Impact Fees Expanding In U.S. Munitipalities
Impact fees are popping up in a rapidly expanding number of cash-poor U.S. municipalities scrounging for new revenue sources while federal funding for local infrastructure has become more difficult to obtain. The one-time fees, imposed on builders and often folded into home prices and passed on to buyers, are used by cities to fund construction of infrastructure such as roads, sidewalks, parks and even fire stations for rapidly growing neighborhoods. A 2006 Kansas State University survey found that 39% of the 292 U.S. cities responding imposed impact fees on new construction last year, up from 25% in 2002. Property-rights advocates decry impact fees and other so-called exactions — requirements to donate land or make concessions to gain a government permit — as a means for local governments to avoid unpopular tax increases for all residents by singling out new arrivals to pay for city projects.
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