Montgomery may cut fees for homebuilders : News : Oswego Ledger-Sentinel : Hometown Newspaper for Oswego and Montgomery, Illinois
|Montgomery may cut fees for homebuilders|
|Board majority voices support for temporary $2,000 reduction|
|by John Etheredge|
It may soon become a little less expensive for builders to construct new homes in the Village of Montgomery.
A majority of village board members expressed support last week for a plan to reduce the village's building fees by $2,000 on new homes through April 30, 2014.
Village Manager Anne Marie Gaura said she and Steve Andersson, an attorney for the village, will prepare an ordinance granting the fee reduction for the board's consideration and a final vote.
During a committee meeting March 20, Village President Marilyn Michelini and three board members expressed support for the reduction in an effort to spur homebuilders to action.
Like most communities across the country, homebuilding in the village slowed dramatically in 2008 at the outset of a nationwide recession.
The village issued a record 559 permits for new homes in 2005, but that number fell to 412 in 2006, 244 in 2007 and just 84 in 2008.
Last year the village issued just 46 permits for new homes, according to information presented to the board by Jamie Belongia, assistant to the village manager.
The dramatic slowdown in new home construction has left subdivisions with vacant lots in various stages of completion throughout the village.
Belongia said village staff proposed the fee reduction in response to a prior board request to review the village's development fees.
In addition, Belongia said a builder asked village staff if they would reduce the build fees by $1,000 to $1,500 per home "in order to make some stalled subdivisions more attractive."
Board members Bill Keck, Matt Brolley and Denny Lee voiced support for reducing the fees on a temporary basis. Board members Pete Heinz and Andy Kaczmarek voiced opposition. Another board member, Stan Bond, was absent from the meeting.
Belongia acknowledged there are "pros" and "cons" to reducing the fees.
She said reducing the fees might encourage development in "stalled" subdivisions; increase aesthetic appeal by eliminating vacant lots, adding connectivity of sidewalks and trees; spur other commercial development; and may help boost the village's share of state reimbursed per capita and property tax revenues.
However, Belongia said a village staff study of fees being charged to builders in other area communities has shown the village's fees are already competitive and/or lower than other communities and there is no current problem or resistance to the fees by builders.
A fee reduction, she continued, could also reduce village revenues for other purposes, including capital improvements, traffic improvements and the village's water system.
Instead of reducing building fees on residential builders, Heinz said the village should do something to promote commercial and industrial construction.
Kaczmarek said there is still some limited home construction taking place on the village's far west side.
"I don't think we should reduce anything," he said.
Kaczmarek also expressed doubt that builders would pass the $2,000 savings on to the home buyers.
Michelini said she believes reducing the fees will send a message to builders the village is "encouraging growth and development."
Keck said he supports reducing the fees if the village sets a "sunset date" when the fees would return to their current levels.
He proposed the village set the date when the reduced fees would end at April 30, 2014, the end of the village's 2013-14 fiscal year.
"I have no qualms whatsoever about tweaking something a little bit to try and encourage growth and development," Keck said, of the fee reduction.
He continued, "This isn't going to open up a waterfall or a floodgate or anything like that, but I think by trying to do something and putting a sunset date on it as a good incentive, it might be just enough to push developers to work just a little bit harder instead of languishing."
Brolley said attempting to encourage additional home construction in the village is "one area where we (the village) can indirectly affect the quality of life" in subdivisions were building has stopped.
He explained builders will be required to finish sidewalks and streets in subdivisions that can be used by all residents.
Board members acknowledged that reducing the fees may not have any impact on local builders.
"If it doesn't work, no one is out anything," Michelini said.