A proposed impact fee of $4,376 for single family homes and $4,718 for multi-family buildings to fund future park and recreation facilities was reviewed by the city council at its Nov. 17 meeting.
Next it will be the subject of a joint meeting between the city council and planning commission that has yet to be scheduled.
City Councilor Walt Schubert said the fee would mean the end of affordable housing in the city.
City Councilor Ken Hays said most of the city's growth will come from residential lots that already are approved and so wouldn't be subject to the proposed fee.
Randy Young, from the city's consultant The Henderson Group, said state law spells out how the fee is calculated and that it's to build new park facilities not to maintain existing ones.
"It's the list that grows the park system, not that fixes what's broken," he said.
Then he explained in step-by-step detail how the fee was calculated based upon the requirements of state law. Young said he started with the $8.3 million worth of park improvements listed in the city's capital facilities plan through 2014.
Then he subtracted other available revenue sources and apportioned the remainder between the city's current residents and new residents, who are projected to account for 16 percent of the city's population through 2014.
The result is that $4.6 million of that $8.3 million in future park improvements can be attributed to growth, Young said.
If that amount is divided by the projected growth of 2,000 residents, the impact fee would be $2,279 per person over the next six years if the fee remains unchanged, he said.
Translated to households, that would be $4,376 for a single family home that has 1.92 people and $4,718 for an apartment that has 2.07 people, Young said.
The city can adopt a lower fee than that but not a higher one and the money must be spent within six years of being received or be refunded, he said.
Schubert asked how this fee might affect a parks district that extended beyond the city's boundaries.
Young said exemptions from the fee for affordable housing are allowed but they must be funded by the city and not other fee payers.
The fee could be charged only inside the city limit unless there's an agreement between the city and the park district, he said.
Hays said the failure of the Sequim Transportation Benefit District's proposed two-tenths of 1 percent sales tax also means the proposed fee must be recalculated, he said. (The proposed sales tax increase was one of the other revenue sources included in calculating the fee.)
Young said they could recalculate the fee or remove projects from the list.
City Councilor Paul McHugh said these park impact fees are the first of other impending impact fees intended to fund transportation and capital facilities.
If these impact fees increase costs for developers by $10,000 to $15,000, that could drive growth out into the county, he said.
Maybe the city could negotiate with the county regarding a parks district or negotiate with the existing parks district, McHugh said.
Mayor Laura Dubois said growth needs to pay for itself but hasn't, so the city is looking at streets fees.
"The city needs impact fees to expand its parks, especially on the west side. I think this is an excellent source of revenue to improve our parks," she said.
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