Ocean Springs Considers Impact Fees For New Homes, Businesses

Ocean Springs is considering a plan to charge developers an "impact fee" for each new home or business they build.

The special assessments are designed to help offset the cost of growth. Money collected would be used for things like police and fire protection, new parks and water service improvements. Some people say the idea makes sense, while others consider it an unnecessary tax.

New houses are appearing all around Ocean Springs. Each new home and neighborhood requires roads and drainage, police and fire protection and other city services. Impact fees are designed to cover some of those costs.

"When an area grows, there are impacts on existing infrastructure," Planning Director Donovan Scruggs said. "These fees are a 'pay as you grow' mechanism that allows the cities to get some of those costs back."

Residential developer Randy Wrigley says while impact fees might initially be assessed on the developer or builder, you can be certain that extra cost will be passed on to the home buyer or business customer.

"Actually a lot of people think the developer or builder would pay it, but the end result is that the homeowner would pay it," Wrigley said. "I realize the city is trying to create additional revenue. I think this is a very unfair tax on new residents and new businesses. And ultimately in a new business, the patrons will pay it."

Wrigley says the added property and sales taxes that come with new neighborhoods should be enough to pay the associated need for city services.

One Ocean Springs alderman who is also a contractor considers impact fees "double taxation." Danny Jalanavich says property taxes in the city are high enough.

"Ocean Springs is one of the finest places to live and we're having to pay the price for that. But it we keep taxing everybody out, pretty soon it's going to be the worst place to live."

The proposed impact fee would be about $1,700 per single family home.  The city will hold a public hearing Tuesday at 6:30 p.m. at Ocean Springs City Hall.