About a dozen people -- mostly business owners and those involved in the local building industry -- argued against a City Council plan to continue marching toward charging developers for the full cost of processing land-use applications in the city.

The council's Administrative Services Committee took up the matter Wednesday, and were asked directly to return to an even split of the charges between the city and developers.

"The general gist of the testmony was that it's not the dollar amount of the fees, it's the message that these increasing fees send to the business community," said Ward 1 Councilor Mark O'Brien, committee chairman.

Ward 9 Councilor Hal Brauner and Ward 6 Councilor Joel Hirsch also serve on the committee.

For years, costs for land-use applications were split 50-50 between developers and taxpayers, a reflection of the public-private partnership in land-use planning.

Last year, the Council changed that and modified its land use permit fees so developers pay 60 percent of related costs, with plans to ratchet up that percentage over the next five years until developers pick up all costs for land-use permits.

That's the situation now in the office that issues building permits: developers pay all costs associated with processing building permits under the assumption that builders benefit from the construction and should shoulder the costs.

The city's general fund picks up all costs related to long-range city planning. The city also pays all costs surrounding historic preservation permits and keeps the charge for land use appeals at $240 per appeal, well below their actual cost of around $10,000 each to process.

"If developers should pay their own way, everyone should pay their own way or we should be honest that there is a public benefit," O'Brien said. "We subsidize a lot of things in our community because we say there is a benefit."

Mysty Rusk, president of the Corvallis-Benton Chamber Coalition, said beside the message that eliminating cost-sharing sends, doing so could have unintended consequences.

In boom times and periods of stability in the building industry, paying for city staff exclusively through developer fees might work. But when the number of projects declines, so go department revenues, she said.

In December, the city division that issues building permits, wholly funded by developer fees, laid off a plans examiner and a building inspector. Also, two vacant positions were not filled, and two employees on leaves of absence weren't rehired.

Department funding that suffers wild swings at the whim of the market might also lead some city employees to seek work in more stable locations, she said.

Rusk also warned that, by putting developers solely in charge of funding development review, some public control might be lost.

"Could that ever happen in Corvallis?" she said. "No, I don't thing any of us think so, but that doesn't mean it won't."

The committee will take up the matter again in future meetings. Ultimately, the decision will return to the full council.

Matt Neznanski can be reached at 758-9518 or matt.neznanski@lee.net

Related

• Editorial: Consider benefits of local development (July 22)
• Council raises applicant’s share of development costs