Agenda - 12-13-2016 - 7-a - Technical Resolution Regarding Grandfathering of Projects for School Impact Fee Collection Purposes

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2 County Schools district (OCS). Developers are concerned that projects that have already gone through a lengthy project approval process but are not yet ready to begin construction will be adversely impacted by these increases because financial analyses of these projects took into account the existing impact fee levels ($1,286 in CHCCS and $1,743 in OCS). This topic was discussed at the December 5, 2016 BOCC meeting where concerns were expressed by development interests that the construction timeline proposed by staff did not allow for a long enough construction timeframe. Northwood Ravin, the developer of Carraway Village in Chapel Hill, proposed additional language that would pertain to projects with at least 100 dwelling units. This language is included in the resolution in Attachment 2. Adoption of this resolution would allow an open-ended construction timeframe, provided the 2016 impact fee amount is paid prior to June 30, 2019. Staff notes that prior updates to school impact fees, which were first adopted in 1993 and have been updated several times, did not provide for extensive grandfathering of projects. In the past, projects that obtained a building permit prior to the impact fee effective date were allowed to pay the prior fees, even if the certificate of occupancy was issued in the subsequent year(s), but additional consideration was not made for projects that had only approved special use permits or zoning compliance permits. Town of Hillsborough staff has stated a preference for drawing the "grandfather line" at "projects that have active permits and are constructing either buildings or infrastructure on site should be able to pay the current fees. Projects that do not yet have construction authorization despite having conditional or special use permits should pay the fees in place at the time construction is authorized" (see Attachment 6 which includes the reasons for this preference). Because of the open-ended nature of the Northwood Ravin proposal, staff has produced a third option (Attachment 3) which includes the language proposed by Northwood Ravin but also requires that a Certificate of Compliance be issued prior to December 31, 2020. The BOCC could also choose to adopt a different construction outer-limit date for projects containing 100 or more dwelling units. The resolution in Attachment 1 is the resolution proposed by staff at the December 5 meeting. It would allow "grandfathering" for the 2016 fee levels if a building permit application is submitted prior to January 1, 2017, the permit is issued within 180 days, and a Certificate of Compliance (aka, Certificate of Occupancy) is issued within 365 days of building permit issuance. This essentially gives builders one year after a building permit is issued to complete construction and qualify for the 2016 fee levels. (This provision is applicable for any projects that do not have an approved Zoning Compliance Permit - see paragraph below.) Also within the resolution in Attachment 1, projects with an approved Zoning Compliance Permit (ZCP) would be given until December 31, 2017 to apply for a building permit(s) and a Certificate of Compliance would have to be issued within 365 days of building permit issuance in order to qualify for 2016 fee levels. A building permit would have to be issued within 180 days of the application date; this provision is included to deter applicants from submitting extremely inadequate permit applications, perhaps in an attempt to "game the system". Most building permits are issued within 30 days of the application date if the plans are done well and require no or only minor revisions. Under the timelines proposed in the attached resolution, the outer- most date limit for projects with a ZCP by January 1, 2017 is June 30, 2019 and this would apply only if building permit issuance takes the full 180 day limit.