In light of a current economic downturn, the San Juan Water Conservancy District (SJWCD) will ask the Town of Pagosa Springs to temporarily suspend collection of an impact fee on its behalf.
The SJWCD board of directors voted Monday to draft a resolution, asking the town to temporarily suspend assessment of a $1,129 per-equivalent-unit fee on all new construction within district boundaries.
An equivalent unit is equal to the normal amount of water used by a single-family home.
Since February 2007, the town has charged the fee on behalf of the district, to aid in funding the development of future water rights and storage, including those associated with the proposed Dry Gulch Reservoir.
The district’s move to suspend its fee comes amid increasing communitywide concern over the dramatic decline in residential and commercial construction in the past year. District officials fear a prolonged pause in area construction will further erode the local economy.
The SJWCD board will postpone the collection of fees to fund future ventures until the economy improves. Though the decision was not unanimous, the majority consensus suggests the act might encourage builders to proceed with planned projects.
A couple of years ago, following more than a decade of unprecedented growth in the county and town, the town looked at how best to maintain quality services, while requiring new development to pay its fair share of infrastructure costs. The analysis resulted in the creation of various impact fees imposed on all new construction.
Archuleta County, meanwhile, feared too many impact fees might actually discourage development, and pushed for communitywide cooperation in determining what level of fees developers could live with. That led to the formation of a community economic roundtable comprised of all local taxing entities, including governments and special districts.
As roundtable negotiations progressed, participants expressed interest in pursuing another impact fees study by Economic Planning Systems (EPS) of Denver, similar to one it completed in 2006.
The 2006 study was designed to aid the town and county in creating a joint impact fee program that would be fair, while avoiding duplication of one-time fees assessed against new development. At the time, the SJWCD participated in the study (and its cost), even though EPS ultimately failed to consider certain circumstances relevant to long-term district needs.
At Monday’s district meeting, as the roundtable waited for a new EPS proposal, board members grappled with joining another study and whether the cost would be money well spent.
At that point, county planner Rick Bellis — who happened to be in the audience — suggested the district consider participating, since he believed the county would successfully obtain a Department of Local Affairs (DOLA) grant that would cover the entire cost of the study.
With that in mind, discussion continued, as various board members also insisted maintaining a voice in the roundtable might be crucial to future considerations.
In the end, the board chose to partake in the study, even if a DOLA grant isn’t secured and the district must pay $4,000 as its share of the study cost.
Once approved at next month’s district meeting, an official resolution to the town will include a request to suspend collection of its $1,129 impact fee effective Jan. 1, an appeal for support in the pursuit of other grants for future capital improvements funding, and assurance that the district will participate in the economic roundtable and a new EPS study.
Collectively, the board agreed that such actions would illustrate district good-faith efforts toward alleviating current economic concerns.