Buda considers additional impact fees on development

Additional impact fees could be on the horizon in Buda as city leaders approved a study to examine a proposed roadway impact fee Oct. 17.

Buda City Engineer John Nett said performing the study was appropriate due to the rapid growth in the area. The study, which will be conducted by Freese and Nichols, is expected to be completed by October 2018.

However, Nett did not go into detail about how the impact fee could be assessed, if it were to be implemented.

Nett said that impact fees are a one-time fee that is charged to all new development, residential and commercial, but does not impact homes and businesses already in existence.

Nett added developers are not the ones paying the impact fees typically, and that it is a cost the builder absorbs then passes on to the homeowner or business owner.

Currently, Buda has water and wastewater impact fees that are charged to the builder when a water meter is installed. The amount of the impact fee is directly related to the size of the water meter. Nett said he doesn’t anticipate a decrease in new businesses or homebuyers in Buda as a result of the current water and wastewater impact fees.

Buda Mayor Todd Ruge said Oct. 17 he has been in favor of impact fees for a long time, but there has never been a political will on the dais for them in the past.

Councilmember Lee Urbanovsky said he was in favor of the proposed roadway impact fees, but was unsure about adopting storm water impact fees for the city.

Nett also said in the later interview that Buda’s water and wastewater impact fees are similar to other neighboring cities. Many prospective developers include impact fee costs into a build no matter in what city they want to construct, Nett said.

“Our impact fees are right in line with what our neighbors are charging,” Nett said. He added that the fees are “one small marginal factor” in the total cost of construction that could be considered.

Charging new development for impact fees is a way to keep bond issuance at a minimum for Buda residents, Nett said.

“Impact fees provide us with another tool in the toolbox to fund capital improvements for water and wastewater infrastructure,” Nett said.

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