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Bills would let Baltimore County impose fees on developers to help build schools

An analysis prepared by the state’s Department of Legislative Services estimates that if Baltimore County adopts a fee structure similar to Anne Arundel or Prince George’s counties, it could increase revenue by $20 million to $35 million annually.
An analysis prepared by the state’s Department of Legislative Services estimates that if Baltimore County adopts a fee structure similar to Anne Arundel or Prince George’s counties, it could increase revenue by $20 million to $35 million annually. (Darryl Brooks / TNS)

Legislation that would let the Baltimore County Council impose fees on developers to help pay for schools, sewers and other public needs is moving forward in the General Assembly.

Similar legislation to allow “impact fees” in Baltimore County didn’t make it far last year — even though such fees are common elsewhere in Maryland. But with the county delegation behind it, supporters say they now have momentum for it as county officials look for ways to alleviate a budget shortfall and relieve overcrowded schools.

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“It’s time for the developers to pay their fair share,” said Phoebe Evans Letocha, a Towson High School parent who supports the legislation.

While some county officials are raising the possibility of property or income tax increases, supporters of impact fees say they could help defray the public cost of development — such as the need for new schools and roads.

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The idea has generated support from both Democrats and Republicans representing the county.

Industry groups including the Maryland Building Industry Association oppose the legislation. Association CEO Lori Graf said the measure would have limited effect in Baltimore County, which is already more developed than some other surrounding jurisdictions.

“Baltimore County’s a very built-out county,” Graf said.

Baltimore County Executive Johnny Olszewski called for cuts to school budget within hours after it was passed Tuesday night.

Fourteen Maryland counties impose impact fees, which can help pay for improving infrastructure and building schools and libraries. Baltimore County is the only suburban county in the Baltimore area without them.

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New County Executive Johnny Olszewski Jr. supports efforts to let the county impose impact fees given the county’s budget challenges. His administration says the county faces an $81 million shortfall in the coming year.

Olszewski, a Democrat who took office last year after winning November’s general election, has held a series of town hall meetings where he has spelled out fiscal challenges facing the county. Last week, he said that a budget request approved by the county school board was not sustainable and would need to be cut.

“The county executive considers impact fees to be another tool worth exploring given the county’s current fiscal situation, so he supports the county having the authority that the bill would provide,” Olszewski spokesman T.J. Smith said in a statement to The Sun.

Fee structures vary throughout the state. In Harford County, for instance, the impact fee for a single-family detached home is a flat $6,000. In Anne Arundel County, builders are charged depending on square footage, with a 2,500-square foot home garnering a $14,435 fee.

Graf said builders already pay other types of fees, such as permitting fees and open-space fees. She said impact fees would increase costs for homebuyers.

The head of Baltimore’s social services department has been named administrative officer for Baltimore County, a top position that oversees day-to-day operations of county government.

“By implementing any extra fees or regulation, it makes the cost of housing go up,” she said.

A state law is necessary for the council to have the legal authority to enact impact fees. Del. Steve Lafferty, a county Democrat, and Sen. Chris West, a Republican, have sponsored companion bills to do that.

“If we had had this 50 years ago, it would have been enormously helpful to Baltimore County,” West said.

But both legislators say it is hard to estimate how much revenue the fees could generate. Their bills would only enable the County Council to impose the fee — it doesn’t require them or lay out any details. Those would be up to the council.

“The question is, is the juice really worth the squeeze?” West said.

An analysis prepared by the state’s Department of Legislative Services estimates that if the county adopts a fee structure similar to Anne Arundel or Prince George’s counties, it could increase revenue by $20 million to $35 million annually.

“Impact fees are not a panacea and will not raise all of the money necessary to build schools, improve roads or replace and upgrade sewer and water,” Lafferty wrote in a recent email to constituents.

Johnny Olszewski Jr. delivered an upbeat message on the campaign trail, promising a fresh approach to governing as Baltimore County executive. Now in office and facing a budget shortfall, he is traveling around the county telling a more sobering story.

In an interview, Lafferty said the charges are “one little piece in the puzzle” as the county explores ways to generate funds.

“I see it as simply one aspect in raising revenue,” he said.

The county’s House delegation approved Lafferty’s bill this month. With the delegation’s support, the bill faces a strong chance of being approved by the appropriate committee and the full House of Delegates. When a bill affects only one county and has the county delegation’s support, lawmakers from other areas generally practice “local courtesy” and defer to the county legislators.

The Senate’s Budget and Taxation Committee held a hearing on the Senate version of the bill on Wednesday. For the House version, a hearing before the Environment and Transportation Committee is scheduled for next month. There’s been no announcement of when committee votes could take place.

Evans Letocha said she was frustrated to see the county grant the developers of the Towson Row development a $43 million public assistance package in 2017 when its school buildings and roads are in bad shape.

“Our taxpayers are subsidizing development that is then starving our ability to maintain our existing public infrastructure,” she said in written testimony to lawmakers.

County Councilman David Marks said that if the state gives the county the power to impose impact fees, he will consider introducing council legislation to make it happen.

“We may have less land, but there’s certainly enough land left where you can put high-rise developments, and that’s going to be the future,” said Marks, a Perry Hall Republican.

Marks wrote about impact fees for his master’s thesis at the Johns Hopkins University. He said they can sometimes be poorly administered.

“That’s why I think it’s important to have a dialogue with the home builders,” he said. “Without schools, homes don’t get sold. … Impact fees are not going to produce a tremendous amount of revenue, but they may help.”

Baltimore Sun reporter Pamela Wood contributed to this article.

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