School Board Adopts State Plan Raising Builder Fees

Ignoring pleas of hardship from residential developers, San Diego city school trustees Tuesday adopted a new state-sanctioned plan for collecting developer fees that will substantially increase the revenues they need to build and refurbish schools.

Under the new plan, which takes effect Thursday, anyone building or expanding residential housing within the San Diego Unified School District must pay the school system $1.50 per square foot before receiving a building permit. Developers of commercial and industrial buildings must pay 25 cents per square foot.

Until now, the district has collected flat fees of $1,832 for single-family units and $897 for multifamily units. The fees were applicable only in the district’s growth areas.

The new system, being adopted statewide under a law passed last year by the Legislature, is expected to yield $11 million for the cash-starved school district in 1987 alone, and a total of $70 million by 1996.

In adopting the new system, the trustees for the moment turned down numerous requests for exemptions from developers, the Construction Industry Federation and the Centre City Development Corp.

“It’s the only sure revenue we can see right now,” Supt. Tom Payzant told the school board members. “If you start making exceptions--as fair and as right as they may seem--you create problems.”

But because several trustees sympathized with developers--who suddenly face the prospect of paying hefty fees on projects initiated months ago--they left open the possibility of enacting exemptions for some developers in the future.

Nine developers and construction industry representatives asked the board to alter the fee plan by taking into consideration their special circumstances. Gerald Trimble, executive vice president of CCDC, told trustees that the fees should not be applied to low- and moderate-income housing downtown that will be occupied predominantly by senior citizens without children.

“There are no kids in elderly housing,” Trimble said. “There are no kids in SROs (single room occupancy hotels).”

He also warned that the fees will drive up the price of CCDC projects designed to provide affordable housing downtown and replace blighted areas. Because downtown projects are densely packed, it would not be unusual for 200,000 square feet of apartment space to be built on a single city block.

Other developers questioned the fairness of levying fees on garage space or day care facilities, as the law allows. Developer Ian Gill said that he must pay $58,000 in fees for living space in a long-planned Golden Hill project and $26,000 in fees for garage space.

Kim Kilkenny, legislative counsel for the Construction Industry Federation, said the district has not demonstrated, as the law requires, that commercial and industrial development will send more children into city schools, and lacks the authority to levy the 25-cent fee. He told trustees that they are “inviting litigation” by doing so.

Kilkenny also noted that anyone seeking to add a room, a deck or a garage to his home will have to pay the district the same $1.50-a-square-foot fee. “Those are the people who are going to scream to the district starting tomorrow,” he said.

But trustees, facing an estimated $139 million in school building projects before the turn of the century, chose not to rewrite provisions enacted by the Legislature.

“Unfortunately, the state has taken away our ability to fund our schools,” said trustee Jim Roache. “This is one of only two viable ways of funding our schools. We have a desperate need for schools. So I believe we have no choice but to go ahead with it.”

The controversial fee legislation is meeting with mixed reviews around the rest of San Diego County. While the city schools will profit from it, other districts that have been charging developers higher fees will see their revenue fall.

In Poway Unfied School District, which adopted the fees Monday morning, each single-family home built was generating $5,769 for the district. The new $1.50-per-square-foot fee will give the district less money, said Jim Abbott, assistant superintendent for business services.

“We believe that this piece of legislation is probably the worst piece of legislation to come out affecting school districts in a long while,” Abbott said. “It doesn’t solve the problem. It creates more problems than it solves.”

Kilkenny said, however, that many of the subdivisions already planned for Poway will pay fees under the old rules.

Because the law says nothing about how elementary school districts and high school districts should share the funds, administrators of the various districts have been forced to negotiate revenue-sharing agreements.

For example, the San Dieguito High School District will share varying amounts of the developer fees with the five elementary school districts that feed students into its schools.

San Dieguito will get 85 cents per square foot from residential developments in the Encinitas, Cardiff and Solana Beach elementary districts; 60 cents from Rancho Santa Fee, and $1.50 from Del Mar, which has not yet adopted a fee plan.

The law is in some places vague about details, such as how to calculate the square footage of a building, other school officials said.