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Indian River County I Impact Fee Update Study Affordable Growth Strategy As presented in Table IX-6 and Appendix D, in addition to impact fees, the County will uses a combination of gas tax, sales tax, and grant revenues to fund the transportation system. In terms of affordable growth calculations, it is important to note the following: • Consistent with the methodology used by many Florida jurisdictions, impact fee calculations are based on the adopted LOS standard, which is lower than the current achieved LOS. In other words, under the current methodology, even with the full impact fee, unless the County uses other revenue sources, the current achieved LOS for the system will deteriorate and more congestion will be experienced. It is Indian River County's policy to conduct a link-by-link capacity analysis and ensure that no link drops below LOS standard D. When the fee is calculated using the current achieved LOS, it amounts to $12,700 for a mid-size single family home, compared to $4,248 per home calculated using the adopted LOS standard. As such, the standard methodology used for transportation impact fees results in fee levels that slows down the degradation of the system, but does not generate sufficient revenues to maintain the existing conditions when they are better than the adopted LOS standard. • As mentioned previously, the credit calculations assume that the local option sales tax will not be re-adopted in 2019. In addition, the County had to defer maintenance expenses since 2006 through the CIP period due to lack of funding for capacity projects. Therefore, the available revenues for transportation capacity are likely to decrease in the future. The Affordable Growth calculations are based on this reduced funding and do not take into account funding from the State since the County does not control the State budget. If the sales tax is re-adopted or other revenue sources become available,these calculations will need to be revised. • Although the medium population projections from the University of Florida, Bureau of Economic and Business Research (BEBR) suggest an average growth rate of approximately 1.4 percent through 2040, the high projections indicate almost a 2- percent annual growth rate. To mitigate the uncertainty of growth rates and given that even if adopted at 100 percent level, impact fees will not generate sufficient revenues to maintain the current LOS and that the transportation system will Tindale-Oliver&Associates, Inc. Indian River County June 2014 122 Impact Fee Update Study 157