Impact Fees

Impact fees for new construction have been in the news a lot this year, with Lee County commissioners deciding whether to restore fees to pre-recession rates.

This is a topic I get asked about regularly, so I thought I’d offer some basic information on those fees this month, especially for visitors from outside the state who might not be familiar with the concept.

Impact fees are fees charged to new construction — both residential and commercial. The money raised is then used to pay for capital improvements needed to support a growing population.

The fees support several key things that are important to any community — especially communities in fast-growing Southwest Florida: Emergency services and fire stations, new schools, roads and sidewalks and parks. The impact fee on new construction varies, depending on the location you are building in and the type of structure you are building.

On unincorporated Pine Island, our fees are generally less than other areas because of our rural nature and limited commercial development, which means that we don’t need a lot of infrastructure out here. But impact fees still apply and a portion of our fees is used to deal with growth and development here and the remainder supports capital improvements to deal with growth countywide. A good example of something supported by impact fees is the bike path that runs the length of our 17-mile Island. While impact fees did not pay the entire cost for the path, they were essential in making it a reality.

In 2013, Lee commissioners had reduced impact fees by 80 percent to help spur growth in light of the recession; now, with development once again speeding up in and the overall economy improving, commissioners voted in February to raise fees.

Currently, the impact fee to build a new single family home on Pine Island and Matlacha is $6,029. On June 2, the fees will increase to $6,315. Impact fees for commercial construction have already increased and are running $2,700 per thousand square feet for office space and $4,180 per thousand square feet for retail space.

As the economy improves in the coming years, it’s likely that fees will only increase. That means if you’ve been considering building a new home on the Island, there’s no time like the present.

First, you’ll need to purchase your lot. Island properties are very reasonable right now and prices haven’t yet returned to pre-recession amounts, but we are seeing increases. Right now, 75-by-135-foot lots are going for $7,000 to $12,000; 80-by-180-foot lots are in the neighborhood of $10,000 to $20,000. Larger lots an acre or so are going for $20,000 to $40,000 and 2.5 acres are selling for $50,000 to $100,000. Waterfront lots can be priced considerably higher.

By filing your building plans and paying your fees before June 2, you’ll be able to lock in your impact fees at the current rates — even if you don’t actually start building until months later. If you plan to build a new Island home, it should definitely be more cost effective to build now than a year or two from now.