The Pagosa Fire Protection District (PFPD) is looking to move forward with implementing impact fees across the district.
The PFPD Board of Directors heard the results from an impact fee study performed by BBC Research and Consulting during a regular meeting held on Tuesday, Nov. 5.
The lead consultant for BBC on the project, Michael Verdone, presented the study to the board.
Verdone began by noting the PFPD currently serves more than 12,350 residents across 319 square miles.
The fees being proposed by BBC are $1,426 for single-family developments, $1,104 for multifamily developments and 65 cents per square foot for nonresidential developments.
Verdone explained that the fees would be a onetime charge on new developments, and that it must be “reasonably related to the overall cost of the capital” the district currently has.
He noted that the impact fees cannot be used to remedy deficiencies in capital facilities that already exist.
Verdone provided some background information as to how the PFPD is legally allowed to implement impact fees, noting Colorado Revised Statute 29-20-104.5 “gave fire districts the authority to impose impact fees.”
He explained there “has to be a triggering mechanism” to impose the impact fee on developments, which is usually the pulling of a building permit.
Verdone explained that the district has to quantify the reasonable impact of development on the district’s facilities and that there “has to be some sort of rational or logical connection between the fee that you are charging and the impact the new development has on your capital facilities.”
He explained that, along with not being able to use the impact fees to remedy current deficiencies, land owners also cannot be asked to provide “site-specific dedication or improvements.”
Verdone explained that his company uses a process to calculate the suggested impact fees which involves looking at the current population and area served while considering how much the area is expecting to grow.
Verdone noted that more rural districts tend to have higher impact fees.
He explained that all of the district’s equipment, buildings and land are given an estimated replacement value.
Verdone noted that he used his company’s database to estimate “what we think the replacement values are of your equipment,” which is “about $12.4 million in today’s dollars.”
He mentioned that patterns of development and the percentage of certain development categories within the district were taken into account when calculating the suggested impact fee.
Verdone notes in his study that 86.4 percent of development in Archuleta County is single family, while multifamily developments take up 5.7 percent and nonresidential accounts for 7.9 percent.
He explained that the replacement value is then multiplied by the percentage of each development category and “that tells us how much capital you have to serve these different land use categories.”
Then, he takes the number of units in each category and divides the cost of capital to serve that group.
Verdone’s report shows there are 7,546 single-family developments, 646 multifamily developments and 499 nonresidential developments currently in the county.
“Each single-family residential unit has about $1,400 in capital to serve,” Verdone stated.
He offered comparisons to other districts around the state similar in size to the PFPD, noting the suggested fees fall in the middle to lower end of other districts’ impact fees.
According to Verdone’s report, the Castle Rock Fire Protection District has an impact fee of $1,116 for single-family homes, while Elk Creek Fire Protection District has a fee of $2,583 for single-family developments.
Verdone also provided expected revenue ranges going forward that are based off of the state’s population growth forecast.
He notes that the district can expect approximately $159,000 in revenue from the fees in 2025, which could grow to $223,000 over the next five years.
PFPD board member James Martin asked if the implementation of the impact fees requires the county’s approval.
Verdone explained that it does not, but he suggested giving residents a three- to six-month grace period when implementing the fees.
Board member Wayne Hooper asked if the PFPD has had any communication with Archuleta County or the Town of Pagosa Springs about implementing the fees.
PFPD Chief Robert Bertram explained that the district has not yet had any discussion with the town or county.
Martin asked if the fees could be implemented in January 2025.
Bertam explained that the district has a “ little bit of homework” to do, such as determining how the fees will be collected.
“It’d be nice to at least have a conversation with the county and the town,” Hooper said.
PFPD attorney Dino Ross explained that, “Prior to adopting or establishing a fee, statute requires a 60-day comment period,” and notice to every county and municipality affected is required.
He mentioned there is usually a public hearing held for residents to provide comment, and a resolution is needed that establishes the impact fee schedule.
“So, a little bit of work to do,” Ross said.
Hooper asked if the district needs to specify where the money will go and if a new fund will be created.
Ross explained that the money would need to go into a new account, reiterating the fees cannot be used to remedy existing deficiencies.
However, he noted the fees can be used to make changes or improvements on existing capital or facilities if that is needed to expand service.
Ross also explained that the statute does not specify how the fees are collected, and that the district could collect the fees directly from developers or partner with the county to collect the fee.
Bertram mentioned the next step for the district to take is to notify the town and county of the fees.
The board unanimously approved a motion for Bertram to use the impact fee study from BBC to notify the town and county and have a resolution drafted, along with publishing a notice for public hearing on the matter.
PFPD Manager Tomi Bliss indicated in a later interview that a date for the public hearing has yet to be determined.
Salary increases
Also during the Nov. 5 meeting, Hooper asked the board if it would entertain an additional salary increase on top of what has already been included in the district’s 2025 draft budget.
Hooper explained that a 3 percent increase in wages was included in the draft budget, but mentioned that “the cost of living in Pagosa is much more.”
Hooper proposed raising the increase in wages by 5 percent, instead of 3 percent, noting that would be an additional $35,000 and adding “the money is available.”
Bertram confirmed that the district has enough funds to cover that increase.
Hooper mentioned that it takes about the same amount of money just to get one person hired and trained, and that the additional wage increase would demonstrate to the district’s staff that “we recognize the cost of living here.”
PFPD board chairman LeRoy Lattin asked how the district’s wages compare to other fire districts in the area.
Bertram explained the PFPD is on par with the Upper Pine River Fire Protection District, based on recent job postings, and the Durango Fire Protection District has slightly higher wages.
Board member Ryan Foster mentioned the PFPD has done a lot of work with increasing salaries, tuition reimbursement and providing insurance options, which he notes has all been beneficial for the district’s employees.
Martin explained that all a fire district is is a group of people coming together to protect us, and “you can’t do enough for them.”
Board member Ronald Beckman mentioned that the increase could potentially cause issues with trying to expand staff later on.
“It’s definitely a line item that’s rapidly increasing,” Foster added.
Martin mentioned that it will force the district to increase its revenues.
“I think it’s a good thing all around,” Beckman added.
The consensus of the board was to direct Bertram to adjust the wage increase by 5 percent and to bring it back to the board for final approval.
clayton@pagosasun.com
