by Rose Murphy, Bull Run Observer

7 September 2007, pp. 7, 10

” ‘What dollars do we need for development to pay for itself?’

“This is the question Corey Stewart says he asked Prince William County planning staff before proposing that $51,113 would be the necessary proffer for each single-family home built. Stewart is chairman and at-large member of Prince William Board of County Supervisors.

“Proffers are monies or other items ‘volunteered’ by developers to mitigate the impact of their projects on county roads, schools, libraries, parks, and police and fire and rescue services.

“In an interview Aug. 30, Stewart explained the higher proffer figures for residential construction would come to a vote before supervisors ‘in the fall.’  Also taking part in the interview was Gary Friedman, Stewart’s representative on the county’s planning commission.

“At a June 5 supervisors’ meeting, the board decided unanimously that higher proffers would not be required for commercial and church projects for this review. The panel also voted unanimously to defer action on residential proffers.

“Friedman said supervisors decided not to hike proffers on church and commercial construction ‘because the county and Corey want to do all they can to encourage business and commercial development and to expand the commercial base.’

“The planner contended that non-residential revenues have been going down as a percentage of the total county revenue.

” ‘And they should be going up,’ Friedman added.

“Stewart remarked, ‘We want more office and commercial uses and more high-end retail. We want to discourage more homes. We want to ensure that homes to be built pay for themselves.’

“The proposed proffer on single-family homes would rise from $37,719. Townhouse proffers would go to $43,262 from $31,927, and multi-family construction proffers [would] be upped to $26,545, up from $19,526. All figures represent a 36 percent increase.

” ‘The county has an on-going policy that each year staff updates the numbers to identify what contribution is needed from developers for parks, schools, transportation, the environment, police, fire and rescue and libraries. These numbers tell us what’s needed from developers so the development pays for itself,’ Stewart explained.

“We told the staff we wanted honest numbers, and the staff came back with the figures we’re proposing. We’re satisfied they’re objective numbers and we want to see them adopted. This is the first time development will pay the true costs for new roads, fire and rescue, libraries, parks, transportation and schools, the chairman asserted.

“Friedman observed that ‘this is probably the first time these numbers are reality based.’

“The chairman noted that, when the proffer system began in the 1980s, ‘we were getting about ten percent of the costs of public infrastructure.  The taxpayers were paying the balance. We’ve been getting closer and closer to development’s paying its own way.’

“Friedman explained Craig Gerhart, county executive, ‘has told the board that if proffers don’t keep pace with development, we’ll fall farther and farther behind.  The gap will grow wider, and then it will be even harder for future boards to address.’

“Stewart pointed out that the transportation package passed this session by the state included impact fees. He said he and Scott York, chairman of Loudoun Board of County Supervisors, lobbied in favor of the fees.

” ‘Impact fees are something this county wanted for decades,’ Stewart said. ‘These fees let us charge developers for roads on the 50,000 approved, but yet not built, units in Prince William County.’

“The chairman noted impact fees are separate from proffers, and that proffers only are part of a new rezoning process.  A consultant has been hired to analyze impact fees and how to assess them. The analysis should be finished by August, 2008.

” ‘Impact fees are enabled by the state, but the county decides how to implement them,’ Friedman said.

“Stewart added impact fees would be assessed on all residential development, ‘no matter when it was approved.’

” ‘Prince William County will probably be the first county in the state to impose impact fees,’ the chairman. said.

“By law, impact fees cannot be assessed before August 2008, so Stewart wants the new proffers ‘in place before the impact fees.’

“Both officials said they would I like to see impact fees expanded to include schools.

” ‘Why should taxpayers pay the costs of new development?  If development doesn’t pay, then the taxpayers subsidize,’ Stewart remarked.

“Mark Granville-Smith, head of Prince William Chapter of Northern Virginia Building Industry (NVBIA), told the September 4 supervisors’ meeting he and his group object to the proposed proffer increases.  He cited a ‘record downturn in the industry’ as a reason for his objections.  He said there were 31 property foreclosures advertised in an area newspaper that day.

” ‘The same day chairman Stewart was holding his press conference to bring up raising proffers again up to $51,000, President Bush was proposing legislation and relaxation of credit qualifications to FHA homebuyers having trouble making their mortgage payments in an attempt to help a struggling industry with record foreclosure rates,’ Granville-Smith told supervisors.

“The builder noted that earlier this year he had cautioned the board that the ‘finance projections of 3200 new residential units being built this year could be grossly over-estimated by 1000 units or more.  In addition, the two-percent projection in home value devaluation was already in the eight to 12 percent range. A recent newspaper article revealed that the finance director of the county, Mr. (Chris) Martino, has now realized property value depreciation of at least four times what the county expected.’

“Granville-Smith added that it ‘has become politically corrrect to bash the building and development industry. However, it is simply wrong for chairman Stewart to say that new homebuyers do not have the cost of proffers passed on to them.  Proffers, or what really is a new home sales tax paid by the purchaser, is a cost of a new home just like sticks and bricks.’

“The NVBIA head contended that the board recently voted to defer a vote on proffers until ‘additional second and third quarter occupancy permits, building permits and assessment date could be reviewed. This would give a better picture of the market conditions than what was available to the board earlier this year.’

“Granville-Smith added his industry ‘strongly supported the Transportation Funding Bill passed recently by the state legislature.’

” ‘We proposed and supported the grantors’ tax which result in over half the transportation authority funding sources, from the real estate industry. We just supported a 12 to 40-percent fee increase for permitting and plan review for the county’s development services division to survive the downturn,’ he explained.

“Granville-Smith said, ‘increasing the proffers now will further tell all industries — commercial, retail and residential — that Prince William County is not really open for business, and you can’t live here.’ “