2021 Legislative Session Review

There’s a saying that the most dangerous time for citizens is when the Legislature is in session.  A lot of time and effort was spent on controversial issues during the 2021 Legislative Session, particularly on issues such as voter rights and election laws.

For the most part, landowners and developers escaped largely unscathed.  During the 2021 Legislative Session, several bills were passed affecting landowners and developers.

First . . . impact fees.

Landowners and developers pay impact fees to compensate for the impacts of private development on schools and roads.  Impact fees can create a perfect storm for owners and developers.  More and more people move to Florida to enjoy its weather, its lifestyle, and to escape high taxes and living costs.  More people equals new or improved schools and roads.

Because it’s difficult to persuade taxpayers to pay for schools and roads, local governments can try to shift too much of these costs to developers through increased impact fees.  HB 337, which was approved with bi-partisan support in the House and Senate, tries to create more predictability for developers.

It tries to increase predictability of impact fee increases by phasing them in at no more than 12.5% annually and no more than 50% over a four-year period.

To address the possibility of future moratoriums, a “relief valve” was created for local governments to exceed the phase-in limitations under extraordinary circumstances.  To take advantage of this relief valve, a local government must do the following:

  1. Complete a study, within a year, justifying impact fees increases higher than 12.5% annually;
  2. Conduct no less than two publicly-noticed workshops dedicated to the extraordinary circumstances necessitating the need to exceed the phase-in limitations;
  3. Finally, once the extraordinary circumstances checklist is complete, the governing board must approve the need to exceed the phase-in by a two-thirds vote.

HB 337 will ensure impact fees are calculated and expended on true capital infrastructure projects.  The law limits the number and types of public facilities for which impact fees may be implemented. It eliminates “General Government Buildings”, “Jails”, and “Libraries” from the list of public facilities for which impact fees may be collected, as well as ensuring impact fees are not used to pay for fixtures, furniture, or equipment. This definition will help eliminate frivolous studies by ensuring “impact fee consultants” cannot throw every expense conceivable into the pot when calculating future fee increases.

Not to discount the financial consequences of impact fees, but there is a tendency to devote a lot of legislative and legal effort on them.  There may also be a tendency to overemphasize their economic affects.  Impact fees are one way local governments raise revenue.  Ideally, impact fees can’t be used to pay the costs to maintain existing roads and schools.  Those revenues come from taxes, usually ad valorem property taxes.  What that means is that developers should not lose sight of all of the long-term costs and expenses of property development and ownership.  A  cost-benefit analysis might indicate that short-term higher impact fees are offset in the mid- to long-term by lower ad valorem taxes.

Second . . . property rights.

HB 421 modifies the Bert J. Harris, Jr., Private Property Rights Protection Act by including mineral estates, subsurface, and surface rights in the definition of real property. The bill also reduces the amount of time after a claimant must notify the government before filing an action; allows a court to determine damages (rather than a jury); extends the point from which a prevailing claimant can recover attorneys’ fees and costs; and authorizes a property owner, under specified conditions, to notify the government that he or she deems a law or regulation’s impact on his or her real property is restrictive of allowable uses.

Jay Small practices in the areas of eminent domain, condemnation, property rights, inverse condemnation, and land use law.  If you have any questions about how government regulations can affect your property, contact him at (407) 425-9044, by email at [email protected], or follow him on LinkedIn.

This blog and these materials are not intended to provide legal advice.  They do not represent the legal opinions of the firm, nor should they be regarded as the legal positions of any client of the law firm of Mateer Harbert, P.A. They are provided for general informational purposes only.  These materials should not be used as a substitute for the advice of qualified legal counsel.

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