Supervisors Oppose Bill That Would End Proffers

By Jonathan Mummolo
Washington Post Staff Writer
Sunday, February 10, 2008

A Senate committee has approved a bill that would replace the 30-year-old system under which Loudoun County and other local governments have collected millions of dollars from developers to compensate for the impact of new homes.

Under the bill, local governments no longer would be able to negotiate proffers -- payments made by developers to offset the cost of providing roads, schools and other government services to new residents. Instead of proffers, Loudoun and other Northern Virginia counties would be allowed to charge developers a flat fee of $8,000 per new house.

The Loudoun County Board of Supervisors voted unanimously to oppose the legislation Tuesday, saying it would hamstring the county's ability to manage the effect of growth.

The legislation, Senate Bill 768, also would sharply restrict the county's ability to receive non-cash contributions from developers, such as parkland, libraries, affordable housing units, trees and playground equipment.

Loudoun collects about $47,000 in proffers for each new residence, the highest such figure in the state.

Supervisors voted to "strongly oppose" the bill, saying it was a gift to building industry lobbyists in Richmond.

"Unfortunately, what this is is an anti-taxpayer bill," said board Chairman Scott K. York (I-At Large), "because what will occur is that the development community will forgo paying that which is the result of their development and put it on the backs of us, the taxpayers."

The legislation was endorsed by the Home Builders Association of Virginia -- which helped write the bill -- though the building industry has defended the proffer system in the past.

Mike Toalson, the association's executive vice president, said that the proffer system has gotten out of control in places such as Loudoun and that given the housing slump, developers need an alternative system to do business.

"We can't continue to bear this burden," Toalson said. "We're not there at the legislature in this slump asking to do away with proffers. We could do that, and we might be successful . . . but we're not doing that. What we're doing is bringing forth an alternative -- an honest, good-faith alternative -- that we believe will work for local governments and will work for people wanting housing."

The bill was approved by the Senate Finance Committee on Wednesday and could be voted on by the full Senate this week. Gov. Timothy M. Kaine (D) has not taken a position on it.

Supporters of the legislation cite a study by Stephen Fuller, director of the Center for Regional Analysis at George Mason University. The study, funded by the home builders association, compared the amount of local government revenue generated through proffers with the amount that would have been garnered if the flat-rate impact fees had been in place.

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