Lubbock’s city council moved ahead quickly on Monday with a second vote, finalizing changes to the city’s roadway impact fee rates.
According to state law, the city is required to approve or disapprove of the imposition of an impact fee within 30 days of the public hearing, which took place in Lubbock on July 22.
Less than a week after the first vote, the council gave final approval to the reduced impact fees in a special meeting on Monday with a vote of 5-2. While District 1 council member Christy Martinez Garcia and District 6 council member Tim Collins opposed the measure, District 2 representative Gordon Harris changed his vote to favor the reduced impact fees.
That new fee was zero dollars and zero percent for developers.
Roadway impact fees are intended to divide one of the major costs of new growth in Lubbock between public tax dollars and private developers, in an upfront fee calculated from a percentage of new construction costs when the development requires new or updated roadways in the area.
When the impact fees were first implemented, the impact fee ratio was set at 25% for developers and 75% for the city. State law requires a new evaluation every five years to update the fees for different service areas of the city, depending on growth.
According to City Engineer John Turpin, the restudy found 2.2% growth for the city of Lubbock over the past few years. The study calculated an assumption of more than $577 million in road building projects and financing across all service areas over the next 10 years.
“It is automatically assumed that we are going to take on 50% of that,” Turpin said. “Now, the piece that we are talking about that could potentially affect the rates in the future is that other 50%.”
Following the evaluation, Lubbock’s capital improvements advisory committee recommended in May that the council maintain the current 25% cost ratio for impact fees, and “use impact fees as the City Council sees fit, in order to support bond projects.”
In 2022, voters approved a $200 million bond covering 17 road projects by a margin of around 5,600 votes. In 2024, voters chose again to support a $103 million bond for seven new projects, including repaving the bricks on Broadway Avenue.
Lubbock developer Thomas Payne served on the committee that recommended the current rate. While Payne argued for a 50/50 split in the cost between the city and developers, he described the structure of impact fees as an “effort toward fairness” when it comes to the cost of building or updating streets.
“Impact fees were created to more fairly distribute that cost, not to put it entirely on new development, but to more fairly distribute that cost to new development,” Payne told the council. “This is a zero-sum game. Somebody is paying for the cost.”
According to Payne, the restudy was necessary because of increasing construction costs and the uneven pace of development in southern and western portions of the city.
“With impact fees, we have the potential for developers to do development agreements to get credits for the impact fees to build streets,” Payne said. “Quaker Avenue is the current prime example that would not exist without impact fees, and, therefore, the credits that developers can get for spending their money.”
According to the city, Quaker Avenue to 146th Street is a street project currently being built with funds from impact fees. The project extends Quaker Avenue out toward development around the Red Feather Golf Course, the future site of the 2026 Parade of Homes by the Lubbock Home Builders Association.
“I think it would be beneficial to step back and look at the fact that a lot of those same constituencies who would argue against impact fees are buying lots to build in the 2026 Parade of Homes at the Red Feather development, which could not exist in 2026 without impact fees,” Payne said.
But developers say it's the new homeowners and business owners who pay the cost.
The case against impact fees
A coalition of developers from the Lubbock Home Builders Association, the Lubbock Association of Realtors, Lubbock Chamber of Commerce and the Lubbock Apartment Association has been calling on the council to reduce or remove impact fees since the discussion began.
Robert Wood is a local custom home builder with housing lots in the Red Feather development. Wood told the council on August 12 the true cost of impact fees doesn’t go to developers.
“The reality is, the cost is passed down, resulting in higher home prices, rents, and as brought to your attention earlier, businesses that have to pay these costs before they can get a permit to build their projects,” Wood said.
The CEO of the West Texas Home Builders Association, Victoria Whitehead, has been an active opponent to impact fees, which she said can disproportionately affect small business owners.
“You're telling a realtor who has an office of four people, you have to pay an impact fee of $40,000 because of the highway impact, the road impact that your office has,” Whitehead said. “It's not going to hurt the HEBs, it's not going to hurt the bigger box stores that can really trickle that down to their consumers. It's hurting our small business.”
Before their first vote, Whitehead told the city council that many factors like looming tariffs on lumber can influence the rising price of homes, but she emphasized that “houses drive business” and home affordability is not improving. In recent budget discussions, the City of Lubbock reported around $2,000 increase in the average home appraisal over last year.
“There are over 115,000 families in the city of Lubbock that want to live in a new home but can't afford one,” Whitehead said. “75 more families join that list every time we increase the home price of $1,000.”
Another custom homebuilder and leader for the Lubbock Economic Development Alliance, Jordan Wheatley, called on the council to drop the impact fee system entirely.
“Developers do not pay impact fees. I've never paid an impact fee. I never will,” Wheatley said. “Lubbock citizens pay impact taxes. It's all rolled down to the citizens.”
Wheatley spoke to the council about what he believes the next steps need to be to pay for the city’s growth. As the chairman of the Keep Lubbock Moving PAC that brought increased attention to the 2024 bond, Wheatley insisted that the future of Lubbock’s growth should be paid for with bonds.
Bonds like 2022’s $200 million road bond, the first road bond passed by Lubbock voters since 2009, can increase the property taxes for the city, but Wheatley said even $300 million in the next 15 years “will not be good.” He wants a new advisory committee, with representatives from each district and regular quarterly meetings with city staff and the council.
“The great thing about this, you guys can accept our findings. You could deny them. You can edit them, or you can act on these quarterly reports,” Wheatley said. “We're going to aim to make these projects beneficial and equitable to the needs of all districts.”
Council representative Tim Collins from District 6 proposed reducing the impact fee to a percentage that would compensate for increased costs and inflation while keeping the cost intended for developers in line with what was being charged initially.
District 6 covers much of the west and north corner of Lubbock, where many new homes are being built. Collins said this issue of impact fees has weighed heavily on him.
“I'm very concerned about how we impact our local business owners,” Collins said. “I'm very concerned about how we impact our local home builders or home buyers, I should say, because we do recognize that these fees are going back to the home buyer.”
With impact fees now effectively nullified, Collins said city council members can’t endorse any road bonds, but at the moment, the city as a whole is left with few other options.
“Going forward, we're totally dependent upon road bonds, and we're going to have to call on these folks to assist us,” Collins said.
While District 3 is not subject to impact fees, in part because it consists of fully developed neighborhoods inside Loop 289, council member David Glasheen has referred to the impact fee system as a “failed experiment.” One reason, Glasheen said, is because the cost passed down to business owners could slow them from opening and generating tax revenue in the first place.
“There's an incredible harm in preventing even one business from opening, but there's an incredible benefit to allowing many businesses to open and begin contributing money to the city's general fund,” Glasheen said.
Glasheen proposed the later approved motion that reduced impact fees to 0%.
Responsibility, cost of growth and development
In 2020, Lubbock’s city council and the capital improvements advisory committee took an in-depth look at what other cities have done to ease the burden of new infrastructure like roads and water systems as cities across Texas experienced a spike in growth.
Lubbock’s council voted to implement a system that would try to share part of the cost of growth in roadways between the city and private developers with an “impact fee.” Water and wastewater costs are still solely covered by the city.
On that previous council was Sheila Patterson-Harris, who represented District 2. Alongside former District 1 representative Juan Chadis, Patterson-Harris pushed for a 50/50 split between the taxpayers and developers. The council eventually reached a compromise with a 25% cost ratio for developers and 75% for the city.
Five years later, none of the members who passed impact fees remain on the council.
After stepping down in 2024 following eight years on the council, Patterson-Harris said she’s tried to take a break from local politics. However, as president of the Chatman Hill neighborhood association, she added that she is still paying attention to what benefits her district.
Patterson-Harris said she would prefer to see an equal share between the city and developers, but she’s been pleased by what has occurred in her district since the impact fees were first implemented, like the extension of East 19th Street to east Loop 289.
“The decision back when I was on the council was for 25% and I'll take that because I've begun to see even in the eastern portion of the city, where, because of some building and impact fees that were collected, we were able to do some work on East 19th street,” Patterson-Harris said.
More than just impact fees, Patterson-Harris said developers benefit from the growing city, and she believes they deserve to pay their share. Patterson-Harris described how repaving roads like Erskine Street across Martin Luther King, Jr. Blvd from Estacado High School has brought new homes and more people to the northeast edge of the city.
“When that roadway was put into place, man, people began to use it,” Patterson-Harris said. “So I don't think we handicap folks because the city doesn't have the money to do it. Developers have the money to do it. They have the money to do it, and they can holler all they want to, but I think it's only fair that they pay for what they should be responsible for.”
Lubbock native Dr. Nicholas Bergfeld is an entrepreneur with a Masters in Public Policy from Harvard’s John F. Kennedy school of Government, and he’s served as an executive coach for west Texas startups with the Innovation Hub at Research Park. He has advocated for development and restoration in the older parts of Lubbock for a decade, including fighting to implement impact fees for the city in 2020.
“The ways the city has utilized resources over its history is undeniably not fair, like you can look at how we've done the allocation of road bonds,” Bergfeld said. “My go to example of this is the gateway fund.”
The Gateway Fund was first established in 2004 from fees that utility companies paid to access public right-of-ways like alleys, in order to build roadways like Milwaukee Avenue in west Lubbock, and extending 98th street to Interstate 27 in the south.
With Lubbock Power & Light as the single electric utility for the city at the time, Bergfeld said that fee cost also got passed on to citizens’ electric bills.
“It wasn't a bond election that originally started all this,” Bergfeld said. “It was a non-voted-on slush fund that forced all of Lubbock's citizens to effectively subsidize the destruction of older parts of town by taking away their resources through a tax.”
The city issued bonds for many of the Gateway street projects to speed up construction, and now much of the Gateway Fund is dedicated to debt service.
“When you see all of those things, you recognize that there's something unfair that's going on,” Bergfeld said. “That somehow there are other individuals that are benefiting from the fact that there is unequal treatment of the different neighborhoods, and that resources are being heavily favored and directed towards some, for the benefit of a few, and not for the benefit of the community.”
Bergfeld explained that as cities grow, there's a one-time initial cost to placing or upgrading infrastructure like roads in new parts of the city, but the maintenance cost with that infrastructure for fully developed, older parts of town will continually get pushed back on the taxpayer.
“For me, as a Lubbock citizen, that's a permanent liability that I now have to figure out how to pay for forever,” Bergfeld said. “And the reality is that that's becoming harder and harder and harder for what we already have, and that's been true for quite some time.”
According to recent city budget presentations, Lubbock’s maintenance and operations budget has increased by $9.5 million over the last two years. In April, the city began a hiring freeze for most departments to offset a budget shortfall of $5 million in the general fund.
For Bergfeld, bringing attention and proposals to ensure that older parts of Lubbock were not left behind was one of the reasons behind the Lubbock Disparity Report.
The report, published in 2020, outlined where the city’s new growth does not take on the ever-increasing cost of infrastructure for the neighborhoods left behind, pulling students to other school districts and homeowners away from Old Lubbock. Other growing cities in Texas have implemented new fee structures and updated zoning practices to reshape growth and confront housing affordability in a state that is expected to gain three to five million more people in the next 10 years.
One hope with impact fees was that the cheaper service areas in central and eastern Lubbock would draw that growth back, but after five years, developers said they’re driven by the market and argued that the city making $14 million from impact fees was not enough to justify the expense they pass on to new home and business owners.
“I see this simply going in one direction, which is: Lubbock citizens are just going to pick up even more of a tab to subsidize the profits of an elite number of individuals in the city of Lubbock,” Bergfeld said. “And we're all going to suffer from it during a period in time where we are struggling to find the resources to finance our maintenance, during a period in time where we are struggling to allocate appropriate resources to revitalization.”
Bergfeld said 2020’s effort with the community group Lubbock Compact to begin enacting impact fees felt different in response compared to the 2025 effort to remove impact fees. He said the 2020 campaign gave new perspective for many Lubbock taxpayers and developers alike.
“We're talking 200 plus citizen comments in real time, right? Not form letters. People actually writing heartfelt letters saying, ‘please do not hurt the future of Lubbock so that a few handful of us can make a little bit more money,’” Bergfeld said. “And at the time, Mr. [Thomas] Payne was on the opposite side of this issue.”
Many who fought to implement the fee, like Lubbock Compact’s Joshua Shankles and Adam Hernandez returned ahead of the city council’s final vote on impact fees on Monday.
Another former city council member, 12-year District 6 council veteran Latrelle Joy, returned to Citizens Tower after she chose not to run for re-election in 2024.
“It seems we have the perfect storm,” Joy said as she addressed the sitting council at Monday’s special meeting. “You're in budget session. We've been told that we have less money available than when we started on budgets. We have impact fees, and then we had technology and security problems.”
Joy said she’s tried to take a break as well over the last year, but she’s concerned about the motivations within the city’s leaders working back the impact fee movement of the previous council. She described how the impact fees developed from conversations and education with leaders who had separate interests but the goal was unquestionably community-focused.
Joy said they didn’t get everything right, but the motivation was clear.
“They grew out of the Comprehensive Plan, which we conducted for the entire city,” Joy said. “Every meeting, we had different groups of people who came to talk about what they would like to see do better.”
Responding to claims of confusion on the impact fee structure, Joy called on everyone to postpone the vote until it made sense, instead of making a poorly informed decision. Joy said the city council sets a budget for one year, but each decision has implications for future years and the previous council implemented impact fees for a reason.
“If you don't understand it, go educate yourself, because it can be done,” Joy said. “We all did it.”
Thomas Payne returned as well, but after working for years on the capital improvements advisory committee, Payne has resigned from his position.
“I did so because the actions of the council last Tuesday placed me in a position of untenable, direct and immediate conflict of interest with the city,” Payne said. “So I can't stand up and speak with my city of Lubbock hat on, so now I'm speaking to you as just a regular citizen.”
Payne explained to the council that voter-based bonds with building interest will not be a reliable method for pulling in money to support Lubbock’s infrastructure, particularly with tax increases already expected to overcome the city’s budget shortfall. Impact fees, he argued, could’ve supported the city’s infrastructure through budget struggles without affecting the tax rate.
“There have been $14 million, approximately, of impact fees collected today,” Payne said. “Of that, five have been spent enabling the substantial completion of $26 million of roadway project projects in Lubbock, Texas. The remaining $9 million in the bank, at the same five to one ratio, will support another $45 million worth of road projects, a total of $71 million.”
As a longtime developer who has watched the process from the beginning and changed his mind on the benefits of impact fees, Payne rejected the “failed experiment” claim, because he saw the data that built it.
“I acknowledge that doing away with impact fees would be a significant benefit to me personally,” Payne said. “But each of us has a greater responsibility than to think only of lining our own pockets.”