City of Foley officially adopts impact fees for new developments

By Jessica Vaughn
Posted 7/13/21

FOLEY - After two months of discussions and draft revisions, Foley council approved to implement an impact fee on new developments within city limits. Funds collected from the fee will be put towards …

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City of Foley officially adopts impact fees for new developments

Posted

FOLEY - After two months of discussions and draft revisions, Foley council approved to implement an impact fee on new developments within city limits. Funds collected from the fee will be put towards improvements within city parks and recreation and streets. The impact fee is based off findings of a study performed by TischlerBise for the city.

Impact fees are designed to offset the financial impact a new development may have on public infrastructure. With the impact fee, a municipality has a set amount of time to use the funds to create or improve new infrastructure. In Alabama, municipalities have five years in which to spend collected impact fees. In Baldwin County, impact fees may not exceed 1 percent of the estimated fair and reasonable market value of a new development after completion.

Fees from single-family home developments will largely be put towards parks and recreation, with $2,477 being put towards such projects and $497 going towards streets. Likewise, multifamily homes will largely benefit parks and recreation, with $1,432 towards parks and rec and $286 towards streets. Residential development fees are based per unit.

For nonresidential developments, 100 percent of the impact fee will be put towards streets. Fees for nonresidential are based per square foot and are $0.11 per square foot for industrial, $0.69 per square foot for commercial, $0.26 per square foot for office and other services and $0.19 per square foot for institutional. Hotels are $231 per room and assisted living facilities are $70 per bed.

“This impact fee is not a full-blown one, we have not implemented it across the board, but what we have implemented will go a long way towards moving forward for our infrastructure needs,” said Mayor Ralph Hellmich. “We are pushing forward with design on intersections and drainage projects and upgrades to roads, so we’re trying to be as proactive and move forward as much of the ten-year road plan with intersections as we can. What we found is our intersections are where the problems are, not capacity. To give an example, ALDOT did complete the 59 corridor, and I’ve had quite a few people say they’ve noticed the difference. Unfortunately now the side streets may cause a little bit longer wait and there’s some people concerned with that. We’re going to work with ALDOT to try to reach a balance.”

Along with establishing the impact fee, Foley council approved the establishment of a new impact fee fund within the city accounting system. The account will allow all impact fee funds to be deposited separately from general revenue of the city to be used for the purpose of infrastructure improvements. The one-time impact fee payment is set to be charged to new developments at the point of a building permit. Current developments undergoing simple remodels are not subject to impact fees. Expansions of existing structures will be considered by the Community Development Department to determine if the fee applies.

For more information, visit cityoffoley.org.