Is it a ‘York County home tax or fee’? Debate heats up ahead of public hearing

June 12--FORT MILL -- As Fort Mill residents await having their say on impact fee increases for new housing construction within the school district, organized groups on both sides are making their cases.

The York County planning commission recommended doubling the current $2,500 fee on homes, but keeping it at $2,500 for apartments. York County Council will have final say on what the number should be. A public hearing, prior to Council's final decision, is June 27 in York.

South Carolina Community Alliance, a program of the SC Association of Realtors based in Columbia, has been sending mailers and sponsoring social media ads promoting stoptheyorkcountyhometax.com. The group says York County is "looking at up to a 760 percent increase" for impact fees on new construction.

The Home Builders Association of South Carolina also opposes the impact fees. Mark Nix, executive officer for the group, told Council last month new homes bring in more money than they cost a community.

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A new home in York County, he said, pumps in more than $25 million in local income and $3 million in taxes and other governmental revenue.

"We always hear that growth doesn't pay for itself," Nix told Council. "We already showed, that's a surplus of money coming to the county for every house."

The Fort Mill school district, a proponent of the fee, shows online at at fortmillschools.org why the district feels the current $2,500 charged on each new residence built within the district may not be enough. The district doesn't have an official opinion on how much the fees should be, although some leaders have expressed their opinions.

School board member Scott Frattaroli called the "Stop the York County Home Tax" mailer "lies, misinformation and scare tactics by greedy businesses" on a Facebook post.

Frattaroli pointed to keepourschoolsstrong.org, a resident-organized committee -- formed to promote the spring school bond referendum -- that now posts information about school impact fees.

Math sense

New residences within Fort Mill School District boundaries have been charged a $2,500 fee set by York County since 1996. The money goes to the district for capital spending.

A recent study commissioned by the county -- which is considering at a separate, countywide impact fee -- found the school fee needed could be close to $19,000 per home and $12,000 per apartment. Those numbers are based on state law, factoring in how much it costs to keep the same level of service amid population growth for new homes and apartments.

According to the Rock Hill-based Piedmont Regional Association of Realtors, the state Realtor group received $150,000 from its national organization to support a campaign against the impact fees. The campaign includes direct mail, email, television and social media efforts "to educate the public on the issue."

"In a market desperately short on inventory," the Piedmont Realtors site states, "impact fees will hurt first-time home buyers. And that's just the tip of the iceberg."

The "Stop the York County Home Tax" flier states the county is looking at a 760 percent increase. If the home fee increased to the max amount allowed by law, it would be an nearly 630 percent increase. The higher figure comes from the fee being rolled into a 30-year loan at a 4.5 percent interest rate.

Both sides agree the added cost will be transferred from builder to homeowner through sales pricing.

According to the Realtor group's flier, a $19,000 fee throughout the length of a typical loan would cost a homeowner "nearly $35,000."

In a "Myths vs. Facts" sheet on the school district site, however, there are other costs to consider.

"Current homeowners could actually see a reduction in taxes paid through debt service millage, depending on the fee amount implemented," it states.

Just the facts

The "Stop the York County Home Tax" flier doesn't mention Fort Mill or Fort Mill school district.

Fact: The only impact fee increase with a proposed dollar amount and the one argued against in the flier applies only to construction in Fort Mill.

York County is looking at possible impact fees for separate municipal services that will apply to some or all unincorporated parts of the county.

Existing development impact fees in Fort Mill and Rock Hill municipal limits, along with ones studied in Tega Cay, would not be affected.

The flier also calls the pending payment change a tax, which by definition is a bit tricky.

Fact: By definition, a tax is imposed by a governing body while a fee can be voluntary, such as a one-time tax on construction. But the money technically is paid for by the builder during construction permitting, making it a fee rather than a tax, according to state laws.

State law defines the charge as an impact fee as a "payment of money imposed as a condition of development approval to pay a proportionate share of the cost of system improvements needed to serve the people utilizing the improvements."

Bonnie Swingle with the state Department of Revenue said both fees and taxes are revenue-generating requirements for the state, but otherwise specifics on the difference aren't easy to answer.

"Generally speaking, it's basically whatever that particular statute refers to it as, whether it's a fee or a tax," she said.

While the words "tax" and "fee" may carry different connotations, the costs will work out the same way.

Kristin Vining is a parent and one of three community members who led the successful Keep Our Schools Strong bond campaign. She also owns a real estate company.

She hears concerns from both sides. Looking at the average new construction in the Fort Mill area from January to May selling at $421,000, Vining said she doesn't believe a higher impact fee will drastically negatively affect home building or home sales.

"I do not believe that an increase in impact fees is going to stop the growth that's happening," she said.

Want to go?

The public hearing on the impact fee for the Fort Mill School District is at 6 p.m. June 27 at McCelvey Center, 212 E. Jefferson St., York.

John Marks: jmarks@fortmilltimes.com; @JohnFMTimes

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