February 24, 1999
Mr. Merrett Stierheim
Stephen P. Clark Center
111 NW First Street, Suite 2910
Miami, FL. 33128-1994
RE: Impact Fees and other Governmental Burden on Infill Housing
Dear Mr. Stierheim:
Yesterday when I spoke before the County Commission Committee on Impact Fees, you correctly questioned me as to how the burden of such fees could amount to 20% of the cost of an "affordable home." I answered that I wasn't speaking only of impact fees, but of the total impact of "government related burden" including repair/replacement of missing or deficient infrastructure on the private development of infill housing in Miami's oldest neighborhoods such as West Coconut Grove.
Enclosed is a letter I wrote to Commissioner Morales last September regarding a house I am now just completing on Collier Street in the West Grove. Since I wrote the letter, several things have changed: My cost for the WASD "Mains" Program turned out to be $4,365 instead of $5,000. The City has undertaken to exempt "affordable homes" from the noxious and I believe illegal "Construction Debris Removal Fee" but only if the home qualifies for a subsidized mortgage. And finally, I believe that WASD has just recently decided to allow new homes in neighborhoods with substandard water lines to tie into such lines without having to go into the "Mains" program.
Even with these recent positive changes, anyway you slice it, the percentage of burden on "affordable" infill housing is and will remain much higher on infill housing than on development of housing in more affluent areas where the sale price of the houses can be higher, sometimes much higher. In effect, the poorer areas subsidize construction in the wealthier areas. And that is one of the main reasons why there aren't many (if any) private for-profit builders building new houses in these neighborhoods.
I have spent five years of my life learning how to build as a "for-profit" in an area where others say "it can't be done." I'd love the chance to show you the ten homes I've built, all sold to low-to-moderate income families (ave. $20,000-$25,000 total family income) without one cent of taxpayer subsidy except for (a) the "soft 2d mortgage" to these families and (b) the refund of the "Road" impact fee to low income qualifiers.
I honestly believe that if we can put the engine of private enterprise to work in infill neighborhoods, just as William Levitt did for the veterans returning from WW II, we can build a lot of new homes, and with them, a whole new "middle class" out of that intransigent category now know as "low-to-moderate income."
Anthony R. Parrish, Jr. President
cc. Mr. Pedro G. Hernandez