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SUBJECTS › PLANNING › Impact Fees
Updated 05/09

Impact Fees

Contents

Introduction

Impact fees are charges assessed by local governments against new development projects that attempt to recover the cost incurred by government in providing the public facilities required to serve the new development. Impact fees are only used to fund facilities, such as roads, schools, and parks, that are directly associated with the new development. They may be used to pay the proportionate share of the cost of public facilities that benefit the new development; however, impact fees cannot be used to correct existing deficiencies in public facilities. In Washington, impact fees are authorized for those jurisdictions planning under the Growth Management Act (RCW 82.02.050 - .100), as part of “voluntary agreements” under RCW 82.02.020, and as mitigation for impacts under the State Environmental Policy Act (SEPA – Ch. 43.21C RCW). GMA impact fees are only authorized for: public streets and roads; publicly owned parks, open space, and recreation facilities; school facilities; and fire protection facilities in jurisdictions that are not part of a fire district. Setting fee schedules for impact fees is a complex process typically involving rate studies; generally, impact fees do not recover the full cost of a new facility since these fees must be directly and proportionately related to impacts associated with new development.

In 2009, the Legislature adopted SB 5580, Chapter 263, Laws of 2009, which extends the time period for expenditure of school impact fees to 10 years.

This impact fees page includes links to materials addressing technical and legal aspects of impact fees, sample ordinances, and fee schedules.

Reference Sources

State Statutes and Administrative Regulations - Impact Fees


Three statutes provide the primary authority for impact fees imposed by cities and counties:

Washington Administrative Code

Court Decisions – Impact Fees 

  • General - James T. James v. Kitsap County, 154 Wn.2d 574 (2005) - The imposition of impact fees as a condition of building permit issuance is a "land use decision" subject to the Land Use Petition Act (LUPA), and thus must be challenged within 21 days.
  • General - Pavlina v. City of Vancouver,  122 Wn. App. 520 (2004) - [Assessment of development impact fees] - Even though preliminary plat approval occurred before an impact fee ordinance was adopted, the fees could be imposed when the developer applied for a building permit. Impact fees are not an additional condition of approval. That the developer’s plan previously received preliminary approval does not preclude imposition of impact fees when a building permit is sought.
  • General - Nolte v. City of Olympia, 96 Wn. App. 944 (1999) - A city may not impose impact fees on projects outside of its borders. However, if a city enters into a utility extension agreement (UEA) based on the promise to pay impact fees that are later found to be invalid, the city is relieved of its duty to perform under the UEA.
  • General - Vintage Construction Co. v. Bothell, 83 Wn. App. 605 (1996) - A land developer sought to recover fees paid to a city in lieu of dedication of land that were imposed on the developer as a condition of subdivision approval. The court held that the city's failure to determine, in a site-specific manner, the value of the land the developer could have been required to dedicate rendered the fees in lieu of dedication invalid. This case provides a clarification of two earlier cases concerning impact fees: Henderson Homes v. Bothell, 124 Wn.2d 240 (1994), and Trimen Development Co. v. King County, 124 Wn.2d 261 (1994).
  • Schools - Wellington River Hollow v. King County,  113 Wn. App. 574 (2002) - [Impact Fees] - It is not unconstitutional for jurisdictions within a school district have discretion to impose school impact fees on new developments, even though the amount of fees for comparable units will differ from one jurisdiction to another within the same school district.
  • Schools - West Coast, Inc. v. Snohomish County,  104 Wn. App. 735 (2000) - [Preliminary Plats/Modification/Impact Fees] - A condition of preliminary plat approval, in this case school impact fees, is tantamount to a contractual obligation that is binding on the applicant absent extraordinary circumstances justifying a failure to perform.
  • Transportation - City of Olympia v. Drebick, 156 Wn.2d 289 (1/19/2006) - [Calculation of development fees under GMA] The state supreme court upheld the city's calculation of transportation impact fees imposed under GMA, reversing a decision by the court of appeals (119 Wn. App. 774 (2004)). The GMA impact fee statutes permit local governments to base impact fees on area-wide infrastructure improvements reasonably related and beneficial to the particular development seeking approval. This standard is broader than the standard under SEPA or the Local Transportation Act. The city was not required to calculate the impact fee by making individualized assessments of the Drebick development's direct impact on each improvement planned in a service area. The city's method of calculating transportation impact fees complied with the plain language of the GMA impact fee statutes.
  • Transportation – New Castle Invs. v. City of LaCenter,  98 Wn. App.224 (1999) - [Transportation Impact Fee Ordinance] - A city's transportation impact fee ordinance is not subject to the vesting statute for subdivision applications, RCW 58.17.033, because transportation impact fees do not fall within the definition of "land use control ordinances" Under that statute. Consequently, the city's impact fee can be applied to a proposed development even though the application for preliminary plat approval was completed prior to the effective date for the city's ordinance.

Selected Growth Management Hearings Board Decisions – Impact Fees

Most Growth Management Hearings Board decisions address the fact that impact fees imposed under Chapter 82.02 RCW are not within the board’s jurisdiction.

Links to selected impact fee decisions

Frequently Asked Questions - Impact Fees

List of  Jurisdictions with Impact Fee Provisions


    Documents

    (Also see the list of impact fee ordinances, which includes some links to ordinances in full-text)

      Ordinances authorizing impact fees for multiple capital facilities:

      Ordinances authorizing impact fees for schools:

      Ordinances authorizing transportation impact fees:

      Ordinances authorizing impact fees for community parks and roads:

      Ordinances authorizing impact fees for park and recreation facilities:

      Articles:

      General Documents and Resources:

      • Timing of Impact Fee Payments - From a 1999 survey conducted by MRSC
      • Impactfees.com, an online impact fees resource provided by Duncan Associates - Comprehensive site on impact fees developed by national impact fee consultants; includes news, state and local links, surveys, publications, and case law.

      Information by Topic

      School Impact Fees

      Transportation Impact Fees

      Impact Fee Surveys and Studies 

      Library Resources

      The ordinance and policy provisions contained in this list are offered as samples rather than models. Some may not be applicable to your particular needs and others, due to changes, may not be consistent with the current law. It is recommended that the city or town attorney, or in the case of a county, the county prosecuting attorney, be consulted before incorporating any of these provisions into your own regulations.

      Sample Impact Fee General Information available from the MRSC Library - Articles addressing impact fees, drafting impact fee ordinances and fee schedules, and rate studies.(paper copies only)

        Overview of Impact Fees
      • "Impact Fees and Transportation Concurrence Programs: What's Authorized? What's Required?" Grace T. Yuan, Washington State Bar Association, September 7, 1995
      • "Development Exactions and Impact Fees," John E. Keegan & Linda White Atkins, Washington Real Property Deskbook, Third Edition, Volume 6, 1996
      • "Exactions, Impact Fees and Other Land Development Conditions," David L. Callies, Benjamin A. Kudo, William S. Richardson, Revolutionary Ideas in Planning: Proceedings of the 1998 National Planning Conference, APA.
      • "Dolan's Mysteries Explained," Fred P. Bosselman, AICP, Land Use Law, January 1999.
      • "Impact Fees Under the Growth Management Act: Road Map for Local Jurisdictions," J. Tayloe Washburn, WFOA Conference September 18-20, 1991
      • "Impact Fees and New Growth Management Legislation," Larry C. Martin, WSAMA Conference, June 1991, Spokane, WA.
      • "Development Exactions: Legal Authorities and Limitations," Richard L. Settle, Legal Notes, MRSC Information Bulletin No. 446, 1988.
      • "Developer Mitigation Agreements and Other Devices for Supporting Infrastructure Needs and Development Impacts," Scott M. Missal, Legal Notes, MRSC Information Bulletin No. 467, 1990.
        Drafting Impact Fee Ordinances And Fee Schedules
      • "Drafting Impact Fee Ordinances - Part 1: A Legal Foundation," PAS Memo, October 1986.
      • "Drafting Impact Fee Ordinances - Part 2: Technical Planning and Administrative Guidelines," PAS Memo, November 1986.
      • The Calculation of Proportionate-Share Impact Fees, PAS Report No. 408, July 1988.
      • "Elements of a Municipal Impact Fee Ordinance, with Commentary," Martin L. Leitner and Eric J. Strauss, APA Journal, Spring 1988.
      • "Transportation Funding," Sandra R. Driscoll, Legal Notes, MRSC Information Bulletin No. 467, 1990.
        Rate Studies
      • "Interim Impact Fee Rate Study for Parks, Open Space, and Recreational Facilities," Henderson, Young & Company; City of Olympia, WA., June 1992.
      • "Draft Rate Study for Impact Fees for Roads," Tumwater, WA., August 1992.
      • "Interim Impact Fees Rate Study for Fire Protection Facilities," Henderson, Young & Company; City of Olympia, WA., July 1992.
      • "Olympia School District Rate Study for Interim Impact Fees for School Facilities," City of Olympia, City of Tumwater, and Thurston County, WA., 1992.