The City of Greenville will not collect impact fees for the next 12 months.
Mayor Steve Reid had asked for a moratorium on the imposition of the fees for new commercial developments.
“I don’t think there is any doubt in my mind that it is a tax,” he said during Tuesday’s Greenville City Council meeting.
The fees are designed as a way for the City of Greenville to help pay for roads and water/sewer improvements needed by economic development projects. The City of Greenville charges incoming projects approximately 20 percent of the costs of providing the infrastructure to the development site, while the city pays for the remaining 80 percent.
But Reid said the fees instead restrict new development from coming to the city.
“That’s exactly what they do,” Reid explained. “My point is I believe they are an impediment to growth.”
Reid said removing the fees might be another tool for the Board of Development to use to encourage business and industry in Greenville.
“If anything I’d like to throw a little gasoline on the fire,” Reid said. “They can say we have a sale in Greenville and thats a sale on lets do more business.”
Council member Dan Perkins took the opposite stance, srguing the city was expected to receive almost $257,000 from the fees in this year’s budget.
“We’ve got to replace that some how,” Perkins said, noting that the collection of the fees has grown from $102,000 in 2007 to $269,000 in 2014, due to multiple projects getting started locally.
“I think we can see it is not an impediment to growtn,” he added. “I think they come and they expand because they want to be in Greenville.”
Reid countered that many of the businesses Perkins mentioned had taken over existing buildings and therefore were not subject to the impact fees.
“You don’t know how many people leave because they see that impact fee, and I can tell you they do,” Reid said.
Reid referred to an email he received from Splash Kingdom Waterparks President/CEO Johnny Blevins, who said he was unaware the city charged impact fees when he decided to open a park in Greenville.
“In the 11th hour, they almost didn’t come,” Reid said.
The council first passed an impact fee ordinance in November 2004. In creating the ordinance, a Capital Improvements Advisory Committee helped draft the recommendations for land use assumptions and capital improvements under which impact fees would be imposed.
The council also considered dropping the fees in March 2010, but voted instead to adopt a revised list of impact fees.
Reid also asked for a moratorium in August 2012. The idea was tabled at that time.
Reid’s effort was supported Tuesday by the remainder of the council, as well as three people who spoke in favor of the moratorium during a public hearing Tuesday.
“You are going to give up a little bit up front ... but you are hopefully going to recoup that later on,” said Council member Jeff Dailey. “I say you’ve got to give it a shot and see.”
The measure passed on a 6-1 vote, with Perkins against.