Gilroy
– Developers working on downtown projects saved $250,000 last
year, according to a quarterly tally released by the city. The
savings, which applied to 31 different projects, are the result of
fee exemptions enacted by City Council in late 2003.
Gilroy – Developers working on downtown projects saved $250,000 last year, according to a quarterly tally released by the city. The savings, which applied to 31 different projects, are the result of fee exemptions enacted by City Council in late 2003.
Developers saved the largest amount on engineering-related fees, which accounted for $173,088 of the total discounts. A new building generally spells greater demand for public services, and the city relies on impact fees to recoup some of the costs associated with a new development.
A typical building project generally involves fees related to emergency services, sewer service, traffic impacts, water use, and more than a dozen other services, depending on the type of project.
For instance, a mixed-use project slated for Lewis and Monterey streets would have required the owners to pay $88,596 in traffic impact fees – $7,383 for each of its 12, second-story apartments.
The downtown fee waiver will free the developers from having to pay those costs.
The exemption also extends to the processing of development applications and building fees, which in 2004 resulted in savings of $42,755 and 34,362, respectively.
The waivers were originally recommended by members of the Downtown Specific Plan Task Force, a group of developers, landowners, city staff and other volunteers crafting development guidelines for Gilroy’s historic Monterey Street corridor.
The fee exemptions are expected to last through 2005 or until the city adopts a specific plan for the downtown area.
Councilman Craig Gartman said he favors extending the exemptions.
“It’s doing exactly what we wanted it to do, which is stimulate growth downtown,” Gartman said. “It’s a winner for the downtown, for the developers, for the entire community.”
The city has seen a flurry of development proposals for the downtown since the fee waivers took effect. City staff are currently reviewing three proposals, but expect more than a dozen more to come up for review in the next year or two.
But fee waivers alone are not driving growth in the downtown area, according to City Administrator Jay Baksa, who also credited the city’s work on the Downtown Specific Plan, upgrades to the Monterey “streetscape,” and efforts to safeguard unreinforced masonry buildings, which could crumble during an earthquake.
“You add all of those up, including the fee waiver,” Baksa said, “and you’ve got yourself a nice little package going here.”
