An impact fee is a calculated and consistent charge on new development that is used by municipalities and other public entities to offset the cost of providing new services.   For example, a municipality can collect impact fees from developers to pay for a turn lane that will be needed once the traffic volume increases due to several developments, but each of the developments has paid “its fair share” of the cost into a mitigation bank so that the dollars are available once the lane is needed.  This process allows the municipality to meet the cumulative impact of multiple developments, which currently burdens the municipal infrastructure.  

Currently, impact fees are not expressly permitted in the state. Instead, many municipalities negotiate exactions that can be unpredictable and costly to developers, while often failing to mitigate the full impact of developments.  The current “closed door” process has little rhyme or reason.  Sophisticated municipalities might squeeze more out of developers, while larger developers have the resources and experience necessary to navigate the overly long and complex process.  Cities and towns may lack the technical capacity to evaluate impacts or to effectively negotiate with developers.  For municipalities, the benefits dwindle when boards are working at cross purposes and resources are consumed by long negotiations.

MAPC should work with stakeholders to develop legislation and guidance that would support application of impact fee assessments consistent with zoning, local plans, and regional plans.

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