Sec. 2-271. - Impact fees.
(a) Findings. S.C. Code § 6-1-910, et. seq. (Supp. 2001), the South Carolina Development Impact Fee Act (Act), authorizes the imposition of impact fees to fund the cost of system improvements to public facilities that are necessitated by new growth and development. The Act requires, as a condition precedent to the imposition of impact fees, that the city must have in place a comprehensive plan as set forth in Chapter 29 of Title 6 of the South Carolina Code and otherwise comply with the Act. The city has adopted a comprehensive plan in accordance with Chapter 29 or Title 6 of the South Carolina Code, and in accordance with the Act, has made available to the planning commission assistance to enable it to study and review the issue of impact fees. The planning commission has recommended that impact fees be imposed to fund certain capital improvements that are necessitated by new growth and development, and city council deems it in the interest of the public that such recommendation be adopted and enacted as law.
(b) Impact fees are hereby imposed in the city to fund the share of capital improvements necessitated by new growth and development as follows:
(1) Definitions.
a. Affordable housing means housing affordable to families whose incomes do not exceed eighty (80) percent of the median income for the service area or areas within the jurisdiction of the city.
b. Building permit means a permit issued for construction on or development of land.
c. Capital improvements means improvements with a useful life of five (5) years or more, by new construction or other action, which increase or increased the service capacity of a public facility.
d. Developer means an individual or corporation, partnership, or other entity undertaking development.
e. Development means construction or installation of a new building or structure, or a change in use of a building or structure, any of which creates additional demand and need for public facilities designated to be funded, in whole or in part, by impact fees. A building or structure shall include, but not be limited to, modular buildings and manufactured housing. "Development" does not include alterations made to existing single-family homes.
f. Development approval means a document that authorizes the commencement of a development.
g. Environmental services impact fee means a payment of money imposed as a condition of development approval to pay a proportionate share of system improvements to environmental facilities attributable to the applicable development. The term does not include:
1. A charge or fee to pay the administrative, plan review, or inspection costs associated with permits required for development;
2. Amounts collected from a developer in a transaction in which the city has incurred expenses in constructing capital improvements for the development if the owner or developer has agreed to be financially responsible for the construction or installation of the capital improvements;
3. Fees authorized by Article 3, of Chapter 1 of Title 6 of the South Carolina State Code of Laws.
j. Feepayer means the individual or legal entity that pays or is required to pay an impact fee.
k. Incidental benefits are benefits which accrue to a property as a secondary result or as a minor consequence of the provision of public facilities to another property.
l. Land use assumptions means the description of a service area and projections of land uses, densities, intensities, and population in the service area over at least a ten-year period.
m. Level of service means a measure of the relationship between service capacity and service demand for public facilities.
n. Project means a particular development on an identified parcel of land.
o. Proportionate share means that portion of the system improvement costs determined pursuant to Section 6-1-990 of the South Carolina Code of Laws that reasonably relate to the service demands and needs of the project.
p. Public facilities means public safety facilities, including law enforcement and fire stations, and capital equipment and vehicles having an individual unit price in excess of one hundred thousand dollars ($100,000.00) used in the delivery of public safety services and the collection and disposal of solid waste.
q. Public safety impact fee means a payment of money imposed as a condition of development approval to pay a proportionate share of system improvements to public safety facilities attributable to the development. The term does not include:
1. A charge or fee to pay the administrative, plan review, or inspection costs associated with permits required for development;
2. Amounts collected from a developer in a transaction in which the city has incurred expenses in constructing capital improvements for development if the owner of developer has agreed to be financially responsible for the construction or installation of the capital improvements;
3. Fees authorized by Article 3 of Chapter 1 of Title 6 of the South Carolina Code of Laws.
r. Service area means the defined geographic area(s) specified in Part 3, Section E-1 of the Charleston Century V City Plan, as amended, provided however, that effective as of September 1, 2005, the Daniel Island/Cainhoy/Thomas Island area of the city is excluded from the service area for the collection of the environmental services impact fee.
s. Service unit means the standardized measure of consumption, use, generation or discharge attributable to an individual unit of development calculated in accordance with generally accepted engineering or planning standards for a particular category of capital improvements.
t. System improvements mean capital improvements to public facilities that are designed to provide service to a service area.
u. System improvement costs mean costs incurred for construction or reconstruction of system improvements, including design, acquisition, engineering, and other costs attributable to the improvements, and also including the cost of providing additional public facilities needed to serve new growth and development. System improvement costs do not include:
1. Construction, acquisition, or expansion of public facilities other than capital improvements identified in the Charleston Century V City Plan;
2. Repair, operation, or maintenance of existing or new capital improvements;
3. Upgrading, updating, expanding, or replacing existing capital improvements to serve existing development in order to meet stricter safety, efficiency, environmental, or regulatory standards;
4. Upgrading, updating, expanding, or replacing existing capital improvements to provide better service to existing development;
5. Governmental administrative and operating costs; or
6. Principal payments and interest or other finance charges on bonds or other indebtedness except financial obligations issued by or on behalf of the city to finance capital improvements identified in the Charleston Century V City Plan.
(2) Affordable housing.
a. The city has prepared a report that estimates the effect of recovering capital costs through impact fees on the availability of affordable housing within the city, and incorporated it in Part 3, Section E-1 of the Charleston Century V City Plan.
(3) Annual report and termination of fees. The city shall prepare and publish an annual report describing the amount of impact fees collected, appropriated or spent during the preceding year. The public safety impact fees provided for herein shall terminate when sufficient funds to pay for the system improvements identified in Part 3, Section E-1 of the Charleston Century V City Plan to be paid for through the use of impact fees have been collected or December 31, 2015, whichever shall first occur. The environmental service impact fees provided for herein shall terminate on May 19, 2015.
(4) Impact fees.
a. In environmental service impact fee is set at eighty-two dollars ($82.00) per residential dwelling unit, and eighty-two ($82.00) per city container used by nonresidential development. The fee shall be adjusted on an annual basis through the year 2015 based on the Consumer Price Index.
The fee was calculated using the whole of the city as the service area, maintaining the current, acceptable level of service of once a week pickup over four (4) days, the number of units served by an average truck route, the estimated number of users to be added to the system through the year 2015 and the number and costs of new trucks that will be needed to serve those units. Cost estimates were based on city departmental experience.
The improvements to be purchased with the environmental impact fees are seven trucks, to be acquired as the number of new units necessitating an additional route come on line, anticipated to be one truck in 2004, one truck in 2005, one truck in 2006, one truck in 2008, one truck in 2010, one truck in 2012 and one truck in 2014.
b. A public safety impact fee is set at seventy-nine dollars ($79.00), per dwelling unit and four cents ($0.04) per square foot of nonresidential development. The fee shall be adjusted on an annual basis through the year 2015 based on the Consumer Price Index. Cost estimates were based on city departmental experience.
The fees were calculated using the whole of the city as the service area, maintaining the current, acceptable level of service of one (1) equipped fire station within five (5) miles of a potential call and one police substation per twenty thousand (20,000) people or per geographically distinct area of the city. Applying these criteria to anticipated growth through the year 2015 demonstrated that new public safety facilities to serve the growth would be required. The type and amount of growth was estimated on the basis of land use assumptions, including zoning, building permit and census data. The cost of public safety facilities and equipment was apportioned between residential sixty-two (62) percent and nonresidential thirty-eight (38) percent, based on departmental experience as to the source and frequency of service calls. A cost per dwelling unit was derived by dividing sixty-two (62) percent of the costs of facility improvements by the estimated number of residential units to be in the city through the year 2015. A cost per square foot of nonresidential development was derived by dividing thirty-eight (38) percent of the costs of facility improvements by the estimated number of nonresidential square footage to be in the city through the year 2015.
System improvements to be made with the public safety impact fees are a fire station and police team station for the Bees Ferry area, and a pumper truck and a ladder truck, with an estimated completion date of 2006; a fire station and police team station for the Daniel Island area, and a pumper truck and a portion of the cost of a ladder truck, with an estimated completion date of 2004; and a fire station and police substation for the Cainhoy area, and a pumper truck and a portion of the cost of a ladder truck, with an estimated completion date of 2007.
c. The payment of a development's proportionate share of system improvement costs by payment of the impact fees as set forth herein constitutes full and complete payment of the new development's proportionate share of those system improvements costs;
d. An impact fee payer:
1. May negotiate and contract with the city to provide facilities or services, in lieu of the impact fees;
2. Has the right of appeal, as hereafter set forth;
3. Shall not be required to pay any impact fee until the issuance of the building permit or development permit when no building permit is required.
(5) Exemptions from impact fees. Any claim for exemption from an impact fee must be made no later than when the applicant applies for the first building permit, or development permit if no building permit is sought, for the proposed development that creates the obligation to pay the fees. Notwithstanding any other provision of this ordinance, only the following development shall be exempt from payment of impact fees:
a. Rebuilding the same amount of floor space of a structure that was destroyed by fire or other catastrophe;
b. Remodeling or repairing a structure that does not result in an increase in the number of service units;
c. Replacing a residential unit, including a manufactured home, with another residential unit on the same lot, if the number of service units does not increase;
d. Placing a construction trailer or office on a lot during the period of construction on the lot;
e. Constructing an addition on a residential structure which does not increase the number of service units;
f. Adding uses that are typically accessory to residential uses, such as a tennis court or a clubhouse, unless it is demonstrated clearly that the use creates a significant impact on the system's capacity;
g. The residential units in a development project if:
1. The development project creates affordable housing units; and
2. The impact fee for the residential affordable housing units is funded through a revenue source other than impact fees; and
3. If the revenue source to fund the fees is provided by the city, the developer has consented to submit the development to the program established to monitor creating and maintaining affordable housing, as hereafter set forth.
h. A development that does not utilize the service for which the impact fee was imposed, provided however, the fee shall be imposed should the development subsequently utilize the service.
(6) Affordable housing [requirements]. Because all or part of any particular development project may be exempt from impact fees, the following sets forth the procedures for exemption from the fees, when the funding source for the fees is provided by the city:
a. As to rental units, the owner and/or developer shall be required to submit to the department of housing and community development verified income reports of household income of all rental occupants at the inception of each tenancy and on an annual basis thereafter for a period of three (3) years. If during this timeframe the units are rented to households whose income exceeds the definition of affordable housing as provided herein, the then owner of the units, as a condition of continues occupancy, shall be required to reimburse the city for the impact fees paid for those units.
b. As to owner occupied units, each owner, prior to initial occupancy, shall be required to submit to the department of housing and community development a verified income report of household income of all members of the household, and continue to do so on an annual basis thereafter for a period of three (3) years. If during this timeframe a unit is owned or occupied by persons, other than the initial owner(s), whose household income exceeds the definition of affordable housing as provided herein, the then owner of that unit shall be required to reimburse the city for the impact fees paid for the unit.
c. For purposes hereof, household income shall include all sources of financial support, both cash and in kind, of all adult members of the household, to include wages, salaries, tips, commissions, all forms of self-employment income, interest, dividends, net rental income, income from estates or trusts, social security benefits, railroad retirement benefits, Supplemental Security benefits, Aid to Families with Dependant Children or other public assistance or public welfare programs, other sources of income regularly received, including Veterans'(VA) payments, unemployment compensation and alimony, awards, prizes, government or institutional or eleemosynary loans, grants or subsidies and contributions made by the members' families for medical, personal or educational needs.
d. The owner and/or developer shall be required to execute a memorandum of use with the city acknowledging the use of the unit(s) for affordable housing in accordance with the provisions hereof, which memorandum shall be in a form acceptable for recording in the record office of the applicable county and which shall be recorded in the record office of the applicable county.
(7) Independent calculations. A developer may submit an independent calculation of the applicable impact fee representing the fair share of system improvements necessitated by his development project pursuant to the provisions of section (viii), or he may enter into an agreement in lieu of the payment of impact fees as provided in section (xiv).
(8) Provisions for independent calculations of impact fees.
a. Independent calculations for the determination of impact fees must be performed by qualified professionals based upon sound studies utilizing accepted engineering practices and planning principles.
b. The independent calculation shall be subject to review and approval of the capital projects committee and the mayor. In the case of large projects involving multiple uses and complex calculations the committee may seek the additional assistance of qualified consultants at the expense of the developer.
c. The committee shall either approve or provide in writing the reasons for disapproval of the independent calculation study within sixty (60) days of its submittal for review.
d. Prior to commencing the study, the developer's professional consultant and the appropriate city staff shall agree upon the relevant factors that will be utilized in the independent fee calculation.
(9) Credits.
a. Should the city elect to accept a contribution, payment, construction or dedication of land for system improvements, a developer may apply for a credit against the applicable impact fee imposed herein.
b. The determination of the amount of any credit shall be undertaken through the submission of an application for credit agreement, which shall be submitted to the director of planning and neighborhoods.
c. The application for a credit agreement shall include the following information:
1. If the proposed application involves a credit for any contribution, the following documentation must be provided:
(i) A certified copy of the development approval in which the contribution was agreed;
(ii) If payment has been made, proof of payment; or
(iii) If payment has not been made, the proposed method of payment.
2. If the proposed application involves credit for the dedication of land:
(i) A drawing and legal description of the land;
(ii) The appraised fair market value of the land at the date a building permit is proposed to be issued for the development, prepared by a professional real estate appraiser who is a member of the Member Appraisal Institute (MAI) or who is a member of Senior Residential Appraisers (SRA), and if applicable, a certified copy of the development permit in which the land was agreed to be dedicated.
3. If the proposed application for credit agreement involves construction:
(i) The proposed plan of the specific construction prepared and certified by a duly qualified and licensed engineer or contractor;
(ii) The projected costs for the suggested improvement, which shall be based on local information for similar improvements, along with the construction timetable for the completion thereof. Such estimated cost shall include the cost of construction or reconstruction, the cost of all labor and materials, the cost of all lands, property, rights, easements and franchises acquired, financing charges, interest prior to and during construction and for one (1) year after completion of construction, costs of plans and specifications, surveys of estimates of costs and of revenues, costs of professional services, and all other expenses necessary or incident to determining the feasibility or practicability of such construction or reconstruction.
(iii) Within ten (10) days of receipt of the proposed application for credit agreement, the director of planning and neighborhoods shall determine if the application is complete. If it is determined that the proposed Agreement is not complete, the director shall send a written statement to the applicant outlining the deficiencies. The director shall take no further action on the proposed application for credit agreement until all such deficiencies have been corrected or otherwise settled.
(iv) Once the director determines the proposed application for credit agreement is complete, the capital projects committee and the mayor shall review it within thirty (30) days.
(v) If the application for credit agreement is approved, a credit agreement shall be prepared and signed by the applicant and the city. It shall specifically outline the contribution, payment, construction or land dedication, the time by which it shall be completed, dedicated, or paid, and any extensions thereof, and the dollar credit the applicant shall receive for the contribution, payment or construction.
(vi) Appeal of credit decision. A feepayer aggrieved by the decision of the committee and mayor regarding credits may appeal such decision pursuant to the appeals provisions herein.
(10) Accounting; expenditures.
a. Revenues from all impact fees shall be maintained in interest-bearing accounts. Accounting records shall be maintained for each system improvement. Interest earned on impact fees shall be considered funds of the account on which it is earned, and must be subject to all restrictions placed on the use of impact fees pursuant to the provisions of this section.
b. Expenditures of impact fees shall be made only for the system improvements for which the impact fee was imposed as shown by the capital improvements plan set forth in Part 3, Section E-1 of the Charleston Century V City Plan and as authorized in this section. Impact fees may not be used for:
1. A purpose other than system improvement costs to create additional improvements to serve new growth;
2. A category of system improvements other than that for which they were collected; or
3. The benefit of service areas other than the area for which they were imposed.
(11) Refunds of impact fees.
a. All impact fees collected shall be refunded to the owner of record of property on which a development impact fee has been paid if:
1. The impact fees have not been expended within three (3) years of the date they were scheduled to be expended on a first-in, first-out basis; or
2. A building permit or permit for installation of a manufactured home is denied.
b. When the right to a refund exists, the city shall send a refund to the owner of record within ninety days after it is determined by the city that a refund is due.
c. The refund shall include the pro-rata portion of interest earned while on deposit in the impact fee account.
d. A person entitled to a refund has standing to sue if there has not been a timely payment of a refund pursuant to subsection (b) of this section.
(12) Appeals.
a. A feepayer aggrieved by an administrative decision regarding the payment of impact fees or independent calculations or credits may appeal to the committee of public works and utilities, utilizing such forms as may be provided by the department of planning and neighborhoods. The appeal must be taken within fifteen (15) days of receipt of written notice of the decision. The committee shall conduct a hearing and render a decision, which shall be final. A party aggrieved by the decision of the committee may appeal to the circuit court for the applicable county within thirty (30) days of receipt of written notice of the committee.
b. A feepayer may pay an impact fee under protest. A feepayer making the payment is not estopped from exercising the right of appeal nor is the feepayer estopped from receiving a refund of an amount considered to have been illegally collected. In lieu of making a payment of an impact fee under protest, a feepayer, at his option, may post a bond or submit an irrevocable letter of credit for the amount of impact fees due, pending the outcome of an appeal.
c. The city shall provide for mediation by a qualified independent party, upon voluntary agreement by both the feepayer and the city, to address a disagreement related to the impact fee for proposed development. Participation in mediation does not preclude the pursuit of other remedies provided for herein or that are otherwise available by law.
(13) Collection of impact fees.
a. Impact fees due according to the provisions contained herein shall be collected at the time a building permit, or development permit if no building permit is required, is sought.
b. Should the feepayer elect to post a financial guarantee as provided in (12)b. above, rather than pay the impact fee at the time of issuance of a building permit, the city may impose the following additional requirements, including, but not limited to:
1. Additions to the fee for reasonable interest and penalties for nonpayment or late payment;
2. Withholding of the certificate of occupancy until the impact fee is paid;
3. Withholding of utility services until the impact fee is paid; and
4. Imposing liens for failure to pay timely a impact fee.
(14) Agreement. A feepayer and/or developer may enter into an agreement with the city, including an agreement entered into pursuant to the South Carolina Local Government Development Agreement Act, or other such mutually acceptable agreement, providing for payments instead of impact fees for facilities or services.
(15) Liberal construction. The provisions of this impact fee ordinance shall be liberally construed to effectively carry out its stated purposes, which are found and declared to be in the furtherance of the public health, safety, economy, good order, appearance, convenience and general welfare for the harmonious, orderly, and progressive development of land within the city.
(16) Severability. If any provision of this section is held invalid, the invalidity shall not affect other provisions or applications of the ordinance which can be given effect without the invalid provision or application, and to this end the provisions hereof are severable.
(Ord. No. 2003-38, § 1, 4-22-03; Ord. No. 2015-089, §§ 1, 2, 7-21-15)
