Impact Fees in Plain English
What is an Impact Fee?
An impact fee is a fee charged by a city or county to developers to pay for the costs of providing public facilities or of improving existing ones needed as a result of the new development. Developers are generally responsible for the entire cost of on-site improvements within the development that primarily serve residents of development. Impact fees are a mechanism for assuring that developers to pay a share of the costs of off-site facilities that serve the development. For example, new developments may create the need for new, expanded or improved public facilities such as parks, new or widened roads and sidewalks, schools, fire protection facilities, and utilities in the vicinity of the development.
In addition to the new demands on public facilities, the new development also will increase ongoing costs for public services, programs, and facilities operation and maintenance. For example, additional teachers, and firemen, as well as expanded recreation programs, may be needed as a result of the new development. Such ongoing expenses must be covered by funding sources other than impact fees.
Impact Fees as Applied in Washington
In Washington, impact fees are specifically authorized for those jurisdictions planning under the Growth Management Act (RCW 82.02.050 - .110). However, 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 addition, payments to "mitigate" direct impacts of development, including those on public facilities, are authorized as part of "voluntary agreements" under RCW 82.02.020, and under the State Environmental Policy Act (SEPA - Ch. 43.21C RCW). See Types of Impact Fees and Other Sources of Public Funding Authorized by Washington Statutes for more information on these and other impact fee or mitigation alternatives. In any case, impact fees must be reasonably related to the demand created by the new development - they may not exceed the development's proportionate share of the public facilities' costs. They must directly benefit the new development, and they may not be used to correct existing deficiencies in public facilities. See Impact Fees for relevant state statutes and case law.
Resources
- Impact Fees, MRSC
- Transportation Impact Fees, MRSC
- Impactfees.com - Comprehensive site on impact fees; Includes news, state and local links, surveys, publications, and case law