School Surcharge 101

calculator.jpgDespite what developers say, in Prince George’s County they do not pay an impact fee–they pay a surcharge. What is the difference? Pretty big. An impact fee assigns funds to the area impacted by the development. The law in Prince George’s County, which I believe originated at the state delegation level, collects a surcharge from developers in Prince George’s County of about $12,000 per unit outside the Beltway and $7,000 per unit inside (to stimulate revitalization). These amounts are linked to a formula and typically increase each year.

What is the case for a surcharge rather than an impact fee? Collecting a surcharge from each unit developed (dorms and senior housing are normally excluded) allows money to pool in the General Fund. Monies can move from the General Fund for allocation throughout the county via the Capital Improvement Program (CIP). The surcharge strategy spreads out the benefit of new development to communities without comparable growth.

What is the downside of the surcharge? The neighborhoods needing school seats, especially to accommodate the new development-based increase in school-age children, may not see any benefit.

The planning and developing drama unfolds:
The developer points at the fee, “We paid, as we were asked.”

But the neighborhood responds, “Hold on. You paid the fee. But we don’t get seats or school construction!” The old and new neighbors send their children to overcrowded schools.

Let’s try an example. Suppose a hundred homes–units above mixed-use, townhouses, condos or single-family–are built in College Park with the developer paying a required surcharge. Real mitigation in terms of school seats will not happen. Why? The surcharge fee goes to a general fund for county-wide dispersal.

If somehow funds remain in College Park and are dedicated to school construction or renovation, that money would not be sufficient to, say, build a new school. Even if the region secured enough money, where does that parcel lie that could be, should be, a new school?

Until this conundrum is resolved, developers must begin to address the community’s concerns regarding school overcrowding creatively and upfront. Waving a bill marked paid is not sufficient.

School Board Members Hathaway and Iliff have been asked to provide a formal, detailed response about school enrollment figures in the Northwestern High School catchment area, also known as Region 5 through the Pupil Accounting office of PGCPS. Those figures for 2007 should be available in early October.–MbS

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Filed under Community, Developers, Infrastructure, Planning, Schools

One response to “School Surcharge 101

  1. Route 1 Growth You are invited to a Party! (I would have emailed you but I couldn’t find the direct contact info on your site.)

    That’s right, episode 50 of the Hyattsville H4X will air live at 8:30 p.m. on Monday, August 27th. Please visit http://www.hyattsvilleh4x.com/ to watch. We have a new set up and will be able to take your phone calls live at 301-637-6060, god willing and the creek don’t rise. More fun than watching the Hyattsville City Council Meeting on Channel 71 – we sure hope so. If you don’t want to call in, you can ask us questions or make comments live on the website in our chat room. This will all be happening in real time. Plus, we have some special guests lined up for the show.

    Of course the audio rerun will be available on the Hacks page the following day and delivered to your iTunes account if you are a subscriber (subscribing is free and easy, try it), and soon we hope to have video podcast versions of these future episodes available.

    In celebration of this milestone, I will break out the bottle of homemade Limoncello I just completed and we will be eating some birthday cake as well.

    It’s a party y’all! And everyone’s invited.

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