A shoulder-to-shoulder crowd overflowed out into the hall of the Wilson County Commission meeting on Monday night, many of them residential home developers and Realtors.
The crowd gathered in anticipation of several resolutions before the commission to increase building fees and taxes, the most prominent of which was an increase of the Adequate Facilities Tax (ATF), also known as an impact fee.
After public comments, District 19 Commissioner William Glover made a motion to amend the resolution to increase the existing impact fee from $3,000 to $5,000 — $2,500 less than the original proposal.
His motion passed and then the commission voted to pass the increased AFT by a vote of 20-2. The new tax will take place in 30 days. Commissioners Robert Fields and Sara Patton voted against the increase.
Two-thirds of the new tax will go to the general debt fund and one-third to the capital projects fund, most pressing of which is a new county jail.
Many of the county’s developers were up in arms about the fee, including longtime residential developer and former Lebanon mayor Philip Craighead.
In an interview before the meeting, Craighead voiced several reasons why he was against the impact fee.
“They just passed this year’s budget 30 days ago. If they were in need of more funds, they should have addressed it at that time. There was talk about impact fees, property tax, everything back then. People were geared up to tell their stories and talk about everything then. But the budget passed and you think, ‘Well everything is in place. We don’t have to have this discussion for another year,’ “ he said.
Craighead said there needed to be at least a 30-60 day delay for discussion with people in the housing industry.
The AFT was passed by the county budget committee last week and was brought before the full commission for a vote two business days later.
“It just makes sense to slow down on these things,” he said.
Craighead said that in his experience when home building slows down then the sales tax income drops tremendously.
‘When I was mayor in the first year, our sales tax dropped a million dollars,” Craighead said. He went on to explain that the costs of projects and debt doesn’t decrease just because the tax revenue does. “It’s still there.”
Craighead reiterated many of his points to the commissioners during the public comment portion of Monday night’s meeting.
Kevin Pigg, a realtor with Benchmark Realty and a member of the Eastern Middle Tennessee Association of Realtors, was in attendance Monday night and echoed several of Craighead’s opinions.
“The impact fee is a one-time tax. But the property tax over a $325,000 home over a 10-year period is $25,000. If just one home is lost (because of an exorbitant impact fee) it would take the impact fee of 6.2 homes to make up for the lost property tax of that same home over 10 years,” Pigg said.
Craighead said that he believed the impact fee would squeeze more than just developers like him.
“This is going to affect the sub-contractors who live and work here in Wilson County. They’ll either have to do the same work in the future for less money or go somewhere else,” he said.
ADEQUATE FACILITIES TAXES
What developers in other Middle Tennessee counties are required to pay in Adequate Facilities Taxes:
Cheatham: $1,000 per home plus an additional $.50 per square foot
Dickson: $1 per square foot
Maury: $.50 per square foot
Robertson: $1 per square foot
Rutherford: $1,500 per home
Sumner: $.70 per square foot
Williamson: $2 per square foot plus an impact fee (court ruling pending)
Wilson: $5,000 per home