What are impact fees?

Impact fees are charges assessed on developers to help cover the costs associated with infrastructure improvements necessitated by new development projects. These fees are designed to ensure that the growth of a community is accompanied by the necessary public services and facilities, such as roads, schools, parks, and utilities, which are impacted by new construction.

The rationale behind impact fees is to allocate the financial responsibility for infrastructure improvements more equitably among those who are contributing to the need for such improvements through their development activities. By levying these fees, municipalities can mitigate the financial burden on existing residents and taxpayers, ensuring that new developments contribute to the infrastructure required to support population growth.

Urban renewal initiatives, property taxes, and conservation grants serve separate purposes that do not align with the specific role of impact fees in financing infrastructure needs related to new development. Understanding this contributes to a broader comprehension of how municipalities manage growth and maintain public service levels.