A Tale of Two Cities

UPDATE: Camarillo officials have postponed the public hearing on the sewer and water fee increases until Jan. 11. We'll keep you posted.

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While builders understand the necessity of growth related fee increases, the City of Camarillo’s proposed fee increases are very untimely and will have negative consequences for near-term housing starts.

The Ventura City Council is expected on Monday to extend the city's fee deferral policy for another year - and to add Quimby and park fees to the list of fees deferred - just two days later the Camarillo City Council will be asked to increase fees by more than $1,700 on each new single-family home. That's on top of an average existing fee load of between $40,000 and $50,000 per home. Ventura and Camarillo are only four miles apart. However, they are handling development impact fees very differently in this difficult economic climate.

Builders understand that some fees are necessary to pay for growth-related services, but adding $1,700 to the cost of doing business in this economic climate just doesn't make sense, especially at a time when it appears some construction will finally get under way in 2012 after four years of virtual no housing starts.

That's because builders face stiff competition from the sale of existing homes, especially foreclosures and short sales that sell below real market value. Projects simply have to pencil out, and with margins so small a couple of thousand dollars can mean the difference between beginning construction and continuing to wait until the economy improves even more.

Just 8 homes have been built in Camarillo in the past four years combined, down from 123 in 2007 and 612 at the market peak in 2005. That has cost the city millions of dollars in building fees and tax revenues, and has exacerbated the region's unemployment problems.

What's worse is that the fees are intended to help pay for a series of water and sewer projects, the largest one of which - estimated to cost $12 million - might not even be necessary if the proposed Conejo Creek master planned community is developed.

The BIA asks the City to reconsider adopting the fees at this time. As Ventura's staff points out in its report, deferring fees there may allow even more projects to move forward. We would suggest the same point holds true in Camarillo as well.