In 1999, the year impact fees were imposed in DeKalb, a person could buy just about any farm land in DeKalb County for $4,000 an acre. Six years later, if the DeKalb City Council approves the proposed impact fee schedule, it will cost $4,000 per acre ($3,000 to the Sanitary District and $1,000 for the new City Annexation Fee) in impact fees just to annex the property into the City of DeKalb.

Before the excavators can dig the hole for a four-bedroom home’s foundation a total of almost $23,000 in impact and permit fees must be paid. That same $23,000 could be the ten-percent down most people would need to purchase a $230,000 town home in DeKalb and that might be about all the new town home a person can afford in this area if these increased fees are approved.

Even at that bargain basement price, most people who currently live in DeKalb, at least those earning the median household income of around $40,000, would be stretched to make that mortgage. If there was a bump in the "economy road," a loss or reduction in that median income, it would be tough to pay the $4,500 annual property tax bill on that town home.

In casting the lone dissenting vote against consideration of the proposed impact fee schedule, seventh ward alderman, James Barr, noted how it was beginning to appear that the city fathers were making it so it was impossible for current DeKalb residents to afford a new construction home.

Don’t despair current residents. The city staff is recommending that they spend the new $1,000 per acre annexation fee on refurbishing the older neighborhoods. Maybe you can get some help with the fixer-upper you end up buying. Just remember to do your proper due diligence on what your property taxes will really be. Chances are that on most older homes the current taxes will be much higher once the tax assessor is notified of the higher price you paid for it.

Second ward alderman, Kris Povlsen, offered some words of encouragement for current residents. Well, sort of. He said that when you get that higher tax bill you should just smile because that meant your property values went up. If you sell that home your smile will fade quickly when you find out how much more expensive your next housing costs can be.

Back in 1999 the proponents of impact fees told the public that imposing those fees would reduce the property tax burden. The fact that out-of-pocket property taxes have risen much more sharply in the six years after impact fees, than in the six years before them, might not be attributable to impact fees. But it sure makes you go hmmmmmmm…

Those same proponents have been saying for at least the past ten years that only a handful of builders and developers benefit from growth. Yet, a recent study by Northern Illinois University and the Center for Tax Budget Accountability shows that the construction trades have been, and will be until 2012 anyway, the fastest growing occupation segment in Northeastern Illinois. In 2002, according to their report, there were some 160,000 construction trades workers employed in our region. About 3,000 more of those jobs will be created each year from 2002 through 2012. The mean income of those jobs is a little over $55,000.

You would think those jobs would mean something to City Hall. That same NIU/CTBA report revealed that, “The state’s median household income has also declined sharply. After reaching a high of $52,515 in 1999, median household income in Illinois dropped to $46,132 in 2004.”

Many communities would gladly offer an employer that paid most of its employees $55,000 per year a nice incentive program. Heck, an average $15 per hour workforce at a warehouse will get you at least a sliding property tax abatement. But if you buy a new construction home in DeKalb, the city council would have you pay a $23,000 penalty for buying the product that employs many of those construction trades workers.

According to our city fathers, you deserve to pay that penalty because the growth in DeKalb has not kept pace with the cost of government services. The $23,000 per home they’ll collect is just a drop in the bucket to what they really need anyway. It’s taking about every penny they can get through traditional tax sources just to cover salaries. Because while the state’s median income dropped by 6.2% since 1999, salaries for most administrative level government employees rose by more than 20%.

Those DeKalb residents who need housing costs, including taxes, to be no more than 30% of their household income, better pay close attention to the proposed impact fee schedule that is in front of the city council.  The city council is so eager to pass this 300% increase in impact fees that they care little if what they are doing is legal.

Why? Because just look at what other surrounding communities are getting in impact fees! Never mind the Suburban Mayors Caucus report that identified 730,000 families, living in the six collar counties to the east of us, where all those impact fees are collected, who are now paying much more than 30% of their household income on housing expenses. The report also says, repeatedly, that impact fees are a significant barrier in their efforts to bring workforce affordable housing back to those communities.

But DeKalb officials don’t think impact fees are a problem for workforce affordable housing. They just want the money that our neighbors to the east get and, by golly, a majority of city council members, and the Mayor, ran for election touting increased impact fees as the tool to lessen the tax burden on existing residents.  Why these folks have been proponents of impact fees for at least ten years! They couldn't name one city in America that lowered property taxes due to raising impact fees. But by adding $23,000 to the upfront cost of a new home all housing prices will go up and you’ll be smiling when you get your next and higher tax bill. It might be a hollow smile, but, hopefully, you get the point.

We need the people who need affordable housing (for them) to stand up, ask questions, and be heard.

Mac McIntyre

For information on the flawed methodology of this proposal, click here.

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