Why Should We Pay?

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Residents Should NOT Have to Pay to Enable the Holiday Isle Development!

Snapshot Summary of this Analysis

This is a detail analysis of the Impact Fees for proposed development called Holiday Isles.  The development plan obligates the city and state to yet unknown costs for new roadway work on city land at no expense, pedestrian walkway and roadway improvements so that the Holiday Isles development can go forward.

The roadway on city land at NO cost to the developer will, no doubt, be landscaped and have all maintenance in perpetuity as the responsibility of Madeira Beach residents.

Costs are supposed to be offset by Impact Fees.  In other locales, all improvements required for development are paid by in fulll by the developers.

How much the developer will actually pay to Madeira Beach in Impact Fees is questionable – despite estimates – as there is an ‘escape clause’ that allows the city to reduce fees.  See the section about the “Trojan Horse” near the end of this analysis.

And finally, is it reasonable for the City Manager and Commission to expect residents to believe that for an $80,000,000 development there will be NO NEED for infrastructure upgrades and improvements?  This subject has been entirely omitted from discussions, and it is perhaps the greatest liability that we as a city have!

The entrance in photo at right is the current entrance to the MB City Marina and provides access to the Holton property.

The entrance in photo at right is the current entrance to the MB City Marina and provides access to the Holton property.

The Problem with the Site & Plan

The Holiday Isle Marina development site, due to its location on a small spit of land very near the causeway draw bridge, presents significant traffic and pedestrian access problems.

  • The developer wants to maximize the commercial value of his property by intense/dense development.
  • Its location is such that the FDOT will NOT approve his Development Plan — unless 150th Ave and a road across city land is modified substantially.
  • A pedestrian walkway is specified.
    If the walkway is not approved by the state, the traffic generated by the project will create significant hazard for residents and visitors.

Costs of the Proposed Development Plan

Since the City Manager thinks that this project is SO BENEFICIAL, he has worked with the developer on a plan to effectively subsidize the developer.

The Development Plan requires:

  • The use of city land – AT NO COST – for primary ingress and egress from the Holiday Isle development.
  • The modification of the roadway and intersections serving the City Marina by the city and state
  • 100% of the COSTS for the roadway improvement be paid by the city and state!

    Ok, they say that he’s paying something for this, as he is paying impact fees. But these impact fees were established to offset the city’s cost for working with a developer, not for improvements to enable maximum use of a developer’s land!

Estimated Costs?   There Are NO Cost Estimates!!!

Neither Madeira Beach nor the FDOT has developed cost estimates for:

  • engineering and reconstructing the city marina frontage road
  • engineering and reconstructing the 150th Avenue entry and exit points to the development site
  • engineering and constructing a new pedestrian walkway under Tom Stuart Causeway.
Tom Stuart Causeway Draw Bridge approaching Holton property on 150th Ave in Madeira Beach.

Tom Stuart Causeway Draw Bridge approaching Holton property on 150th Ave in Madeira Beach.

 

The Impact Fees Proffered Are Minimal 

The Development Plan (agreement) as written requires the city to pay for road improvements needed to make access to the Holiday Isles site viable.

  • The draft contract between the city and the developer shows that the developer will pay approximately $806,000 in impact fees.
  • These fees must be used to pay for:
    • The city-owned roadway in front of the City Marina on City Land, which the city will obviously be obligated to maintain in perpetuity
    • The state road (150th Ave/Tom Stuart Causeway)
    • The pedestrian walkway improvements needed to access the development site.

This amount, $806,000, represents less than 1% of the projected cost of the Holiday Isle project.

And, it appears that neither the city nor the state DOT conducted a study to determine the actual costs of the roadway changes in the development agreement.

Structure Total Impact Fee Fee per Unit or Sq Ft
3 Condominium Bldgs – 68 units $84,400 $1241
2 Hotels – 352 units $521,300 $1917
Restaurant – 15,000 sq ft $119,130 $7.94
Dock Master House – 1,000 sq ft. $00 – – –
Marina Slips $81,400 $814
Total $806,230  

The table above lists the impact fees proposed in the revised February 8, 2016 development agreement. 

The fees above have not modified to show the changes made to the original development agreement.

  • Because the number of hotel rooms proposed was reduced to 270, fees will be reduced.
  • Based on the numbers in the table, it appears that impact fee for hotel rooms would be $521,300 $399,860.
  • The total impact fees $684,790, or about $121,440 less that shown in the table. 

In other jurisdictions, developers are obligated to pay the full cost for improvements.

The Tom Stuart Causeway is used by residents of Redington Beach as well as some at the south end of Redington Shores to reach the mainland.

The Tom Stuart Causeway is used by residents of Redington Beach as well as some at the south end of Redington Shores to reach the mainland.

Impact Fee Schedule Problems

  1. The development agreement does not provide information about how the various fees were calculated.
    Further, there is no comparative benchmark data for fees levied in other beach communities.
  2. There is a discrepancy in agreement with the number of hotel units shown in the revised Data Table (272 units) dated 1/19/16 and those in section 13 Impact Fee part of the revised submission (325 units).
  3. There is a discrepancy in the size of the restaurant upon which the fees were determined.
    See the revised size of the restaurant (17,000 sq ft) listed in the Data Table dated 1/19/16 and the size of the restaurant listed in section 13 Impact Fee part of the revised submission (15,000 sq ft).
  4. No Impact Fees are assessed for the Dock Master facility in either the original development plan/agreement nor the revised version.
  5. The most troubling aspect of Section 13 Impact Fee of the revised development plan is the following limiting condition:

“The City has estimated impact fees that the developer shall pay to the City as follows, subject to credits issued for prior development of the property….

Credits to Developer for Prior Development of Property?

The agreement does not provide any detail about the past “credits” listed above. For example: what the fees were, the amount and purpose of any past fees.

  • It is possible that the purpose of the above statement is to limit the developer’s obligation to pay the full amount of the enumerated impact fees, if:
    • The project is developed in a piecemeal fashion – or
    • A portion of the project is never built.

In either situation, the city would not be reimbursed for all costs in making the needed transportation improvements – but would be obligated to make them, none-the-less.

  • The city’s proposed agreement with the developer further states that Madeira Beach and/or state of Florida – NOT the DEVELOPER – is obligated to pay 100% of all upgrade costs that exceed the impact fee amount. This includes:
    • The city frontage road on city property at the marina
    • The state road (150th Ave) west of the bridge
    • The proposed pedestrian walkway UNDER the Tom Stuart Causeway.

Are the Credits a “Trojan Horse”?

Aside from the:

  • Missing criteria for impact fees in #1 above and
  • Discrepancies between specifications and fee in items #2 and #3
  • The most troubling part is the limiting conditions in #5.

Taken together, they likely mean that:

  • the developer may not pay any new fees to the city and
  • Madeira Beach and the state of Florida will be legally obligated to pay unspecified and potentially unlimited monies for road and pedestrian improvements.

Is the Impact Fee clause a “Trojan Horse” – designed to transfer traffic improvement costs from the developer to the city and state?

In other communities, developers are obligated to pay the full cost for transportation enhancements needed to support their projects.

This development blurs the line between public and private enterprises in which the city may be obligated to spend substantial public dollars to cover the transportation improvements needed for this for-profit project.

Finally, it is customary for developers to proffer fees to public entities when the developer requests zoning changes that will create inconveniences to the public from traffic congestion and/or increase the demand for public services — all to bestow development rights and profits on a private sector endeavor. And, in most cases, developers provide additional ‘gifts’ of public amenities to the locale in recognition of the benefits received.

Conclusions

  • Residents should not have to pay for any Holiday Isle Marina development road improvements – especially those where they are getting FREE USE of city property.
  • 100% of the public improvements to support this private, for-profit development should be borne by the developer and the future owners of buildings on the property, not current residents of Madeira Beach.
  • 100% of the enumerated transportation impact fees (Approximately $806,000) should be deposited in the city’s account before any transportation expenditures are made.
150th Ave before the Causeway Bridge, with sign for parking on school childlren's crosswalk overhead.

150th Ave before the Causeway Draw Bridge. City of Madeira Beach employees put Event Parking signs on the (school children’s) crosswalk.

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