Effort to kill cash proffers fails for year

A comprehensive restructuring of the way localities pay for the costs of growth perhaps proved to be too comprehensive too soon.

Senate Bill 768 would have replaced cash proffers, the amount developers pay per unit to get a rezoning approved, with impact fees, an amount per unit when a building permit is approved, regardless of rezoning.

Sen. John Watkins, R-Powhatan, the sponsor of the bill, and the Home Builders Association of Virginia relied on a study by a George Mason University that concluded that the proposal would produce more money than proffers.

With some proffers topping $40,000 and the impact fees initially limited to $8,000 in Northern Virginia and $5,000 elsewhere, localities had trouble accepting that logic. The Virginia Association of Realtors and localities also were not fooled by an effort to label an increase in the grantor’s tax a “real property tax relief fee.”

Watkins got the bill through the Senate on a 21-19 vote by dropping the grantor’s tax increase and agreeing to increase the impact fees to $12,500 in Northern Virginia and $7,500 elsewhere.

Localities said they aren’t opposed to studying the issue but contended it was too much too soon. The House Rules Committee agreed yesterday and carried the bill over till next year.