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Prescott City Council Study Session—September 19,2006 Page 13 <br /> meetings and Council needed to decide where the money was <br /> going to come from to keep up with new growth. <br /> Councilman Blair made the point that people who build new houses pay <br /> impact fees, but people moving into already built houses did not pay <br /> impact fees; also, any homes built prior to 1995 did not pay impact fees, <br /> yet any new facilities, such as a new fire station, was for the use of new <br /> residents and existing residents and it couldn't all be focused on new <br /> growth. <br /> Candace McNulty, 221 S. Marina Street, asked if people moved in to an <br /> existing house and others moved out of that house how it didn't balance <br /> out and there wouldn't be an impact; she understood with a new home it <br /> was a new demand on services. <br /> Ethan Edwards, 126 N. Marina Street,presented the following information: <br /> • The city relied heavily on the revenues from transaction privilege <br /> taxes. <br /> • He suggested the city identify growth related items the impact fees <br /> would be used for; prepare a capital growth plan and raise the <br /> impact fees for a specific project, such as a fire station or a police <br /> station. <br /> • The City needed to understand that for everyone that decided not <br /> to build in Prescott, the City was looking at losing $18,000 on a <br /> 3,000 sf home (cost of permits, inspection fees, all city fees) and <br /> the transaction privilege taxes on building materials as well. <br /> • Growth did pay for growth through the transaction privilege tax; it <br /> had worked in the past and once the taxes weren't coming in the <br /> city would be in trouble. <br /> It was clarified the State did not allow development impact fees until 1992 <br /> when they saw the effects of rapid growth and the impact fees paid for the <br /> facilities, but did not pay for services. <br /> Attorney Kidd added there needed to be a reasonable relationship to a <br /> facility and new development; it had to be a direct benefit to new growth; <br /> the City couldn't go back and charge existing homes impact fees and the <br /> use of the fees was limited. <br /> Mr.Woodfill clarified State law allowed the impact fees to be used in one <br /> of three ways - the capital plan approach; incremental approach or the <br /> buy-in approach. <br /> Additional Council remarks: <br /> %rr <br />