Saturday, May 12, 2018

Carrefour Exempt from Apartment Moratorium??? Request from Economic Development Commission.

Those of you that follow the Massey for Germantown Facebook Page may have noticed the copy of letter that Alderman Massey posted: 

The letter was also posted in the Developments in Germantown TN Facebook group

As you can see, Jerry Klein, on behalf of the Germantown Economic Development Commission, requests that Mayor Palazzolo exempt Carrefour from the Apartment moratorium. The apartment moratorium was proposed last December by Mayor Palazzolo in response to the citizens' demands, and enacted by a BMA vote in January.

Carrefour is the shopping center at the Western Gateway (Kirby and Poplar), and is subject to Smart Growth zoning. The plan may have significant revenue associated with it, as the letter states, but it also may have significant cost. The whole reason for the moratorium was to give the City time to assess the true fiscal costs and benefits of additional residential units. As far as I know, there has been no concerted effort to do cost-benefit analyses for these type projects, taking into account the significant cost of school construction and possible need for yet another new school. It seems prudent to await those results before a developer embarks on building another large apartment complex. Thornwood is being built now, Watermark is fully approved, and Viridian and City Center are exempt from the moratorium. And, as this blog post has shown, approvals for apartment complex units have greatly exceeded approvals for traditional housing.

Residential construction of any type has a negative fiscal impact on our City, according to a fiscal impact study commissioned by the City. Is there a reason for Germantown to grow, increase traffic, crowd the schools, etc. without at least ensuring that this new, more hectic lifestyle doesn't also increase our taxes?  And, remember, a two million dollar sewer upgrade is needed for the Carrefour project.

Williamson County (near Nashville) certainly has not found that residential growth has had a positive fiscal impact. That county commissioned a study, and it was found that the county was justified in charging developers a fiscal impact fee for the cost of building schools. This upfront fee for residential units can go as high as $10,000 per home, although obviously smaller apartment units would be charged a smaller fee. Before giving exemptions from the moratorium for apartment complexes, we need to study the true fiscal impact of apartment developments, and, like Williamson County, consider charging developers an upfront fiscal impact fee.

I will cover more details of the Williamson County fiscal impact fee in a later post.


  1. Thank you for keeping us informed. I am curious though, shouldn't communities that want to grow, build up?

    1. The answer could be "yes" for those who want to attract significant residential growth in Germantown. Residential growth, though, means more crowded schools, crowded streets, and higher taxes, as residential growth was shown in Germantown's commissioned fiscal impact study to be draining on the city's finanaces. There is no strong imperitive for Germantown to have significant new residential growth, as there are no real pressures from the surrounding area. The population of Shelby County and the SMSA are stagnant. Where will the growth come from? Memphis? Memphis already has the infrastructure in place to serve the population. In fact, schools are closing because of declining numbers. It is inefficient to close existing schools in Memphis, only to have to build expensive new schools in Germantown at the Germantown taxpayer's expense.