By RICK KRON
Leader staff writer
The Sherwood City Council is looking at funding a possible study for impact fees — an added levy placed on new construction ranging from about $1,000 to $5,000.
The council voted to pursue the possibilities of adding impact fees to the city’s arsenal of revenue collecting mechanisms based in part on last year’s park study and the desires of the parks and recreation commission.
However, impact fees won’t help the city gain the 200-plus acres of park land that it is currently lacking, according to the study.
Impact fees, by state law, may only be used for street work or park land purchase and upkeep that are connected to new developments.
The main reason the city is short of park space is because of its annexation of the 3,000-plus acres Gravel Ridge community. There were no parks in any of that annexed area. But impact fees, by law, cannot be used for any Gravel Ridge parks unless there is new development in that area.
The park study states that Gravel Ridge is “underserved and currently has no access to any parks facility within the annexed area. It would be necessary to develop a new park in the vicinity of the area within a short time.”
But it will have to be done without impact fees unless plans for a new development in the area spring up shortly after the levy is approved.
Alderman Mary Jo Heye is a proponent of impact fees, citing how well they’ve helped Conway. In presenting the levy to the council she said it had the unanimous recommendation “from all in attendance from both the parks and street committees.”
“We obviously have some problems concerning our infrastructure without a means in which to fix them,” she said.
“We have problems with streets adjacent to new developments. They are torn up and need to be enlarged to meet the new demands now placed on them. Roads do not just get torn up by the increase in traffic but also from heavy construction vehicles,” she said.
Heye added that with new growth also comes a stronger demand for new and enlarged parks. “These things place a burden on the general revenue funds,” she said. Impact fees offset this burden according to Heye.
“I think this is a win-win for our community. Builders will have a better opportunity to sell homes if there are good streets leading to and surrounding the developments and parks to service the new families. In addition, this will free up money in the general fund to maintain current parks and roads in the established parts of Sherwood,” Heye said.
The park study does suggest impact fees as one way to increase the number of parks and pay for their maintenance; it is the last item listed out of seven ways to pay for city parks.
The park study, by ETC Engineers of Little Rock, first suggests user fees, but says these types of fees are “generally not adequate to fund large capital projects. However, it is a good way to provide operation and maintenance budgets for a project.”
The study then suggested sales-tax based revenue bonds. “This is the most commonly used method for financing large capital projects. The capital portion of the bond will have a sunset date while the maintenance portion of the bond will continue perpetually. For financing large parks and recreation projects in Arkansas, this is the preferred method,” the study stated.
The study then lists using advertising and tourism tax-based revenue bonds, a pay-as-you-go system and park foundation funds.
It then suggests the use of federal and state grants, most of which require a 50 percent match by the city.
Then it lists impact fees on new development without any comment.
The park study’s five-year plan says Sherwood will be in need of 200 to 360 acres of new parks, based on national standards of about 10 acres of land per 1,000 residents. The city is averaging about 8.4 acres of park land per 1,000 residents at this time. The cost for the new land, plus renovations to current parks will run up to $22 million, with $14 million of that going to turning Sherwood Forest into a citywide park.
The city is seeking qualified companies and bids for the study which is projected to run $30,000 or more. Most likely, the issue will be back before the council in May.
