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Builders Like Fees; Home Buyers Don't

March 02, 2003

Re "Developers Should Pay Up," Feb. 23:

Regardless of the reader's viewpoint regarding Riverside County's recent decision to add a flat fee of $6,650 onto each new home to fund road improvements, do The Times' editors actually expect that we home buyers are naive enough to think it is developers who will pay this additional fee? As with all taxes and fees, it is we, the home-buying taxpayers, who pay.

Look below the surface. Why are people moving to Riverside County? Isn't the chief reason the lower cost of housing relative to Orange, Los Angeles and San Diego counties?

Don't you get it? When your hand gets burned you pull it away. When added regulatory costs burn buyers, those who can move away. And then your left-behind tax base suffers the consequences. So you raise taxes again. And more can move away. It's the Gray Davis vicious-circle theory of taxation.

Michael Nevins

Coto de Caza

*

The Times congratulated Riverside County for "finally placing long-term planning ahead of short-lived benefits."

Hear, hear!

Surprise, but Riverside builders actually are on the record supporting a transportation fee. Think about it. Builders live in the communities in which they build, so why would they want to clog their own roads with traffic? Builders need improved roads to serve their developments. It's good business. We understand the need to pay for the effects of new developments with new road construction.

What Riverside builders opposed was the way the fee would be collected and spent, a situation that vexed many Riverside cities that are forced to accept the fee proposal without local control of the dollars collected. There was no guarantee that money raised by fees at a project in Temecula would be spent on road improvements in that area. New homeowners should pay for their effect on their community only.

The rest of the editorial, unfortunately, is a shooting gallery of inflammatory, unsupported and inaccurate accusations.

Builders don't make "hefty profits," as assumed. A quick check of SEC documents of public building companies shows that builders net a profit of only 5% to 8%. Try comparing that with pharmaceutical or media companies.

There is no "hyperdevelopment" in Southern California. Actually, we are building only half the homes each year that we built annually until 1990. And we're building half the homes that are needed each year to house California's increasing population, according to the state Department of Finance. There's a housing shortage, not a housing glut.

What's funny is that the Building Industry Assn. agrees with the editorial's conclusion and for years has been arguing for more planning foresight from our elected officials. We completely agree that planners, politicians and the public must plan for growth and account for how those costs will be paid -- through a combination of builder fees, housing assessments and taxes.

Don't bash those funding the improvements. Try holding accountable those responsible for making sure the improvements get done.

Jon W. Robertson

President, Building Industry

Assn. of Southern California,

Orange County Chapter

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