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CHARLOTTESVILLE REGIONAL CHAMBER APPLAUDS ALBEMARLE COUNTY SUPERVISORS FOR REVIEW AND REEVALUTION OF COUNTY CASH PROFFER POLICY

For more than a century � �dedicated to representing private enterprise, promoting business
and enhancing the quality of life in our Greater Charlottesville communities.�

cvillechamber.com � 209 5th Street � Charlottesville, Virginia� 22902

� (Charlottesville, Virginia � April 21) The Charlottesville Regional Chamber of Commerce today released an April 16th Chamber memorandum to members of the Albemarle County Board of Supervisors applauding the Supervisors for their �efforts to reevaluate Albemarle County�s cash proffer policy.� The Chamber memorandum stated, �As the area�s real estate marketplace has demonstrated volatility over the past decade, regular reevaluation � should be in order, particularly as past practice has witnessed only increased costs placed upon homeowners while marketplace conditions declined.� �Albemarle County might even consider repeal of the cash proffer policy as many municipalities in our Commonwealth of Virginia do not have such policies, locally most notably the City of Charlottesville.� Some jurisdictions have either removed or are in the process of reconsidering their cash proffer policies.� The County�s cash proffer policy is in direct conflict with Albemarle County�s affordable home-ownership goals.� Better mechanisms that do not increase the cost of home ownership as well as apartment living, should at a minimum, be explored.� The Chamber memorandum (copy attached) noted, �Until 2007 Albemarle County�s unofficial cash proffer policy generally called for a �voluntary contribution� to the County, of $3,200 per single family detached home.� In 2007 � when Supervisors adopted an official policy � that required �contribution� amount had increased (+400%) to $17,500 per single family detached home. �In 2013, the Albemarle cash proffer policy called for �contributions� of $20,460 per single family detached home; $13,913 per an attached home or townhouse and $14,497 for multi-family apartments.� (By comparison, the Greene County cash proffer policy is less than $6,000 per home.)� The Charlottesville Regional Chamber of Commerce is dedicated to representing private enterprise, promoting business and enhancing the quality of life in our greater Charlottesville communities.� The Chamber�s more than 1,100 member and affiliate member enterprises employ more than 45,000 people in our community, representing an estimated total payroll of more than $1.75 billion a year. �

For more than a century � �dedicated to representing private enterprise, promoting business
and enhancing the quality of life in our Greater Charlottesville communities.�

cvillechamber.com � 209 5th Street � Charlottesville, Virginia� 22902

April 16, 2014

TO������� :���������� The Honorable Jane Dittmar, Chair, Albemarle County Board of
Supervisors & Honorable Albemarle County Supervisors

cc:������� Albemarle County Planning Commissioners
The Chamber Board of Directors

FROM�� :���������� Timothy Hulbert, IOM, Chamber President

RE������� :���������� ALBEMARLE COUNTY CASH PROFFER POLICY

*��������� *�������� *��������� *

Our Charlottesville Regional Chamber of Commerce appreciates your efforts to reevaluate Albemarle County�s cash proffer policy.� As the area�s real estate marketplace has demonstrated volatility over the past decade, regular reevaluation of such policies should be in order, particularly as past practice has witnessed only increased costs placed upon homeowners while marketplace conditions declined. Albemarle County might even consider repeal of the cash proffer policy as many municipalities in our Commonwealth of Virginia do not have such policies, locally most notably the City of Charlottesville.� Some jurisdictions have either removed or are in the process of reconsidering their cash proffer policies.� The County�s cash proffer policy is in direct conflict with Albemarle County�s affordable home-ownership goals.� Better mechanisms that do not increase the cost of home ownership as well as apartment living, should at a minimum, be explored. In addition, Albemarle County�s cash proffer policy is also in direct conflict with the core principles of the Albemarle County Comprehensive Plan.� As you know, that Plan is designed to encourage development in the designated County Development Areas, so the Rural Areas in the county can be preserved and protected for agricultural and forestry uses, and for the protection of the County�s natural, historic and cultural resources.� Because of the now extraordinarily high costs for cash proffers for new residential units in Albemarle County�s Development Areas that require re-zoning, landowners and developers are: developing land in the Development Areas by-right at lower densities than are recommended by the Comprehensive Plan; and, they are increasingly subdividing Rural Area parcels for residential development.� Both outcomes are in direct conflict with the goals of the Albemarle County Comprehensive Plan. Our Chamber believes that the current Albemarle County cash proffer policy needs significant revision and applauds the Albemarle County Board of Supervisors attention to this matter. While the current cash proffer policy may be somewhat comfortable in some aspects, in appears to create a host of disincentives and unintended consequences. �For Albemarle County to continue with this flawed policy would be out of place and most likely not fully serve the array of the County�s best interests.� This central and complex issue deserves a full and comprehensive review, analysis and discussion � and a decision � to help develop a better way to address and meet continuing housing affordability and housing demand. For example, why should a homeowner � either moving into Albemarle County or relocating within one of the County�s designated development areas � where growth in approved project areas is best suited � be required to shoulder a cost burden of up to $20,460 attached to their home? Owners of private undeveloped property, or underutilized property pay local taxes, yet are availed of no or very little County services (education, public safety, etc.).� When developed, either by-right or through re-zoning, these same properties generate substantial new County tax revenues and yes, their new owners require significant new services.� But what credit for years of taxes paid and services not required or provided, does the County policy accord? Also, cash proffer requirements can and in fact, do impede new projects; new homes; new advancing, re-locating and downsizing homeowners; and, new and improving neighborhoods.� What amount of �recorded� County cash proffers over the past decade have been actualized? �Of course, if projects do not move forward, there are no additional tax revenues.� If the cash proffer policy stalls movement, is not the housing affordability market negatively altered? �How much of that housing moved to the rural areas would be better suited in the designated growth areas? Until 2007 Albemarle County�s unofficial cash proffer policy generally called for a �voluntary contribution� to the County, of $3,200 per single family detached home.� In 2007 � when Supervisors adopted an official policy � that required �contribution� amount had increased (+400%) to $17,500 per single family detached home. In 2013, the Albemarle cash proffer policy called for �contributions� of $20,460 per single family detached home; $13,913 per an attached home or townhouse and $14,497 for multi-family apartments. �(By comparison, the Greene County cash proffer policy is less than $6,000 per home.) The Charlottesville Area Association of Realtors� comprehensive housing reports offer interesting data:� Median home prices in Albemarle County have risen +20.26% over the past decade; +3.2% since the County�s cash proffer policy increase in 2007, despite a �Great Recession� and relatively weak economic recovery. �

Albemarle County Median Home Prices (CAAR Annual Year-end Reports)

2004 = $266,000

2007 = $310,000

2013 = $319,900

Certainly some measure of home price increase is a result of the modest economic and housing recovery, but what has been the economic effect of the cash proffers on home prices? What has been and might be the fiscal impact to Albemarle County? Sorting these impacts out is difficult at best, but some measure of thoughtful analysis and reassessment clearly is in order. Again, our Chamber appreciates the Albemarle County Board of Supervisors and professional staff attention to and reevaluation of, this important policy. We are available to assist you in your effort and await your response and decisions. � Thank you.

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The Charlottesville Regional Chamber of Commerce is dedicated to representing private enterprise, promoting business, and enhancing the quality of life in our Greater Charlottesville communities.