It’s going to be more expensive to build a house or an office in SLO County because not enough people are building houses and offices.
New development continues to fall in the county, but inflation continued in 2008 despite a deep recession. Now county officials are searching for ways to break even on public construction projects.
County supervisors voted unanimously on May 12 to increase public facilities fees 3.7 percent beginning July 13. Facilities fees are charged on building permits for new structures. The money collected is used to fund county capital projects. Recently, that pool of money began to evaporate when construction waned. The county made $378,363 less in facilities fees in the 2008 budget year compared to the year before, according to a county staff report.
The fees are intended to offset new development and growth in unincorporated areas, but there is less growth. Home construction dropped about 30 percent from 2007 to 2008, which led to fewer fees for the county.
“You can only charge the fee for the impact that person or builder is creating,” Supervising Planner John Hofschroer said.
Under the old structure a new single-family home building permit would be charged $5,473 in facility fees. Once the new structure is put in place the same permit would come with a $5,675 facility fee.
Increasing the fees can be done even when development slows because they’re not just linked to growth. State law allows local governments to raise fees based on the Consumer Price Index. Surprisingly, despite the recession, the CPI rose 3.8 percent in 2008 over the previous year.