Impact Fee Study - CITY OF DESTIN

Impact Fee Studyfor Transportation, Parks, Library and Police Facilities

prepared for Destin, Florida

prepared by

in association with

CRSPE, Inc. and Dr. James C. Nicholas

September 2007

Table of Contents

EXECUTIVE SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1Impact Fee Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1Impact Fee Revenue Projection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3Ordinance Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6Legal Framework . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

TRANSPORTATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10Major Transportation System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13Service Unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14Existing Level of Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18Planned Improvement Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20Cost per Service Unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24Net Cost per Service Unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27Net Cost Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

PARKS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32Service Unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33Existing Facilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35Cost per Service Unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36Net Cost per Service Unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38Net Cost Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41

LIBRARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44Service Unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44Cost per Service Unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44Net Cost per Service Unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46Net Cost Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48

POLICE PROTECTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50Service Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50Service Unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50Cost per Service Unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53Net Cost per Service Unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54Net Cost Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

APPENDIX A: ROAD INVENTORY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57

APPENDIX B: DEMOGRAPHIC DATA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59

APPENDIX C: LAND VALUATION REPORT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63

List of Tables and Figures

Table 1: CURRENT, POTENTIAL AND AVERAGE SINGLE-FAMILY FEES . . . . . . . . . . . . . . . . . 2Table 2: POTENTIAL IMPACT FEE SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3Table 3: CURRENT AND POTENTIAL REVENUE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4Table 4: DAILY TRIPS BY HOUSING TYPE AND BEDROOMS . . . . . . . . . . . . . . . . . . . . . . . . . 15Table 5: DAILY TRIPS BY DWELLING UNIT SIZE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16Table 6: TRANSPORTATION SERVICE UNIT MULTIPLIERS . . . . . . . . . . . . . . . . . . . . . . . . . . . 17Table 7: MAJOR TRANSPORTATION SYSTEM REPLACEMENT VALUE . . . . . . . . . . . . . . . . . 19Table 8: EXISTING TRANSPORTATION SERVICE UNITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19Table 9: EXISTING TRANSPORTATION COST PER SERVICE UNIT . . . . . . . . . . . . . . . . . . . . . 20Table 10: PLANNED ROADWAY IMPROVEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21Table 11: PLANNED PEDESTRIAN IMPROVEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22Table 12: PLANNED BICYCLE FACILITY IMPROVEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23Table 13: TOTAL PLANNED TRANSPORTATION IMPROVEMENT COST . . . . . . . . . . . . . . . . . 24Table 14: RESIDENTIAL/LODGING UNIT GROWTH PROJECTION, 2006-2030 . . . . . . . . . . . . . 25Table 15: NONRESIDENTIAL GROWTH PROJECTION, 2006-2030 . . . . . . . . . . . . . . . . . . . . . . 25Table 16: FUTURE TRANSPORTATION SERVICE UNITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26Table 17: TRANSPORTATION IMPROVEMENT COST PER SERVICE UNIT . . . . . . . . . . . . . . . . 26Table 18: TRANSPORTATION FACILITY DEBT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27Table 19: TRANSPORTATION DEBT CREDIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27Table 20: TRANSPORTATION NET COST PER SERVICE UNIT . . . . . . . . . . . . . . . . . . . . . . . . . 28Table 21: TRANSPORTATION NET COST SCHEDULE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29Table 22: TRANSPORTATION FEE COMPARISON . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30Table 23: POTENTIAL TRANSPORTATION IMPACT FEE REVENUE . . . . . . . . . . . . . . . . . . . . . 31Table 24: PARK EQUIVALENT DWELLING UNIT MULTIPLIERS . . . . . . . . . . . . . . . . . . . . . . . . . 34Table 25: EXISTING PARK SERVICE UNITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34Table 26: EXISTING PARK FACILITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35Table 27: UNDEVELOPED PARK LAND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36Table 28: PARK LAND VALUE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37Table 29: PARK IMPROVEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37Table 30: SPECIAL PARK FACILITY VALUE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38Table 31: PARK COST PER SERVICE UNIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38Table 32: PARK FACILITY DEBT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40Table 33: PARK DEBT CREDIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40Table 34: PARK GRANT FUNDING, 2001-2005 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40Table 35: PARK GRANT FUNDING CREDITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41Table 36: PARK NET COST PER SERVICE UNIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41Table 37: POTENTIAL PARK IMPACT FEES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42Table 38: PARK IMPACT FEE COMPARISON . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42Table 39: POTENTIAL ANNUAL PARK IMPACT FEE REVENUE . . . . . . . . . . . . . . . . . . . . . . . . . 43Table 40: ESTIMATED PEAK POPULATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44Table 41: LAND COST PER ACRE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45Table 42: EXISTING LIBRARY BUILDING COST . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45Table 43: LIBRARY COLLECTION AND EQUIPMENT COST . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46Table 44: LIBRARY CAPITAL COST PER SERVICE UNIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46Table 45: LIBRARY DEBT CREDIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47Table 46: LIBRARY NET COST PER SERVICE UNIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47Table 47: LIBRARY NET COST BY LAND USE TYPE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48Table 48: LIBRARY IMPACT FEE COMPARISON . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48Table 49: POTENTIAL ANNUAL LIBRARY IMPACT FEE REVENUE . . . . . . . . . . . . . . . . . . . . . . 49Table 50: RESIDENTIAL FUNCTIONAL POPULATION PER UNIT . . . . . . . . . . . . . . . . . . . . . . . . 51Table 51: NONRESIDENTIAL FUNCTIONAL POPULATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52Table 52: TOTAL FUNCTIONAL POPULATION, 2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53Table 53: POLICE CAPITAL COST . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

Table 54: POLICE NET COST PER SERVICE UNIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54Table 55: POLICE NET COST BY LAND USE TYPE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55Table 56: POLICE IMPACT FEE COMPARISON . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56Table 57: POTENTIAL ANNUAL POLICE IMPACT FEE REVENUE . . . . . . . . . . . . . . . . . . . . . . . 56Table 58: MAJOR ROAD INVENTORY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57Table 59: DWELLING UNITS BY TYPE, 2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59Table 60: AVERAGE HOUSEHOLD SIZE BY HOUSING TYPE, 2000 . . . . . . . . . . . . . . . . . . . . . . 59Table 61: AVERAGE HOUSEHOLD SIZE BY HOUSING TYPE AND BEDROOMS . . . . . . . . . . . 60Table 62: AVERAGE HOUSEHOLD SIZE BY UNIT SIZE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61Table 63: NONRESIDENTIAL LAND USE, 2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62

Duncan Associates13276 Research Boulevard, Suite 208, Austin, TX 78750

(512) 258-7347 x204, [email protected], www.impactfees.com

DESTIN\IMPACT FEE STUDY September 25, 2007, Page 1

EXECUTIVE SUMMARY

The purpose of this project is to assist the City of Destin in updating its existing impact fee program.This study updates the City’s impact fees based on the most appropriate methodology and most currentdata.

The project has been divided into two parts. The first part, represented by this report, provides anupdate for the City’s transportation, parks, public library and police protection impact fees. The secondpart of the project, presented in a separate report, provides an assessment of the impacts of newdevelopment on affordable housing in the City and develops a potential housing mitigation fee.

The update of the transportation impact fee changes the fee from a “roads-only” impact fee to a multi-modal impact fee that includes all modes of motorized and non-motorized transportation. A multi-modal transportation impact fee was developed to reflect the cost of expanding the system of arterialand collector roads as well as sidewalks and bicycle routes that will be required to accommodate newdevelopment. This approach was chosen since the City has decided as a matter of policy that it will notpursue widening the existing primary arterial road (US 98), and, instead, will pursue multi-modaltransportation improvements that will preserve the community’s character. The proposedtransportation impact fee methodology is based on the “improvements-driven” model, which essentiallydivides the cost of growth-related improvements required to accommodate new development expectedby the city’s projected build-out in 2030. The improvements-driven model is an appropriate approachfor cities that are nearing build-out and have planned for their ultimate facilities.

The proposed park, library and police impact fees are based on the existing level of service. In thisstudy, the level of service is measured in terms of the ratio of the replacement value of existing facilitiesto existing development. Rather than develop specific capital plans through build-out that commitimpact fee funds for specific facilities, the approach utilized in this study gives the City the flexibility toprogram impact fee funds for capital facilities and equipment incrementally as needed to serve newdevelopment. In addition, this approach gives the City flexibility to take advantage of opportunities asthey arise, such as acquiring a specific parcel of land for a park.

Impact Fee Summary

In Table 1, current fees per single-family unit assessed on new development in the city are comparedto potential fees. The current and potential fees in Destin are also compared to average impact fees inFlorida.


Table 1CURRENT, POTENTIAL AND AVERAGE SINGLE-FAMILY FEES

FacilityCurrent

Fees Potential Fees

Average FL Fees

Transportation $471 $4,377 $3,118

Parks $160 $2,196 $1,134

Library $108 $389 $213

Police $21 $37 $242

Total* $760 $6,999 $8,476 * total Florida average includes all impact fees except water and wastewaterSource: Current and potential fees for transportation, parks, library and police fromTables 22, 38, 48 and 56; average Florida fees from Duncan Associates survey, July1, 2007.

Destin’s current total impact fee for a single-family unit is less than one-tenth of average total feecharged in Florida. The updated fees calculated in this report would increase the fee to a rate that iscloser to the average of Florida jurisdictions. It should also be kept in mind that average fees chargedtoday include fees that have not been updated in years. In particular, recently-updated road impact feesin other Florida jurisdictions are significantly higher than those calculated here for Destin. For example,recently-calculated single-family road impact fees include $8,976 in Lee County, $8,060 in SarasotaCounty and $7,963 in Indian River County.

Give the magnitude of these potential increases, there may be a desire to adopt the updated fees at avery low percentage of the full net costs calculated in this report. This should be resisted, because,unless significantly greater outside or alternative funding becomes available, the result will be declininglevels of service or increased taxes. A preferable alternative to permanently adopting artificially low feeswould be to phase in the increases over a period of time.

The maximum potential fees calculated in this report for the four facilities for typical land use types arepresented in Table 2. For new dwelling units, the City has the option of charging a flat rate per dwellingunit by housing type, or charging variable rates that vary between eight dwelling unit size categories.


Table 2POTENTIAL IMPACT FEE SUMMARY

Land Use TypeUnit of

MeasurementTrans-

portation Parks Library Police Total

Flat Rate Option:Single-Family Detached Dwelling $4,377 $2,196 $389 $37 $6,999

Multi-Family Dwelling $3,068 $1,566 $277 $26 $4,937

Variable Rate Option:

Less than 500 sq. ft. Dwelling $1,882 $909 $161 $15 $2,967

500 - 749 sq. ft. Dwelling $2,337 $1,144 $203 $19 $3,703

750 - 999 sq. ft. Dwelling $2,758 $1,360 $241 $23 $4,382

1,000 - 1,499 sq. ft. Dwelling $3,278 $1,634 $290 $28 $5,230

1,500 - 1,999 sq. ft. Dwelling $3,865 $1,944 $344 $33 $6,186

2,000 - 2,999 sq. ft. Dwelling $4,596 $2,337 $414 $40 $7,387

3,000 - 3,999 sq. ft. Dwelling $5,410 $2,781 $493 $47 $8,731

4,000 sq. ft or more Dwelling $6,115 $3,167 $561 $54 $9,897

Mobile Home/RV Park Pad $2,285 $2,181 $386 $37 $4,889

Hotel/Motel Room $3,165 $1,184 $20 $4,369

Retail/Commercial 1,000 sq. ft. $5,651 $54 $5,705

Office 1,000 sq. ft. $4,530 $31 $4,561

Industrial 1,000 sq. ft. $2,863 $18 $2,881Warehouse 1,000 sq. ft. $2,040 $11 $2,051

Source: Potential fees for transportation, parks, library and police from Tables 21, 37, 47, and 55.

Impact Fee Revenue Projection

Potential impact fee revenue is difficult to project, since recent building trends do not necessarily reflectfuture building activity. Given the limited vacant land for new construction, it is uncertain if newconstruction will continue at the same pace as in recent years.

Revenue from Destin’s current impact fee schedules would average about $241,000 annually based onlong-term average new construction to build-out. If the updated fees are adopted at the full net costsidentified in this study, revenues could amount to about $644,000 annually. Most of the overall revenueincrease would come from the updated transportation impact fee; however, the park fee would have thegreatest proportionate increase.


Table 3CURRENT AND POTENTIAL REVENUE

FacilityCurrent

RevenuePotentialRevenue

PercentIncrease

Transportation $220,000 $440,000 100%

Parks $12,000 $170,000 1317%

Library $7,000 $30,000 329%

Police $2,000 $4,000 100%

Total $241,000 $644,000 167%Source: Tables 23, 39, 49 and 57.

Ordinance Issues

In addition to updating the maximum potential impact fee schedules, the Consultant has prepared draftordinance amendments to implement the study (provided separately). In particular, the impact feeordinance amendments address the following issues.

1. Cost Recovery. The fee schedules included in the draft ordinance are the full net costscalculated in this report. The City could choose to charge some percentage of the full net cost,but if this is done the fees should be reduced by the same percentage for all land uses to retainthe proportionality of the fees.

2. Phase-in Period. Florida statutes provide that notice must be given at least 90 days before theeffective date of an ordinance imposing or increasing impact fees. Many jurisdictions areimplementing this by having the new fees go into effect 90 days after adoption of the ordinance.Given the magnitude of the potential increases, the City might also want to provide someadditional phase-in provisions. For example, an initial increase equal to half of the total increasefor a single-family unit could be imposed for the first year, followed by an increase to the fullamount.

3. Grandfathering. The ordinance could exempt development that has already received certaintypes of approvals from the obligation to comply with the new fee schedule. In discussions withstaff, it was decided to recommend exempting from the new fee schedule any development forwhich a final development order has been approved or building permit issued prior to theadoption of the ordinance. Given this recommendation, no additional phase-in beyond themandatory 90-day grace period is recommended.

4 Progressive Residential Fees. This report presents the option of progressive residential feesthat vary by the size of the dwelling unit as one way to address the issue of housing affordability.The draft ordinance implements this option, although the City has the option of retaining flatrates by housing type.

5. Use of Impact Fee Funds. For the transportation impact fee, which is based on animprovements-driven methodology, the use of impact fee funds will be limited to making theplanned improvements that were utilized to calculate the impact fee. The planned roadway,pedestrian and bicycle improvements are listed in Tables 10, 11 and 12, respectively. For parks,libraries and police, the impact fee revenues may continue to be used to acquire land, add new


facilities, expand existing facilities, add amenities and purchase additional capital equipment toserve new development.

6. Annual Inflation Indexing. The draft ordinance provides for automatic annual indexing forcost inflation.

1City of Destin, The City of Destin Comprehensive Plan: 2010, Data, Inventory and Analysis, September 2004.

2There are six Florida cases that have guided the development of impact fees in the state: Contractors andBuilders Association of Pinellas County v. City of Dunedin, 329 So.2d 314 (Fla. 1976); Hollywood, Inc. v. Broward County, 431 So.2d606 (Fla. 1976); Home Builders and Contractors Association of Palm Beach County, Inc. v. Board of County Commissioners of PalmBeach County, 446 So.2d 140 (Fla. 4th DCA 1983); Seminole County v. City of Casselberry, 541 So.2d 666 (Fla. 5th DCA 1989);City of Ormond Beach v. County of Okaloosa, 535 So.2d 302 (Fla. 5th DCA 1988); and St. Johns County v. Northeast FloridaBuilders Association, 583 So. 2d 635, 637 (Fla. 1991).


INTRODUCTION

Destin claims to be the “World’s Luckiest Fishing Village,” and hasone of Florida’s largest charter fishing fleets. Situated between theGulf of Mexico and Choctawhatchee Bay, water and beachrecreation is a huge draw for tourists, seasonal residents and newpermanent residents seeking some of the best beaches along theGulf Coast. The city currently has a year-round population ofapproximately 12,000 persons. However, during the peak seasonmonths, estimated population swells to more than 44,000,according to the City’s Comprehensive Plan.1

The City of Destin is generally built-out, with few large vacant tracts of land open for new development.However, given the City’s desirable location, demand for new housing units has created in-fill andredevelopment projects, with the City adding more than 2,000 housing units since 2000. Seasonal unitsaccount for more than half of the housing units within the City. Given the relative scarcity of landwithin the City, most of the new growth has occurred through redevelopment of existing parcels.

Legal Framework

Impact fees are a way for local governments to require new developments to pay a proportionate shareof the infrastructure costs they impose on the community. In contrast to traditional “negotiated”developer exactions, impact fees are charges that are assessed on new development using a standardformula based on objective characteristics, such as the number and type of dwelling units constructed.The fees are one-time, up-front charges, with payment usually made at the time of building permitissuance. Essentially, impact fees require that each new development project pay its pro-rata share ofthe cost of new capital facilities required to serve that development.

Since impact fees were pioneered in states like Florida that lacked specific enabling legislation, such feeshave generally been legally defended as an exercise of local government’s broad “police power” toregulate land development in order to protect the health, safety and welfare of the community. Thecourts have developed guidelines for constitutionally valid impact fees, based on “rational nexus”standards.2 The standards set by court cases generally require that an impact fee meet a two-part test:

1) The fee must be proportional to the need for the new facilities by new development, and

2) The expenditure of impact fee revenues must provide benefit to the fee-paying development.

3 Hollywood, Inc. v. Broward County, 431 So. 2d 606, 611-12 (Fla. 4th DCA), review denied, 440 So. 2d 352 (Fla.1983), quoted and followed in St. Johns County v. Northeast Florida Builders Ass'n, 583 So. 2d 635, 637 (Fla. 1991).


A Florida district court of appeals described the dual rational nexus test in 1983 as follows, and thislanguage was quoted and followed by the Florida Supreme Court in its 1991 St. Johns County decision:3

In order to satisfy these requirements, the local government must demonstrate a reasonable connection,or rational nexus, between the need for additional capital facilities and the growth in populationgenerated by the subdivision. In addition, the government must show a reasonable connection, or rationalnexus, between the expenditures of the funds collected and the benefits accruing to the subdivision. Inorder to satisfy this latter requirement, the ordinance must specifically earmark the funds collected foruse in acquiring capital facilities to benefit the new residents.

Florida StatutesThe 2006 Florida Legislature passed Senate Bill 1194, which establishes certain requirements for impactfees in Florida. The bill, which became effective on June 14, 2006, created a new Section 163.31801,Florida Statutes, which reads as follows:

163.31801 Impact fees; short title; intent; definitions; ordinances levying impact fees.

(1) This section may be cited as the "Florida Impact Fee Act."

(2) The Legislature finds that impact fees are an important source of revenue for a local government touse in funding the infrastructure necessitated by new growth. The Legislature further finds that impactfees are an outgrowth of the home rule power of a local government to provide certain services within itsjurisdiction. Due to the growth of impact fee collections and local governments' reliance on impact fees,it is the intent of the Legislature to ensure that, when a county or municipality adopts an impact fee byordinance or a special district adopts an impact fee by resolution, the governing authority complies withthis section.

(3) An impact fee adopted by ordinance of a county or municipality or by resolution of a special districtmust, at minimum:

(a) Require that the calculation of the impact fee be based on the most recent and localizeddata.

(b) Provide for accounting and reporting of impact fee collections and expenditures. If a localgovernmental entity imposes an impact fee to address its infrastructure needs, the entity shallaccount for the revenues and expenditures of such impact fee in a separate accounting fund.

(c) Limit administrative charges for the collection of impact fees to actual costs.

(d) Require that notice be provided no less than 90 days before the effective date of an ordinanceor resolution imposing a new or amended impact fee.

(4) Audits of financial statements of local governmental entities and district school boards which areperformed by a certified public accountant pursuant to s. 218.39 and submitted to the Auditor General


must include an affidavit signed by the chief financial officer of the local governmental entity or districtschool board stating that the local governmental entity or district school board has complied with thissection.

Other provisions relating to impact fees are scattered about in the Florida Statutes. Section163.2517(3)(j) requires that urban infill and redevelopment area plans contain a package of financialincentives, one of which could be “lower transportation impact fees for development which encouragesmore use of public transit, pedestrian and bicycle modes of transportation.” School concurrencyprovisions in Section 163.3180(13)(e)2 state that if developers make proportionate-share mitigationcontributions, “the local government shall credit such a contribution, construction, expansion, orpayment toward any other impact fee or exaction imposed by local ordinance for the same need, on adollar-for-dollar basis at fair market value.” Transportation concurrency provisions relating tomulti-modal transportation districts provide in Section 163.3180(15)(d) that “local governments mayreduce impact fees or local access fees for development within multi-modal transportation districtsbased on the reduction of vehicle trips per household or vehicle miles of travel expected from thedevelopment pattern planned for the district.” Transportation concurrency management provisionsprovide in Section 163.3180(16)(b)2 that “proportionate fair-share mitigation shall be applied as a creditagainst impact fees to the extent that all or a portion of the proportionate fair-share mitigation is usedto address the same capital infrastructure improvements contemplated by the local government's impactfee ordinance.” The boards of independent special fire control districts are authorized to establish fireimpact fees in Section 191.009(4). Section 290.0057(1)(e) authorizes “impact fee abatement orreduction” as part of a package of incentives that must be put in place for enterprise zones.Developments of regional impact must be given credit for any capital contributions required as acondition of development approval, pursuant to Section 380.06(16). Local governments are encouragedto establish affordable housing incentive strategies, which may include the “modification of impact-feerequirements, including reduction or waiver of fees and alternative methods of fee payment foraffordable housing,” according to Section 420.9076(4)(b). Public schools are exempted from thepayment of impact fees in Section 1013.371(1)(a).

Impact Fee PrinciplesOne of the most fundamental principles of impact fees, rooted in both case law and norms of equity,is that impact fees should not charge new development for a higher level of service than is provided toexisting development. While impact fees can be based on a higher level of service than the one existingat the time of the adoption of the fees, two things are required if this is done. First, another source offunding other than impact fees must be identified and committed to fund the capacity deficiency createdby the higher level of service. Second, the impact fees must generally be reduced to ensure that newdevelopment does not pay twice for the same level of service, once through impact fees and againthrough general taxes that are used to remedy the capacity deficiency for existing development. In orderto avoid these complications, the general practice is to base the impact fees on the existing level ofservice.

A corollary principle is that new development should not have to pay more than its proportionate sharewhen multiple sources of payment are considered. As noted above, if impact fees are based on a higher-than-existing level of service, the fees should be reduced by a credit that accounts for the contributionof new development toward remedying the existing deficiencies. A similar situation arises when theexisting level of service has not been fully paid for. Outstanding debt on existing facilities that arecounted in the existing level of service will be retired, in part, by revenues generated from newdevelopment. Given that new development will pay impact fees to provide the existing level of service


for itself, the fact that new development may also be paying for the facilities that provide that level ofservice for existing development could amount to paying for more than its proportionate share.Consequently, impact fees should be reduced to account for future payments that will retire outstandingdebt on existing facilities.

The issue is less clear-cut when it comes to other types of revenue that may be used to make capacity-expanding capital improvements of the same type being funded by impact fees. Arguably, no credit iswarranted in most cases, since, while new development may contribute toward such funding, so doesexisting development, and both existing and new development benefit from the higher level of servicethat the additional funding makes possible. Impact fee studies in Florida, however, have traditionallygiven credit for the portion of dedicated revenues, such as gasoline taxes, that are used for capacity-expanding improvements. This study will provide revenue credits for these types of dedicated revenues.

Credit has also sometimes been provided for outstanding grants for capacity improvements that canreasonably be anticipated in the future. In addition to the argument presented above (i.e., grants raisethe level of service and benefit new development as well as existing development), two additionalarguments can be made against applying credit for grants. First, new development in a community doesnot directly pay for State and Federal grants in the same way they pay local gasoline and property taxes.Second, future grant funding is far more uncertain than dedicated revenue streams. On the other hand,local governments have less discretion about whether to spend grant funding on capacity-expandingcapital improvements. In this study, credit will be provided for anticipated future grant funding.

4City of Destin, Ordinance 309, S. 19.04.09 A.


TRANSPORTATION

The purpose of this section is to calculate the maximum impact fees that the City of Destin can chargefor transportation improvements. As part of this update, the transportation impact fee will be changedfrom “roads-only” to a multi-modal impact fee. The new transportation fee will include the capacity,physical improvement and funding needs of both motorized and non-motorized transportation,including pedestrian, bicycle and motorized vehicular facilities, as set forth in the multi-modalcomponents of the Transportation Element of the City’s Comprehensive Plan.

This impact fee study provides the opportunity for the City to update the transportation impact feebased on the most appropriate methodology, most recent cost estimates, current travel characteristicsand the most recent financial data and transportation funding data for the City. The current road impactfee schedule was adopted in December 2002 based on a study conducted in July 2002.

Major Transportation System

A transportation impact fee program should include a clear definition of the major transportationsystem that is to be funded with the impact fees. The City’s road impact fee ordinance defines the majorroad system as the arterial and collector road network designated by the City, County or State ofFlorida.4 For purposes of this update, the major transportation system is expanded to include bicycleand pedestrian transportation facilities located in major transportation corridors.

The City’s growth and development has created traffic flow problems that become particularly acuteduring the peak tourism months. The City has faced congestion problems along HarborBoulevard/Emerald Coast Parkway with no alternative east-west travel routes and a high percentage ofpass-through trips. Given that the city is largely developed and the negative impact on the community’scharacter that would result from widening Harbor Boulevard, the City’s Comprehensive Plan recommendsdevelopment of a transportation concurrency management system that favors multi-modal strategiessuch as bicycle, pedestrian and transit facilities that will enhance mobility and the overall capacity of thetransportation system.

The proposed transportation impact fee is designed to address the cost of expanding the system ofarterial and collector roads as well as sidewalks and bicycle routes in order to accommodate the trafficand transportation needs generated by new development. An inventory of the existing major roadnetwork was prepared as part of this update and is presented in Table 58 of Appendix A. The majorroad system is illustrated in Figure 1.


Figure 1MAJOR ROAD SYSTEM

The existing transportation inventory does not include a separate accounting of sidewalk and bicyclefacilities in the city. Most residents have reasonable access to pedestrian facilities along the City’s majorarterial and collector roads. Bicycle facilities include designated lanes that are a minium of four feet inwidth on the following roads:

• Calhoun Avenue/Cross Street (between Harbor Boulevard and Beach)• Stahlman Avenue (between Harbor Boulevard and Azalea Avenue)• Benning Avenue (between Azalea Avenue and Calhoun Avenue)• Beach Drive (between Kelly Street and Calhoun Avenue)• Main Street (between Legion Drive and Bayou Drive)

The existing bicycle and sidewalk facilities are shown in Figure 2.


Figure 2EXISTING BICYCLE AND PEDESTRIAN FACILITIES

5City of Destin, Comprehensive Plan: 2010, “Transportation Element,” Map 2-1, 2005.


Methodology

The proposed transportation impact fee methodology is based on the “improvements-driven” model.The improvements-driven approach essentially divides the cost of growth-related improvementsrequired over a fixed planning horizon by the number of new service units (e.g., average daily trips)projected to be generated by growth over the same planning horizon in order to determine a cost perservice unit. This study is based on the total new development through build-out, which is projectedto occur in 2030, and the planned transportation infrastructure necessary to serve the new development.

The improvements-driven approach must be based on sound transportation planning. The City ofDestin’s Comprehensive Plan: 2010, adopted in March 2005 and the remedial comprehensive planamendment adopted in January 2006, provide a basis for the development of an improvements-drivensystem of transportation impact fees for the City.

The transportation impact fees calculated in this report are designed to fund growth-related,capacity-expanding improvements to the major road system and bicycle and pedestrian routes in the city.The major road system includes principal arterial and urban collector roads maintained by the State andCity that were identified and modeled in the transportation element of the City’s Comprehensive Plan.5 Thebicycle and sidewalk network includes sidewalks and bikeways located along principal arterial and urbancollector roads and other corridors as identified in the Comprehensive Plan. This update does not includemass transit and ferry facilities, since such facilities do not yet exist on a scale that would warrant theirinclusion in the development of the multi-modal impact fee. The transportation impact fees can be usedto fund any capacity-expanding improvements to the major transportation system identified in thisstudy.

The multi-modal transportation impact fees represent the net costs to fund growth-relatedimprovements. The net cost is the total cost, less the amount of State, Federal and local funding fromgas tax and other dedicated sources, such as Community Redevelopment Agency (CRA) revenues,anticipated to be available to help fund those improvements.

Finally, new development should not be required to pay both for future growth-related improvementsand 1) past growth-related improvements to the major road system (by retiring outstandingtransportation bond debt) or 2) existing deficiencies on the major transportation system. The credit fordebt service will be addressed as part of the local funding credit, and the cost to remedy existingdeficiencies, if any, will be subtracted from the growth-related improvement costs in calculating thetransportation impact fee.

The recommended formula for transportation impact fees in Destin is shown in Figure 3.


Figure 3RECOMMENDED TRANSPORTATION IMPACT FEE FORMULA

Impact Fee = EDUs x NETCOST/EDU

Where:

EDUs = VMT/SINGLE-FAMILY VMT

VMT = TRIPRATE x % NEW x LENGTH

NETCOST/EDU = COST/EDU - CREDIT/EDU

COST/EDU = GROWTHCOST ÷ NEWEDUs

GROWTHCOST = COST - DEFICIENCY

Where:

SINGLE-FAMILY VMT = Relative vehicle-miles of travel generated by a typical single-familydetached dwelling unit

TRIPRATE = Average daily trip ends on a weekday (ADT) per unit of development(e.g., dwelling unit or 1,000 square feet)

%NEW = % of ADT that are primary as opposed to passby or diverted-linkedtrips

LENGTH = Ratio of average trip length for the proposed use to average single-family trip length, from national transportation data

COST = Total net cost of planned capacity-expanding improvements for roads,sidewalks and bike lanes over planning horizon, excluding portionanticipated to be funded by non-local or dedicated revenue

DEFICIENCY = The cost of remedying existing deficiencies, if applicable

NEWEDUs = Projected increase in single-family equivalent dwelling units over theplanning horizon

CREDIT/EDU = Revenue credit per EDU, if appropriate

Service Unit

In impact fee analysis, disparate types of development must be translated into a common unit ofmeasurement that reflects the impact of new development on the demand for facilities. This unit ofmeasurement is called a “service unit.” The service unit for transportation impact fees is the EquivalentDwelling Unit, or EDU, which represents the impact on the transportation system of a typical single-family detached dwelling unit. This study uses available data on vehicle travel to equate thetransportation demand of other land uses to a single-family unit. However, it should be kept in mindthat the multi-modal transportation impact fees encompass all modes of travel, not just travel in privatemotorized vehicles.

The first step in quantifying existing and future service units for the transportation impact fee is todetermine the relationship of travel demand for all land uses to average single-family travel demand.The travel demand generated by specific land use types is a product of trip generation, the share of tripgeneration that is related to new trips and average trip length.

Trip generation rates represent trip ends, or driveway crossings at the site of a land use. Thus, a singleone-way trip from home to work counts as one trip end for the residence and one trip end for the work

6 The equation is ln(y) = 0.485932 * ln(x) - 1.49359, where y is average daily trips and x is the floor area of theunit in square feet; the R2 is 0.745 and the t-statistics are 73 for the slope and -30 for the y-intercept.


place, for a total of two trip ends. To avoid over-counting, all trip rates have been divided by two. Thisplaces the burden of travel equally between the origin and destination of the trip and eliminatesdouble-charging for any particular trip.

This study gives the City the option of charging residential fees based on the size of the dwelling unit.The size of the dwelling unit is related to the number of residents, and the average number of vehicletrips generated is strongly related to the number of people living in the dwelling unit.

The average household size by housing type and number of bedrooms is available from 2000 Censusfive-percent sample data, which is presented in Appendix B. This information is combined with triprate data by household size to derive daily trip rates by the size of the unit, represented by bedrooms,as shown in Table 4.

Table 4DAILY TRIPS BY HOUSING TYPE AND BEDROOMS

Housing Type/BedroomsAvg.

HH SizeDaily Trips

Single-Family/0-2 Bedrooms 1.94 7.65

Single-Family/3 Bedrooms 2.38 9.22

Single-Family/4 Bedrooms 2.92 11.08

Single-Family/5 Bedrooms+ 3.90 13.99

Single-Family/All Sizes 2.49 9.57

Multi-Family/0-1 Bedrooms 1.33 5.18

Multi-Family/2 Bedrooms 1.65 6.45

Multi-Family/3 Bedrooms 2.32 8.94

Multi-Family/4 Bedrooms+ 3.52 12.83

Multi-Family/All Sizes 1.77 6.72 Source: Average household sizes from Table 61; daily trips derived fromTransportation Research Board, NCHRP Report 365, “Travel Estimation Techniquesfor Urban Planning,” Washington, D.C.: National Academy Press, Table 9 (for areaswith populations of 50,000 to 199,999), 1998.

To determine a relationship between dwelling unit square footage, bedrooms and trip generation, theconsultant compiled data on 735 single-family detached houses and 1,087 multi-family (condominiumand townhome) units listed for sale in Destin from the National Association of Realtors web site(www.realtor.com) on December 5, 2006. This represented a fifty percent sample of multi-family unitslisted for sale (every other page of listings) and a random sample of single-family listings so that the twotypes of housing units each comprised the same share of total cases in the MLS data base that they didof units in the 2000 census. These on-line listings give square footage and the number of bedrooms foreach unit offered for sale. A variable for daily trips was added, consisting of the data presented in Table4 above. Regression analysis was then performed to determine the relationship between unit size insquare feet and persons residing in the unit. Both linear and logarithmic regressions were performed,and the logarithmic equation was determined to provide the best explanation of the data.6


Figure 4DAILY TRIPS BY UNIT SIZE

The curve described by the equation for average daily trips by dwelling size is shown in Figure 4. Usingthe regression equation, average daily trip rates were derived for eight square footage size categories.The results are shown in Table 5.

Table 5DAILY TRIPS BY DWELLING UNIT SIZE

Dwelling Size CategoryApprox.

Midpoint Daily Trips

Less than 500 sq. ft. 400 4.13

500 - 749 sq. ft. 625 5.13

750 - 999 sq. ft. 875 6.04

1,000 - 1,499 sq. ft. 1,250 7.18

1,500 - 1,999 sq. ft. 1,750 8.46

2,000 - 2,999 sq. ft. 2,500 10.06

3,000 - 3,999 sq. ft. 3,500 11.85

4,000 sq. ft. or more 4,500 13.38 Source: Daily trips derived using the regression equation formula and themidpoints of the size categories.

Trip rates must also be adjusted by a “new trips”factor to exclude pass-by and of diverted-linkedtrips. This adjustment is intended to reduce thepossibility of over-counting additional travelinduced by a new development. Pass-by trips arethose trips that are already on a particular route fora different purpose and simply stop at adevelopment on that route. For example, a stop ata convenience store on the way home from theoffice is a pass-by trip for the convenience store.A pass-by trip does not create an additional burdenon the street system and therefore should not becounted in the assessment of impact fees. Adiverted-link trip is similar to a pass-by trip, but adiversion is made from the regular route to makean interim stop. The reduction for pass-by anddiverted-linked trips was drawn from ITE andother published information.

The next step is to calculate EDUs for all land uses based on the relative daily travel demand per single-family household. Travel demand is expressed in terms of relative vehicle-miles of travel (VMT). Therelative VMT is the product of trip generation, new trip factor and relative average trip length comparedto single-family households. The relative average trip length factor is a ratio based on national triplength data for different land uses compared to residential trip length. The relative VMT for eachdevelopment unit is then converted into EDUs by dividing by the relative VMT generated by theaverage single-family detached dwelling. The recommended transportation EDUs for Destin are shownin Table 6.


Table 6TRANSPORTATION SERVICE UNIT MULTIPLIERS

Land Use TypeITE

Code Unit1-WayTrips

NewTrips

TripLengthRatio

RelativeVMT EDUs

Flat Rate Option:Single-Family Detached 210 Dwelling 4.79 100% 1.00 4.79 1.000Multi-Family 220 Dwelling 3.36 100% 1.00 3.36 0.701

Variable Rate Option: Less than 500 sq. ft. n/a Dwelling 2.06 100% 1.00 2.06 0.430 500 - 749 sq. ft. n/a Dwelling 2.56 100% 1.00 2.56 0.534 750 - 999 sq. ft. n/a Dwelling 3.02 100% 1.00 3.02 0.630 1,000 - 1,499 sq. ft. n/a Dwelling 3.59 100% 1.00 3.59 0.749 1,500 - 1,999 sq. ft. n/a Dwelling 4.23 100% 1.00 4.23 0.883 2,000 - 2,999 sq. ft. n/a Dwelling 5.03 100% 1.00 5.03 1.050 3,000 - 3,999 sq. ft. n/a Dwelling 5.92 100% 1.00 5.92 1.236 4,000 sq. ft. or more n/a Dwelling 6.69 100% 1.00 6.69 1.397

Mobile Home/RV Park 240 Pad 2.50 100% 1.00 2.50 0.522Hotel/Motel 310/320 Room 4.51 80% 0.96 3.46 0.723COMMERCIAL/RECREATIONAL

Retail/Shopping Center 820 1000 sq. ft. 21.47 43% 0.67 6.19 1.291Discount Superstore 813 1000 sq. ft. 24.61 48% 0.67 7.91 1.652Bank, Walk-in 911 1000 sq. ft. 78.24 27% 0.34 7.18 1.499Bank, Drive-in 912 1000 sq. ft. 123.25 27% 0.34 11.31 2.362Supermarket 850 1000 sq. ft. 51.12 34% 0.67 11.65 2.431Convenience Market 853 1000 sq. ft. 422.80 16% 0.22 14.88 3.107Golf Course (open to public) 430 Acre 2.52 80% 0.96 1.94 0.404Marina 420 Berth 1.48 80% 0.96 1.14 0.237Racquet/Health Club 493 1000 sq. ft. 16.47 80% 0.96 12.65 2.641Restaurant, Fast Food 934 1000 sq. ft. 248.06 30% 0.22 16.37 3.418Restaurant, High Turnover 932 1000 sq. ft. 63.58 37% 0.67 15.76 3.290Restaurant, Sit-Down 931 1000 sq. ft. 44.98 38% 0.67 11.45 2.391Service Station 946 Fuel Pos. 76.42 14% 0.34 3.64 0.759OFFICE/INSTITUTIONAL

Office 710 1000 sq. ft. 5.51 90% 1.00 4.96 1.035Hospital 610 1000 sq. ft. 8.79 90% 1.01 7.99 1.667Nursing Home 620 1000 sq. ft. 3.05 90% 1.01 2.77 0.579Church/Synagogue 560 1000 sq. ft. 4.56 90% 0.76 3.12 0.651School (private) 520/530 1000 sq. ft. 6.85 24% 0.76 1.25 0.261Day Care Center 565 1000 sq. ft. 39.63 24% 0.76 7.23 1.509INDUSTRIAL

General Light Industrial 110 1000 sq. ft. 3.48 90% 1.00 3.13 0.654Warehouse/Storage 150 1000 sq. ft. 2.48 90% 1.00 2.23 0.466Mini-Warehouse 151 1000 sq. ft. 1.25 90% 1.00 1.13 0.235Source: “1-Way Trips” = ½ of average daily trips (ADT) during weekday from Institute of Transportation Engineers (ITE), TripGeneration, 7th ed., 2003; new trip percentages (excluding all pass-by and diverted-linked trip percentages) from ITE, Trip GenerationHandbook, March 2001;percentage for day care center and elementary school based on Preston Hitchens, “Trip Generation of DayCare Centers,” 1990 ITE Compendium; other new trip factors (80% or 90%) assumed; trip length ratio based on average trip lengthsfrom U.S. Department of Transportation, National Household Travel Survey, 2001 (“average” used for residential, office and industrialland uses; “medical/dental” for hospital and nursing home; “other social/recreational” for hotel/motel, and recreational uses;“school/church” for church, school and day care; “shopping” for retail uses, except ½ shopping trip length used for bank and servicestation and 1/3 used for convenience store and fast food restaurant).


Existing Level of Service

One of the principles of impact fees is that new development should not be charged for a higher levelof service (LOS) than is provided to existing development. Traditional road impact fees define LOSin terms of operational characteristics of individual roadway segments or intersections. The proposedmulti-modal transportation impact fee uses a different LOS measure.

The City of Destin has adopted LOS D for urban collector roads and LOS E for the principal arterialroad, which is US 98. Most of the links on US 98 are over-capacity, and there is likely constrained flowduring peak travel periods throughout the system as a result of congestion on US 98.

However, the City has decided as a matter of policy that they will not pursue widening US 98, since thatwould only temporarily ease traffic congestion, permanently exacerbate pedestrian access and alter thenature of the community. Rather than pursue capacity expansion on US 98, the City has decided topursue multi-modal transportation system improvements.

Given the City’s adoption of a multi-modal approach to transportation, a new approach was developedfor this update of the transportation impact fee in Destin. Since the capacity added by pedestrian andbicycle facilities is not directly comparable with vehicular capacity added by road improvements, theapproach utilized in this study relies on the total replacement value of existing facilities and the totalestimated cost of planned improvements. The level of service measure used in this analysis is thereplacement value of capital investment in the multi-modal transportation system per transportationservice unit. The existing system cost per service unit can then be compared to the cost of plannedimprovements needed to serve each forecast service unit in order to ensure that new development is notcharged for a higher level of service than is provided to existing development.

A summary of the major transportation system by road type and the value of the facilities is shown inTable 7. The cost data from the Florida Department of Transportation (FDOT) utilized in the valuationof existing road facilities includes costs for sidewalk construction. A separate accounting of bicyclefacilities was not necessary since most of the current bike paths are bike lanes located along the majorroads. As shown in the table, the value of the City’s existing transportation system is an estimated$123.4 million (it should be noted this estimate does not include right-of-way costs).


Table 7MAJOR TRANSPORTATION SYSTEM REPLACEMENT VALUE

Road Type Miles Cost

per Mile Total Value

6-Lane Divided 2.03 $6,162,900 $12,510,687

4-Lane Divided 5.31 $5,337,500 $28,342,125

4-Lane 0.96 $4,187,600 $4,020,096

2-Lane 19.21 $3,449,500 $66,264,895

Total Value, 2004 $111,137,803

Construction Cost Adjustment 1.11

Total Value, 2006 $123,362,961Source: Road type and miles from Table 58 in Appendix A; 2004 construction cost per mile based onFlorida Department of Transportation (FDOT), 2004 Transportation Costs, March 2005; cost adjusted byFDOT Price Trends Index (2006/2004=1.11) from 2004 Transportation Costs, p. 17.

As part of this analysis, the number of existing service units was estimated for the city based on currentland use. Existing demographic data and nonresidential development estimates are presented inAppendix B. Based on existing development and transportation EDUs per unit, the City of Destincurrently has 15,406 service units (EDUs) that are served by the existing transportation system, asshown Table 8.

Table 8EXISTING TRANSPORTATION SERVICE UNITS

Land UseITE

Code UnitEDUs/Unit

Existing Units

ExistingEDUs

Single-Family Detached* 210 Dwelling 1.000 5,163 5,163

Multi-Family 220 Dwelling 0.701 7,377 5,171

Hotel/Motel 310/320 Room 0.723 1,148 830

Commercial/Retail 820 1,000 sq. ft. 1.291 2,107 2,720

Office 710 1,000 sq. ft. 1.035 640 662

Other/Institutional 710 1,000 sq. ft. 1.035 337 349

Hospital 610 1,000 sq. ft. 1.667 17 28

Nursing Home 620 1,000 sq. ft. 0.579 56 32

Religious Institution 560 1,000 sq. ft. 0.651 174 113

School 520 1,000 sq. ft. 0.261 88 23

Industrial 130 1,000 sq. ft. 0.654 62 41

Warehouse 150 1,000 sq. ft. 0.466 588 274

Total 15,406* includes mobile home units.Source: EDUs per unit from Table 6; existing single-family and multi-family units from Table 59; hotel/motel roomsfrom Table 25; existing nonresidential units from Table 63.

The level of service related to existing development is based on the current level of infrastructureinvestment per EDU. As shown in Table 9, the value of the existing transportation system is $8,007per EDU.


Table 9EXISTING TRANSPORTATION COST PER SERVICE UNIT

Transportation System Replacement Value $123,362,961

Existing Transportation EDUs 15,406

Cost per EDU $8,007Source: Transportation system replacement value from Table 7; existingtransportation EDUs from Table 8.

Planned Improvement Costs

As part of the previous Comprehensive Plan, which was adopted in January 2005, the City proposedtransportation infrastructure investment priorities for roads, sidewalks and bicycle facilities. These weredisputed by the Florida Department of Community Affairs as not consistent with five-year CapitalImprovements Element and not financially feasible. As a result, the improvements included in thecurrent Comprehensive Plan are generalized and non-specific. As part of the impact fee analysis, plannedcapacity expanding improvements were identified and cost estimates were developed utilizing currentconstruction cost indices. These planned projects and costs will be reflected in future Comprehensive Planupdates.

The City has established two Community Redevelopment Agencies (CRAs) to refocus growth in taxrevenues generated by a specific geographic area back into the redevelopment of that area. The primaryfunding source of the CRA is tax increment financing (TIF). TIF captures increased tax revenue derivedfrom growth in the assessed values of the CRA district over the base year values. The City hasestablished two TIF districts. The first, the Town Center CRA, contains approximately 517 acres, andis located in the central area of the city. Town Center TIF projects include the Main StreetEnhancement project, road and drainage improvements and the conversion to underground utilities.The second area is the 397-acre Harbor CRA, which is located in the western side of the city and northof Destin Harbor. Harbor CRA projects include new parking garages, a boardwalk and street-scapeimprovements.

More than $40 million in capital improvements are planned for the two CRAs over the next five years.The City will issue bonds for the projects with the tax increment pledged to bond repayment.Development that occurs in the CRAs will not pay any extra taxes beyond what would be paid bydevelopment occurring outside the CRAs; instead, a portion of the CRA tax revenue is earmarked forcapital improvements to major road facilities that benefit the CRA district. The funding for theimprovements is being paid as much by development outside the CRA districts as by developmentwithin the districts, since the earmarked tax revenues must be made up by tax revenues from othersources. In order to account for the dedicated revenue source of funding that the CRA represents, theCRA-funded transportation improvements are excluded from the list of planned projects upon whichthe transportation impact fee is based.

The City of Destin has implemented a height, intensity and density bonus program with three levels, ortiers, of development criteria. Through the tier system, a developer may attain approval for projectswith added density or intensity of use by providing funding for “public benefit” improvements. TheCity’s “Tier 3” requirement allows the highest building height and density thresholds, provided thedeveloper agrees to provide facilities that have a significant public benefit. Such projects must be


consistent with the City’s Comprehensive Plan, provide value roughly proportionate to the value of theincremental increase in density or intensity of the development and implement portions of the CRAPlan, multi-modal facilities, the Capital Improvement Program or other capital projects in the City’sComprehensive Plan. The Tier 3 provisions are ultimately determined by City Council approval, and Tier3 developments will still be required to pay impact fees. In order to prevent “double payment” forimprovements, potential Tier 3 improvements are not included in the list of planned transportationimprovements utilized in developing the impact fee.

As shown in Table 10, the City has planned $27.8 million in road improvements. About $11.1 millionwould be funded with transportation impact fees. The remainder would be funded through CRA taxincrement funding or Tier 3 contributions by developers.

Table 10PLANNED ROADWAY IMPROVEMENTS

Lanes

Project From To Exist Future Cost/Mile Miles Total Cost

Widen Azalea Dr Benning Dr Stahlman Av 2 4 $3,427,014 0.70 $2,398,910

Extend Legion/Azalea Beach Dr Benning Dr 0 4 $4,648,236 0.27 $1,255,024

Extend Legion/Azalea (ROW Costs) $4,711,014

Extend Mattie Kelly Dr Road end Harbor Blvd 0 2 $3,427,014 0.34 $1,165,185

Extend Mattie Kelly Dr (ROW Costs) $1,548,558

Subtotal, Impact Fee Projects $11,078,691

Widen Airport Road Harbor Blvd Legion Dr 2 4 $3,427,014 2.80 $9,595,639

Subtotal, CRA Projects $9,595,639

New Rd (E of DWU) Airport Rd 98 Palms B lvd 0 2 $3,427,014 0.32 $1,096,644

Extend Palms Blvd Road end 98 Palms Blvd 0 2 $3,427,014 0.05 $171,351

Extend Palms Blvd (ROW Costs) $522,720

Extend 98 Palms Blvd Road end Mattie Kelly 0 2 $3,427,014 0.68 $2,330,370

Extend 98 Palms Blvd (ROW Costs) $2,979,504

Subtotal, Tier 3 Projects $7,100,589

Total, All Projects $27,774,919Source: Planned roadway capacity improvements from Renaissance Planning Group and City of Destin, November 21, 2006; costper mile based on 2004 costs adjusted by FDOT Price Trends Index to 2006 costs (1.11 factor) from Florida Department ofTransportation, 2004 Transportation Costs, March 2005; right-of-way (ROW) costs based on acres of land needed from City of DestinEngineering Department, April 18, 2007 memorandum and inland park cost per acre from Table 28.

The planned sidewalk improvements are shown in Table 11. The City has planned $1.1 million inpedestrian improvements. About half of the project costs would be funded through the transportationimpact fees. The remainder would be funded through CRA tax increment funding or Tier 3contributions by developers.


Table 11PLANNED PEDESTRIAN IMPROVEMENTS

Road From To Cost per Ft Length (Ft) Total Cost

Restaurant Row Scenic Hwy Emerald Coast Pkwy $38.05 300 $11,415

Sibert Ave Pine Kelly St $38.05 1,000 $38,050

Two Trees Rd Emerald Coast Indian Bayou Tr $38.05 2,850 $108,442

Stahlman Ave Pine St Kelly St $38.05 1,700 $64,685

Scenic Highway 98 Henderson Bch Walton Co. Line $38.05 3,500 $133,175

Main St Airport Rd Kelly St $38.05 1,750 $66,588

Hutchinson St Emerald Coast Luke Ave $38.05 150 $5,708

Gulf Shore Dr Sandpiper Cv Harbor Blvd $38.05 1,800 $68,490

Matthew Blvd John Ave Scenic Hwy 98 $38.05 750 $28,537

Subtotal, Impact Fee Projects $525,090

Calhoun Ave Harbor Blvd Zerbe St $38.05 600 $22,830

Benning Dr Harbor Blvd Legion $38.05 1,250 $47,563

Stahlman Ave Harbor Blvd Azalea $38.05 1,250 $47,563

Beach Dr Sea View Dr Legion Dr $38.05 850 $32,342

Azalea Dr Stahlman Ave CRA Boundary $38.05 1,300 $49,465

Mountain St Stahlman Ave Benning Dr $38.05 2,200 $83,710

Subtotal, CRA Projects $283,473

Azalea Dr CRA Boundary Benning Dr $38.05 3,500 $133,175

Kelly St Calhoun Ave Main St $38.05 3,500 $133,175

Subtotal, Tier 3 Projects $266,350

Total, All Projects $1,074,913Source: Planned sidewalk capacity improvements from Renaissance Planning Group and City of Destin, November 21, 2006; costper foot based on 2004 costs adjusted by FDOT Price Trends Index to 2006 costs (1.11 factor) from Florida Department ofTransportation, 2004 Transportation Costs, March 2005.

As shown in Table 12, the City has planned approximately $15.2 million in bicycle facilityimprovements. The planned projects exclude the bicycle facilities along Airport Road between HarborBoulevard and Main Street, since those facilities have already been completed. Transportation impactfees would fund approximately $4.9 million of the cost. The remainder would be funded through CRAtax increment funding or Tier 3 contributions by developers.


Table 12PLANNED BICYCLE FACILITY IMPROVEMENTS

Road From To Cost Per Ft. Length (Ft) Total Cost

Restaurant Row Scenic Hwy 98 Emerald Coast Pkwy $133.20 2,200 $293,040

Scenic Hwy 98 Emerald Coast Restaurant Row $133.20 3,100 $412,920

Sibert Ave Pine St Kelly St $133.20 2,200 $293,040

Two Trees Rd Harbor Blvd Indian Bayou Tr $133.20 5,000 $666,000

Stahlman Ave Pine St Kelly St $133.20 2,200 $293,040

Main St Airport Road Kelly St $133.20 4,000 $532,800

Hutchinson St Emerald Coast Pkwy Scenic Hwy 98 $133.20 4,200 $559,440

Beach Dr Legion Dr Kelly St $133.20 4,200 $559,440

Gulf Shore Dr Sandpiper Cove Dr Harbor Blvd $133.20 3,600 $479,520

Scenic Highway 98 Henderson Beach Walton Co. Line $133.20 6,200 $825,840

Subtotal, Impact Fee Projects $4,915,080

Sibert Ave Calhoun Ave Pine St $133.20 6,400 $852,480

Stahlman Ave Azalea Dr Pine St $133.20 3,000 $399,600

Beach Dr Harbor Blvd Legion Dr $133.20 4,100 $546,120

Azalea Dr Stahlman Ave CRA Boundary $133.20 3,800 $506,160

Mountain Dr Stahlman Ave Benning Dr $133.20 8,600 $1,145,520

Harbor Blvd (Seg A) Marler Bridge Gulf Shore Dr $133.20 22,000 $2,930,400

Harbor Blvd (Seg B) Gulf Shore Dr Scenic Hwy 98 $133.20 12,400 $1,651,680

Subtotal, CRA Projects $8,031,960

Azalea Dr CRA Boundary Benning Dr $133.20 3,600 $479,520

Kelly St Calhoun Ave Main St $133.20 13,400 $1,784,880

Subtotal, Tier 3 Projects $2,264,400

Total, All Projects $15,211,440Note: Feet are for both sides of street except for Scenic Highway 98 project, which has a multi-use pathway on just the northside of the street.Source: Planned bicycle capacity improvements from Renaissance Planning Group and City of Destin, November 21, 2006; costper foot based on 2004 costs adjusted by FDOT Price Trends Index to 2006 costs (1.11 factor) from Florida Department ofTransportation, 2004 Transportation Costs, March 2005.

In the Comprehensive Plan, the City has established a goal to develop an efficient, high quality, multi-modaltransportation system that includes both motorized and non-motorized transportation systems. Asshown in Table 13, the City has planned $44.1 million for capacity-expanding multi-modaltransportation improvements and new facilities. Of this, about $16.5 million would be funded withtransportation impact fees.

7West Florida Redional Planning Council, Okaloosa-Walton 2030 Long Range Transportation Plan, “TransportationStatistical Data Development Report,” February 2006.


Table 13TOTAL PLANNED TRANSPORTATION IMPROVEMENT COST

Facility Type Impact Fee CRA-Funded Tier 3 Total

Roads $11,078,691 $9,595,639 $7,100,589 $27,774,919

Sidewalks $525,090 $283,473 $266,350 $1,074,913

Bicycle Lanes $4,915,080 $8,031,960 $2,264,400 $15,211,440

Total $16,518,861 $17,911,072 $9,631,339 $44,061,271Source: Road cost from Table 10; sidewalk facility cost from Table 11; bicycle facility cost from Table 12.

Cost per Service Unit

To determine the cost per service unit using an improvements-driven methodology, the plannedimprovement costs are divided by the projected growth in service units over the planning horizon. Inthe previous section, the planned projects and their costs to accommodate future growth weredescribed. The next step is to determine projected service units over the planning horizon. Theplanning horizon is build-out, which is estimated to occur by about 2030.

Future service units were estimated based on population and employment growth forecasts preparedfor the long range planning process for the Okaloosa-Walton Transportation Planning Organization bythe West Florida Regional Planning Council in February, 2006.7 Future single-family units are based onexisting vacant single-family zoned lots within the City.

The population and employment forecasts for Walton County and Okaloosa County were developedbased on existing housing units and employment, land use trends and historic growth trends.Employment forecasts were developed for three employment categories – commercial, service andindustrial – utilizing standard industrial classification (SIC) codes. The West Florida Regional PlanningCouncil based hotel/motel unit growth on hospitality industry data from the Florida Department ofBusiness Regulation and the Division of Hotels and Restaurants. The growth data was dis-aggregatedinto 378 Traffic Analysis Zones (TAZs).

The single-family growth projection is based on existing vacant parcels, since the City of Destin isunable to expand its existing borders through annexation and most of the City has already been plattedfor future development. The total vacant single-family lots were tabulated based on an analysis of aerialsurveys conducted in October and November 2005. The vacant lots were adjusted to account for newpermits issued in 2005 and 2006.

In order to project growth of multi-family and hotel/motel units within the City of Destin, theconsultant isolated the TAZs associated with the city in the multi-county growth analysis. Consistentwith the densification of the city, multi-family units are projected grow at an annual rate of 0.79 percentfrom 2004 to 2010, 1.53 percent from 2010 to 2020 and 1.43 percent from 2020 to 2030. The city’sattraction for tourism is anticipated to continue to generate growth in hotel/motel development at anannual rate of 2.41 percent growth from 2004 to 2010, 2.24 percent from 2010 to 2020 and 1.88 percent


from 2020 to 2030. The existing housing and hotel/motel units and forecast growth through 2030 isshown in Table 14.

Table 14RESIDENTIAL/LODGING UNIT GROWTH PROJECTION, 2006-2030

Unit Type Current (2006) 2010 2020 2030

Single-Family Detached* 5,163 5,243 5,443 5,649

Multi-Family 7,377 7,610 8,850 10,200

Hotel/Motel Rooms 1,148 1,260 1,570 1,890* includes mobile home unitsSource: Existing single-family and multi-family units from Table 59; hotel/motel rooms from Table 25;forecast single-family growth based on City of Destin GIS survey of existing vacant single-family lotsconducted in October/November 2005 less new building permits issued in 2005 and 2006; forecastmulti-family and hotel/motel growth based on annualized growth rate for TAZs 125 to 144 and 147 to150 from West Florida Regional Planning Council, Okaloosa-Walton 2030 Long Range TransportationPlan, February 2006.

Future employment growth by sector can be utilized to forecast growth in the amount of nonresidentialsquare footage. The analysis of employment growth includes projections for industrial, commercial andservice employment. Industrial employment includes industries in Standard Industrial Classification(SIC) code categories 01 to 39; the employment in this group is not projected to grow during the periodfrom 2005 through 2030. The commercial sector, which primarily comprises retail and restaurantestablishments (SIC codes 50 to 59), is projected to stay flat through 2010, increase to annual growthof 0.68 percent from 2010 to 2020 and increase to 0.99 percent annually from 2020 to 2030. Theservice sector includes office and institutional employment (SIC codes 40 to 49 and 60 to 99). Theforecast growth for the service sector is 0.06 percent annually through 2010 and 0.70 percent annuallyfrom 2010 to 2030. Based on the forecast employment growth and existing nonresidential buildingfloor area, the forecast nonresidential development through 2030 is shown in Table 15.

Table 15NONRESIDENTIAL GROWTH PROJECTION, 2006-2030

Land UseEmployment

Type UnitCurrent(2006) 2010 2020 2030

Commercial/Retail Commercial 1,000 sq. ft. 2,107 2,107 2,255 2,488

Office Service 1,000 sq. ft. 640 642 646 651

Other/Institutional Service 1,000 sq. ft. 337 338 340 342

Hospital Service 1,000 sq. ft. 17 17 17 17

Nursing Home Service 1,000 sq. ft. 56 56 57 57

Religious Institution Service 1,000 sq. ft. 174 175 176 177

School Service 1,000 sq. ft. 88 88 89 89

Industrial Industrial 1,000 sq. ft. 62 62 62 62

Warehouse Industrial 1,000 sq. ft. 588 588 588 588Source: Existing nonresidential units from Table 62; forecast growth based on annualized employment growth rate for TAZs 125to 144 and 147 to 150 from West Florida Regional Planning Council, Okaloosa-Walton 2030 Long Range Transportation Plan, February2006.

Given these growth projections, the City will need to accommodate 3,513 additional EDUs by 2030,as shown in Table 16.


Table 16FUTURE TRANSPORTATION SERVICE UNITS

Land UseITE

CodeEDUs/Unit

Future Units

FutureEDUs

Single-Family Detached* 210 1.000 5,649 5,649

Multi-Family 220 0.701 10,200 7,150

Hotel/Motel 310/320 0.723 1,890 1,366

Commercial/Retail 820 1.291 2,488 3,212

Office 710 1.035 651 674

Other/Institutional 710 1.035 342 354

Hospital 610 1.667 17 28

Nursing Home 620 0.579 57 33

Religious Institution 560 0.651 177 115

School 520 0.261 89 23

Industrial 130 0.654 62 41

Warehouse 150 0.466 588 274

Total Future EDUs (2030) 18,919

Existing EDUs 15,406

Net New EDUs (2006-2030) 3,513Note: * Single-family includes mobile home units.Source: EDUs per unit from Table 6; future single-family, multi-family and hotel/motel units fromTable 14; future nonresidential units from Table 15; existing EDUs from Table 8.

Impact fees should not charge new development for a higher LOS than is provided to existingdevelopment. As noted earlier, this analysis uses the transportation system replacement cost per serviceunit as the LOS measure. If the existing infrastructure cost per unit is higher than the plannedimprovement cost per unit, no deficiency exists. As shown in Table 17, the cost per new EDU is $4,702based on the planned impact-fee funded transportation improvement cost and total EDUs that will beadded by 2030. Given that the transportation plan cost per additional EDU is lower than the existingtransportation system cost of $8,007 per EDU (refer to Table 9), new development will not be payingfor a higher level of service than is provided to existing development. As a result, the cost per unit ofthe planned transportation improvements will be utilized in developing the transportation impact feein accordance with the improvements-driven methodology.

Table 17TRANSPORTATION IMPROVEMENT COST PER SERVICE UNIT

Planned Impact Fee Funded Improvements $16,518,861

New EDUs (2006-2030) 3,513

Cost per New EDU $4,702Source: Planned impact fee funded transportation improvement cost fromTable 13; new EDUs from Table 16.


Net Cost per Service Unit

The transportation impact fee will need to take into account other revenues that will be generated bynew development and used for capacity-expanding road improvements. The City of Destin hasprogrammed funding for transportation projects in its five-year CIP from general fund revenue, impactfee revenue and bond proceeds. Pledged revenues for the outstanding debt include local option gas tax,electric franchise, telecommunications tax and proceeds from a local half-cent sales tax.

The City has two outstanding bonds from which proceeds were utilized for transportation-relatedimprovements. The outstanding debt includes the 1993B Capital Improvement Revenue Bonds and2002 General Obligation Bond issues. The 1993B bond was issued to fund road projects, and the 2002issue was utilized to fund a $300,000 sidewalk plan and $300,000 for the Commons Boulevard project.An additional $4,350,000 of the 2002 issue was utilized to pay off the 1993A debt issue; while theoriginal purpose of that debt cannot be determined, to be conservative, credit will be provided for thisportion of the debt as well. Based on the transportation original shares of the original bond issues, thetotal outstanding bond balance related to transportation facilities is about $5 million, as shown in Table18.

Table 18TRANSPORTATION FACILITY DEBT

Debt Issue Original IssueTrans. Proj.

FundingShare of

IssueOutstanding

BalanceCurrent

Debt

Capital Improvement Rev. Bond, 1993B $680,000 $680,000 100.0% $230,000 $230,000

Capital Improvement Rev. Bond, 2002 $9,950,000 $4,950,000 49.7% $9,615,000 $4,783,342

Total Current Transportation Debt $5,013,342Source: Current principal balance from City of Destin, Finance Director, March 22, 2006; share of original issue from FinanceDirector, February 22, 2006.

To avoid double payment issues, the transportation impact fees should be reduced to account for theamount that new development will pay to retire the debt on existing transportation facilities. A simplemethod that ensures that new development is not required to pay for existing facilities, through propertytax or other funds used for debt retirement, as well as new facilities, is to calculate the credit by dividingthe outstanding debt by existing service units. Reducing the impact fee by this amount places newdevelopment on an equal footing with existing development in terms of debt funding of pastimprovements. Based on the outstanding transportation debt, the debt credit per service unit is $325,as shown in Table 19.

Table 19TRANSPORTATION DEBT CREDIT

Total Outstanding Debt $5,013,342


Debt Credit per EDU $325Source: Total debt from Table 18; existingtransportation EDUs from Table 8.


Okaloosa County does not currently levy a local government infrastructure surtax. In September,County voters defeated a referendum that would have implemented a local surtax to help pay for roadand infrastructure improvements. The County has not previously levied a Local Option Sales Tax fortransportation projects.

The proceeds from the City’s general fund revenue are not derived exclusively from new development,and for the most part the revenue from the general fund may be spent at the City’s discretion on eitherthe rehabilitation or maintenance of existing facilities or on new or expanded facilities. Arguably, anyadditional funding beyond transportation impact fees that the City decides to commit to roadwaycapacity expansion will be paid by both existing and new development, and will raise the level of servicefor all users of the transportation system. Since new development is not being required to pay for ahigher level of service than existing development, nor is new development paying twice for the samelevel of service, a strong case can be made that no revenue credits are warranted beyond the creditprovided for outstanding debt. However, revenue credits have historically been provided for motor fueltaxes in road impact fees in Florida, and this report examines the potential applicability of such a creditfor Destin’s transportation impact fee.

The City’s capital spending plan for the next three years provides the basis for examining the potentialneed for additional revenue credits. The City does not program its share of the local option gas tax forcapacity-related transportation projects, and, instead, utilizes the gas tax funding for road repairs. Allof the capital improvements related to additional roadway capacity and the City’s corridor managementplan are funded with impact fees, general fund revenues or CRA bond issues. A credit for CRA bondissues to be refunded by TIF revenues is not necessary, since projects to be funded by CRA revenueshave already been excluded from the impact fee calculations. Consequently, no additional credit beyondthe debt credit is warranted. Reducing the cost per service unit by the transportation debt credit leavesa net cost of $4,377 per EDU, as summarized in Table 20.

Table 20TRANSPORTATION NET COST PER SERVICE UNIT

Cost per EDU $4,702

Debt Credit per EDU $325

Net Cost per EDU $4,377Source: Cost per EDU from Table 17; debt creditper EDU from Table 19.

Net Cost Schedule

In Table 21, the maximum potential transportation impact fees that can be assessed by the City ofDestin based on the data, assumptions and analysis contained in this study are shown. The net cost perunit of development by land use shown in the table is the product of the transportation service units(EDUs) generated by each land use and the net cost of planned improvements to accommodate eachnew service unit. The schedule gives the City the option of charging dwelling units using flat rates byhousing type or variable rates based on unit size.


Table 21TRANSPORTATION NET COST SCHEDULE

Land Use Type UnitEDUs/Unit

Net Cost/EDU

Net Cost/Unit

Flat Rate Option:Single-Family Detached Dwelling 1.000 $4,377 $4,377Multi-Family Dwelling 0.701 $4,377 $3,068

Variable Rate Option: Less than 500 sq. ft. Dwelling 0.430 $4,377 $1,882 500 - 749 sq. ft. Dwelling 0.534 $4,377 $2,337 750 - 999 sq. ft. Dwelling 0.630 $4,377 $2,758 1,000 - 1,499 sq. ft. Dwelling 0.749 $4,377 $3,278 1,500 - 1,999 sq. ft. Dwelling 0.883 $4,377 $3,865 2,000 - 2,999 sq. ft. Dwelling 1.050 $4,377 $4,596 3,000 - 3,999 sq. ft. Dwelling 1.236 $4,377 $5,410 4,000 sq. ft. or more Dwelling 1.397 $4,377 $6,115

Mobile Home/RV Park Pad 0.522 $4,377 $2,285Hotel/Motel Room 0.723 $4,377 $3,165Retail/CommercialShopping Center 1000 sq. ft. 1.291 $4,377 $5,651Discount Superstore 1000 sq. ft. 1.652 $4,377 $7,231Bank, Walk-in 1000 sq. ft. 1.499 $4,377 $6,561Bank, Drive-in 1000 sq. ft. 2.362 $4,377 $10,338Supermarket 1000 sq. ft. 2.431 $4,377 $10,640Convenience Market 1000 sq. ft. 3.107 $4,377 $13,599Golf Course (public) Acre 0.404 $4,377 $1,768Marina Berth 0.237 $4,377 $1,037Racquet/Health Club 1000 sq. ft. 2.641 $4,377 $11,560Restaurant, Fast Food 1000 sq. ft. 3.418 $4,377 $14,961Restaurant, High Turnover 1000 sq. ft. 3.290 $4,377 $14,400Restaurant, Sit-Down 1000 sq. ft. 2.391 $4,377 $10,465Service Station Fuel Position 0.759 $4,377 $3,322Office/InstitutionalOffice, General 1000 sq. ft. 1.035 $4,377 $4,530Hospital 1000 sq. ft. 1.667 $4,377 $7,296Nursing Home 1000 sq. ft. 0.579 $4,377 $2,534Church/Synagogue 1000 sq. ft. 0.651 $4,377 $2,849School/College (private) 1000 sq. ft. 0.261 $4,377 $1,142Day Care Center 1000 sq. ft. 1.509 $4,377 $6,605IndustrialGeneral Light Industrial 1000 sq. ft. 0.654 $4,377 $2,863Warehouse/Storage 1000 sq. ft. 0.466 $4,377 $2,040Mini-Warehouse 1000 sq. ft. 0.235 $4,377 $1,029Source: EDUs per unit from Table 6; net cost per EDU from Table 20.


The maximum transportation fees calculated in this report are compared to Destin’s existing roadimpact fees in Table 22.

Table 22TRANSPORTATION FEE COMPARISON

Land Use Type UnitCurrent City Fee

Max. City Fee % Change

Single-Family Detached Dwelling $471 $4,377 830%

Multi-Family Dwelling $577 $3,068 430%

Mobile Home/RV Park Pad $577 $2,285 300%

Hotel/Motel Room $1,365 $3,165 130%

Retail/Commercial

Retail 1000 sq. ft. $9,400 $5,651 -40%

Discount Superstore 1000 sq. ft. $13,967 $7,231 -50%

Bank, Walk-in 1000 sq. ft. $6,549 $6,561 0%

Bank, Drive-in 1000 sq. ft. $11,100 $10,338 -10%

Supermarket 1000 sq. ft. $4,832 $10,640 120%

Convenience Market w/ Gas 1000 sq. ft. $14,157 $13,599 0%

Convenience Market 1000 sq. ft. $12,355 $13,599 10%

Golf Course Acre $7,039 $1,768 -70%

Marina Berth $583 $1,037 80%

Racquet/Health Club 1000 sq. ft. $3,376 $11,560 240%

Restaurant, Fast Food 1000 sq. ft. $12,947 $14,961 20%

Restaurant, High Turnover 1000 sq. ft. $3,851 $14,400 270%

Restaurant, Sit-Down 1000 sq. ft. $8,858 $10,465 20%

Service Station Fuel Position $3,984 $3,322 -20%

Office/Institutional

Office, General 1000 sq. ft. $1,871 $4,530 140%

Hospital 1000 sq. ft. $3,305 $7,296 120%

Nursing Home 1000 sq. ft. n/a $2,534 na

Church/Synagogue 1000 sq. ft. $1,794 $2,849 60%

School/College 1000 sq. ft. n/a $1,142 na

Day Care Center 1000 sq. ft. $3,903 $6,605 70%

Industrial

General Light Industrial 1000 sq. ft. $1,030 $2,863 180%

Warehouse/Storage 1000 sq. ft. $369 $2,040 450%

Mini-warehouse 1000 sq. ft. $369 $1,029 180%Source: Maximum City fees from Table 21; current fees from City of Destin Ord. 309, Section 19.04.05: RoadImpact Fee Schedule.


While transportation fees would go up at varying rates for different land uses, most future developmentwill be classified into four general land use categories. Based on forecast residential, lodging and


nonresidential growth projections, overall impact fee revenues could increase by about 100 percent ifthe fees were adopted at the maximum levels, as shown in Table 23.

Table 23POTENTIAL TRANSPORTATION IMPACT FEE REVENUE

Land Use UnitAnnualUnits

CurrentFee

Current Revenue*

PotentialFee

Potential Revenue*

PercentIncrease

Single-Family Detached Dwelling 20 $471 $10,000 $4,377 $90,000 800%

Multi-Family Dwelling 60 $577 $30,000 $3,068 $180,000 500%

Hotel/Motel Room 30 $1,365 $40,000 $3,165 $90,000 125%

Retail/Commercial 1000 sq. ft. 15 $9,400 $140,000 $5,651 $80,000 -43%

Total Revenue $220,000 $440,000 100%* hypothetical estimates based on forecast building permits, current and potential fees and assuming no developer creditsSource: Annual units for single-family, multi-family and lodging based on forecast units from Table 14; annual retail/commercial unitsbased on City of Destin forecast nonresidential growth projections from Table 15; current and potential fees from Table 22.


Figure 5 CITY OF DESTIN PARK SITES

PARKS

The City of Destin provides year-round and seasonal residents and visitors with recreation and openspace. The City’s park network includes neighborhood and community parks, special facilities andbeach and shoreline parks. Special facilities include the Destin Community Center, the Morgan Sportscomplex and the City’s public boat launch at Joe’s Bayou Recreation Area. The locations of the City’spark sites from the Comprehensive Plan are shown in Figure 5.


The City’s adopted level of service (LOS) for parks is 2.0 acres of community parkland per 1,000residents, 1.0 acre of neighborhood parkland per 1,000 residents and one beach and shoreline accesspoint per one half-mile of shoreline. Based on the analysis in the City’s Comprehensive Plan, additionalparkland will be needed to accommodate neighborhood parks and shoreline sites, while the City hassufficient land in community parks to meet demands through year 2010. In addition, theComprehensive Plan analysis identified the need for additional tennis courts, a community swimmingpool, additional exercise trails and at least one additional basketball court. The City has started planningfor the community pool and has bond proceeds reserved for the project.

While the City has adopted LOS standards for park land and recreational facilities, and generally exceedsthe adopted LOS, there is not necessarily a close link between the formal levels of service adopted bya community in its comprehensive plan and the methodology used to calculate impact fees. Generally,impact fees are based on the existing levels of service, rather than adopted or desired levels of service.In addition, the levels of service used in calculating park impact fees generally rely on the replacementvalue of existing park land and improvements, rather than on acres, since, for example, an acre ofintensively-developed park land is not equivalent to an acre of open space or passive recreation land.This study bases the proposed park impact fees on the existing level of service, and measures that levelof service in terms of the ratio of the replacement value of existing facilities to existing residentialdevelopment expressed in service units.

Service Unit

Disparate types of development must be translated into a common unit of measurement that reflectsthe impact of new development on the demand for park facilities. This unit of measurement is calleda “service unit.” Population is the most common service unit used in park impact fee analysis.Population estimates are based on three factors: the number of dwelling units (and hotel/motel roomsfor peak season population), average household sizes for various types of units and occupancy rates.The number of dwelling units can be estimated with some degree of precision, and average householdsize has been declining somewhat predictably but has been stabilizing in recent years. Occupancy rates,on the other hand, tend to vary significantly over time, and not in predictable directions.

Consequently, this report recommends the use of a service unit that avoids the need to makeassumptions about occupancy rates. This service unit is the “equivalent dwelling unit” or EDU, whichrepresents the impact of a typical single-family dwelling. By definition, a typical single-family unitrepresents, on average, one EDU. Other types of units each represent a fraction of an EDU, based ontheir relative average household sizes.

Since the level of service for park facilities is measured in terms of population, demand for park facilitiesis proportional to the number of people in a dwelling unit. Consequently, data on average householdsize for various types of units is a critical component of a park impact fee. These data are presented andanalyzed in Appendix B and are used to develop the EDU multipliers for Destin’s park impact feeupdate. The EDUs associated with each housing type and unit size category are shown in Table 24.


Table 24PARK EQUIVALENT DWELLING UNIT MULTIPLIERSLand Use Avg HH Size EDUs/UnitFlat Rate Option:Single-Family Detached 2.486 1.000

Multi-Family 1.772 0.713


Less than 500 sq. ft. 1.028 0.414

500 - 749 sq. ft. 1.294 0.521

750 - 999 sq. ft. 1.539 0.619

1,000 - 1,499 sq. ft. 1.850 0.744

1,500 - 1,999 sq. ft. 2.201 0.885

2,000 - 2,999 sq. ft. 2.646 1.064

3,000 - 3,999 sq. ft. 3.148 1.266

4,000 sq. ft or more 3.584 1.442

Mobile Home/RV Park (pad) 2.469 0.993Hotel/Motel (room) 1.340 0.539Source: Average household size for all sizes of single-family and multi-familyunits and for mobile homes from Table 60 in Appendix B; average householdsizes by size categories from Table 62 in Appendix B; average householdsize for hotel/motel rooms is based on one-half of average vehicleoccupancy on vacation trips from U.S. Department of Transportation,Nationwide Household Travel Survey, 2001; EDUs/unit is ratio of averagehousehold size to single-family detached average household size.

In order to determine the existing level of service, it is necessary to estimate the total number of EDUsin the city. This is accomplished by multiplying the number of existing residential units by the EDUsper unit calculated earlier based on relative average household sizes. As shown in Table 25, there are11,041 park service units (EDUs) in the city.

Table 25EXISTING PARK SERVICE UNITS

Land UseExisting

Units EDUs/Unit

Total EDUs

Single-Family Detached 4,988 1.000 4,988 Multi-Family 7,377 0.713 5,260 Mobile Home/RV Park (pad) 175 0.993 174 Hotel/Motel (room) 1,148 0.539 619 Total Park EDUs 11,041 Source: Existing units from Table 59 in Appendix B; hotel/motel rooms from City ofDestin Comprehensive Plan 2010: Data, Inventory and Analysis, Table 3-32, September2004; EDUs/unit from Table 24.


Existing Facilities

As mentioned in the introduction, the updated park fees will be based on the existing level of service.Basing the fees on the existing ratio of total park replacement costs (both land and improvements) topark service units avoids the need to continually update the impact fees to reflect changing adoptedlevel-of-service standards, or changing the standards every time the fees are updated.

The amount of neighborhood and community parkland, shoreline parks and access areas andimprovements in developed City parks are summarizedin Table 26. The City leases the Morgan Sports Centersite from the City’s water utility; the land is includedhere in the park inventory since it is leased for anominal sum of $1 per year and is considered a parkasset. The land and facilities at the Destin ElementarySchool site are not included since the City did notdevelop those facilities and the City leases the propertyfrom the County School Board for community usewhen not in use by the school.

Table 26EXISTING PARK FACILITIES

ParkTotal Acres

Acres(inland)

Acres(beach)

Acres(Harbor/Bayou)

Base-ball

Basket-ball

Play-ground

Pavi-lion

Rest-room

Soccer/Fball Tennis Picnic Pier

Clement Taylor 3.65 3.65 1 2 1 14 1

Threadgill 2.06 2.06 3

Mattie Kelly 11.00 8.00 3.00 1 1 4

Buck Destin 1.65 1.65 2 1 1 1 2 1

Kell Aire Gardens 4.32 4.32

Harbor View 0.40 0.40 2

Kelly St. Duck Pond 0.20 0.20 2

Bay View St. 0.07 0.07

Indian Trail 0.68 0.68

Harbor Lane 0.14 0.14 2

Crystal Beach-Shirah 0.48 0.48

Crystal Beach Dr. 0.04 0.04

Crystal Bch.-Barracuda 0.20 0.20

Crystal Bch.-Pompano 0.10 0.10

Crystal Port 0.67 0.67

Junes Dunes 0.32 0.32

June White Decker 0.40 0.40

Silver Shells 0.20 0.20

O’Steen 0.16 0.16

Noriego Point 0.20 0.20

Main St. Park 0.75 0.75 2 1

Subtotal, Parks 27.69 16.03 6.42 5.24 3 2 2 4 3 0 2 27 2

ParkTotal Acres

Acres(inland)

Acres(beach)

Acres(Harbor/Bayou)

Base-ball

Basket-ball

Play-ground

Pavi-lion

Rest-room

Soccer/Fball Tennis Picnic Pier


Morgan Center 25.00 25.00 6 1 1 3

Community Center 4.07 4.07 2

Joe’s Bayou 2.10 2.10 *

Subtotal, Special 31.17 29.07 0.00 2.10 6 2 1 1 0 3 0 0 0

Total 58.86 45.10 6.42 7.34 9 4 3 5 3 3 2 27 2* Boat RampSource: City of Destin Recreation Department Manager, February 8 and March 1, 2006 and January 19, 2007; City of Destin Comprehensive Plan 2010:Data, Inventory and Analysis, Table 7-2, September 2004.

In addition to developed parks, the City also owns land that is undeveloped open space and landdesignated for parks but not yet developed. As summarized in Table 27, the City has about 3 acres ofundeveloped inland park land and 2 acres of undeveloped land along the bayou.

Table 27UNDEVELOPED PARK LAND

Undeveloped Park Inland Acres Bayou Acres

1st & 4th Street 0.20

4th Street Waterfront 0.92

6th Street Waterfront 0.15

Azalea Dr. 0.47

Cobbs Point 0.83

Jupiter Street 0.20

Kell-Aire Gardens North 0.03

Sandalwood 1.54

Driftwood 0.20

Twin Lakes 0.20

Total Future Parks 2.64 2.10Source: City of Destin Comprehensive Plan 2010: Data, Inventory and Analysis, Table 7-2,September 2004


Since the City of Destin’s land area is almost completely built out, park land in many areas of Destin canbe obtained only by assembling residential lots. The City’s most recent land purchases for parks werein the early 2000s. Since 2000 land values have increased rapidly, with gulf coast properties selling forthe highest price per acre and with bayou and harbor access property values slightly lower based onrecent City acquisitions. While land costs have recently moderated, the cost of acquiring new land andpursuing additional beach access points to accommodate new growth have increased well beyond thecapacity of the current impact fee schedule. Along with updating the cost of park amenities andimprovements, this update provides an opportunity to adjust the City’s existing park land in accordancewith current market values.

As part of the impact fee update, the City retained an appraiser to determine appropriate park land costsfor the fee calculations. The appraisal report is presented in Appendix C. The park land costs are based


on average land costs in Destin for five different classes of land that correspond with the types of landfound in the City’s park land inventory. To be conservative, all of the City’s park land is valued at thecost of inland property. Based on this value per acre, the total value of the City’s parkland is $41.6million, as shown in Table 28.

Table 28PARK LAND VALUE

Park Land TypeCost per

Square FootValue Per

Acre* TotalAcres Land Value

Inland $15 $653,400 45.10 $29,468,340

Inland (Undeveloped) $15 $653,400 2.64 $1,724,976

Gulf Coast $95 $653,400 6.42 $4,194,828

Bayou/Harbor $35 $653,400 7.34 $4,795,956

Bayou (Undeveloped) $35 $653,400 2.10 $1,372,140

Total $41,556,240* inland cost per acre used for all property types to be conservative.Source: Value per acre based on market land value study conducted by Humphrey and Associates,Inc. provided in Appendix C ($15 per square foot); total acres from Tables 26 and 27.

The City of Destin has invested in numerous park improvements and continues to add facilities to parksin order to provide a diverse array of outdoor recreation activities for residents and visitors. As shownin Table 29, the replacement value of the City’s recreation facilities, excluding facilities associated withthe Morgan Center and Community Center, totals about $1.7 million.

Table 29PARK IMPROVEMENTS

Improvement TypeExistingFacilities Unit Cost

ReplacementCost

Baseball 3 $120,000 $360,000

Basketball 2 $62,000 $124,000

Playground 2 $40,000 $80,000

Pavilion 4 $75,000 $300,000

Restroom 3 $200,000 $600,000

Soccer/Football Field* 0 $120,000 $0

Tennis 2 $62,000 $124,000

Picnic (tables) 27 $700 $18,900

Pier 2 $22,800 $45,600

Total Existing Facility Replacement Cost $1,652,500 * Note: Existing soccer/football field value included in cost of Morgan Sport Center in Table 30.Source: Replacement cost for baseball, basketball, soccer/football, tennis and picnic facilities from City of DestinDepartment of Recreation, February 8 and March 1, 2006 e-mail; restroom replacement cost based on 2005-06City of Destin Budget, Capital Improvement Plan; replacement cost for playground, pavilion and pier based on Cityof Destin 2005 Fixed Asset Listing, February 22, 2006; existing units, excluding special facilities, from Table 26.

In addition to more standardized park facilities, the park system includes the Morgan Center recreationalcomplex, the Destin Community Center and Joe’s Bayou Boat Ramp. Based on original constructioncosts, the total value of theses facilities is $9.1 million, as shown in Table 30.


Table 30SPECIAL PARK FACILITY VALUE

Facility Year Original CostInflation

Adjustment Total Value

Community Center 1990 $1,428,115 1.667 $2,380,668

Morgan Sports Center 2000 $3,468,458 1.680 $5,827,009

Joe’s Bayou Boat Ramp 2001 $700,000 1.244 $870,800

Total $9,078,477Source: Original construction cost and date from City of Destin, Fixed Assets, inflation adjustment based onthe change in Engineering News Record (ENR), Construction Cost Index (CCI), December 2006.

As shown in Table 31, the total replacement value of the existing park land and improvements is $52.3million. However, it may be difficult for the City to maintain the ratio of acres of land to populationgiven the high cost of land. Consequently, the cost per service unit will only include one-half of landcosts. Dividing this reduced replacement cost of existing facilities by the existing service units (orEDUs) yields a cost of $2,854 per EDU.

Table 31PARK COST PER SERVICE UNIT

Land $41,556,240

Park Improvements $1,652,500

Special Facilities $9,078,477

Total Park Cost $52,287,217

Reduced Park Cost (with One-Half Land Cost) $31,509,097

Equivalent Dwelling Units (EDUs) 11,041

Park Cost per EDU $2,854 Source: Land value from Table 28; improvement cost from Table 29;special facilities from Table 30; and EDUs from Table 25.


New development should not be required to pay for new park facilities required to serve it throughimpact fees, while also having to pay for existing park facilities through property tax or other paymentsused to retire outstanding debt. In addition, credit may be provided for that share of new park facilitiesthat will be funded through State or Federal grants or other outside funding sources.

The City has two outstanding bonds, the 1999 Florida Municipal Loan Council debt and the 2002General Obligation Bond issues, from which proceeds were utilized to fund the purchase of parklandor make improvements. The City has reserved proceeds from the 2002 Bond issue for the publicswimming pool; since the pool facility has not been constructed and is not included in the City’s parkinventory, a credit for the pool-related debt is not necessary. The share of each bond issue and theoutstanding balance related to park facilities are shown in Table 32.


Table 32PARK FACILITY DEBT

1999 Bond 2002 Bond

Original Loan Issue $7,885,000 $9,950,000

Park Facility Share of Issue $3,371,790 $1,500,000

Percent of Original Issue 42.8% 15.1%

Outstanding Loan Balance $7,240,000 $9,435,000

Total Outstanding Park Related Debt $3,098,720 $1,424,685Source: Current principal balance from City of Destin, Finance Director, March 22, 2006e-mail; share of original issue from Finance Director, February 22, 2006 e-mail.

A simple method that ensures that new development is not required to pay for existing facilities, throughproperty tax or other funds used for debt retirement, as well as new facilities through impact fees, is tocalculate the credit by dividing the outstanding debt by existing service units. Reducing the impact feeby this amount places new development on an equal footing with existing development in terms of debtfunding of past improvements. Based on the outstanding park debt related to park facilities, the debtcredit per service unit is $410, as shown in Table 33.

Table 33PARK DEBT CREDIT

1999 Florida Municipal Loan Council Bond $3,098,720

2002 General Obligation Bond $1,424,685

Total Outstanding Debt $4,523,405


Debt Credit per EDU $410Source: Total debt funding from Table 32; existing EDUs from Table 25.

As noted above, the park impact fees will be reduced to account for the likelihood that some growth-related park costs can be paid for with Federal and State grants. Over the last five years, the City hasreceived an average of $206,173 annually in grants for park improvements, as summarized in Table 34.

Table 34PARK GRANT FUNDING, 2001-2005

Type Description Year AmountState FCMP grant for Mattie Kelley park 2003 $50,000 State Florida Community Trust grant for beach frontage 2004 $840,000 Federal U.S. Department of Agriculture, Destin Community Center 2005 $50,865 Federal FRDAP, beach frontage 2006 $90,000 Total Grant Funding, 2001-2006 $1,030,865 Average Annual Grant Funding $206,173 Source: City of Destin Recreation Director, February 1, 2006 e-mail.

Based on recent funding trends, the City has been receiving $19 in annual park grant funding for eachexisting single-family unit or equivalent. Assuming that this level of funding continues, over the 20-year


typical life of most capital improvements, the City will receive grants with a present value equivalent to$248 per service unit, as shown in Table 35.

Table 35PARK GRANT FUNDING CREDITS

Annual Park Grant Funding, 2001-2006 $206,173


Annual Grant Funding per EDU $18.67

Present Value Factor (20 years @ 4.24%) 13.31

Grant Funding Credit per EDU $248Source: Annual park grant funding from Table 34; existing EDUs fromTable 25; discount rate for present value factor is the average interestrate on state and local bonds for the last three months (September toNovember, 2006) from the Federal Reserve at http://www.federalreserve.gov/releases/h15/data/Monthly.

Reducing the cost per service unit by the outstanding debt and anticipated grant funding per service unitleaves a park net cost of $2,196 per EDU, as shown in Table 36.

Table 36PARK NET COST PER SERVICE UNIT

Cost per EDU $2,854

Debt Funding Credit per EDU $410

Grant Funding Credit per EDU $248

Net Park Cost per EDU $2,196 Source: Cost per EDU from Table 31; debt funding credit from Table 33,and grant funding credit from Table 35.

Net Cost Schedule

The maximum fees that can be adopted by the City based on this study are derived by multiplying thenumber of equivalent dwelling units (EDUs) represented by each dwelling unit, mobilehome/recreational vehicle park pad site or hotel/motel room by the net cost per EDU, as shown inTable 37. The City has the option of charging residential a flat rate based on housing type or a variablerate based on dwelling unit size.


Table 37POTENTIAL PARK IMPACT FEES

Land UseEDUs/Unit

Net Cost/EDU

Net Cost/Unit

Flat Rate Option:

Single-Family Detached 1.000 $2,196 $2,196

Multi-Family 0.713 $2,196 $1,566


Less than 500 sq. ft. 0.414 $2,196 $909

500 - 749 sq. ft. 0.521 $2,196 $1,144

750 - 999 sq. ft. 0.619 $2,196 $1,360

1,000 - 1,499 sq. ft. 0.744 $2,196 $1,634

1,500 - 1,999 sq. ft. 0.885 $2,196 $1,944

2,000 - 2,999 sq. ft. 1.064 $2,196 $2,337

3,000 - 3,999 sq. ft. 1.266 $2,196 $2,781

4,000 sq. ft or more 1.442 $2,196 $3,167

Mobile Home/RV Park (pad) 0.993 $2,196 $2,181

Hotel/Motel (room) 0.539 $2,196 $1,184 Source: EDUs per unit from Table 24; net cost per EDU from Table 36.

The maximum park fees calculated in this report are compared to Destin’s existing park impact fees inTable 38.

Table 38PARK IMPACT FEE COMPARISON



Single-Family Detached Dwelling $160 $2,196 1270%

Multi-Family Dwelling $113 $1,566 1290%

Mobile Home/RV Park Pad $160 $2,181 1260%

Hotel/Motel Room $50 $1,184 2270%Source: Maximum fees from Table 37; current fees from City of Destin Ord. 309, Section 19.01.05.

Potential impact fee revenue is difficult to project, since recent building trends do not necessarily reflectfuture building activity. Given the limited vacant land for new construction, it is uncertain if newconstruction will continue at the same pace as in recent years. Based on forecast construction data, theCity might expect park impact fees adopted at the maximum rate calculated in this report to generate$0.17 million annually, as shown in Table 39.


Table 39POTENTIAL ANNUAL PARK IMPACT FEE REVENUE

Land Use Type UnitAnnual Units

Fee/Unit Annual Revenue PercentIncreaseCurrent Potential Current* Potential*

Single-Family Det. Dwelling 20 $160 $2,196 $3,000 $40,000 1233%

Multi-Family Dwelling 60 $113 $1,566 $7,000 $90,000 1186%

Hotel/Motel Room 30 $50 $1,184 $2,000 $40,000 1900%

Total $12,000 $170,000 1317%* hypothetical estimates based on forecast building permits, current and potential fees and assuming no developer creditsSource: Annual units for single-family, multi-family and lodging based on forecast units from Table 14; annual retail/commercial unitsbased on City of Destin forecast nonresidential growth projections from Table 15; current potential fees from Table 38.


LIBRARY

The City of Destin extends free information services and recreationalreading materials to City residents and provides services to the entire countypopulation along with other area libraries as part of the Okaloosa CountyPublic Library Cooperative. In 1998, the City acquired a 3.1 acre site onSibert Avenue for a new library, which was opened in March 2003.

As is the current practice, library impact fees are appropriately assessed atthe jurisdiction level and earmarked for expenditure within a single city-widebenefit district.

Service Unit

As with parks, most library impact fees are assessed only on new residential development; however,hotel/motel units are excluded, since temporary visitors who typically utilize these units do not qualifyfor free residential library services.

The common unit of measurement that reflects the impact of new development on the demand forcapital facilities is called the “service unit.” The library service unit is the peak population of the city,assuming all existing housing units are occupied. The level of service for the library fee is expressed interms of a ratio of facilities, equipment and circulation materials to peak population. As shown in Table40, the peak population for Destin is estimated to be 25,904.

Table 40ESTIMATED PEAK POPULATION

Housing TypeExisting

UnitsAvg. HH

SizeEst. Peak

Population

Single-Family 4,988 2.486 12,400

Multi-Family 7,377 1.772 13,072

Mobile Homes 175 2.469 432

Total 12,540 25,904 Source: Existing units from Table 59 in Appendix B; average householdsize from Table 60 in Appendix B.


The City’s existing library facility, equipment and collection materials are utilized to determine the costper service unit. As previously mentioned, the City is currently served through its relatively new 13,300-square foot library facility on Sibert Avenue.

The site for the library was purchased in 1998 for $320,000, which was approximately $103,000 per acre.Based on discussion with City staff regarding land cost in Destin and recent land acquisition data forparks, the value of the library site has increased significantly since 1998. The City recently purchaseda 0.69-acre parcel adjacent to the library for additional library parking at a cost of $495,000. Based on


non-coastal land cost data for parks of $653,400 per acre, the value of the library site is about $2.5million, as shown in Table 41.

Table 41LAND COST PER ACRE

Non-coastal Land Cost (per acre) $653,400

Library Site (acres) 3.79

Total Site Cost $2,476,386Source: Parcel size from Destin Library, January 23, 2006 andJanuary 19, 2007; land cost per acre based on non-coastal landacquisition cost from Table 28.

The replacement cost of the facility can be determined based on the recent construction cost data fromthe library’s construction in 2003. Groundbreaking for the facility was in December 2001, and thebuilding was completed in March 2003 for a total cost of $2.9 million including all furnishings andequipment. A portion of the new facility’s cost was offset through a $500,000 State of Florida LibraryConstruction Grant. In order to provide adequate credit for the grant, the facility’s original cost isadjusted by the amount of the grant. Based on increased construction cost since 2002, the replacementcost of the facility and related furnishings and equipment, is estimated to be $2.8 million, as shown inTable 42.

Table 42EXISTING LIBRARY BUILDING COST

Building Cost (2002) $2,854,161

State of Florida Grant $500,000

Net Building Cost (2002) $2,354,161

Construction Cost Index 1.21

Adjusted Net Building Cost $2,848,535Source: Original construction cost and grant data from DestinLibrary, January 23, 2006 e-mail; original construction costadjusted by Engineering News-Record (ENR) Construction CostIndex (CCI) (2002 to December 2006 = 1.21).

The library’s current collection materials include approximately42,500 books, CDs and DVDs. For insurance purposes, the Cityvalues all collection material items at the uniform cost of $20 apiece.In addition to the collection materials, the library provides computersfor patron use. All other equipment, such as furniture and patroncheck-out facilities, was included in the construction cost of thefacility in 2003. As shown in Table 43, the total replacement cost forall library collection materials and patron computers is $0.9 million.


Table 43LIBRARY COLLECTION AND EQUIPMENT COST

Units Cost/Unit Total Cost

Collection Materials 42,500 $20 $850,000

Patron Computers 24 $1,125 $27,000

Total Replacement Cost $877,000Source: Collection material replacement cost and units from Destin Library, January 23, 2006;computer replacement cost and units from City of Destin Fixed Asset Listing, February 22, 2006.

The capital cost per person is calculated by dividing the total replacement cost of existing capitalfacilities by total existing peak residential population. As shown in Table 44, that cost is $239 perperson.

Table 44LIBRARY CAPITAL COST PER SERVICE UNIT

Library Land $2,476,386

Library Building and Furnishing $2,848,535

Collection Materials and Equipment $877,000

Total Library Replacement Cost $6,201,921

Total Peak Population, 2006 25,904

Cost per Service Unit $239.42Source: Library land cost from 41; building and furnishing replacementcost from Table 42; collection materials and equipment from Table 43;total 2005 peak population from Table 40.


New development should not be required to pay for new library facilities required to serve it throughimpact fees, while also having to pay for existing library facilities through property tax or other paymentsused to retire outstanding debt. Of the three outstanding general obligation bonds, only the 1999Florida Municipal Loan Council debt was issued for library facilities.

The original 1999 bond was issued for $7,885,000, of which approximately $2,293,600 was utilized topay for construction of the new library building. A simple method that ensures that new developmentis not required to pay for existing facilities, through property tax or other funds used for debt retirement,as well as new facilities through impact fees, is to calculate the credit by dividing the outstanding debtby existing service units. Reducing the impact fee by this amount places new development on an equalfooting with existing development in terms of debt funding of past improvements. Based on theoriginal share of the 1999 debt issue and the outstanding bond balance, the debt credit is $82.91 perservice unit based on the peak population, as shown in Table 45.


Table 45LIBRARY DEBT CREDIT

1999 Florida Municipal Loan Issue $7,885,000

New Library Share of Issue $2,293,588

Percent of Original Issue 29.1%

Outstanding Loan Balance (September 2004) $7,380,000

Current Library Debt $2,147,580

Peak Population 25,904

Debt Credit per Service Unit $82.91Source: Original issue and current outstanding loan balance from City ofDestin, Comprehensive Annual Financial Report, pp. 33 - 37, September 30,2004; share of original issue from City of Destin, Finance Director, February22, 2006 e-mail; peak population from 40.

Reducing the cost per service unit by the appropriate debt credit leaves a library net cost of $157 perservice unit, as shown in Table 46.

Table 46LIBRARY NET COST PER SERVICE UNIT

Cost per Service Unit $239.42

Debt Credit per Service Unit $82.91

Net Cost per Service Unit $156.51 Source: Cost per service unit from Table 44; debt funding credit fromTable 45.


Net Cost Schedule

The maximum impact fees that the City can charge for library facilities needed to accommodate newdevelopment are shown in Table 47. The maximum fee is the product of the average household sizefor each type of residential building classification (see Appendix B) times the net cost per service unit.The City can choose whether to charge dwelling units a flat rate by housing type, or with variable ratesby dwelling unit size.

Table 47LIBRARY NET COST BY LAND USE TYPE


MeasurementPersons/

UnitNet Cost/

PersonNet Cost/

Unit

Flat Rate Option:

Single-Family Detached Dwelling 2.486 $156.51 $389

Multi-Family Dwelling 1.772 $156.51 $277


Less than 500 sq. ft. Dwelling 1.028 $156.51 $161

500 - 749 sq. ft. Dwelling 1.294 $156.51 $203

750 - 999 sq. ft. Dwelling 1.539 $156.51 $241

1,000 - 1,499 sq. ft. Dwelling 1.850 $156.51 $290

1,500 - 1,999 sq. ft. Dwelling 2.201 $156.51 $344

2,000 - 2,999 sq. ft. Dwelling 2.646 $156.51 $414

3,000 - 3,999 sq. ft. Dwelling 3.148 $156.51 $493

4,000 sq. ft or more Dwelling 3.584 $156.51 $561

Mobile Home/RV Park Pad 2.469 $156.51 $386Source: Persons per unit from Tables 60 and 62 from Appendix B; net cost per service unit from Table 46.

The maximum library fees calculated in this report are compared to Destin’s existing impact fees inTable 48.

Table 48LIBRARY IMPACT FEE COMPARISON



Single-Family Detached Dwelling $108 $389 260%

Multi-Family Dwelling $76 $277 260%

Mobile Home/RV Park Pad $108 $386 260%Source: Maximum fees from Table 47; current fees from City of Destin Ord. 309, Section 19.02.05.



Based on forecast construction, the City might expect library impact fees adopted at the maximum ratecalculated in this report to generate $30,000 annually, as shown in Table 49.

Table 49POTENTIAL ANNUAL LIBRARY IMPACT FEE REVENUE



Single-Family Det. Dwelling 20 $108 $389 $2,000 $10,000 400%

Multi-Family Dwelling 60 $76 $277 $5,000 $20,000 300%

Total $7,000 $30,000 329%* hypothetical estimates based on forecast building permits, current and potential fees and assuming no developer creditsSource: Annual units for single-family, multi-family and lodging based on forecast units from Table 14; annual retail/commercial unitsbased on City of Destin forecast nonresidential growth projections from Table 15; current and potential fees from Table 48.


POLICE PROTECTION

The Okaloosa County Sheriff’s Office provides law enforcement services to the City of Destin througha service agreement. Under the current contract, the Sheriff provides the City with thirteen patrolofficers, one investigator, one clerical staff, one marine patrol officer and two beach patrol officers. Inaddition, the Sheriff provides the City with four additional deputy sheriff positions specifically allocatedto the “Destin District” substation located on Stahlman Avenue in Destin. The deputies located in theDestin substation provide services within the corporate city limits in specially identified patrol units. TheCity owns the Stahlman Avenue facility and leases it to the Sheriff’s office as part of the serviceagreement for the nominal sum of $1 per year.

As part of the agreement, the City pays the Sheriff’s Office annually for the law enforcement service.For the period between October 1, 2005 through September 30, 2006, the City will pay approximately$1.3 million to the County. Included in the most recent contract are payroll expenses, two new vehicles,costs associated with monthly detail traffic enforcement units and other costs such as insurance, vehiclerepair and maintenance.

Service Area

The current police fee is slightly different for certain land uses in the U.S. 98 corridor compared to otherparts of the city. However, police impact fees are typically based on a jurisdiction-wide service area. TheCity of Destin has only one substation utilized by the County Sheriff’s Office as a base for the City’s lawenforcement patrols. In addition, the available data does not provide a basis upon which to charge ahigher fee for police services along the U.S. 98 corridor. For these reasons, it is recommended that theCity’s entire incorporated jurisdiction should be designated as a single-service area for police impact feesand that the fee be calculated based upon the jurisdiction-wide level of service and earmarked forexpenditure within a single city-wide benefit district.

Service Unit

To calculate police impact fees, the demand on the police response system associated with different typesof development must be expressed in a common unit of measurement, called a “service unit.” Serviceunits create the link between the supply of police capital facilities and the demand for such facilitiesgenerated by new development.

The two most common methodologies used in calculating police impact fees are the “calls-for-service”approach and the “functional population” approach. The calls-for-service approach uses historical dataon police calls by land use type to make the connection between land use type and demand for policefacilities. However, since the available call data records do not include identifiable information for landuses, an alternative approach is required.

The approach that will be used in this study to estimate the service demands for law enforcement servicesis known in impact fee literature as “functional population.” This approach is based on the assumptionthat demand for these types of facilities is generally proportional to the presence of people. Thefunctional population concept is analogous to the concept of “full-time equivalent” employees. Itrepresents the number of “full-time equivalent” people present at the site of a land use.


The residential functional population is considerably simpler than the nonresidential component. It isassumed that people spend 12 hours per day at home during week days and 20 hours per day duringweekends. In total, people are assumed to spend 100 hours per week, or 60 percent of their time, athome. The other 40 percent of their time spent away from home accounts for working, shopping andother away-from-home activities. For residential uses, then, functional population is calculated bymultiplying average household size by 60 percent. The functional population for single-family, multi-family and mobile home units and hotel/motel rooms is shown in Table 50. For dwelling units, the Citywill have the option of charging a flat rate based on housing type, or a variable rate based on unit size.

Table 50RESIDENTIAL FUNCTIONAL POPULATION PER UNIT

Housing TypeUnit of

Measurement

PersonsperUnit

OccupancyFactor

FunctionalPopulation/

Unit

Flat Rate Option:

Single-Family Detached Dwelling 2.486 60% 1.492

Multi-Family Dwelling 1.772 60% 1.063


Less than 500 sq. ft. Dwelling 1.028 60% 0.617

500 - 749 sq. ft. Dwelling 1.294 60% 0.776

750 - 999 sq. ft. Dwelling 1.539 60% 0.923

1,000 - 1,499 sq. ft. Dwelling 1.850 60% 1.110

1,500 - 1,999 sq. ft. Dwelling 2.201 60% 1.321

2,000 - 2,999 sq. ft. Dwelling 2.646 60% 1.588

3,000 - 3,999 sq. ft. Dwelling 3.148 60% 1.889

4,000 sq. ft or more Dwelling 3.584 60% 2.150

Mobile Home Pad 2.469 60% 1.481

Hotel/Motel Room 1.340 60% 0.804Source: Persons per unit from Table 60, except for hotel/motel rooms, which is one-half of average vehicleoccupancy on vacation trips from U.S. Department of Transportation, Nationwide Household Travel Survey,2001.

The functional population methodology for nonresidential uses is based on national trip generation datacompiled by the Institute of Transportation Engineers (ITE). Functional population per 1,000 squarefeet is derived by dividing the total number of hours spent by employees and visitors during a day by 24hours. Employees are assumed to spend eight hours per day at their place of employment, and visitorsare assumed to spend one-half to one hour per visit, depending on the land use. The formula used toderive the nonresidential functional population estimates is summarized in Figure 6.


Functional population/1000 sf = (employee hours/1000 sf + visitor hours/1000 sf) ÷ 24 hours/day

Where:

Employee hours/1000 sf = employees/1000 sf x hrs/day

Visitor hours/1000 sf = visitors/1000 sf x 1 hour/visit (½ hour for industrial/warehouse)

Visitors/1000 sf = weekday ADT/1000 sf x avg. vehicle occupancy - employees/1000 sf

Weekday ADT/1000 sf = one-way average daily trips (total trip ends ÷ 2)

Figure 6FUNCTIONAL POPULATION FORMULA

Using this formula and information on trip generation rates from the ITE manual, nonresidentialfunctional population estimates per 1,000 square feet of gross floor area were calculated. Table 51presents the results of these calculations for major land use categories.

Table 51NONRESIDENTIAL FUNCTIONAL POPULATION

Land UseUnit of

MeasurementTrip Rate

Persons/Trip

Empl./Unit

Visitors/Unit

Func.Pop.

Shopping Center/General Retail 1,000 sq. ft. 21.47 1.80 1.96 36.69 2.182

Office 1,000 sq. ft. 5.51 1.14 3.31 2.97 1.227

Industrial 1,000 sq. ft. 3.48 1.14 2.08 1.89 0.733

Warehouse 1,000 sq. ft. 2.48 1.14 1.28 1.55 0.459

Church/Synagogue 1,000 sq. ft. 4.56 1.74 0.52 7.41 0.482

Elementary/Secondary School 1,000 sq. ft. 6.85 1.74 0.79 11.13 0.727

Hospital 1,000 sq. ft. 8.79 1.63 4.66 9.67 1.956

Nursing Home 1,000 sq. ft. 3.05 1.63 2.61 2.36 0.968

Source: Trip rates are one-half average daily trip ends from Institute of Transportation Engineers, Trip Generation, 7th Edition, 2003;persons per trip are average vehicle occupancies from US. Department of Transportation, National Household Travel Survey, 2001for following trip purposes: “shopping” for retail, “to work” for office, industrial and warehouse, “school/church” for church andschool, “medical/dental” for hospital and nursing home; employees per 1,000 sq. ft. derived from trip rates per employee from ITEmanual (retail employees per 1,000 sq. ft. from National Association of Office and Industrial Parks, Americas Future Office SpaceNeeds, 1990 p. 22); visitors/unit and functional population calculated based on formula in Figure 6.

Total functional population for the city can be determined based on existing land use data and functionalpopulation ratios for various land use categories. Destin’s current functional population is estimated inTable 52.


Table 52TOTAL FUNCTIONAL POPULATION, 2006


Measurement2006 Units

Func. Pop./Unit

Total Func. Pop.

Single-Family Detached Dwelling 4,988 1.492 7,442

Multi-Family Dwelling 7,377 1.063 7,842

Mobile Home Dwelling 175 1.481 259

Hotel/Motel Room 1,148 0.804 923

Retail/Commercial 1,000 sq. ft. 2,107 2.182 4,597

Office 1,000 sq. ft. 640 1.227 785

Industrial 1,000 sq. ft. 62 0.733 45

Warehouse 1,000 sq. ft. 588 0.459 270

Church/Synagogue 1,000 sq. ft. 174 0.482 84

School/College 1,000 sq. ft. 88 0.727 64

Hospital 1,000 sq. ft. 17 1.956 33

Nursing Home 1,000 sq. ft. 56 0.968 54

Other Institutional* 1,000 sq. ft. 337 1.227 413

Total Functional Population, 2006 22,811 * uses functional population per unit for officeSource: Existing dwelling units from Table 59; hotel/motel units from Table 25; nonresidential units based square feetfor nonresidential buildings from Table 63; functional population/unit from Tables 50 and 51.


Police protection impact fees are designed to charge new development the cost of providing the samelevel of service that is provided to existing development. The existing level of service for police facilitiesis based on the replacement cost of existing facilities provided by the City of Destin for use by theOkaloosa County Sheriff’s Office specifically for law enforcement duties within the corporate limits.

The Sheriff’s Office currently operates out of a City-owned facility on Stahlman Avenue. As discussedin the introduction, the City provides this facility to the Sheriff’s Office for $1 per year as part of theservice agreement. The 6,000 square foot building is valued at $458,250 based on the City’s 2005insurance listing.

While the City does not own police vehicles, the vehicles used at the Destin substation for use within theCity are purchased by the County with impact fee funds provided by the City of Destin for vehiclepurchase as specified in the service agreement. These vehicles are provided for exclusive use within theCity and are marked “Destin District” to distinguish them from other Sheriff’s Office vehicles. Aspreviously discussed, the current service agreement included $55,000 for the purchase of two patrolvehicles. As part of the new vehicle purchase, the Sheriff transfers ownership of the vehicles that arereplaced by the new patrol cars back to the City for disposal or other City use. There are currently four“Destin District” police patrol vehicles in use by the Sheriff’s Office that have been purchased with Cityfunds.


The only other asset owned by the City for use in law enforcement activity is a generator that wasacquired through a grant in 2002. Since the generator was acquired through a grant, it is not includedin the total asset inventory for determining the impact fee. All other law enforcement related assets suchas communications equipment and weapons are provided by the Sheriff’s Office and not included in thecalculation of the impact fee. As shown in Table 53, the total replacement cost of law enforcementcapital items provided by the City is $568,250.

Table 53POLICE CAPITAL COST

Police Station/Facility Cost $458,250

Vehicle Cost (4 vehicles @ $27,500 each) $110,000

Total Police Capital Cost $568,250Source: Police station cost from Preferred Governmental Insurance Trust,City of Destin Schedule of Values, July 2005; vehicle cost and inventoryfrom 2005-06 Law Enforcement Agreement.


The City does not have any outstanding debt related to the law enforcement functions included in thecost of determining the police impact fee. As a result, the capital cost per functional population iscalculated by dividing the total replacement cost of the existing City-owned facility and patrol carspurchased with City funds for use by the Sheriff’s Office in its law enforcement duties with Destin bythe functional population. As shown in Table 54, the net police cost per functional population is $24.91based on the value of facilities and vehicles provided by the City to the Sheriff’s Office for exclusive usein Destin.

Table 54POLICE NET COST PER SERVICE UNIT

Total Police Capital Cost $568,250

Functional Population 22,811

Net Cost per Functional Population $24.91 Source: Total police capital cost from Table 53; functional population fromTable 52.

Net Cost Schedule

The maximum impact fees that the City can charge for police facilities needed to accommodate newdevelopment based on the data, assumptions and analysis in this study are shown in Table 55. Themaximum fee is the product of the functional population associated with each development unit (seeTable 52) times the net cost per functional population. The City can choose whether to charge residentialunits on a flat rate by housing type, or with variable rates by dwelling unit size.


Table 55POLICE NET COST BY LAND USE TYPE


Measurement

Functional Population/

Unit

Net Cost/ Functional Population

Net Cost/ Unit

Flat Rate Option:Single-Family Detached Dwelling 1.49 $24.91 $37Multi-Family Dwelling 1.06 $24.91 $26


Less than 500 sq. ft. Dwelling 0.62 $24.91 $15

500 - 749 sq. ft. Dwelling 0.78 $24.91 $19

750 - 999 sq. ft. Dwelling 0.92 $24.91 $23

1,000 - 1,499 sq. ft. Dwelling 1.11 $24.91 $28

1,500 - 1,999 sq. ft. Dwelling 1.32 $24.91 $33

2,000 - 2,999 sq. ft. Dwelling 1.59 $24.91 $40

3,000 - 3,999 sq. ft. Dwelling 1.89 $24.91 $47

4,000 sq. ft or more Dwelling 2.15 $24.91 $54

Mobile Home/RV Park Pad 1.48 $24.91 $37Hotel/Motel Room 0.80 $24.91 $20

Retail/Commercial 1,000 sq. ft. 2.18 $24.91 $54Office 1,000 sq. ft. 1.23 $24.91 $31Industrial 1,000 sq. ft. 0.73 $24.91 $18Warehouse 1,000 sq. ft. 0.46 $24.91 $11

Church/Synagogue 1,000 sq. ft. 0.48 $24.91 $12

School/College 1,000 sq. ft. 0.73 $24.91 $18

Hospital 1,000 sq. ft. 1.96 $24.91 $49

Nursing Home 1,000 sq. ft. 0.97 $24.91 $24

Other Institutional 1,000 sq. ft. 1.23 $24.91 $31Source: Functional population per unit from Tables 50 and 51; net cost per functional population from Table 54.


The maximum police protection fees calculated in this report are compared to Destin’s existing impactfees in Table 56.

Table 56POLICE IMPACT FEE COMPARISON



Single-Family Detached Dwelling $21 $37 80%

Multi-Family Dwelling $15 $26 70%

Mobile Home/RV Park Pad n/a $37 n/a

Hotel/Motel Room $13 $20 50%

Retail/Commercial 1000 sq. ft. $48 $54 10%Office 1000 sq. ft. $25 $31 20%Industrial 1000 sq. ft. $6 $18 200%Warehouse 1000 sq. ft. $6 $11 80%

Church/Synagogue 1000 sq. ft. n/a $12 n/a

School/College 1000 sq. ft. n/a $18 n/a

Hospital 1000 sq. ft. n/a $49 n/a

Nursing Home 1000 sq. ft. n/a $24 n/a

Other Institutional 1000 sq. ft. n/a $31 n/a

Source: Maximum fees from Table 55; current fees from City of Destin Ord. 309, Section 19.03.05.

Potential impact fee revenue is difficult to project, since recent building trends do not necessarily reflectfuture building activity. Given the limited vacant land for new construction, it is uncertain if newconstruction will continue at the same pace as in recent years. Based on forecast annual constructiondata, the City might expect police impact fees adopted at the maximum rate calculated in this report togenerate $3,700 annually, as shown in Table 57.

Table 57POTENTIAL ANNUAL POLICE IMPACT FEE REVENUE



Single-Family Avg. Dwelling 20 $21 $37 $400 $700 75%

Multi-Family Dwelling 60 $15 $26 $900 $1,600 78%

Hotel/Motel Room 30 $13 $20 $400 $600 50%

Retail/Commercial 1000 sq. ft. 15 $48 $54 $700 $800 14%

Total $2,400 $3,700 54%* hypothetical estimates based on forecast building permits, current and potential fees and assuming no developer creditsSource: Annual units for single-family, multi-family and lodging based on forecast units from Table 14; annual retail/commercial unitsbased on City of Destin forecast nonresidential growth projections from Table 15; current and potential fees from Table 56.


APPENDIX A: ROAD INVENTORY

Table 58MAJOR ROAD INVENTORY

Roadway From To Class Ln Mi.

Harbor Blvd Matthew Blvd Danny Wuerffel Wy Arterial 6D 0.28

Harbor Blvd Danny Wuerffel Wy Walton Co Line Arterial 6D 1.75

Subtotal, 6-Lane Divided 2.03

Harbor Blvd Marler Brdge Stahlman Ave Arterial 4D 0.37

Harbor Blvd Stahlman Ave Benning Dr Arterial 4D 0.91

Harbor Blvd Benning Dr Beach Dr Arterial 4D 0.35

Harbor Blvd Beach Dr Main St Arterial 4D 0.42

Harbor Blvd Main St Gulf Shore Dr Arterial 4D 0.20

Harbor Blvd Gulf Shore Dr Airport Rd Arterial 4D 0.94

Harbor Blvd Airport Rd Scenic Hwy 98 Arterial 4D 0.27

Harbor Blvd Scenic Hwy 98 Henderson Bch Rd Arterial 4D 0.77

Harbor Blvd Henderson Bch Rd Triumph Dr Arterial 4D 0.45

Harbor Blvd Triumph Dr Matthew Blvd Arterial 4D 0.63

Subtotal, 4-Lane Divided 5.31

Gulf Shore Dr Harbor Blvd Curve Collector 4 0.43

Main St Harbor Blvd Airport Rd Collector 4 0.53

Subtotal, 4-Lane 0.96

Scenic Highway 98 Matthew Blvd Danny Wuerffel Way Arterial 2D 0.27

Scenic Highway 98 Danny Wuerffel Way Walton Co Line Arterial 2D 1.78

Commons Dr Henderson Bch Rd Home Depot Collector 2D 0.29

Commons Dr Home Depot Matthew Dr Collector 2D 0.91

Airport Rd Harbor Blvd Indian Bayou Trl Collector 2 0.26

Airport Rd Indian Bayou Trl Main St Collector 2 1.39

Azalea Dr Stahlman Ave Benning Dr Collector 2 0.71

Beach Dr Harbor Blvd Kelly St Collector 2 0.80

Benning Dr Harbor Blvd Kelly St Collector 2 0.70

Calhoun Ave Harbor Blvd Kelly St Collector 2 0.89

Crystal Bch Dr Scenic Hwy 98 Hwy 98 Collector 2 0.52

Dolphin St Scenic Hwy 98 Luke Ave Collector 2 0.22

Henderson Bch Rd Two Trees Eop Collector 2 1.49

Hutchinson St Emerald Coast Pkwy Scenic Hwy 98 Collector 2 0.45

Indian Bayou Tr Airport Rd Two Trees Collector 2 0.22

Indian Bayou Tr Two Trees Country Club Collector 2 0.25

Indian Trl Main St Deerfield Dr Collector 2 1.36

Kelly St Calhoun Ave Stahlam Ave Collector 2 0.25

Kelly St Stahlman Ave Main St Collector 2 1.03

Legion Dr Main St Beach Dr Collector 2 0.43

Roadway From To Class Ln Mi.


Luke Ave Dolphin St Regatta Bay Rd Collector 2 0.03

Main St Airport Rd Kelly St Collector 2 0.39

Matthew Blvd Harbor Blvd Scenic Hwy 98 Collector 2 0.39

Mountain Dr Stahlman Ave Benning Dr Collector 2 0.83

Regatta Bay Rd Luke Ave Hwy 98 Collector 2 0.30

Restaurant Row Scenic Hwy 98 Harbour Blvd Collector 2 0.22

Scenic Hwy 98 Hwy 98 Restaurant Row Collector 2 0.13

Sibert Ave Calhoun Ave Kelly St Collector 2 0.82

Stahlman Ave Harbor Blvd Kelly St Collector 2 0.76

Two Trees Emerald Coast Pakwy Indian Bayou Trail Collector 2 0.44

Main St Kelly St Indian Trl Collector 2 0.68

Subtotal, 2-Lane 19.21

Total Lane-Miles 27.51Source: CRSPE, Inc., 2005.


APPENDIX B: DEMOGRAPHIC DATA

For the impact fee analysis, it is important to know both the existing amount of residential developmentand the number of residents associated with each dwelling unit. The first step is to compile an estimateof existing dwelling units by type in Destin. This is done by combining 2000 Census counts of housingunits with building permit data on the number of dwelling units constructed since the censusenumeration, as shown in Table 59.

Table 59DWELLING UNITS BY TYPE, 2006

Housing Type2000

Census 2000-05Permits

EstimatedUnits

Single-Family Detached 4,053 935 4,988

Multi-Family 6,269 1,108 7,377

Mobile Home 175 0 175

Total 10,497 2,043 12,540 Source: 2000 dwelling units from U.S. census; new units from City building permitrecords through December 15, 2005.

An important input into the impact fee calculations is the number of persons associated with dwellingunits of various housing types. These residential multipliers will be used in developing the impact feesfor parks and recreational facilities, which are assessed solely on residential development. The bestavailable data source on average household size in Destin is the 2000 U.S. Census. As shown in Table60 below, average household size varies significantly by housing type, ranging from 1.77 persons permulti-family unit to 2.486 persons per single-family detached unit.

Table 60AVERAGE HOUSEHOLD SIZE BY HOUSING TYPE, 2000

Housing Type Population Households Avg. HH Size

Single-Family Detached 8,171 3,287 2.486

Multi-Family 2,601 1,468 1.772

Mobile Home 363 147 2.469

Subtotal, Households 11,135 4,902 2.272Source: U.S. Census Bureau, 2000 Census SF-3 (1-in-6 weighted sample data) for Destin.

In addition, data are available on average household size by other housing characteristics, such as thenumber of bedrooms, from the five-percent sample of households that filled out the long-formquestionnaire. Destin is combined with all of Okaloosa and Walton counties. While overall averagehousehold sizes for single-family and multi-family units are somewhat lower in Destin than in the region,housing units in Destin also tend to be smaller. For, example, 23 percent of owner-occupied units inDestin have fewer than three bedrooms, compared to only 16 percent of owner-occupied units in theregional sample. However, the fact that units in Destin are somewhat smaller than elsewhere in theregion accounts for only a small part of the differential. Applying the regional household sizes to theestimated distribution of single-family housing by bedroom size in Destin would lead us to expect anoverall average household size for single-family units of about 2.57, slightly lower than the regional


Figure 7RESIDENTS BY DWELLING SIZE

average (2.60), but still significantly above Destin’s actual household size (2.49). Consequently, it isnecessary to adjust the regional average household sizes by bedroom category to reflect smallerhousehold sizes in Destin, as shown in Table 61.

Table 61AVERAGE HOUSEHOLD SIZE BY HOUSING TYPE AND BEDROOMS

Housing Type/BedroomsSample

HouseholdsWeighted Population

Weighted Households

RegionalAverageHH Size

DestinAverageHH Size

Single-Family/0-2 Bedrooms 281 11,004 5,423 2.029 1.938

Single-Family/3 Bedrooms 1,495 70,891 28,437 2.493 2.381

Single-Family/4 Bedrooms 547 31,466 10,295 3.056 2.919

Single-Family/5 Bedrooms+ 54 4,337 1,061 4.088 3.904

Single-Family/All Sizes 2,377 117,698 45,216 2.603 2.486

Multi-Family/0-1 Bedrooms 223 6,500 4,169 1.559 1.330

Multi-Family/2 Bedrooms 194 15,716 8,118 1.936 1.652

Multi-Family/3 Bedrooms 422 8,504 3,134 2.713 2.315

Multi-Family/4 Bedrooms+ 35 2,623 636 4.124 3.518

Multi-Family/All Sizes 874 33,343 16,057 2.077 1.772Source: U.S. Census Bureau, 2000 Public Use Microdata Sample (PUMS) 5% weighted sample data for Public Use Microdata Area(PUMA) 300 (Okaloosa and Walton counties); Destin average household sizes for single-family/all sizes and multi-family/all sizes fromTable 60; other Destin average household sizes based on ratio of Destin to regional average household sizes for all sizes.

While the only measure of dwelling unit size recorded by the Census Bureau is bedrooms, it isrecommended that the fees be based on square footage rather than number of bedrooms. Althoughsome Florida municipalities charge impact fees on the basis of bedrooms, it can be an administrativechallenge to determine the number of bedrooms when there is a financial incentive to disguise bedroomsas something else (a den or storage room, for example). An alternative is to translate bedrooms into sizecategories.

To determine a relationship between the unit squarefootage, bedrooms and household population, theconsultant compiled data 735 single-family detachedhouses and 1,087 multi-family (condominium andtownhome) units listed for sale in Destin from theNational Association of Realtors website(www.realtor.com) on December 5, 2006. Thisrepresented a fifty percent sample of multi-family unitslisted for sale (every other page of listings) and arandom sample of single-family listings so that the twotypes of housing units were equally represented in theMLS data base and in the 2000 census. These on-linelistings give square footage and the number ofbedrooms for each home offered for sale. A variablefor average household size was added, consisting of theaverage household size multipliers by housing type and

8 The equation is ln(y) = 0.516073 * ln(x) - 3.06476, where x is square feet of living area and y is householdsize. The r-square is 0.7397. The t-statistics are -57 for the intercept and 72 for the slope.


number of bedrooms derived from 2000 U.S. Census sample data. Regression analysis was thenperformed to determine the relationship between unit size in square feet and persons residing in the unit.Both linear and logarithmic regressions were performed. The logarithmic equation best explained therelationship between household size and unit size, accounting for 74 percent of the variation.8

Figure 7 illustrates the linear equation for household size and unit size. The average household size foreach size category is calculated by applying the equation derived above to the midpoint of the squarefootage range, as shown in Table 62.

Table 62AVERAGE HOUSEHOLD SIZE BY UNIT SIZE

Dwelling Size CategoryApproximate

midpoint (sq. ft.)Average

Household Size

Less than 500 sq. ft. 400 1.028

500 - 749 sq. ft. 625 1.294

750 - 999 sq. ft. 875 1.539

1,000 - 1,499 sq. ft. 1,250 1.850

1,500 - 1,999 sq. ft. 1,750 2.201

2,000 - 2,999 sq. ft. 2,500 2.646

3,000 - 3,999 sq. ft. 3,500 3.148

4,000 sq. ft or more 4,500 3.584Source: Average household size is derived by substituting the midpoint for x andsolving for y in the equation described in the preceding text.

Existing nonresidential floor area and corresponding land use codes for existing parcels of land in Destinwere provided by the Okaloosa County Tax Assessor. The square footage for existing nonresidentialdevelopment in Destin was estimated by summing the total square footage for all nonresidential parcels.Table 63 summarizes the nonresidential development in Destin by land use.


Table 63NONRESIDENTIAL LAND USE, 2006

Land UseExisting

Sq. Ft.

Hotel/Motel 511,545

Commercial/Retail 2,106,863

Office 640,344

Other/Institutional 336,946

Hospital 17,221

Nursing Home 56,191

Religious Institution 174,399

School 87,955

Industrial 61,815

Warehouse 588,050

Total 4,581,329Source: Okaloosa County Property Appraiser, January25, 2006.


APPENDIX C: LAND VALUATION REPORT

Impact Fee Study - CITY OF DESTIN

Documents

Transcript of Impact Fee Study - CITY OF DESTIN