Homebuilders in Kalihi-Ala Moana corridor must pay new school fee

Residential builders will have to pay $3,864 as a school impact fee for each new housing unit constructed along the Kalihi to Ala Moana urban corridor starting Oct. 1, a big discount from the $9,374 estimate two years ago.

The fee will apply to developers of large projects as well as individual homebuilders, and will be levied even on accessory dwelling units, according to Assistant Superintendent Dann Carlson.

The amount dropped from the original proposal because the Board of Education changed the formula to require less land for schools in the urban core, where real estate is so costly and schools can be built vertically. Plans for Pohukaina Elementary School in Kakaako, for example, call for a four-story school.

The city has projected that up to 39,000 more residential units could be built in the urban corridor along the rail line in the next 25 years, which would generate about 8,500 students.

“School impact fees help to offset the cost of accommodating additional students, but the fees are only assessed if and when that development occurs,” Carlson said. “The thing about impact fees is they are only charged if somebody goes and pulls a permit to build. The amount should be proportionate to the impact it has on the schools.”

A 2007 law requires residential developers to contribute to the cost of expanding or building schools in areas with growing populations. The assessment, paid to the Department of Education, varies by district, depending on local conditions.

The new fee applies in the Kalihi to Ala Moana School Impact Fee District, which was created in 2017 and follows the rail line. It covers neighborhoods that are served by these elementary schools: Fern, Kalihi Kai, Kalihi Waena, Linapuni and Puuhale in the Farrington Complex; and Kaahumanu, Kaiulani, Kauluwela, Likelike and Royal in the McKinley Complex.

The previous fee estimate was based on a formula used in less developed areas, such as Leeward Oahu, where land is cheaper. Affordable housing advocates feared it would push home prices in the urban core even further out of reach.

On Feb. 15, the Board of Education adopted new guidelines for the Kalihi to Ala Moana district. The new fee analysis requires a minimum of 2.5 usable acres for elementary schools, 5 acres for middle schools and 9 acres for high schools. In the past, at least 8 acres were required for elementary schools and 45 acres for high schools.

The fee is based on a residential project’s expected impact on the school-age population, and covers a portion of construction and land costs. Developers planning to build 50 or more units must meet with the Department of Education to determine whether fees will be levied as land or cash, or a combination of the two.

Most residential projects are subject to the fee, but there are exemptions for homes that simply replace existing structures as well as senior housing projects that do not accept children as residents. The school impact fee does not apply to retail, commercial, industrial and office space.

So far, the Hawaii Department of Education has collected a total $4.7 million in school impact fees in Leeward Oahu, West Maui and Central Maui.

Identification of Schools Adjacent to the Kalihi to Ala Moana Impact Fee District by Honolulu Star-Advertiser on Scribd