Improvement-Driven Fees National Impact Fee Roundtable Arlington, VA October 5, 2006

Session Outline  Clancy Mullen (15 minutes) Conceptual framework  Randy Young (15 minutes) Road impact fee example  Joe Colgan (15 minutes) Alternative taxonomy  Panel Discussion (15 minutes)  Q&A (15 minutes)

Overview  Alternative Methodologies Plan-Based Standard-Based  Essential Characteristics  Plan Requirements in State Laws  Advantages and Disadvantages

Alternative Methodologies  Plan-Based (Improvements-Driven)  Standard-Based (Demand-Driven, Consumption-Based, Buy-in, Incremental Expansion)

Essential Characteristics of Plan-Based Methodologies  Geographic LOS standard All roads function at LOS D or better Drainage adequate for 100-year storm A park within one mile of every house Minimum 5-minute fire response time  A 10-year to 20-year master plan Growth projections for planning period Improvements needed to serve growth at adopted/desired standard  Fee = Total Cost divided by Growth

Essential Characteristics of Standard-Based Methodologies  System-wide LOS standard Park acres/1,000 population Road system VMC/VMT ratio Fire station sq. ft./dwelling unit Gallons/day per single-family equivalent Permanent school stations per student Existing facilities cost per demand unit  Total cost / capacity = unit cost  Fee = unit cost x units needed

Comparative Typical Features Plan-BasedStandard-Based List of projects mandatoryList of projects optional Spend only on listed projectsAny eligible improvement Add projects when plan updatedAdd projects any time Desired LOS = deficienciesExisting or desired LOS No charge existing capacityTypically no excess Charge for future excessCharge only for needed

State Law Requirements  27 states have enabling acts 30% no requirements (FL, AZ, CO, WA..) 20% require only a list (AR, OR, UT, WI..) 50% require growth projections  Typical requirements Growth projections List of needed projects and costs Only attributable share used in fee calc.  TX: max fee = growth costs/growth

Advantages/Disadvantages Plan-BasedStandard-Based Certainty based on planFlexibility to adapt to change Legitimacy based on planValidity not tied to plan Can use geographic LOSSystem-wide LOS simpler Captures marginal costLong-term avg. = marg. cost

When Plan-Based is Warranted  Complex, geographic-based LOS  Master plans available  Community approaching build-out