By Eric Griego and Martin Heinrich
Albuquerque City Councilors
Recent newspaper coverage suggests that higher development impact fees at the urban fringe would "explode sprawl into a three-county area beyond the city limits."
Impact fees do not "penalize" growth at the fringe, as stated. It would be a violation of state law if impact fees were set at higher than the cost of growth. Higher impact fees at the fringe simply reflect higher infrastructure costs to serve growth at the fringe.
Far from driving away growth, research shows that higher impact fees benefit the community as a whole and developers. They do this by making needed infrastructure available in a more timely and predictable way.
As an example, the Southwest Mesa received very little funding for new roads in past years. Under the impact fee system, the Southwest Mesa would receive more than $26 million for new roads during eight years of impact fees charged at 100 percent.
This is $26 million that cannot be moved for political reasons to other parts of Albuquerque. The fees collected for streets on the Southwest Mesa must be used for new streets there only.
In general under the new impact fee system, growth at Albuquerque's urban fringe would still be substantially subsidized— just not as much as it was previously. The new street impact fees will raise only 45 percent of the total public dollars to build needed roadways. The remainder comes from general property taxes, gross receipts taxes and state funds. Moreover, there are no impact fees for schools, and current water and sewer fees are probably half or less than cost.
The reality is that the cost of growth, even under higher impact fees, still is shared between developers and the community as a whole.
What did Albuquerque's past growth-friendly practices produce?
Here are some things that other communities should consider:
When PGS was adopted, there was a backlog of nearly $1 billion in city streets, parks, water, sewer, storm drainage rehabilitation and deficiency needs.
A substantial portion of housing development on Albuquerque's fringe is not based on population growth, but on existing residents moving from one place to another.
People moving from one part of the city to another create many inefficiencies. New infrastructure needs to be built despite the fact that service capacity exists elsewhere. New services such as police, fire, libraries, community centers are needed in new areas, but the city has been very reluctant to reduce these services in older areas as the population decreases. This reality of new residential development without population growth causes continual government budget crises, higher taxes, and results in many services being stretched wafer thin.
As an example, the Albuquerque Public Schools system currently has little enrollment growth, but is planning to spend more than $120 million dollars for new schools at the urban fringe over the next five years. At the same time, there are 4,500 empty seats in schools in older neighborhoods.
Where else has the old system gotten Albuquerque? The critical issue is that Albuquerque needs higher quality economic development, but Albuquerque has had a "low-paying jobs / low-cost housing" approach to development.
What are the results of this strategy? A University of New Mexico study in 2000 showed that while the number of local jobs has been growing faster than the national average, the average earnings per job rose 2.7 times faster in other metro areas compared to us.
Can Albuquerque ultimately compete with the movement of low-wage jobs to Mexico, China or India? We hazard a guess that the residents of our metropolitan area do not want this approach to growth. Moreover, they do not deserve it.
There is a different path for the metropolitan area in the future. It is a new regionalism based on respected planning, healthy and vital neighborhoods, high quality mixed-use office and industrial parks, a true economic development strategy, stewardship over public facilities, and protection of the environment.
These are the objectives of the Planned Growth Strategy and we will achieve them! We invite other communities, their citizens and leaders, to join in our efforts to manage urban growth for the benefit of all our residents.
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