Chamber Opposes Rescinding Non-residential Concurrency Fees

At a recent St. Johns County Board of Commissioners meeting, Scott Maynard spoke on behalf of the Chamber and its members to oppose the ordinance to rescind the existing commercial exemption for non-residential concurrency fees.   
Concurrency fees in St. Johns County are based on the number of peak-hour trips generated by the new project. The business owner would pay these fees upfront. Large corporations build these fee estimates into their development budgets as a cost of doing business. However, for small businesses trying to open up or expand, these upfront fees determine whether the business owner can even afford to open up or expand.

Commissioner Christian Whitehurst said during the discussion, “I had our staff research to put some real numbers to this.  For Commissioner Murphy to open Sonny’s Bar-B-Q, he would have been required to pay an additional $513,188. The new V-Pizza, north of the airport, would have been required to pay an additional $4,405,617 to open its doors.  This would be perceived as a tax to open a business.  It is hard enough to open a new business. It would be unconscionable for us to consider a new fee that would stand in the way of an individual trying to open a new business.”

Another crucial factor in the discussion highlights that St. Johns County currently has a severely unbalanced tax base. Residential developments provide over 87 percent of the tax revenue, while commercial businesses contribute less than 13 percent. A more balanced residential /commercial tax base ratio would be 70% residential and 30% commercial. 

The current imbalance is unsustainable in the long run as the volatility of the residential real estate market is subject to the whiplash of severe price swings as we saw during the recession of 2007-2009, making it even more critical for the County to encourage, not discourage businesses from opening and expanding. In the past 5 years, the total assessed value of commercial real estate has increased by 74% from 3.6 billion to 6.3 billion. Encouraging small businesses to open and expand brings new tax dollars and employees to St. Johns County, providing additional benefits and revenue.

The County Commission voted 3-2 not to proceed with this ordinance change. The Chamber appreciates the commission’s support on this issue. We believe that the existing concurrency fee exemption for non-residential interests should be maintained in the public interest to continue growing our employment and tax base.