The Georgia Supreme Court has denied an appeal by the Newton County Home Builders Association and the Home Builders Association of Georgia to issue an injunction order on impact fees collected by the county on new developments.
This means that approximately $6.5 million in impact fee collections and accrued interest can now be spent by the county on several previously designated public projects such as the county's eagerly anticipated second library. Until now the impact fee collections have been held in an escrow account by the county pending the courts' decision on the injunction request.
While the lawsuit filed by the home builders associations against the Newton County Board of Commissioners continues to make its way through the court system, attorneys for the county are optimistic that the denial of the injunction request bodes well for the county's prospects of eventually winning the case.
"This gives us confidence that we are going to prevail," said James Griffin, an attorney with County Attorney Tommy Craig's office who has worked on the case. "We have to presume that our case is strong if the injunction was denied."
Added Newton County Executive Officer John Middleton, "I certainly think its encouraging news, but the matter is still under litigation."
According to a press release from the BOC on the matter, Newton County's impact fee ordinance was put in place in February, 2005, after several years of study and public input and after enough time had passed to see whether or not the impact fees in other Georgia counties would survive the expected legal challenges by developers.
Impact fees were then levied on developers and builders in Newton County to pay for the costs of future public improvements necessitated by the population and traffic growth brought about by the addition of new subdivisions and shopping centers. According to Georgia law, impact fees are for structures and infrastructure within the areas they are collected, not for maintenance, operations or personnel. Projects that the county intended to use these impact fees towards include the building of new libraries, parks, recreation facilities and various road improvements.
In December 2005, however, the Newton County Home Builders Association Inc. and the Home Builders Association of Georgia filed a lawsuit against the county, alleging that the impact fee ordinance was illegal and unenforceable. In their suit, the home builders associations asked for an injunction which would require that all impact fees collected by the county be held in an escrow account until such time as the court determined whether or not the impact fee ordinance was illegal.
As a matter of caution while the courts decided on the injunction request, Newton County has so far retained almost all impact fees collected since 2005 in the event that a court did order them held in escrow.
In October 2006 Newton County Superior Court Judge Horace Johnson denied the home builders associations' injunction request. The associations appealed this decision.
In June, 2007 the Court of Appeals of Georgia upheld the decision of the Newton County Superior Court to deny the injunction.
In an opinion written by Court of Appeals of Georgia Presiding Judge Ed Johnson denying the appeal, Johnson finds that because the home builders associations admit that they have not paid any impact fees to Newton County but are basing their standing on the claims of their individual members, the associations do not have the standing to invoke the court's remedial powers.
"Damage claims in which an association seeks relief on behalf of association members, however, are not normally allowed," reads the opinion. "This is especially true when the damage claims are not common to the entire membership, nor shared by all in equal degree."
On Sept. 10 the Supreme Court of Georgia refused to hear any further appeal of the denial of the injunction in a very brief two-line decision.
Because of the succession of appeal victories, county officials now feels confident enough to move forward with plans to spend the impact fees on projects previously approved by Newton County voters.
"We feel like it's not a great risk to go ahead and spend the impact fees," Griffin said. "We could have done it before. There was nothing stopping us, but we thought it prudent (not to). The last thing you want to do is refund money.
"Newton County is looking forward to the conclusion of the litigation with the Home Builders," Griffin said. "Overall we have a good relationship with the Home Builders."