Huntsville Area REALTORS® Deflect Steep Increase in Impact Fees on New Housing Construction

Huntsville Area REALTORS® Deflect Steep Increase in Impact Fees on New Housing Construction

July 2020

The booming city of Madison, in northern Alabama, was facing a threat born of its own success:  strong city leadership had grown jobs by leaps and bounds, but the impact fees being considered on new housing construction threatened to price the middle class out of the American Dream of homeownership. Seeking to reduce the exorbitant fees proposed to offset the cost of city services for most new households – between $14,000 and $20,000 – the local Huntsville Area Association of REALTORS® worked to show the City Council the risks. A robust response to a Call for Action through the REALTOR® Party’s Advocacy Everywhere program drove the point home.

Because the inventory of existing homes in Madison is low, prospective homebuyers in the area are dependent on new development, explains Sean Magers, the Huntsville REALTORS®’ Director of Association Outreach. The proposed impact fees devised by a consultant hired by the city would have ranked among the highest in the nation, he says, “And, of course, that $20K fee paid by the construction company or developer would be passed on to the consumer, at which point it’s no longer $20K:  rolled into a mortgage, it could very quickly become a much higher  expense.”

In work sessions with the mayor and the City Council, the Huntsville REALTORS® demonstrated the deterrent effect such high impact fees would have on would-be homeowners.  Prior to the vote on the fees, the association sent out a Call for Action to its nearly 2,500 REALTOR® members, who responded in force. “Over the first weekend, the elected officials heard such strong opposition to the plan, that they decided to table the decision for three months.  One council member declared that he’d never received so many emails in his life.” reports Magers. Within short order, the mayor recommended that the City Council take impact fees off the table entirely, and find another way to help fund essential city services.

In fact, the Huntsville Area REALTORS® had secured an Issues Mobilization Grant, expecting to have to launch a significant public-facing campaign in conjunction with the Call for Action.  Instead, the CFA worked so effectively, says Magers, that the public awareness campaign wasn’t necessary, and the grant money was saved. “The CFA program works remarkably well,” he says.  “Not only do they win battles, they empower and energize our members to advocate for their clients and their community.

In this particular battle, he adds, the REALTORS® were never opposed to the concept of an impact fee, just the proposed amount, which enabled them to maintain a productive spirit of compromise in their talks with the City Council. He credits President Sha Jarboe with leading the effort with strong but balanced messaging that let council members know that the REALTORS® are professionals whose expertise and community-mindedness they can trust: “The members took their direction from her example, and discussions moved forward with patience and understanding on both sides.” REALTOR® leadership, from the local level on up, including the strong support they had from the state association and the valuable partnership at the national level, was their strongest asset in opposing high impact fees for new development in the city of Madison.

“The ability to get guidance based on years and years of experience, that’s a very broad safety net,” concludes Magers.  “It’s the reason you’re seeing these successes among those of us middle and smaller-sized boards who’ve learned to tap into the resources of the REALTOR® Party. This was our third time calling on the Advocacy Everywhere program in a year, God bless ‘em. I’m just glad they don’t seem to be getting tired of us!”

To learn more about how the Huntsville Area Association of REALTORS® is working to keep new housing affordable in its booming communities, contact Director of Association Outreach Sean Magers at 256-658-1331.




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