House Construction (Pixabay)
Pixabay

After a more than two-year legal battle between Middle Tennessee home builders and the Williamson County government, the Education Impact Fee, which places a one-time fee on new residential construction in Williamson County, was upheld in the state appellate court Friday.

Judge Andy Bennet upheld a previous ruling that decreed the fee “did not exceed the authority granted to the county.” 

A collection of Middle Tennessee home builders known as the Home Builder’s Association of Middle Tennessee (HBAMT) had sued Williamson County over the fee back in 2017, only to have Circuit Court Judge James Martin rule in favor of the county in early 2019. The HBAMT appealed Judge Martin’s decision, leading to Friday’s ruling that upheld that prior decision. 

The HBAMT will have until April 12 to appeal this most recent decision.

Education Impact Fee

First implemented in 2017, the Education Impact Fee was enacted by the government of Williamson County to help offset costs of the new school construction. As of October of last year, the fee had already generated more than $42 million, $12.5 million of which could not be used by the government as it was paid under protest by developers.

Residential developments of 1,399 square feet or less will incur a fee of $3,374, with developments of 3,400 square feet or more incurring a fee of $12,237. This is in addition to other development fees implemented by local city governments.

Supporters of the fee argue that residential developers should help bear the cost of growth. To put into simpler terms, as more homes are built in Williamson County, more people are likely to move into the county, and thus, the need for new schools will increase.

Opponents of the fee argue the costs disproportionately affect just one market that is responsible for growth, and argue that a broader tax would be more appropriate. Opponents also argue the fee will most likely only hurt new home buyers, with local realtors predicting home costs to increase in direct response to the fee.

Home Builders Association of Middle Tennessee v. Williamson County

The lawsuit against the Williamson County government was filed by the HBAMT in July 2017, with County Mayor Rogers Anderson saying he was “disappointed” in the HBAMT for their decision to pursue legal action against the county. 

The lawsuit saw its first day in court in February 2019 during a summary judgement hearing in Franklin. Representing the HBAMT, attorney John Williams argued the fee was not legal as the revenues collected from the fee were not required to be used in such a manner that would directly benefit that development. 

For example, an impact fee collected on a residential development in Brentwood could potentially go towards the construction of a new school in Spring Hill. This would go in direct opposition to the purpose of an impact fee Williams argued, as such a fee is designed to mitigate or defray the cost of an activity.

Despite Williams’ persistence, the judge presiding over that hearing ultimately ruled in Williamson County’s favor. The HBAMT appealed the judge's decision, only to have the appellate court uphold that decision on Friday.

“The judgment of the trial court is affirmed, and this matter is remanded with costs of appeal assessed against the appellant, Home Builders Association,” reads court documents related to Friday’s ruling. “In light of the foregoing, we conclude that the trial court did not err in granting summary judgment to the County.”