Framing Frederick’s Future – APFO Changes…
The Adequate Public Facilities Ordinance (APFO) has, within the last 20 years of existence, been a key regulatory mechanism shaping both the pace and location of development in Frederick County.
It was initiated in 1993 for the purpose of “requiring all new development to pay its proportionate fair share of the costs for capital facilities and reasonably attributable impacts on public schools” and further to “complement the County Comprehensive Plan by ensuring that adequate public facilities are available in a timely and well planned manner.”
An examination of the APFO’s evolution is a good opportunity to consider the drivers behind residential development, and how those drivers, in turn, indicate the strengths and weaknesses of the APFO.
By 1995, Frederick County system-wide school capacity reached its peak at 100% of State Rated Capacity (“SRC”). Elementary schools peaked in 1994 at 103%; middle schools in 1997 at 102%; and high schools in 2002 at 106%. Particularly in the early years, school construction was buoyed by a strong housing market paying impact fees and bringing in additional revenue in the form of property and income taxes.
The first eight years of the APFO saw construction of six elementary, one middle and one high school (or capacity additions related thereto). At the time, there were good justifications for the APFO and its companion impact fees; certainly, they were utilized to create the capacity that exists today.
In 1999, the county made a policy change and amended the APFO to revise the school “passing” threshold down to 100% SRC. This was arguably unnecessary for elementary and middle school levels, as they both had already peaked with respect to their system-wide capacities.
As for high schools, which take longer to plan and construct, perhaps the tighter standard was needed until school construction could catch up to the existing need. As high school capacity peaked in 2002, the opening of Tuscarora in 2003 increased available capacity, even though enrollment stayed steady and an additional high school was being planned.
Over the last eight years, system-wide elementary school capacity declined from 97% to 94% and middle schools from 84% to 81%. High school system-wide capacity began the period above 100%, with the 2010 opening of Oakdale High School adding capacity.
Ironically, Oakdale/Lake Linganore Development, who donated the land for Oakdale, saw its related land holdings down-zoned just five months prior to the opening of the high school. But that’s a story for another day.
Recent changes to APFO include expanding the information used in calculating impacts on planned developments, as well as the School Construction Fee Option, which provides an opportunity to pay an increased amount (above the proportionate fair share) of school fees to the school level that is failing as one of the options to mitigate an inadequacy.
The Villages of Urbana development made the first payments under the School Construction Fee Option; these have already been allocated for use with the expansion of the Urbana Middle School fit out. Without the recent change, funding would have had to have been pulled from other worthy projects, or other revenue increasing options.
Overall, the county initiated the APFO at a time when system-wide capacity was on the rise due to increased enrollment as a result of planned and programmed development in the county. From the year of its onset, there were five straight years with actual enrollment growth greater than 1,000 students.
Interestingly, enrollment growth has declined ever since, significantly over the last seven years, to virtually flat enrollment growth (40,130 students in September 2007 and 40,157 students in September 2013).
During this same period, 3,868 new homes were constructed in Frederick County, which by simple application of the pupil generation formulas should have generated 1,780 new students. When examined in the light of actual enrollment data, this is a clear demonstration that new homes don’t always equal more students.
One may argue that the decreasing enrollments in the early years of the APFO were related to new school construction; but the almost flat enrollment trend is evidence that new housing is not the only influence. Changing demographic drivers, economic cycles and household formations play a very influential role as well.
As there were necessary changes to the APFO to deal with those development and demographic drivers in the past, different approaches to planning for and funding our school needs should now be considered. A good example is Hillcrest Elementary. In looking at the attendance area, very little, to no new growth (i.e. housing starts/building permits) has occurred in that schools attendance area for many years. Yet, enrollment capacity has increased from 106% to 130% in the last two years alone.
Reasons for enrollment growth in areas with little new residential construction may include state mandates such as All-Day Kindergarten, Mandatory Pre-K and reductions in maximum State Rated Classroom sizes, making for a very complex set of circumstances that cannot be blamed on new growth alone. No APFO or Impact Fee approach would be able to deal with these types of influences.
Other areas may see enrollments increase as older neighborhoods ‘re-generate’ when the older population moves out and younger generations with school aged children move in. This is happening all over, particularly in areas with constrained housing supply. Many of these areas of re-generation are in homes that preceded APFO and Impact Fees, relying on general fund revenues to cover their costs of the impact.
It should not be lost on any of Frederick County’s taxpayers, new housing fueled the revenue stream, both from one-time impact fees and annual income and property tax revenue to the county and state. This made possible the new schools that serve our community today.
The APFO and its related inputs and outputs are a revealing window on the demographic and economic drivers which have changed since 1993; those drivers will continue to change.