and others who would be impacted.
Brown said she has received no feedback even though there is a builder and an architect on the SDC committee. Additionally, the drafted methodology was sent to the Builder’s Association and “several other people who have expressed interest.”
“We are finally establishing a rate that’s current, rather than a rate from 1999,” Brown said.