St. Petersburg, developers rail at thought of impact fees

ST. PETERSBURG -- It soon could become a little more expensive to build in downtown St. Petersburg.

Starting in 2004, developers building in the downtown area might have to pay an impact fee used to help fund new roads, a charge they were exempted from the past four years.

The Pinellas County Commission voted in December to end the downtown exemption.

Now, angry developers and city officials are decrying the decision as unfair and say it could hamper efforts to revitalize Midtown, the collection of neighborhoods south of Tropicana Field.

"It's the little guy this will have a bigger impact on," said Dave Goodwin, the city's assistant director of development services. "And there are plenty of little guys out there who are trying to start a business or build a home who are going to feel the impact of this fee."

As of Jan. 1, developers of new property downtown would pay $1,923 for a single-family home. A condominium will cost $1,252 per unit, and an efficiency apartment building will be $413 per room. Redeveloping an existing property is slightly cheaper: a single-family home is $1,423, and a condominium $831 per unit.

Everyone from the small entrepreneur hoping to open a coin laundry to the builders of giant, luxury condominiums will feel the pinch if the exemption is allowed to expire, Goodwin said.

For example, Opus South Corp., which is planning to build two condominium towers on Beach Drive, would have to pay more than $300,000 if they can't obtain their permits by the time the exemption expires.

Jerry T. Shaw, senior vice president of Opus South, said the cost won't be enough to sink his project on the 300 and 400 blocks of Beach Drive. But it could hike the price of the condominiums.

"I don't know if that would stop the development, but the cost would be passed on to the consumers," he said. "I don't know if that really encourages downtown housing."

Downtown St. Petersburg was one of three no-fee zones designated by the commission in 1999. The others are in Safety Harbor and Pinellas Park.

Developers in other areas of Pinellas County must pay the transportation impact fee when they build a new building or enlarge existing buildings. The cost varies according to the size of the construction.

The fee is intended to help accommodate the number of cars a new building will bring to the surrounding roads.

The no-fee zones were created because those areas already had sufficient roads and transportation facilities.

The zones were scheduled to expire after five years. At the time, the commission left open the possibility of renewing the exemption for an additional five years. Their vote on Dec. 3 closed that option.

Commissioner Karen Seel said the decision to eliminate the zones stems from a broader look the county is taking at transportation impact fees.

A task force has been created to study the issue and determine whether the fees are needed. Rather than create further confusion, the commission decided to end the no-fee zones and put everyone on equal footing, Seel said.

"It could have gotten really sticky," she said.

But the possibility remains open that the fees will remain. Without that exemption, it may become more difficult to lure potential builders downtown, Goodwin said.

"It's a tangible, marketable incentive for developers," he said.

Anyone without the necessary permits when the exemption expires will have to pay the fee. While St. Petersburg's no-fee zone officially ends in January, the city can apply for an extension until October.

As if the unexpected costs weren't unpalatable enough, the commission also voted to hike the fees by 18 percent effective Jan. 1.

St. Petersburg council member Richard Kriseman sits on the task force charged with examining the impact fees. He said he's hoping they can act quickly enough to eliminate them before downtown developers are forced to pay up.

"We would like to see the no-fee zone continued," Kriseman said. "This certainly isn't something we wanted to see happen."

-- Carrie Johnson can be reached at 892-2273 or cjohnson@sptimes.com .

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