"The proffer system is broken"
By Greg Pearson STAFF WRITER

Jaeckle

The public and county leaders agree that the proffer system is broken, but they haven't agreed on how to fix it. As an interim remedy, the Chesterfield Board of Supervisors voted 3-2 last week to hike proffers from a maximum of $15,600 per home to $18,080, with an automatic annual escalation based on the Marshall and Swift Building Index.

Of the more than 20 persons who spoke during the public hearing, there seemed to be a consensus that a "one size fits all" proffer isn't working and isn't fair. Developers pay the same proffer amount, regardless of size, sales price or whether a dwelling is a single-family home, a condominium, townhome or apartment.

The county needs to increase revenues since it continues to fall behind on building new schools and roads. Raising proffers is one way to do that.

The board is split on how to resolve the dilemma as evidenced by two failed motions before the board settled on the 16 percent increase, which is what the building industry index would have required if the automatic increase had already existed. The county is warily eyeing what solution the General Assembly might approve early next year, which might override the board's action.

Lisa Billings/Chesterfield Observer Contractors prepare to plant grass on a new football/soccer/ baseball field that's being put in beside Spring Run Elementary School. Proffers are used to fund new recreational facilities, as well as roads, schools and other county services.

Bermuda Supervisor Dorothy Jaeckle first motioned for a 30-day deferral to sort out the board's options, but her motion died for a lack of a second. Midlothian Supervisor Dan Gecker then motioned for the $18,080 figure, which Clover Hill Supervisor Art Warren seconded. But Dale Supervisor Jim Holland wanted a higher fee and motioned for a maximum of $20,500, which Matoaca Supervisor Marleen Durfee seconded. That motion took precedence, but was defeated when the other three supervisors voted against it. Then Jaeckle joined Gecker and Warren for a 3-2 majority on $18,080.

About two-thirds of the speakers during the public hearing - many of them from the development industry - opposed any increase given the state of the real estate market. As requested by Jaeckle, the county pledged to bring the stakeholders together for more dialogue, but that effort of conciliation hasn't worked before, and positions may have hardened due to the slowing housing economy.

Lisa Billings/Chesterfield Observer Planning Administrator Greg Allen looks over blueprints for a proposed development. Some planning staff are reportedly spending long hours reviewing site and subdivision plans.

Developer George Emerson was one of the speakers calling for more study. He reminded the board that "builders don't pay proffers. Homebuyers do."

Development attorney Jack Wilson asked the board what message a proffer increase would send since Speaker of the House of Delegates Bill Howell sent a May 1 letter to local governments asking them not to raise proffers.

Development attorney Will Shewmake reminded the board that some homebuilders helped the county defer action on Senate Bill 768, which proposed eliminating proffers and instead enacting an impact fee of $7,500 per new home. Chesterfield leaders believe that legislation, introduced by State Senator John Watkins, would have dramatically reduced county revenues.

"Some [builders] will feel that they were sucker punched" by an increase in proffers, Shewmake surmised.

"If they do this to the housing industry in this county," asked President/CEO Tom Winfree of Village Bank, "who or what sector of the business community is next in line for a tax increase?"

"Funding needs to be more broad based" instead of just paid by new homebuyers, said Kevin McNulty, president of Lifestyle Builders and Developers.

Matoaca resident Bill Hastings agreed that proffers drive up the cost of homes. "Will our children be able to live in Chesterfield County?" he asked.

Vernon McClure, president of Main Street Homes, pointed out that the median lot in Chesterfield during the past year sold for $85,000 (according to Integra Realty Services) while the same median in Henrico County was $64,600. Henrico does not use a cash proffer system. New homes in Chesterfield were also selling for more.

"There are people who can't afford to fill up their gas tanks," said homebuilder Kimberly Sanchez, "and you want to raise the cost of homeownership?"

But residents favoring a proffer increase countered with "$15,600 doesn't begin to pay for the cost of new homeowners," according to Peter Martin.

Special interest groups will represent their own pocketbooks, said Midlothian resident Mike Harton. "Get development under control and pay for it."

"The proffer system is broke because there's not enough money to pay for the services citizens expect," commented Hampton Park resident Shelly Schuetz. She read off a list of home values of Chesterfield homebuilders she expected to attend the public hearing, and all of them were above $700,000. "Builders are doing just fine," she concluded.

Following the public hearing and before the proffer vote, Warren urged citizens to contact their legislative representatives about funding for new road building. "We can't let our advantages [for living in Chesterfield] go down," he said. "…and the General Assembly must accept its responsibility for transportation."

"We must keep pace with inflation," insisted Gecker in his support of a proffer increase.

Some of the speakers represented the nonprofit housing industry and were concerned about higher proffers. Some builders also argued that higher proffers have a negative impact on affordable housing, but Gecker called that claim "disingenuous."

According to County Administrator Jay Stegmaier, an earlier county proposal for workforce housing that allowed higher densities in exchange for some less expensive housing was rejected. "The homebuilders shot down our proposal for workforce housing," he said.

As of last year, $360 million has been proffered by developers, but only $44 million has been collected since proffers aren't paid until the building permit process. Put another way, 35,467 lots have been approved with proffers, but only 9,021 lots have had homes put on them.

Chesterfield hasn't increased proffers in almost three years. By the county's estimate, the cost of providing services for new homes today is $23,959. That includes roads ($13,871), schools ($8,148), parks ($1,130), fire stations ($556) and libraries ($254).

Planning fees

 

The board deferred for 30 days a proposal to hike planning fees because it is considering a plan that has commercial and residential review costs reimbursed by fees of about 70 percent. The county had previously advertised a lower commercial rate, so supervisors couldn't legally vote on a higher amount without running an updated legal notice in this newspaper.

The higher commercial fees under consideration took some business representatives by surprise. Warren Wakeland, spokesperson for the Home Builders Association of Richmond, supported the deferral.

Displaying a plastic "wounded golden goose," business owner Bob Schrum said planning fees are already higher in Chesterfield compared to Henrico without the increase. Those higher costs drive businesses elsewhere, he said. "I would encourage you to vote this down."

The proposed fee increase for reviewing site plans and subdivision plans would raise $470,000 in the year starting July 1 and be used to fund additional planning staff. Gecker said he believes more staff support will reduce approval time, which will ultimately offset the higher fees.

About one-third of the planning department's budget is based on fees. According to Gecker, Henrico's fees are much lower because that county believes its work is a government service supported by taxpayers.

"There is a cost for providing world class service," explained Planning Director Kirk Turner. He has said publicly that some of his staff are overworked, which is affecting morale. Turner also reported last week that fees must go up because of the high-level of citizen involvement.

New voting precincts

 

The board approved new voting precincts that divided the Chippenham, Dutch Gap and Wells precincts and changed the polling places for the Beach, Enon, Matoaca and Meadowbrook precincts. Those precincts experienced heavier than usual voting last February during the Democratic presidential primary, causing a number of complaints. Some locations had insufficient parking for the voters who turned out.

"They are voter-friendly," said Chesterfield Registrar Larry Haake of the new voting precincts.

Some speakers during the public hearing and at least two supervisors expressed concern about changing locations before the November election, but Haake pledged to inform and advertise the new locations to the affected registered voters. The new plan must be approved by the U.S. Department of Justice, which is expected by August.

New development plans

 

The board unanimously approved a traditional neighborhood development (TND) plan that creates new standards for mixed-use developments combining residential and commercial uses. Also known as neotraditional or New Urbanism, the plan sets guidelines for future developments of at least 60 acres that mix different types of housing with businesses.

The TND plan was recommended by a committee and endorsed by the planning commission.

Moseley Architects

 

Moseley Architects has been excluded from a list of firms "to be awarded annual requirements contracts," but can be hired to do some projects. The exclusion is the result of complaints registered by citizen activist Brenda Stewart, who persistently claims Moseley overcharged the school system by $486,000 for the building plans for Cosby High School and the replacement for Clover Hill High School.

Speaking for the Budget and Audit Committee which reviewed the dispute, Gecker told the board, "There is no data to support the idea that the county was credited" with the money because there is "no clear paper trail." He questions how the school system and Moseley could have missed such a large amount of money.

Holland, who is a CPA, described the financial questions using the words "ambiguity… [and] inconclusive."

In remarks to the board, Stewart saw much larger issues than just $486,000, saying business had been steered to Moseley. "I won't be satisfied until the school division gets their money back," she said later.

No Moseley representative was present to respond to questions by board members.