Adequate Public Facilities Ordinances in Maryland: Inappropriate Use, Inconsistent Standards, and Unintended Consequences

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The purpose of this study is to examine the implementation and effects of APFOs and the relationship between APFOs and Maryland’s Smart Growth policy. Thirteen counties and 12 incorporated municipalities in Maryland have enacted ordinances designed to assure that infrastructure necessary to support proposed new development is built concurrently with, or prior to, that new development. These Adequate Public Facilities Ordinances, or APFOs as they are commonly called, are designed to assure that public schools, roads, sewers, water for fire fighting, police and rescue response times and/or other infrastructure or services are “adequate” to support proposed new development. APFOs are timing devices that can be a useful tool for managing urban growth. When properly used, they can help ensure that needed facilities and services are available for new development and can signal to planners and elected officials what types of infrastructure, in which particular growth areas, are in need of additional capital improvement spending. They are intended to provide the rationale for prioritizing infrastructure investment decisions. As of April 2005, 13 counties and 12 municipalities had implemented APFO ordinances. In terms of categories of services included in the 12 county APFOs, all cover schools and roads. While two counties limit their APFOs to those two service categories, nine others include water and sewage capacity; three include water for fire suppression in rural areas, two include police/fire/rescue services; and one includes recreation. Not only do categories of services included in the APFOs vary, but so do a) the standards used to gauge adequacy, and b) the approaches taken by the counties when a development proposal is judged as leading to service or facility inadequacy. Moreover, APFO standards in a given jurisdiction can and do change over time as local elected officials respond to the concerns of constituents, other stakeholders and changing public policy objectives. This study finds that APFOs in Maryland are often poorly linked to capital improvement plans, and moratoria can last for indefinite periods of time. Further, the consequences of APFOs in Maryland are often unintended and their effects frequently contrary to the broader land use policies of the state. In many counties that employ APFOs, they have become the dominant planning tool rather than just one of many tools a county might use to manage its growth. When roads, schools or other infrastructure are judged to be insufficient to meet the standards established within APFOs, the result is often a moratorium on building until the infrastructure is ready to come on line. Often, the only way these moratoria can only be lifted is through the payment of impact fees by developers. These fees are, in turn, passed through to new home buyers. While this practice is justified by some observers as being consistent with the “benefit standard” (i.e., those who benefit from a particular service or facility should be the ones to pay for it), it ignores the benefits that accrue to the community from new development. Another perspective is that it places a disproportionate burden for the cost of new infrastructure on new home buyers. Under the latter perspective, if new development is consistent with a jurisdiction’s comprehensive plan, then it is appropriate for the funding for needed services and services be borne by the jurisdiction as a whole. The study also finds that APFOs are applied in ways that often deflect development away from the very areas designated for growth in county comprehensive plans to rural areas never intended for growth, to neighboring counties, or even to adjacent states. An analysis of the effects of APFOs on housing in Harford, Howard, and Montgomery counties found that over a three-year period, APFOs deflected as much as 10 percent of the new home development that otherwise would have been built within the PFAs of those counties. It is likely that the cumulative effect is that the amount of housing available in those counties is reduced, housing prices are inflated, and the growth simply moves elsewhere. APFO consistency with a local comprehensive plan is possible only if adequate funding is allocated to provide necessary infrastructure in the plan’s designated areas. That, however, is often not the case. In short, APFOs appear to be fueling the same pattern of development the state’s Smart Growth policy is intended to curtail. This result appears to be at odds with both the intent underlying the enactment of local Adequate Public Facilities Ordinances and the land use goals of the state.