A developer planning to build a new neighborhood here says he can charge future homeowners thousands of dollars when they sell their houses. The neighbors say he can’t. And the city of Allen says it doesn’t know who’s right. A conflict that began over a zoning case has raised questions about the strength of a state law that intended to ban private transfer fees — money paid to the original developer or builder of a property every time it changes hands. The fee has pitted developer Philip Williams against residents of Montgomery Farm, an enclave in west Allen where palatial houses overlook open space. The collection of small neighborhoods sits above a 155-acre natural area.
Dozens of Montgomery Farm residents are bound by a decade-old deed restriction that requires them to pay 1 percent of the purchase price of their property to the developer when they sell their houses. At The Meadow subdivision, next to the proposed Montgomery Farm Estates neighborhood, homes start at about $800,000. Homeowners have to fork over at least $8,000 or so to Williams. The fee doesn’t expire. It has to be paid by subsequent sellers. According to Williams, it also applies to the future homes.
The 2011 law allowed existing transfer fees to continue if developers filed paperwork with their counties. Collin County records show Williams submitted required notices. He said the fee will apply to his proposed neighborhood because that land was included in the deed restriction that had already been recorded when the law went in effect. That piece of land has not been subdivided into the lots that would be sold. Williams said his company uses the money to maintain the natural area, dubbed the Gardens of Connemara.
Williams’ plan was to build another 200 homes or so north of the natural area. Some residents were upset about the short distance between the proposed homes and their own.
- Dallas Morning News, February 10, 2016