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Orlando residential developments in limbo due to school conflicts

On Behalf of | Feb 25, 2020 | Land Use |

Approximately 15-20 Orlando residential developments are currently on hold, and frustrations are rising. Neither developers, investors, nor law-makers are sure what to do at this point to fix the impasse, but know that it has to be properly resolved. Not only current projects are affected, but those coming down the development pipeline as well.

Last year, Florida governor Rod DeSantis signed House Bill 7103 into law. Prior to that bill, developers were required to pay an extra fee known as a “capacity enhancement agreement” to the school district where they were building. Its purpose was to cover school-impact fees that would arise from new students moving into the district once a development was compete. While money from property and sales tax do help, they do not cover the costs of campus additions and the hiring of additional staff to prevent classroom overcrowding.

Since the bill was signed into effect, school are continually reporting a shortfall of funds to provide for overcrowded schools and classrooms. Essentially, there are plenty of new students moving in, but no more money coming with them. In order for this issue to be resolved, new legislation is required to be passed, which is neither a quick nor easy process. Orange County developers require approval from a school district prior to residential development. Therefore, no new approvals are being made until the schools can be guaranteed funding.

This has become a complex, urgent issue to be addressed by Florida legislators. Any developer or investor who is affected by this matter would benefit greatly by seeking expert counsel on how to proceed.