The Lexington Town Council deliberates on urgent updates to development impact fees.
The Lexington Town Council is facing an urgent deadline to update development impact fees due to a state mandate. Elected officials are concerned about how potential fee increases will affect the local economy, especially small businesses. While the town has collected substantial fees since 2020, only a fraction has been spent. The council aims to fund essential infrastructure projects without raising local taxes, but the debate around fairness continues as they prepare for imminent changes.
In the picturesque city of Lexington, time is ticking for town officials as they gear up to update the development impact fees before a state-imposed deadline in just under three weeks. This pressing situation emerged from a fresh look at the impact fee ordinance that was originally approved over five years ago, designed to support essential infrastructure needs as the town grows.
With a community of around 25,000 residents, Lexington has seen its fair share of development over the years. The development impact fees, which are a one-time charge imposed on new commercial and residential projects, directly contribute to necessary improvements in the town’s infrastructure. As state law mandates a review of this ordinance, the council is anticipating an uptick in fees which could put strain on small businesses.
Concerns from council members have echoed across meetings, particularly from Councilman Gavin Smith, who has questioned how these new fees will impact the livelihood of local business owners. Since the ordinance took effect in 2020, Lexington has raked in about $1.7 million in development fees but has only spent around $500,000. This leaves a notable sum still waiting to be utilized.
The aim behind collecting these fees is to fund crucial infrastructure projects in three main categories: transportation, parks and recreation, and municipal facilities. The town is determined to support these initiatives without needing to raise local taxes, especially in light of continued growth in the area.
Councilman Todd Carnes highlighted a significant 35% population increase over the last decade, and lamented the lack of financial support from federal and state sources to help manage this growth. With ambitious plans in place, the town has allocated more than $25 million in impact fees exclusively for transportation projects over the next five years, alongside receiving an additional $16 million from the state specifically for road improvements.
As discussions heat up, the town council voted 5-2 to approve increased rates, with two council members voicing their dissent. The dynamics around these proposed fees have sparked a vigorous debate. Smith has suggested that perhaps there could be a way to ease the financial strain on local businesses, which are currently seen contributing significantly to transportation costs.
Meanwhile, Mayor Hazel Livingston defended the idea that commercial developers ought to shoulder a larger share of fees due to the traffic increase they cause. An example cited was the new Whataburger restaurant, where the heightened traffic flow brought about discussion regarding who should fairly contribute to the town’s infrastructure needs.
Recognizing the intricacies of this issue, Smith has indicated that he might reconsider his initial vote on the fees after further deliberation. Before the final votes on the fees for parks and recreation and municipal facilities, the transportation fees will be tackled later on this year, allowing for additional discussions.
However, time remains a critical factor as the council grapples with the speed at which they need to review potential changes. The town initiated plans for a contractor to conduct an impact fee study back in April, but it wasn’t until October that the execution of the survey began, leaving precious little time for thorough review.
The town currently faces additional challenges, such as ongoing litigation surrounding PFAS and the unexpected cancellation of a long-established roads agreement with Lexington County. As the council continues navigating these waters, residents are keenly watching how these decisions will shape the future of their beloved Lexington.
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