Impact Fees

An impact fee is a fee imposed by a municipality as a precondition for the development of land. Such fees are commonly imposed on developers by local governments in order to pay for the impacts of the development on the services provided by local governments. For example, a new housing development generates demands for services to maintain new roads, collect household garbage and recycling, and educate new children in the community. Impact fees must be reasonably related to the impact of the development. Communities often choose to closely tie impact fees to their capital improvement program.