Delegates from the McMinnville Area Chamber of Commerce testified on behalf of business at a Public Hearing regarding building and planning fees on Tuesday December 11, 2018 at the City Council Meeting.
Board Chair Lucetta Elmer and Chamber CEO/President Gioia Goodrum both testified regarding the concerns business has for the significant increase in building and planning fees, citing the increases would negatively impact small business developers, new home construction, buyers, affordable housing and the community at large.
Elmer spoke about the impact the fees would have to small developers and that, likely, the fees would be passed on to the consumer, as absorbing the fees would make building projects prohibitively expensive. She went on to say that there hadn’t been enough time for business to really weigh the pros and cons and had concerns that some of the fees are a significant increase over the current fees structure. Elmer said “Please, council, wait to give us a chance to weigh in and come alongside you so that we can work together.” She also said she thought gradually increasing the fees over time was much more reasonable.
Goodrum asked the Council to wait for input from the business community as there had been only discussion with real estate developers and those discussions did not include other businesses that would be impacted by the fees. She recommended the City consider the impact to not only new housing development opportunities but also the impact to residents and small businesses. Goodrum cited the Oregon Business Plan, developed by Oregon Business and Industry, that called for a lowering of permitting costs and impact fee calibration to allow for more building. Oregon has, according to some estimates, a deficit of 155,000 homes.
Staff reported that the Oregon Building and Codes Division mandated the City update their building fee schedules and encourages cities to maintain a full cost recovery. Currently, the Building Department is recovering about 90% of costs and Planning is recovering about 12%. The fees are associated with the total costs of delivering services which includes overhead, labor, materials and services in each department. The impact will be about a 5-7% increase in fees.
The City Council approved the increases with a 6-0 vote for the Building Fees and a 5-1 vote for the Planning Fees. Councilor Garvin suggested creating a less aggressive schedule by gradually increasing the fees, but that was not widely supported. The Council provided reasons for their decision: time is of the essence to begin the cost recovery plan or they risk a funding crisis down the road; they must move quickly as the cost of buildable land is too high; they need to create more housing so that our workforce can live/work in McMinnville; and they stated they heard the concern regarding the proposed appeal process fee and amended it to $1,000.
The McMinnville Area Chamber of Commerce is disappointed in the direction the City Council has taken and also understands the need to recoup the costs associated with providing services. We will work with the City to find ways to support businesses in our community.
The new fee structure for both planning and building will take effect January 28, 2019.
If you have any questions or would like additional information, please contact the Chamber at 503-472-6196.
