Montgomery County planners are studying a proposal to impose a $1,000 "development impact fee" on new homes in the county to raise as much as $10 million a year for road construction in the traffic-choked I-270 corridor.
The fee is the latest in a series of proposals that are under study by the Montgomery County Planning Board, which will recommend legislation to the County Council in the next few weeks to address what is now considered the biggest stumbling block to growth since the sewer moritoriums of the 1970s.
"It's a promising proposal," said Planning Board Chairman Norman Christeller this week. "I think it has some merits."
Traffic congestion is a frustrating fact of life for thousands of Montgomery County commuters. Much of the problem has come about because rapid development has outpaced new road construction, which traditionally has been funded by government.
The county's six-year capital improvement program for transportation calls for more than $160 million to widen existing arteries and build new highways, but the county does not have the money to carry out all the projects on schedule.
So-called "impact fees" are being used increasingly to pay for public improvements, especially by local governments that have been strapped for cash by tax-limiting laws such as California's Proposition 13, said Christeller.
The county is not saddled with such a law, but it is nearing the ceiling on the amount of local bonds it can issue to pay for public improvements without jeopardizing its AAA bond rating.
"It's a promising proposal just because the county is concerned about how much more money it can raise," he said.
The idea here was proposed by several county developers who have been negotiating with the county to set up a "super" road club to pay for highway projects in the Germantown area.
"They're recognizing that restrictions on them may not be able to be relieved by resources available to the county. So, they're essentially saying let's make more resources available," said Christeller.
Under the county's Adequate Public Facilities Ordinance, new growth cannot take place until roads, sewers, schools and other public services are available to support the development.
Developers have met the law's requirements in some cases by forming "clubs" to pay for road improvements that normally are the responsibility of local government.
"The only thing such a fee would do would be to subsidize road construction in lieu of road clubs," he said.
As currently proposed, the fee most logically would be imposed at the time building permits are issued, Christeller said.
Based on the current rate of new home construction, a $1,000 charge would raise as much as $10 million a year. About 10,000 building permits were issued last year, and at least 9,000 permits are expected to be issued this year, according to planners.
Reaction to the proposal in the homebuilding industry is mixed, Christeller said. The local homebuilders association has not formally endorsed the idea, but privately developers are saying they can live with it, he said.
"The one thing that gives people pause is the effect on the price of housing. But if you listen to builders, delaying them is going to cause the price of housing to go up anyway," he said.
Developers probably will be given the option to pass the cost on to home buyers, the planning chairman said.