Two months and two meetings after developers first met with the
city and school district, the three parties have agreed to, well,
meet again.
Gilroy – Two months and two meetings after developers first met with the city and school district, the three parties have agreed to, well, meet again.
The three parties did agree on one concept: They need to buckle down and determine ways builders can help the district pull out of roughly $13 million budget deficit.
In a Monday meeting, the Gilroy Unified School District reiterated its plea for area developers to voluntarily raise the amount they pay to the district in construction fees. While developers agreed at a March 2 meeting that they would start to hammer out such a voluntary fee hike, they came to Monday’s meeting without even an outline of an agreement. Furthermore, the response from developers to the district’s second plea was lukewarm.
“We feel pretty strongly that this isn’t a developer responsibility, this is a community responsibility,” said Brad Durea, of Arcadia Homes.
Developers already pay a lot of fees and would be averse to paying even more to develop in Gilroy, he said.
The fees collected by the district are used to build new schools to accommodate the new children that development brings to the city.
If developers are paying more to the district, they should have to pay less to the city, said Chris Vanni of Hecker Pass Landowners. The city council has issued permits to the company to build 427 homes in west Gilroy along the Hecker Pass Highway. As none of the houses have yet been built, a fee hike would translate to a multi-million dollar additional expenditure when the company starts construction.
“We’re coming up against a problem that Gilroy impact fees are the highest in the state of California and beyond,” he said. “That fact makes that margin to do other things” – such as pay higher fees to the district – “that much harder.”
Thanks to city fee hikes last year, Gilroy has become one of the most expensive places to build in the state, yet the Dispatch could not independently confirm Vanni’s claim.
Protests notwithstanding, Durea, Vanni and eight other developers have agreed to discuss higher developer contributions with two members from each of the city council, the district board of trustees and the citizen’s oversight committee. The city will set up the meeting by the end of the week, said Mayor Al Pinheiro.
Up for debate will be a proposal discussed at the March 2 meeting. In this proposal, the price of building would rise $3.98 per square foot, from $2.63 – the state-mandated limit the district can charge developers – to $6.61. The fee hike would increase the cost of developing a 2,500-square-foot single-family home by about $9,950. These costs are ultimately passed on to the consumer, Tony Sudol of ACS Ventures said at the March meeting.
Other options for developers who want to help the district include building the schools themselves and donating land or facilities.
Whatever means developers choose to aid the district, they have to act fast, said trustee Jaime Rosso.
“This is an urgent matter for the district,” he told about 20 attendees. “This is something that needs to get solved because we will not have the facilities we need to house the students this construction creates.”
This urgency, and the exact amount developers should contribute, are still points of contention, said Lee Wieder of Access Land Development Services.
“I’m just confident it will be resolved,” he said. “It’s just on whose schedule.”
The mayor has projected a time frame of 60 to 90 days to work out a compromise. To allow adequate time, he will propose to delay the city’s awarding of building permits from July 2 to the first week of September at this Thursday’s joint meeting between the council and planning commission. In the worst-case scenario, the city can threaten to not issue any permits if talks with developers are not productive, Pinheiro said.
While disappointed that the developers did not come to Monday’s meeting with a voluntary agreement underway, Rosso believed the meeting was still a step forward.
“If nothing else, the message came across today that it is an urgent need for us,” he said.
