Village approves reduction in developer fees

By on October 23, 2009

by Susan O’Neill
SUGAR GROVE—The Village Board on Tuesday approved a short-term reduction in developer fees in an attempt to encourage residential growth within the village. The package includes a $5,000 reduction in impact fees and the elimination of transition fees.

The reductions would be in effect for up to 35 homes. To be eligible, a building permit must be applied and paid for by Oct. 29, 2010, and a certificate of occupancy must be issued and paid for by Oct. 31, 2011. In addition, the village will grant a deferral of the payment of some fees from the time of building permit issuance to the time of certificate of occupancy issuance.

Village officials said they see this as a stimulus package at the municipal level.

Sugar Grove Development Director Rich Young said the total number of buildable lots in Sugar Grove is in the 400 range. A single building permit was issued this year within the village.

Impact fees vary by development and by the size of the home, with fees ranging from $3,500 to $16,000.

Transition fees, which are collected on behalf of the village, School District, Park District, Library District and Township, were initiated in Sugar Grove due to the volume of growth taking place several years ago. The idea was to fill in the gap between when a new household began utilizing services and when taxes from that home reached the taxing bodies providing the services.

The amount of the transition fees also vary by development, size and price of home, from $200 to $5,800.

Trustee Kevin Geary said that, in the worst case scenario, nothing happens, and in the best case scenario, it stimulates the local building economy, creating some needed revenues for the village.

Village Administrator Brent Eichelberger said the village has communicated with the other taxing bodies that may be affected by the program. He said the Sugar Grove Township and Library Boards and the Fire District staff have all expressed their support. He added that the Kaneland School District and the Sugar Grove Park District have not provided any formal input. (See related story)

“We did cap it at 35 homes, and we did not do it carte blanche,” Eichelberger said in defense of the reductions.

He said the village will still collect impact fees and land cash for the schools.

“There will be no decrease to these,” he said. “If this helps developers and builders survive, it ends up being a huge benefit to the community.”