The Avondale City Council Last night approved the creation of a development impact fee incentive program that would be used to help spur residential development and commercial growth in the city. At its regular meeting on Monday, June 1, the Avondale City Council approved a resolution that would set aside $2 million in FY 2015-2016 for a development impact fee incentive program that would be used to pay 20 percent of all development fees for new residential and commercial construction in Avondale.
Development fees are one-time payments made to the city that are used to pay for new growth’s share of capital costs. Development fees are assessed on both residential and non-residential growth, and are used for construction of capital projects such as roads, bridges, parks, public safety facilities, as well as other capital improvements.
“The Avondale City Council has long held the philosophy that new growth should pay its way. Our current development fee structure, in the amount of $17,707 assessed for every single family home, assures that we are collecting the necessary fees to ensure that new growth does not fall on the backs of our existing residents,” said Avondale Mayor Kenn Weise.
“At the same time, we also recognize that the development community has concerns about our development fees, which is higher than in some neighboring communities. The Council’s action on Monday evening demonstrates that Avondale is committed to working with the development community to spur new growth and economic development in the city,” Mayor Weise explained.
He said: “Adding new residents helps support existing businesses, which in turn, generates additional revenue for the city. Population growth is also essential to maintain our share of state shared revenues and to help attract new business and economic development to Avondale.”
The resolution adopted by the City Council on Monday night creates a Development Impact Fee (DIF) Incentive program, using fund balance from the General Fund, in the amount of $2 million. Any property for which a building permit is issued after June 1, 2015, is eligible to receive a 20 percent discount on the development fee due. The discount is available on a first-come-first-serve basis until the funds run out, and does not apply to property previously eligible for discount as part of the Infill Incentive Program. The DIF incentive program could be funded annually up to three years at the discretion of the City Council. The incentive fund would be replenished from the additional building permit and construction sales tax revenue the following year.
According to City Manager David Fitzhugh, the $2 million in funds would accommodate 450 new homes, and leave approximately $400,000 for commercial development. Each year, the fund would be evaluated as part of the budget process.
For more information about the Development Fee Incentive Program, contact Tracy Stevens, Director of Development & Engineering Services at (623) 333-4012, tstevens@avondale.org; or Dan Davis, Economic Development Director, (623) 333-1411 ddavis@avondale.org.
