County wins impact fee battle

COVINGTON - Newton County claimed victory in Superior Court Monday in the prolonged battle over its impact fee ordinance with local and state home builders associations.

Superior Court Judge Horace Johnson Jr. dismissed a lawsuit filed against the county by the Newton County Home Builders Association and the Home Builders Association of Georgia, saying the associations failed to meet burden of proof.

The ruling means that the county will move forward with spending the $6.5 million in fees collected so far, said Newton County's Executive Officer, John Middleton.

"I think you have to look back to 2000 to 2005, when the Newton County Board of Commissioners very carefully studied impact fees, engaged in a comprehensive capital improvements planning process and moved forward in adopting a Capital Improvements Element, and then set impact fees in 2005. The court's decision reflects that the Newton County Board of Commissioners followed the law and acted in accordance with the Georgia Impact Fee Act," Middleton said. "The Board of Commissioners is ready to move forward with recreation and parks, library and transportation projects that were delayed by this lawsuit."

A branch library and a park, both in the Oak Hill area, along with several transportation projects, could be the first to benefit, Middleton said.

Newton County enacted its impact fee ordinance in March 2005, with the expectation of collecting $50 million over 10 years to fund libraries, parks and recreation and transportation projects.

The associations filed suit against the county in December 2005, alleging that the county's ordinance was illegal and unenforceable.

Since that time, commissioners have made several changes in the ordinance to address allegations in the lawsuit, including the exclusion of churches from paying the fees.

Georgia law does not exempt churches, but the county had not been requiring that churches pay the fees. In 2006, commissioners agreed to begin imposing the fees on churches.

The associations also asked for an injunction requiring that the fees be held in an escrow account until the court issued a ruling on the suit.

In October 2006, Johnson denied that request. That ruling was later upheld by the Georgia Court of Appeals.

The associations then appealed to the Georgia Supreme Court.

In September, the court refused to hear the appeal, freeing the county to spend the money.

The county has collected $6.5 million in impact fees since March 2005, but has yet to spend any toward projects, Impact Fee Coordinator Kellie Lundy said.

At issue Monday was the question of whether the burden of fees related to road improvements was unfairly shifted onto residential development.

Attorney Deron Hicks, representing the state home builders, said that after county commissioners asked impact fee consultants Ross and Associates to revisit fees in the roads and transportation category, a second methodology report showed a "significant shift" toward the residential side.

In the first report prepared by Ross and Associates, trip generation fees were the same for residential and commercial development.

That report showed residential accounting for 68 percent of fees, with commercial at 32 percent.

In the second report, those percentages changed to 88.6 percent for residential and 11.4 percent for commercial. The trip generation fees also changed, to $315.74 for residential and $88.53 per trip for nonresidential.

Bill Ross Jr., president of Ross and Associates, said that in determining that the majority of trips in the county were caused by residential traffic, the percentage breakdown was as close a number as reasonable, adding that, "It was a judgment call on my part."

Attorney Andy Davis, representing Newton County, said the law does not give a specific formula that must be used to determine funding proportions.

Davis pointed out that commissioners could have imposed a maximum fee of $3,800 per residential development but instead passed a much lower fee of about $1,700.

Following testimony by Ross and an engineer who assisted with traffic data, Johnson dismissed the case, saying that based on the evidence, the plaintiffs had not met the burden of proof.

"I'm obviously disappointed, but when you fight city hall, you know what's going to happen," said Newton County Home Builders President Bob Goucher after the ruling. "There's nothing in the law that says taxes have to be fair. But we would be remiss in our duties as citizens to not challenge something that we felt in our hearts encroached on our equality."

Goucher said he wouldn't rule out an appeal, but that it's too early to make that decision.