Northwest Arkansas Following Fayetteville?s Lead

While Fayetteville officials consider passing the impact fee on building permits, Bentonville may be ready to follow suit.

Fayetteville is considering imposing the impact fee, one which could substantially raise the cost of construction in a town already expecting to see slowed growth due to new stringent commercial and residential ordinances.

Bentonville appears to be waiting in the wings to see what Fayetteville officials decide on a series of possibilities. One example is having a set fee of about $5,000 per permit. Another would be an escalating fee that would be extremely costly for upscale houses and commercial projects.

One developer said the added fee may not mean as much for someone building a $185,000 home, but for someone that suddenly is asked to pay $85,000 instead of $80,000, it could be a deal killer.

“Why would someone not go five miles down the road and save that money in Rogers?” asked the developer. “Where’s the rationality?”

Popular opinion is that all cities in Northwest Arkansas would soon follow Fayetteville’s lead if it chooses to impose the impact fee, citing that it’s necessary to keep up with their neighbors’ schools, libraries, etc.

“I think what it will do is make lot prices go up,” said developer John David Lindsey of Lindsey & Associates in Rogers. “Everybody in Bentonville with an existing house will see an increase in value by that [impact fee] amount. The only down side is for first-time home buyers, because the developers and builders are going to charge for it. What it will do on the front end is discourage developers, and when the supply is down, the demand is up, so prices will then go up.”