By Paul Gable
Horry County Council is expected Tuesday night to have second reading on an ordinance establishing impact fees on new construction.
Council held a workshop on impact fees Thursday with a view to having some parameters for what the new fee would cost.
There has been discussion about impact fees in Horry County for most of the last two decades. Two years ago, an advisory referendum showed three out of four voters supported establishment of impact fees on new construction.
Predictably those in the development industry have fought establishment of impact fees. To date, that industry has been successful in holding the fees off.
However, a number of cities and counties in South Carolina have established impact fees in the nearly twenty-year interim they have been under periodic discussion in Horry County.
One engineer predicted a $6,000 impact fee would stop half the business currently with his firm. This, however, seems a ridiculous statement when the cost of lumber has quadrupled in the last 12 months and construction hasn’t slowed at all in Horry County due to the increase in cost.
Long time county residents have been remarking recently that new home prices have reached ridiculous levels in the county. But new homes are still selling at record levels.
Any cost to the developer and builder winds up on the final purchase price of the home. Impact fees can be thought of as a tax that will be paid by purchasers of new homes to help fund the increased level of government goods and services additional homes and their residents require.
The question for council is who should pay for these increased demands on county government and how much should be paid.
Council member Harold Worley said during the Thursday discussion that $4,500 (impact fee) is not going to slow down development one bit. He noted failure to pass an impact fee ordinance could result in a tax increase of 13.2 mils to residents of the unincorporated areas of the county in the future. Council will vote on third reading of a budget ordinance that increases taxes 7.6 mils in the unincorporated areas of the county next year with additional rises in stormwater and solid waste fees.
Worley said new purchasers of homes need to pay their “fair share” of additional costs for services and “they need to do it up front.”
To put some perspective on Worley’s $4,500 figure, Beaufort County currently charges approximately $5,500 impact fee on new single-family homes. The Beaufort fee pays for roads, libraries, fire service and parks associated with increased population.
While some council members have their ears tuned to the objections of the development industry, it appears the train has left the station in Horry County on the question of will impact fees be established.
The question to be decided by council is at what level will those new fees be established and what will they fund? The $4.500 number may be too high for a beginning but I believe the developers have to come to the realization that zero is no longer an option in Horry County.