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Sherman approves impact fees for new development

Staff Writer
Herald Democrat
Herald Democrat

In a unanimous decision, the Sherman City council approved an ordinance Monday night that will create and define impact fees for new development in the city. The new fees will require new growth partners in the city to support a portion of their impact on local infrastructure.

Monday’s decision represents a compromise on the issue following concerns that were raised earlier this month on the effect the fees would have on various types of development.

“First of all, I want to thank the mayor for your leadership,” said Grayson County Judge Bill Magers, who spoke representing SSCGC Holdings, LLC. “I think that what is being proposed here tonight is palatable to the community.”

Under the terms of the ordinance, new development would be charged a one-time fee associated with the development’s use and demand on city infrastructure. Through this, city leaders said Sherman could ease the burden on current residents for future utility needs.

When rates were initially proposed in early September the charge for an average single-family home came out to about $3,500. Meanwhile, a 10,000-square-foot retail strip center could see just under $39,000 in impact fees.

Water and sewer impact rates would remain the same throughout the city. However, road fees would vary depending on which of four service areas the development fell under.

However, these proposals raised concerns from the council, who asked for alternative rates that included accommodations for retail, infill residential and other developments.

During Monday’s meeting, city staff presented an alternative proposal that was presented by Mayor David Plyler that reduced and created flat fees.

Using the same example as above, an average single-family home would be charged a flat fee of $1,000 for road impact, $1,000 for water and $500 for wastewater impact.

Under this model, the same retail strip center would pay $31,665 without considering any reductions.

However, the ordinance does include several exceptions that will reduce the fee by 75 percent.

These exceptions include all of service area three, which includes areas south of U.S. Highway 82, North of FM 1417 and East of U.S. Hwy. 75. Much of the development taking place in this area is infill, which is being built in existing neighborhoods.

The ordinance also included exceptions for non-profit, recreational and religious uses. City Manager Robby Hefton said this mirrors other exceptions that are given to these uses for other fees.

Dining and retail also will receive the same 75 percent reduction in the fee.

While the modified proposal did receive positive feedback, multiple members of the public did express concern about possible double dipping on water and sewer fees, as the city already charges pro rata rates.

Hefton noted that this was not the intent of the fees and the city did not intend to charge twice.

Likewise, Magers expressed some concern about the proposed start date in early January, which he felt did not give developers enough time to get plans and other proposals in prior to the new fee. Instead, Magers proposed a start date in July as an alternative.

“For those developers who have purchased property and are in the early stages of development, 90 days is simply not enough time,” Magers said. “From my limited experience, from the day the deal closes to the day the dirt starts flying, you are looking at a eight to nine month time frame.”

In another compromise, the council agreed to set a official start date for the fees in June.

Prior to passing the ordinance, multiple members of the council said they were pleased by the compromises that were made.

“I think this process is a really good exercise in what doesn’t always get done up here with elected officials,” Council Member Willie Steele said. “It is this process that has been done and worked out the right way.”

Michael Hutchins is the local government reporter for the Herald Democrat. He can be reached at mhutchins@heralddemocrat.com.