A Multifamily Industry Perspective on Impact Fees

Presented by

Rachel S. Arnold

National Apartment Association

October 2003

National Impact Fees Roundtable

San Diego, California

Multifamily housing has a lesser impact on communities than traditional single-family housing

Impact fees negatively affect affordable housing

Concepts to include in impact fee laws

Multifamily development benefits communities

Multifamily housing helps to minimize sprawl.

Houses more people in a smaller area Preserves open space Uses infrastructure more efficiently Redevelops infill sites Increases neighborhood walkability

when designed in conjunction with retail and jobs

Multifamily housing has a lower per-housing-unit fiscal impact than single-family homes

Privatized trash removal and recycling

Efficiencies created for mail service

Urban Land Institute, Case for Multifamily Housing, 2003

Multifamily communities have a lesser impact on schools than single-family communities

NMHC tabulations of 1999 American Housing Survey (Washington, D.C.: U.S.Bureau of the Census and U.S. Department of Housing and Urban Development, 1999).

Owner-Occupied Single-Family

Homes

All

Apartments

Mid- to High- Rise Apartments

64 21 19

Number of School-Age Children per 100 New Housing Units

Multifamily development typically requires less

infrastructure Compact development lends itself to

needing less infrastructure than a single-family development - less roads, sewer and water pipes and electricity and gas lines

Infrastructure is used more efficiently

Sedway and Associates, BART Higher Density Residential Study (San Francisco: author, 1989), p.1.

Multifamily housing has many environmental benefits

Reduces development pressure on undeveloped land

Combats sprawl with density

Less land disturbance Fewer impervious

surfaces Inclusion of open space

and recreation amenities

Increased preservation of natural land features

Less traffic and air pollution

Less electricity used Less water used, both

internally and externally

Multifamily housing can minimize traffic congestion

Multifamily residents tend to own fewer cars People can live near where they work Greater efficiencies for mass transit High-speed Internet and access to business centers

allow for telecommuting Multifamily residents average fewer auto trips

Multifamily housing helps communities retain economic vitality

Multifamily housing is often more affordable than single-family housing

Creates a wider-range of housing options, which is more attractive to businesses

New development creates an immediate and long-lasting effect on a community’s prosperity

Multifamily housing is accessible to a wider range of incomes

Effect of Impact Fees on Affordable Housing

Average impact fees for multifamily housing now exceed $9,000 per unit (James C. Nicholas, An Update on Impact Fees, October, 2002.)

Fees are passed on to residents resulting in a rent increase and depletion of affordable units

Declining availability of housing forces people out of the community, increasing sprawl and the need for more infrastructure

Concepts to include in impact fee laws

Fair and equitable fees

Consistent methodologies

Set timeframes for expenditures and refunds

Use of a capital improvement plan

Exemptions and Credits/Affordable Housing

Mechanism for appeal