Early on in Monday's meeting of the Shelby County Commission, it became obvious that most of the seats in the overflowing auditorium at the county administration building were filled by developers and homebuilders, there to stage a reprise of their criticism last month of county mayor A C Wharton's proposed "Adequate Facilities Tax." This week's protest against the tax, which is the administration's version of an impact fee on new developments, was mounted in far greater depth, however.
Not only were the organized attendees there en masse, they gave full license to their dramatic sense, with several speakers ignoring Chairman Walter Bailey's admonitions and calling on the audience to make a standing -- and sometimes vocal -- show of strength. Outside, the histrionics were even more pronounced: Concrete mixers lumbered by the county building, almost like elephants at the circus, their horns blaring in clear imitation of the honking motorists who serenaded the Tennessee General Assembly during the protests against income-tax legislation in Nashville. At one point, as audience grumbling reached a crescendo against Commissioner Julian Bolton's argument that developmental impact costs must either be borne by new homeowners or by the public at large, sirens actually began to go off and the Fire Department showed up to clear the auditorium temporarily. This fuss was presumably occasioned by bad-weather alerts, though it was not easy to tell.
Hoopla aside, the facts are that the development community is already well represented on the commission itself, which made a conspicuous effort to meet objections halfway, amending the Wharton proposal to cap the Adequate Facilities Tax at 1 percent of an assessed project's total cost, and, in concert with the mayor, agreeing to postpone presenting the tax to the legislature until next year.
Although other revenue options have been suggested -- with that of a payroll tax increasingly finding favor among commissioners -- a modest impact fee like that proposed by Mayor Wharton is certainly one of the most reasonable put forth so far. And for the ever-cautious, deliberate Wharton to suggest it is in itself a statement about its moderate and limited scope. Some logical objections to the proposed tax have been made. It may be true, as developer Ron Belz put it last month, that development contracts are often decided on the basis of pennies, and it may also be true that residential and commercial development need to be assessed by different standards. But one contention made by opponents of an impact fee is almost certainly not the case -- namely, that the costs of such taxation will be passed on to the consumer. It is more likely, as one commissioner privately argued, that homebuilders are already charging what the market will bear and, if forced to adapt to a new fee, will be forced to do so at their own expense, not that of home purchasers.
In any case, all sides have been granted a reprieve and have a full year to show cause why this proposed tax is or is not a partial answer to the county's fiscal needs. The alternative, as we all know, is more property tax, and we are already high-water on that scale.