BEND, OR -- The city of Bend is considering changes to how it calculates System Development Charges (SDCs) - those are fees paid by developers to cover the cost of increased demands on infrastructure, like roads, water and sewer. But Brian Fratzke, of Fratzke Commercial Real Estate, worries it will slow the pace of development.

It would increase water SDCs "For new medical buildings by 100%," Fratzke tells KBND News, "And if you want to do an indoor athletic facility - crossfit gym, pickleball court, indoor volleyball, the fees are going up 371%." He adds permit fees have also increased, "Even if the cost of construction went flat and labor went flat, it’s still really tough to get a building to pencil. We did an analysis: a new 7,000 foot medical building in Bend, the dirt costs less than the fees that are charged to build a building."

Other changes are proposed for transportation and sewer SDCs. The city has said revisions are needed to stimulate housing development and be more fair to high-density projects. Fratzke worries about the future impact on non-residential buildings, "Those fees, they think, ‘oh, the developer will pay them.’ Yeah, the developer’s going to hand them over to guys like you and me that are leasing the space. Our medical rates are already high. At some point, what I think will happen is people will say, ‘I can’t afford the rent.’ And you’re going to see a slowdown in construction."

A public hearing is scheduled for the January 17 Bend City Council meeting.