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Impact fees take some business owners by surprise |
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Impact fees take some business owners by surprise
Published:
Monday, May 3, 2010 12:07 AM CDT
Christian County resident Allen Nichols attended Sparta’s April Board of Aldermen meeting seeking approval for his new business—Al’s Cook Shack. He has already purchased a grill and fryer and received his food handling certification through the Christian County Health Department. Getting the board’s blessing was Nichols’ last stop before starting construction, with hopes of opening the business within 30 days of that April 13 meeting.
At that meeting, Nichols was told he didn’t need the board’s approval, he only needed the required permits. To his surprise, the permits include an $1,800- sewer and water impact fee.
“I don’t understand how they expect Sparta to grow if they charge these impact fees. I think they need to make some exemptions for small businesses,” he said. “For $2,000 I have to sell 2,000 hamburgers right off the bat to break even.”
Al’s Cook Shack will sell “quick meals” of hamburgers, pork steaks, hot dogs, brats and homemade french fries. Located on the corner of state Routes 125 and 14, Nichols plans to construct a 12-by-16-foot building and assumed he could hook up to the water and sewer lines that are already in place at the existing building on the same lot. But Sparta public works employee Mike Evans said when a new building is constructed, new impact fees are required.
“Because of city ordinance he’s got to have a separate meter for a separate building, so he’s got to have his own utilities,” Evans said.
Evans said the purpose of impact fees are to help maintain the current systems.
“We just built a new sewer plant,” Evans said, “every time the city grows they put an impact on the sewer plant and the water system. All that (impact fee) money goes to maintenance of the water and sewer system or to help buy a new plant when the time comes.”
And although the one-time fee is steep for a new, small-business owner, Karen Allen, Sparta municipal city clerk, said it is not out of line when compared with other towns.
“When I first started this job there was a lot of building going on. A lot of builders came over here because the impact fees were cheaper. Some of the towns that compare (in size) to Sparta were a lot higher,” she said.
Clever’s sewer and water hook-up fees total a minimum of $2,500 for commercial. People looking to build commercially in Ozark can expect to spend more than $2,800 on sewer and water connection fees; this does not include building permits.
Billings’ hook-up fees appear to be the cheapest coming in at about $800. However, that price may soon increase as aldermen are holding a special meeting April 28 to discuss increasing the fees to about $1,500.
Dolores Lamb, with Ozark planning and zoning, said she has seen people in her office upset when discovering the one-time fee and her best advice for potential new business owners is to research the costs first.
“If you’re thinking about opening a business please contact the city that you are going into and check out their fees,” she said. “I think almost any municipality would be glad to meet with you and give you a building cost break down and talk about any challenges that your property may have. Do your homework first.”
Allen said she hopes Nichols doesn’t let the fees deter him from opening the restaurant because “Sparta needs more businesses.”
Nichols agrees.
“I’m committed. I’ve spent quite a bit of my savings. I’m absolutely going to open a business in Sparta, even with the impact fees,” he said. “I’ve already invested $5,000 to $6,000 in what I’ve got but when I found out I had to pay an additional $2,000 it kind of puts me at a halt. I don’t know if that’s excessive (for impact fees) but it seems excessive to me. That’s a lot of money for me and my family.”
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