Government Cutbacks Force Public Service Improvements on Developers

By William Schmidt, N. Y. T. N. S. | THE JOURNAL RECORD, February 7, 1986 | Go to article overview
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Government Cutbacks Force Public Service Improvements on Developers

William Schmidt, N. Y. T. N. S., THE JOURNAL RECORD

ATLANTA - Pinched by sharp cutbacks in state and federal financing, local governments around the nation are demanding privat e developers pay a larger share of the cost of expanding community road networks, sewer systems and other public services that are burdened as a result of the developers' projects.

Cities' and counties' growing reliance on exacted fees to offset the effects of development is expected to redefine the way that many local governments raise millions of dollars to rebuild or expand public facilities, according to specialists in how land is used.

In contrast with the past, when developers were required to make public improvements only on their own property, these exactions are intended to help pay for public services, such as new roads, schools or expanded police and fire departments, that are required to serve the new residents or workers drawn by the developments.

The use of these new fees, which were first imposed in the fast-growing areas of Florida and California, has generated considerable controversy among private developers. Some refer to such paymentsas a kind of ""blackmail'' by local governments.

The trend is widespread, especially in the high-growth areas of the South and West, where local governments are under the most pressure to expand public services.

In the suburbs north of Atlanta, developers of several large office complexes have agreed to contribute fire trucks, a new police station, an expanded freeway interchange and improvements in the sewer system to help offset problems created by their projects.

In Boston and San Francisco, officials have gone even further, requiring that developers of downtown projects put money into funds that will be used, among other things, for construction of housing.

""For 40 years we have relied on the federal government to help finance improvements in infrastructure, whether it was a new stadium or sewage plant,'' said Robert Gerber, chief of the Department of Planning and Community Development of Fulton County, which includes Atlanta.

""With cutbacks in federal aid and the anticipated loss of revenue-sharing money, the burden is almost entirely on local resources, and we just can't absorb these kinds of costs without help from the private sector.''

In several intances, developers have taken local governments to court, some of them successfully arguing that the fees or assessments constitute a form of illegal taxation. But others have chosen to pay the fees rather than fight, reasoning that it will cost them less in the long run.

""I think most builders are resigned to the facts of life and realize there are going to be these kinds of fees because the Federal funding just isn't there to pay the bills anymore,'' said Gus Bauman, a lawyer with the national Association of Homebuilders in Washington.

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Government Cutbacks Force Public Service Improvements on Developers


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