Capacity for sale 

Three years ago, activists stormed Orange County commission chambers demanding that their elected officials do something, anything, to stem the tide of unfettered growth. Then-chairman Mel Martinez, sensing the political opportunity that would make him a GOP darling, secure his appointment as U.S. Department of Housing and Urban Development secretary and cast him as a front-runner for Florida governor in 2006, responded. He issued the so-called "Martinez plan," which suggests that the county factor in school capacity when approving new developments.

"Suggests" is the operative word, because to this day, the Martinez plan isn't formal policy; it was never adopted by the county commission. It's a directive to county planners recommending that they deny any re-zoning that adversely affects schools. In turn, county planners look to the school board to tell them what developments they should approve.

But the Martinez plan has been subverted by the school board itself. Instead of shooting down developments that will pack schools, the board is negotiating with developers, squeezing millions of dollars in "voluntary contributions" from developers -- school board chairman Rick Roach chuckles at the word "voluntary" -- in return for the school board's approval of new subdivisions.

As school officials readily point out, the county has the final say in any development. Of course the county relies heavily on the school board's OK, which developers can now buy.

School-board officials insist it's a win-win for developers, the school board and for crowded classrooms. And indeed, even the county's staunchest slow-growth officials acknowledge that, in principle, the school board's policy is sound.

The problem may be that the school board is being too nice, letting developers build massive subdivisions though new, "reliever" schools are years off, and not charging them enough to buy out of the Martinez plan.

On the surface, the price tag seems pretty low: $1,500 per unit, on top of existing impact fees that range from $1,907 for apartments, to $2,828 for single-family homes. The school board can -- arbitrarily, it seems -- levy additional fees on developers if the original amount won't pay for the classrooms, cafeterias, media centers and teachers to accommodate the new kids.

For Wetherbee Acres, a proposed 1,155-home development in southwest Orange County that has reached a deal with the school board, that means $3.3 million in impact fees, $1.7 million to alleviate capacity, and another $663,000 to meet the "full incremental cost," for a total of almost $5.7 million to the school district.

By the school board's estimate, Wetherbee Acres will pump 290 kids into Meadow Woods Elementary; 128 into Meadow Woods Middle School, and 163 into Cypress Creek High School. Cypress Creek already has more than twice the students as it was built to handle.

For comparison, Morgran Company, Inc., will pay the school board about $5 million, all totaled, for 600 single-family and 700 multifamily units in east Orange. According to the formula supplied by the school board, Morgran will pump an estimated 416 kids into Cypress Springs Elementary; 195 students into the 400-over-capacity Discovery Middle School; and 234 more students into the 1,200-over-capacity University High School.

On May 20, Orange commissioner Linda Stewart wrote Roach a letter, accusing the school board of side-stepping the Martinez plan.

"I don't think we should continue [in this direction]," Stewart says. She thinks the school board's policy undercuts not just the Martinez plan, but the half-cent sales tax Orange voters passed last year so the school system could catch up on long-delayed improvements. "We don't need to make the same mistakes for the next 20 years."

Stewart was angry, and understandably so. But she got a few things wrong in her letter. She worried, for instance, that the school board was putting the money from the agreements with developers into its general fund, meaning it might not be spent to alleviate crowding in specific developments. School officials say that isn't the way it works.

But her primary concern -- that school officials are "mitigating [capacity] for a price that doesn't come close to the purpose" -- bears examination. Though Roach and other school officials insist the $1,500 figure isn't arbitrary, they also don't know how the school board arrived at the figure. The person who does know, chief financial officer Henry Boekhoff, did not return repeated phone calls for this story.

If the school board refuses to deal with developers, their subdivisions won't happen. It could, in all likelihood, demand far more than $1,500, and get it, because developers have no choice. It's an offer they absolutely can't refuse, at least if they want to turn a profit.

"That is just something they pulled out of the air," Stewart says of the $1,500 figure. "We are not applying enough money to relieve these schools."

The county's impact fees were intended to cover about half the school district's cost when a new development brings in new students, says Orange County commissioner Teresa Jacobs, who served on a task force that helped set the fees. The rest is supposed to come from property taxes.

But that doesn't cut it. Eighty percent of the district's schools are overcrowded, and the school board doesn't have enough money to keep up; hence the sales-tax campaign. School administrators say the new fees are designed to help them reach the "full incremental cost" of the new development. But, again, no one is quite sure what that cost is, referring questions on the subject to Boekhoff.

"I'm not sure how [Boekhoff] got it," Roach says of the incremental cost.

The current $1,500 add-on doesn't meet the difference between the impact fees and what presumably would constitute the "full incremental cost," based on Jacobs' assertion that impacts were designed to cover about half the cost. New high schools cost almost $60 million, new middle schools $24 million and new elementary schools, $13 million.

Rich Crotty, Martinez's usually deadpan successor, says the $1,500 figure needs to be looked at. "Compared to the current cost of housing," he says, "it does not seem like a very big hit."

Crotty and other commissioners are curious as to how the school board sets its numbers. "The more you let everybody know what's going on in government, the better it works," Crotty says.

"The problem is, we don't have a good enough handle on exactly what the school board is doing," says Jacobs.

Even if the money is right, Stewart says new schools won't be built until years after the new subdivisions go up. (The school board points out that all impact fees are collected up front, meaning they can start building more classrooms as soon as possible.)

Since January 2003, 42 developers have petitioned Orange County schools to buy their way out of capacity concerns. In April, the school board approved the first six agreements. So far, school officials say, the policy has generated $400,000 for repairs and new schools. As much as $30 million is expected. If all 42 developers who've come forward this year make deals -- and the school board doesn't seem eager to turn anyone down -- that number will increase drastically.

Whether or not the school board is extracting enough money, its policy in principle seems sound. The alternative -- tying development to school capacity with no room for bargaining -- is unrealistic.

Jacobs, who is helming a task force on the subject, points out that Palm Beach County is the only county in Florida to adopt a such a policy, and because of loopholes that make it virtually impossible to declare a particular school has "no capacity," it has been ineffective. If Orange adopted a similar policy, she says, it would lose any ability to regulate development.

"All I know is the schools are being impacted and they're not being relieved," says Stewart. "It's not working. They're going to have to do something else."



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