A Guide to Impact Fees and Housing Affordability

by Nelson, Arthur C.; Bowles, Liza K.; Juergensmeyer, Julian C.; Nicholas, James C.

• ISBN13: 9781597264136
• ISBN10: 159726413X
• Edition: 1st
• Format: Hardcover
• Copyright: 2008-04-30
• Publisher: Island Pr

Summary

Impact fees are one-time charges that are applied to new residential developments by local governments that are seeking funds to pay for the construction or expansion of public facilities, such as water and sewer systems, schools, libraries, and parks and recreation facilities. In the face of taxpayer revolts against increases in property taxes, impact fees are used increasingly by local governments throughout the U.S. to finance construction or improvement of their infrastructure. Recent estimates suggest that 60 percent of all American cities with over 25,000 residents use some form of impact fees. In California, it is estimated that 90 percent of such cities impose impact fees. For more than thirty years, impact fees have been calculated based on proportionate share of the cost of the infrastructure improvements that are to be funded by the fees. However, neither laws nor courts have ensured that fees charged to new homes are themselves proportionate. For example, the impact fee may be the same for every home in a new development, even when homes vary widely in size and selling price. Data show, however, that smaller and less costly homes have fewer people living in them and thus less impact on facilities than larger homes. This use of a flat impact fee for all residential units disproportionately affects lower-income residents. The purpose of this guidebook is to help practitioners design impact fees that are equitable. It demonstrates exactly how a fair impact fee program can be designed and implemented. In addition, it includes information on the history of impact fees, discusses alternatives to impact fees, and summarizes state legislation that can infl uence the design of local fee programs. Case studies provide useful illustrations of successful programs. This book should be the first place that planning professionals, public officials, land use lawyers, developers, homebuilders, and citizen activists turn for help in crafting (or recrafting) proportionate-share impact fee programs.

Author Biography

Arthur C. Nelson, FAICP, the lead author, is director of the Metropolitan Institute and professor of urban affairs and planning at Virginia Polytechnic Institute and State University. He is editor of Housing Policy Debate and associate editor of both the Journal of the American Planning Association and the Journal of Urban Affairs.

Table of Contents

List of Figures, Tables, and Boxes
Foreword
Impact Fees - Past, Present, and Future	p. 9
Basic Elements of Impact Fees	p. 25
Legal Foundations	p. 49
Impact Fees in Relation to Housing Prices and Affordable Housing Supply	p. 79
The Relationship among Impact Fees, Planning, and Exactions	p. 103
Equity and Proportionate-Share Principles Applied to Impact Fees	p. 109
Capital Facility and Infrastructure Financing Options	p. 141
The Role of the State	p. 165
Designing Impact Fees to Address Housing Affordability	p. 175
Case Studies of Proportionate-Share Residential Impact Fees	p. 207
Affordable Housing Impact Fee Relief Programs	p. 235
Expanding the Base to Advance Housing Affordability	p. 249
Impact Fees and Housing Affordability in the Next Generation	p. 259
Notes	p. 261
Bibliography	p. 277
Index	p. 287
Table of Contents provided by Blackwell. All Rights Reserved.