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Gaithersburg staff seek to remove school utilization premium fee; council introduces ordinance and sets July 6 hearing
Summary
Planning staff proposed repealing the citys school utilization premium payment (UPF) fee, arguing the per-unit charge (roughly $3,500 in a recent example) is a small revenue source that can increase development costs while yielding little toward school construction; council voted 5-0 to introduce the ordinance amendment and rescind the related resolution and set a public hearing for July 6.
Planning staff recommended that the mayor and city council introduce an ordinance amendment to repeal the citys adequate public facilities code provision that authorizes a school utilization premium payment (UPF) and to rescind the companion regulation/resolution. Michael Hayes explained that the UPF is assessed when a proposed residential development is projected to cause an affected elementary, middle, or high school to exceed 105% capacity within a five-year forecast window.
Hayes used a recent example to illustrate the programs impact: the Metro Stevenson development was assessed a UPF of about $3,500 per unit (roughly $84,000 for the full project) but staff said such sums are small compared with the cost of constructing permanent school capacity and therefore tend to be passed through to unit buyers or renters. The code requires collected funds to be used only for permanent capacity expansions of the affected school and for expenditure within eight years, otherwise a refund must be issued to the current property owner.
Staff also said Quince Orchard High School was projected previously to trigger the fee but that new boundary work and the opening of a new school (Crown) are expected to remove that trigger; staff recommended repeal because current projections indicate no school in the city is forecast to exceed the 105% capacity threshold within the five-year window.
Council members raised questions about county enrollment projections, the timing of boundary studies (Lake Forest and Watkins Mill cluster concerns), and whether Gaithersburg would diverge from county practice. Staff noted that the fee is an additional charge on top of county impact taxes, that countywide UPF revenue has been limited, and that the funds collected under the UPF are narrowly restricted to capacity increases (not routine capital maintenance).
After discussion, council moved and passed motions to introduce the ordinance amendment and to introduce the resolution to rescind the associated regulation; both motions passed 5-0, and the council set a public hearing for July 6.
