Last week, there was lots of chat about “the end of sprawl” after the New York Times ran two pieces harkening the decline of suburban expansion. One, “The Death of the Fringe Suburb” was relayed around the blogosphere with many putting in their own examples of how suburban expansion was coming to a close.
Clovis, like many other cities built on sprawl, would like to have a word with them.
The Clovis City Council has introduced another reduction in development fees to attract developers who have been sitting on the fringes.
The council approved a two-year fee reduction, that began Thursday, that would provide developers with an average savings of $4,500 per lot for residential development and about $35,000 an acre for commercial, industrial and office projects.
“Our hope…is that this will give a jump start to development in the community and it will incentivize those who are thinking about doing something to go ahead and do it,” said Tina Sumner, the city’s director of community and economic development.
The fee reduction will be available for two years. It is the latest in a series of development fee reductions introduced by the city of Clovis in the last year.
In Dec. 2010, the council approved a two-year waiver of the city’s sewer and water facilities fee that would amount to a savings of about $53,000 per acre. In spring 2011, the city created a sales tax rebate program for retailers who opened a business in vacant buildings.
Like most California cities, Clovis has had a tough couple of years when it comes to the budget. Less property taxes, less sales taxes, but more expenses. All those suburban roads, streetlights, sewers, parks and so forth, must be maintained, even if many of the homes fronting them had been foreclosed on and sat empty.
The logic here appears to be:
More development = more fees!
But that solution seems like a giant step backwards.
Cities love those initial fees developers must pay, which help the budget, but don’t really cover any long-term expenses.
That’s where property taxes come in, but when the housing market is over-developed, each additional new home simply hurts the value of existing homes. As supply increases, prices fall. And as prices fall, so does tax revenue.
So less long-term revenue, and now, less short-term revenue, because those initial fees are being slashed. The math doesn’t seem to add up.
But hey, what could go wrong?
And until the people in charge figure it out, sprawl is more than welcome. The end isn’t near at all, it’s business as usual.