Metro Detroit communities want funds for road improvements

CHRISTY ARBOSCELLO

FREE PRESS STAFF WRITER March 30, 2008

DEVELOPERS VS. TAXPAYERS

http://www.freep.com/apps/pbcs.dll/article?AID=/20080330/NEWS04/803300603

Impact Fees for Developers• They were on the back burner in more prosperous times, but

now impact fees for developers -- money that pays for infrastructure upgrades such as traffic lights and road improvements in areas where big commercial projects are built -- are once again at the forefront of discussions in communities throughout metro Detroit.

• More and more, metro Detroit leaders contend that the fees, which can reach well into the millions, should be paid by developers, not taxpayers, in light of state revenue-sharing cuts and scaled-back services.

• But it's nearly impossible to get developers to pony up any money.

• “The impact that we have in the community is bringing in jobs,” said Nick Infante, senior manager of public affairs for Wal-Mart in Michigan, who called the fees an unnecessary burden for companies. "For us, it's bringing in produce and general merchandise that people want."

Approval as Leverage

• To their dismay, community leaders can't use their approval as leverage, especially when the development meets zoning regulations or gets the green light from courts.

• And many agree that developers don't owe anything more -- that they bring enough to the table already in the form of jobs, tax revenue and charitable initiatives such as the $19,500 in grants Wal-Mart gave to Sterling Heights city departments and nonprofit organizations when it opened earlier this year in the city.

• Homeowners opposed to developments say getting an unwanted neighbor stings enough, but knowing some of their taxes are used to support it is another blow.

Increased Traffic

• A Clinton Township study projects that when a Wal-Mart opens in the community next year, increased traffic will create safety hazards on the already busy Romeo Plank and Hall corner. The proposed solution: Install a $500,000 boulevard the store does not want to pay for.

• Wal-Mart's traffic study concluded the boulevard isn't necessary, Infante said.

• Township officials say taxes will now foot the work needed to improve the street.

• Partridge Creek subdivision homeowner Chris Fett, 35, said he's baffled taxes will foot the boulevard bill. "I don't see how, being a responsible developer, they wouldn't want to share the cost somehow."

Extortion?• Bob Filka, chief executive officer of the Michigan Association of

Home Builders, said of the impact fees: "I do believe that it's akin to extortion in terms of local communities looking for impact fees. I realize times are tough for local communities. Times are tough for our builders."

• But, "impact fees are certainly not the way to go," he said, adding that city leaders and developers should work with, not against, each other.

• Some communities are hashing out the dilemma on their own.In Flat Rock, for instance, officials say a new Meijer could benefit the city, but also would bring more traffic. As part of negotiations, the company has indicated it would share the $800,000 cost of a half-mile stretch of Vreeland Road that will lead to the store, said George Mans, the city's economic development director.

• "I think each situation is unique, and I think each side should have some ability to negotiate," he said.

Economics

• Who should pay for public access?

• How would you calculate an impact fee?

• If you make the new project pay the fee, who benefits? Who loses?

• If the development is legal, and properly zoned, is the fee a “taking” of property?

• If communities compete for business, who pays the fee?