District 4 Supervisor Patrick Jones exercises his Clint Eastwood fetish.
At last week’s Shasta County Board of Supervisors meeting, District 4 Supervisor Patrick Jones touted Redding’s experience with reducing new development impact fees while he was on the city council to justify eliminating such fees for the unincorporated areas of the county.
As we shall see, supervisor Jones’ memory of what happened more than a decade ago may be a little bit foggy.
Last week’s impact fee elimination passed on a 3-2 vote. Jones, along with District 1 Supervisor Kevin Crye and District 5 Supervisor Chris Kelstrom, voted to eliminate the fees. District 3 Supervisor Mary Rickert and District 2 Supervisor Tim Garman voted against the proposal.
Crye, who’s facing a recall election in the March primary, proposed the resolution eliminating impact fees, but the idea appears to have originated with Jones, who served on the Redding city council from 2006-2014. The city of Redding experimented with reducing impact fees from 2011-2012, before reinstating them in 2013.
Both supervisors claimed that eliminating the fees would spur economic growth and pay for itself in the form of increased sales and property taxes. Neither supervisor offered any hard data proving the claim, but Jones repeatedly referred to Redding’s experiment with reducing impact fees during his time on the council.
“For all the Charlie Menohers out there, and the Judy Salters, we have dealt with this over and over,” Jones lectured two of Shasta County’s most well-known liberals during debate on the resolution. “We have proved it for a fact that the city of Redding reduced the fees, you spur growth and its tremendously good for Shasta County.”
As you might suspect, that’s not exactly what happened.
It’s true that Redding reduced impact fees in varying degrees for 200 new homes between 2011-2012. But Jones failed to note one of the main reasons Redding was able to reduce the fees in the first place: unexpected grants from the American Recovery and Reinvestment Act, according to a 2014 city staff report on the city’s development impact fee waiver program.
“The impacts associated with the previous waiver program benefited from lower bids for infrastructure projects due to Great Recession pressures and the availability of American Recovery and Reinvestment Act grants,” the report states. “Without identification of ‘backfill’ funding sources, selective fee reduction would be questionable from a legal standpoint.”
That’s because without impact fee funds dedicated to expanding public infrastructure such as sewers, utilities, public safety and parks, new development could outpace the requirements of the California Environmental Quality Act.
For those who don’t recall the American Recovery and Investment Act of 2009, that was the $800 billion economic stimulus bill written and passed by a Democratic majority Congress and President Barack Obama on a straight party-line vote at the start of Obama’s 8-year tenure. Some Republicans were/are so enraged by the African American president and this dose of old-fashioned Keynesianism they splintered off and formed their own reactionary Tea Party.
Jones was a ringleader of the local Tea Party movement back then, so it’s understandable why he might have memory-holed Obama’s role in Redding’s impact fee waiver program that the gun-toting supervisor touts so highly today.
District 4 Supervisor Patrick Jones in his cosplaying Tea Party heyday.
“We proved all of this,” Jones said before the vote. “We’ve done it here in this county. We’ve reduced impact fees and had an immediate response. I mean immediate, tens of millions of dollars coming into the city of Redding when nothing was happening before.”
This statement is supposed to ‘prove’ Jones and Crye’s claim that eliminating new development impact fees pays for itself by boosting tax revenue enough to pay for public infrastructure expansion. But is that what Redding’s experiment proved? Let’s go to the report:
“The intent of the impact fee waiver program was to stimulate single-family home construction as a way to boost the local economy by creating construction jobs. At this time, all 200 waivers have been allotted and all but 14 homes completed. Under the terms of the program, the remaining homes must be completed prior to March 31, 2015.
“The program can be termed a success in that a significant amount of additional construction activity was initiated, which in turn provided jobs within the community. However, the program did not come without a cost. Approximately $1,718,750 in revenue to the wastewater and traffic impact fee funds was not collected during the waiver period.”
The message is clear: waiving impact fees didn’t magically pay for itself, at least in the city of Redding. This wasn’t a case of cutting fees and letting laissez faire economics run its free market course. This was an organized federal government stimulus program that demanded at least some accountability, i.e., new houses must be built to qualify for the funding.
That federal funding was significant and helped backfill nearly $2 million in lost impact fees. In 2011, Redding temporarily waived $12,500 in wastewater and traffic impact fees per single-family home for the first 50 homes in the grant project.
In 2012 the benefit was expanded to duplex construction, and impact fees were waived for 50 more homes. Later that year, Redding extended ‘half-waivers’ for $6250 to 50 homes and ‘quarter waivers’ of $3125 to 50 more homes. In total, 200 homes received waivers for some but not all impact fees.
District 1 Supervisor Kevin Crye
It’s important to note that the resolution passed last week by Jones, Crye and Kelstrom doesn’t reduce new impact fees in the unincorporated county; it eliminates them entirely. This will result in an annual loss of nearly $1 million with no planned backfill funds other than Jones and Crye’s mistaken belief that cutting fees automatically pays for itself.
No planning whatsoever appears to have gone into this measure, despite Crye’s claim of doing six months of homework.
Neither Jones nor Crye returned my email seeking documentation for their allegations. In contrast to Shasta County’s planning on impact fees, the Redding City Council appears to be the epitome of good government in action.
When the federal stimulus funding began tapering off in 2013 Redding quickly recognized it needed to reinstate the development impact fees to fund public infrastructure. At the same time, after an extensive review process, the city lowered the total amount charged for impact fees by $987 per single-family home. Staff issued an ominous warning about loss of revenue in the 2014 report.
“A loss in revenue will likely result in the reduction in the ability of the City to fund utility improvements deemed necessary to support additional growth,” the report states. “In the case of water and wastewater, rate increases above those approved in 2013 could make up for some or all of the loss in revenue. In the case of others, such as traffic, the loss of revenue will likely have a permanent impact by reducing funding available for future projects necessary to maintain existing and/or General Plan levels of service.”
“The Council should note that if some form of a waiver program is initiated, there are currently no known grants or other funding options on the horizon which may be available to offset losses in revenue due to further impact fee waivers,” the 2014 report concluded.
Redding City Councilwoman Julie Winters.
Which is exactly where we find ourselves in Shasta County today. I’m no expert on impact fees, so I contacted former Redding mayor Julie Winter, currently the longest serving member on the Redding city council, and asked her if she knew what impact fee program Jones was referring to. She did and provided me with the 2014 staff report on impact fee waivers used in this story.
“In 2011 the city was in a severe recession and construction was decimated,” Winter recalled. “The impact fee schedule had not been updated and the nexus between the fees and the actual impact was questioned. Lastly, there was an alternative revenue source to help pay for the fees.”
“By 2014, the situation had changed,” Winter continued. “The industry was starting to recover, and the fee structure was updated.”
Unlike Shasta County, Redding conducted a combined impact fee comparison study with similarly sized cities and found itself in the middle range, $7434 more than the lowest combined fee and $9264 less than the highest combined fee.
Winter said the city could see the grant money declining and realized lost revenue from reduced impact fees was going to “cause significant long-term restraints for the utilities and streets that needed to be fixed.”
Winter was elected to the city council in 2018 and has been through several impact fee revisions since then. She says that tinkering with the fees has become a perennial obsession for the city council. She offered this familial comparison to illustrate the issue.
“The problem is that projects do have an impact,” Winter said. “It’s like having 6 kids when you can only seat 4 in your vehicle, and you only have enough food for 2 kids. The additional kids have an impact on the rest of the family. So, unless the family has an income source to buy a new vehicle and provide food and everything else, everyone will suffer (except for the developer). Pretending that new development does not increase traffic, require new sewer lift stations, greater pump and water capacity, etc. is incredibly short-sighted.”
The Bethel elder and nurse practitioner then offered Shasta County a warning about meeting environmental requirements.
“Unless the county has designated, not just theorized, another revenue stream to pay the impact fees, then I would also question the violation of CEQA,” Winter said.
It remains to be seen if Shasta County as we know it will survive under continued MAGA rule. The cavalier elimination of new development impact fees by Jones, Crye and Kelstrom is yet another willy-nilly decision by the hyper conservative board majority that will cost the county millions in revenue down the road.
Shasta County district 4 supervisor candidate Matt Plummer.
There’s a solution to all of this, maybe. It’s called democracy. Kelstrom isn’t up for reelection until 2026, but Crye is facing a determined recall effort in the March primary and Jones is paired of against Matt Plummer, the Yale graduate, nonprofit consultant and Bethel member who’s a formidable intellectual foe. I asked Plummer to comment on the impact fee controversy.
“I agree with the intent behind suspending impact fees, which is to spur more development in the county, though I believe most of the new development in Shasta County should happen in its 3 cities rather than in the unincorporated areas, enabling us to conserve the rural beauty of our county,” Plummer said.
But he does not agree with the way the decision was made.
“More analysis should have been done before making this decision,” Plummer said. “If the analysis suggested that suspending impact fees makes financial sense for the county, the county should have implemented a temporary waiver of fees or temporary reduction in fees to fully test the fiscal impact of ending impact fees.”
Plummer reviewed some of the existing data on impact fees and came back with mixed results. Here’s a study from the conservative Brookings Institute that finds development impact fees promote economic growth. Given these mixed results, he questions the timing of the impact fee elimination, and his answers sound more like a traditional conservative Republican than a MAGA maniac like Jones.
“To responsibly manage the finances of the county, the board should focus on reducing government spending before reducing its revenue, especially at a time when we do not have enough money to build a new jail or maintain our roads,” Plummer said. “Our roads rank 7th worst in the state with an average score of 50 out of 100. By my estimates, it would cost us $95M to fix all failed and poor-condition roads. Instead, the board is increasing spending by approving a budget with a 4.8 percent increase last May.”
Plummer criticized Jones for using the city of Redding’s experiment with reducing impact fees to rationalize his vote to eliminate impact fees in the unincorporated county last week.
“Supervisor Jones’ attempt to justify the decision using his time on Redding City Council is another attempt at rewriting history, after doing the same last month to justify 18-month severance packages,” Plummer said.
A dedicated researcher, Plummer crunched the numbers and somewhat surprisingly discovered Redding’s federally funded impact fee cut did not result in a building boom as Jones and Crye claim.
“The suspension of impact fees by the city had to be backfilled by grant dollars and they did not result in a building boom, as shown by building permit data from that time, which shows that more building permits were issued in the two recession years before the fees were suspended (2009-2010) than the years following (2011-2012),” Plummer said.
Jones stands to gain at least $20,000 in eliminated impact fees for the High Plains Shooting Sports Center, his proposed 161-shooting position gun range on the Millville Plains several miles east of Palo Cedro. Millville Plains landowners adjacent to the proposed gun range have filed suit against Jones and the county in an attempt to force Jones to conduct and environmental impact report for the project.
Plummer lambasted Jones for not recusing himself from the vote to eliminate impact fees.
“Supervisor Jones shouldn’t have even been part of the discussion because he stands to benefit financially from the suspension of these fees,” Plummer said. “It is honestly shocking to me that the person who led the charge against alleged political corruption just 3 years ago is now brazenly using his office for personal benefit.”
Let’s hope a majority of district 4 voters agrees and puts Matt Plummer on the dais on March 5th.
