S 696 Session 112 (1997-1998)
S 0696 General Bill, By McConnell
Similar(H 3893)
A BILL TO AMEND CHAPTER 7, TITLE 6, CODE OF LAWS OF SOUTH CAROLINA, 1976,
RELATING TO PLANNING BY LOCAL GOVERNMENTS, BY ADDING ARTICLE 15 SO AS TO
ESTABLISH UNIFORM STANDARDS FOR A LOCAL GOVERNMENTAL ENTITY TO REQUIRE A
DEVELOPER TO PAY A PROPORTIONATE SHARE OF THE COST OF NEW PUBLIC FACILITIES
NEEDED TO SERVE NEW GROWTH AND DEVELOPMENT, AND TO ESTABLISH PROCEDURES FOR
ADOPTING A CAPITAL IMPROVEMENTS PLAN, FOR COMPUTING THE PROPORTIONATE SHARE OF
COSTS, AND FOR PASSING AN ORDINANCE IMPOSING DEVELOPMENT IMPACT FEES.
04/24/97 Senate Introduced and read first time SJ-6
04/24/97 Senate Referred to Committee on Judiciary SJ-6
A BILL
TO AMEND CHAPTER 7, TITLE 6, CODE OF LAWS OF SOUTH
CAROLINA, 1976, RELATING TO PLANNING BY LOCAL
GOVERNMENTS, BY ADDING ARTICLE 15 SO AS TO
ESTABLISH UNIFORM STANDARDS FOR A LOCAL
GOVERNMENTAL ENTITY TO REQUIRE A DEVELOPER TO
PAY A PROPORTIONATE SHARE OF THE COST OF NEW
PUBLIC FACILITIES NEEDED TO SERVE NEW GROWTH AND
DEVELOPMENT, AND TO ESTABLISH PROCEDURES FOR
ADOPTING A CAPITAL IMPROVEMENTS PLAN, FOR
COMPUTING THE PROPORTIONATE SHARE OF COSTS, AND
FOR PASSING AN ORDINANCE IMPOSING DEVELOPMENT
IMPACT FEES.
Whereas, the General Assembly finds that an equitable program for
planning and financing the public facilities needed to serve new
growth and development, in such a manner as not to restrict unduly
or to inhibit growth and development, is necessary to promote and
accommodate orderly growth and development and to protect the
public health, safety, and general welfare of the citizens of this State;
and
Whereas, it is the intent of the General Assembly to:
(1) ensure that adequate public facilities are available to serve new
growth and development;
(2) promote orderly growth and development by establishing
uniform standards for local governments to require that those who
benefit from new growth and development pay a proportionate share
of the cost of new public facilities needed to serve that new growth
and development;
(3) establish minimum standards for the adoption of development
impact fee ordinances by governmental entities;
(4) ensure that those who benefit from new growth and
development are required to pay no more than their proportionate
share of the cost of public facilities needed to serve new growth and
development and to prevent duplicate and ad hoc development
requirements;
(5) encourage the construction of affordable housing by ensuring
the availability of sufficient infrastructure; and
(6) authorize governmental entities that are authorized to adopt
ordinances to impose development impact fees. Now, therefore,
Be it enacted by the General Assembly of the State of South
Carolina:
SECTION 1. Chapter 7, Title 6 of the 1976 Code is amended by
adding:
"Article 15
Development Impact Fees
Section 6-7-1300. This article may be cited as the 'South Carolina
Development Impact Fee Act'.
Section 6-7-1310. As used in this article:
(1) 'Affordable housing' means housing affordable to families
whose incomes do not exceed eighty percent of the median income
for the service area or areas within the jurisdiction of the
governmental entity.
(2) 'Appropriate' means to obligate legally by contract or to
otherwise commit to use by appropriation or other official act of a
governmental entity.
(3) 'Capital improvements' means improvements with a useful life
of ten years or more, by new construction or other action, which
increase the service capacity of a public facility.
(4) 'Capital improvement element' means a component of a
comprehensive plan, adopted pursuant to this article.
(5) 'Capital improvements plan' means a plan adopted pursuant to
this article that identifies capital improvements for which
development impact fees may be used as a funding source.
(6) 'Connection charges' means charges for the actual cost of
connecting a property to a public water or public sewer system,
limited to labor and materials involved in making pipe connections,
installation of water meters, and other actual costs. Not included in
this definition are system improvement costs, land acquisition, capital
construction, engineering or design costs, or upgrading, updating,
expansion, repair, or maintenance of existing or new capital
improvements.
(7) 'Developer' means a person or legal entity undertaking
development.
(8) 'Development' means construction or installation of a building
or structure, or a change in use of a building or structure, or a change
in the use, character, or appearance of land, that creates additional
demand and need for public facilities.
(9) 'Development approval' means written authorization from a
governmental entity that authorizes the commencement of a
development.
(10) 'Development impact fee' or 'impact fee' means a payment of
money imposed as a condition of development approval to pay for a
proportionate share of the cost of system improvements needed to
serve development. The term does not include:
(a) a charge or fee to pay the administrative, plan review, or
inspection costs associated with permits required for development;
(b) connection or hookup charges;
(c) amounts collected from a developer in a transaction in which
the governmental entity has incurred expenses in constructing capital
improvements for the development if the owner or developer has
agreed to be financially responsible for the construction or
installation of the capital improvements, unless a written agreement
is made pursuant to Section 6-7-1380 for credit or reimbursement; or
(d) a fee imposed by a county in lieu of property taxes, pursuant
to Chapter 12, Title 4.
(11) 'Development requirement' means a requirement attached to
a developmental approval of a particular development project
compelling the payment, dedication, or contribution of goods,
services, land, or money as a condition of approval.
(12) 'Fee payer' means that person who pays or is required to pay
a development impact fee.
(13) 'Governmental entity' means a unit of local government that
is authorized in this act to adopt a development impact fee ordinance.
(14) 'Hook up charges' means charges for the actual cost of
connecting a property to a public water or public sewer system,
limited to labor and materials involved in making pipe connections,
installation of water meters, and other actual costs. Not included in
this definition are system improvement costs, land acquisition, capital
construction, engineering or design costs, or upgrading, updating,
expansion, repair, or maintenance of existing or new capital
improvements.
(15) 'Incidental benefits ' means benefits that accrue to a property
as a secondary result or as a minor consequence of the provision of
public facilities to another property.
(16) 'Land use assumptions' means a description of the service area
and projections of land uses, densities, intensities, and population in
the service area over at least a twenty-year period.
(17) 'Level of service' means a measure of the relationship between
service capacity and service demand for public facilities.
(18) 'Manufactured home' means a structure, constructed according
to HUD/FHA mobile home construction and safety standards,
transportable in one or more sections, which, in the traveling mode,
is eight feet or more in width or is forty body feet or more in length,
or when erected on site, is three hundred twenty or more square feet,
and which is built on a permanent chassis and designed to be used as
a dwelling with or without a permanent foundation when connected
to the required utilities, and includes the plumbing, heating, air
conditioning, and electrical systems contained in it. This term
includes a structure that meets all the requirements of this item except
the size requirements, and for which the manufacturer voluntarily
files a certification required by the secretary of housing and urban
development and complies with the standards established under 42
U.S.C. 5401, et seq.
(19) 'Modular building' means a building or building component,
other than a manufactured home, that is constructed according to
standards contained in the Uniform Building Code, that is of closed
construction and is either entirely or substantially prefabricated or
assembled at a place other than the building site.
(20) 'Present value' means the total current monetary value of past,
present, or future payments, contributions, or dedications of goods,
services, materials, construction, or money.
(21) 'Project' means a particular development on an identified
parcel of land.
(22) 'Project improvements' means site improvements and facilities
planned and designed to provide service for a development project
and that are necessary for the use and convenience of the occupants
or users of the project.
(23) 'Proportionate share' means that portion of the cost of system
improvements determined pursuant to Section 6-7-1360 that
reasonably relates to the service demands and needs of the project.
(24) 'Public facilities' means:
(a) water supply production, treatment, storage, and distribution
facilities;
(b) wastewater collection, treatment, and disposal facilities;
(c) roads, streets, and bridges, including rights-of-way, traffic
signals, landscaping, and local components of state or federal
highways;
(d) storm water collection, retention, detention, treatment, and
disposal facilities, flood control facilities, bank and shore protection,
and enhancement improvements;
(e) parks, open space, and recreation areas, and related capital
improvements; and
(f) public safety facilities, including law enforcement, fire,
emergency medical and rescue, and street lighting facilities.
(25) 'Recreational vehicle' means a vehicular unit designed
primarily as temporary quarters for recreational, camping, or travel
use, that either has its own motive power or is mounted on or drawn
by another vehicle.
(26) 'Service area' means a defined geographic area identified by
a governmental entity or by intergovernmental agreement in which
specific public facilities provide service to development within the
area defined, on the basis of sound planning or engineering
principles, or both.
(27) 'Service unit' means a standardized measure of consumption,
use, generation, or discharge attributable to an individual unit of
development calculated in accordance with generally accepted
engineering or planning standards for a particular category of capital
improvements.
(28) 'System improvements,' in contrast to project improvements,
means capital improvements to public facilities that are designed to
provide service to a service area.
(29) 'System improvement costs' means costs incurred for
construction or reconstruction of system improvements, including
design, acquisition, engineering, and other costs attributable to the
improvements, and also including the costs of providing additional
public facilities needed to serve new growth and development. For
clarification, system improvement costs do not include:
(a) construction, acquisition, or expansion of public facilities
other than capital improvements identified in the capital
improvements plan;
(b) repair, operation, or maintenance of existing or new capital
improvements;
(c) upgrading, updating, expanding, or replacing existing capital
improvements to serve existing development in order to meet stricter
safety, efficiency, environmental, or regulatory standards;
(d) upgrading, updating, expanding, or replacing existing capital
improvements to provide better service to existing development;
(e) administrative and operating costs of the governmental
entity; or
(f) principal payments and interest or other finance charges on
bonds or other indebtedness except financial obligations issued by or
on behalf of the governmental entity to finance capital improvements
identified in the capital improvements plan.
Section 6-7-1320. (A) Governmental entities that comply with the
requirements of this article may impose by ordinance development
impact fees as a condition of development approval on all
developments.
(1) A development impact fee must not exceed a proportionate
share of the cost of system improvements determined in accordance
with Section 6-7-1360. Development impact fees must be based on
actual system improvement costs or reasonable estimates of the costs
supported by sound engineering studies.
(2) A development impact fee must be calculated on the basis
of levels of service for public facilities applicable to existing
development and to new growth and development, and adopted in the
development impact fee ordinance of the governmental entity. The
construction, improvement, expansion, or enlargement of new or
existing public facilities for which a development impact fee is
imposed must be attributable to the capacity demands generated by
the new development.
(3) Before imposing development impact fees a governmental
entity must prepare a report that estimates the effect of recovering
capital costs through impact fees on the availability of affordable
housing within the political jurisdiction of the governmental entity.
This report also must include an estimate of the number of
households who would not be able to purchase or rent housing due
to the imposition of impact fees.
(B) An ordinance authorizing the imposition of a development
impact fee must:
(1) require payment of development impact fee at the time of
issuance of the certificate of occupancy, or building permit if no
certificate of occupancy is required, or issuance of zoning permit for
a manufactured home;
(2) include a provision requiring a governmental entity to
provide written certification, at the time of preliminary plat approval
or preliminary site plan approval, of the amount of impact fees that
are due for each unit of development in a development project for
which an individual building permit or certificate of occupancy is
issued, binding the governmental entity to the amount of impact fees
so certified and prohibiting the governmental entity from charging
higher impact fees at the point at which impact fees are collected.
The certificate must include an explanation of the calculation of the
impact fee, including an explanation of factors considered under
Section 6-7-1360, and must specify the system improvements for
which the impact fee is intended to be used;
(3) include a provision permitting individual assessments of
development impact fees under guidelines established in the
ordinance;
(4) include a provision for credits in accordance with the
requirements of Section 6-7-1380;
(5) include a provision prohibiting the expenditure of
development impact fees except in accordance with the requirements
of Section 6-7-1390;
(6) require that development impact fees be spent only for the
category of system improvements for which the fees were collected
and either within or for the benefit of the service area in which the
project is located;
(7) provide for a refund of development impact fees in
accordance with the requirements of Section 6-7-1400;
(8) establish a procedure for timely processing of applications
for determinations by the governmental entity of development impact
fees applicable to all property subject to fees; and individual
assessment of development impact fees, credits, or reimbursements
to be allowed or paid under this article;
(9) provide for appeals regarding development impact fees in
accordance with the requirements of Section 6-7-1410.
(10) provide a detailed description of the methodology by which
costs for each service unit are determined. The following
methodology is acceptable: the development impact fee for each
service unit may not exceed the amount determined by dividing the
costs of the capital improvements described in Section
6-7-1370(A)(6) by the total number of projected service units
described in Section 6-7-1370(A)(7). If the number of new service
units projected over a reasonable period of time is less than the total
number of new service units shown by the approved land use
assumptions at full development of the service area, the maximum
impact fee for each service unit must be calculated by dividing the
costs of the part of the capital improvements necessitated by and
attributable to the projected new service units described in Section
6-7-1370(A)(7) by the total projected new service units described in
that section;
(11) include a schedule of development impact fees for various
land uses for a unit of development. The ordinance must provide that
a developer has the right to elect to pay a project's proportionate
share of system improvement costs by payment of development
impact fees according to the fee schedule as full and complete
payment of the development project's proportionate share of system
improvement costs, except as provided in Section 6-7-1430(C).
(12) exempt from development impact fees the following
activities:
(a) rebuilding the same amount of floor space of a structure
that was destroyed by fire or other catastrophe;
(b) remodeling or repairing a structure that does not increase
the number of service units;
(c) replacing a residential unit, including a manufactured
home, with another residential unit on the same lot, if the number of
service units does not increase;
(d) placing a temporary construction trailer or office on a lot;
(e) constructing an addition on a residential structure that
does not increase the number of service units; and
(f) adding uses that are typically accessory to residential
uses, such as tennis courts or clubhouse, unless it is demonstrated
clearly that the use creates a significant impact on the capacity of
system improvements;
(13) provide for the calculation of a development impact fee in
accordance with generally accepted accounting principles. A
development impact fee is not invalid because payment of the fee
may result in an incidental benefit to owners or developers within the
service area other than the fee payer. A development impact fee is
invalid if it results in benefits to owners or developers within the
service area, other than the fee payer, that are greater than incidental
benefits ;
(14) include a description of acceptable levels of service for
system improvements.
(C) An ordinance authorizing the imposition of a development
impact fee may:
(1) provide for the imposition of a development impact fee for
system improvement costs incurred subsequent to adoption of the
ordinance to the extent that new growth and development will be
served by the system improvements;
(2) exempt all or part of a particular development project from
development impact fees, if the project is determined to create
affordable housing, if the public policy that supports the exemption
is contained in the governmental entity's comprehensive plan, and if
the exempt development's proportionate share of system
improvements is funded through a revenue source other than
development impact fees.
(D) After payment of the development impact fees or execution of
an agreement for payment of development impact fees, additional
development impact fees or increases in fees may not be assessed
unless the number of service units increases or the scope of the
development changes. If the number of service units increases, the
additional development impact fees imposed are limited to the
amount attributable to the additional service units or change in scope
of the development.
(E) A system for the calculation of development impact fees must
not be adopted that subjects a development to double payment of
impact fees.
(F) A development impact fee must be assessed for installation of
a modular building, manufactured home, or recreational vehicle
unless the fee payer can demonstrate by documentation such as utility
bills and tax records, either that a:
(1) modular building, manufactured home, or recreational
vehicle was legally in place on the lot or space before the effective
date of the development impact fee ordinance; or
(2) development impact fee was paid previously for the
installation of a modular building, manufactured home, or
recreational vehicle on the same lot or space.
Section 6-7-1330. Governmental entities as defined in Section
6-7-1310(13) that are jointly affected by development may enter into
intergovernmental agreements with each other or with highway
districts for the purpose of developing joint plans for capital
improvements or for the purpose of agreeing to collect and expend
development impact fees for system improvements, or both, if the
agreement complies with applicable state laws. Governmental entities
also may enter into agreements with the Department of
Transportation for the expenditure of development impact fees
pursuant to a developer's agreement under Section 6-7-1430.
Section 6-7-1340. (A) A governmental entity that is considering
or that has adopted a development impact fee ordinance, must
establish a development impact fee advisory committee, composed
of not fewer than five members appointed by the governing authority
of the governmental entity. Members of the advisory committee may
not be elected officials or employees of the governmental entity.
Three or more members must be active in the business of
development, building, civil engineering, or other real estate related
professional work. An existing planning or planning and zoning
commission may serve as the development impact fee advisory
committee if no elected officials of the governmental entity serve on
these commissions in ex officio or other capacity and if the
commission includes three or more members who are active in the
business of development, building, civil engineering, or other real
estate related professional work; otherwise, three members who are
active in the business of development, building, civil engineering, or
other real estate related professional work and who are not employees
or officials of a governmental entity must be appointed to the
committee.
(B) The development impact fee advisory committee serves in an
advisory capacity and is established to:
(1) assist the governmental entity in adopting land use
assumptions;
(2) review the capital improvements plan and proposed
amendments, and file written comments;
(3) monitor and evaluate implementation of the capital
improvements plan;
(4) file periodic reports, at least annually, with respect to the
capital improvements plan and report to the governmental entity any
perceived inequities in implementing the plan or imposing the
development impact fees; and
(5) advise the governmental entity of the need to update or
revise land use assumptions, capital improvements plan, and
development impact fees.
(C) The governmental entity must make available to the advisory
committee, upon request, all financial and accounting information,
professional reports in relation to other development and
implementation of land use assumptions, the capital improvements
plan, and periodic updates of the capital improvements plan.
Section 6-7-1350. (A) A development impact fee imposed by a
governmental entity must comply with the provisions of this section.
(B) A capital improvements plan must be developed, in
coordination with the development impact fee advisory committee,
utilizing the land use assumptions most recently adopted by the
governmental entity.
(C) At least one public hearing must be held to consider adoption,
amendment, or repeal of a capital improvements plan. Two notices,
at least one week apart, of the time, place, and purpose of the hearing
must be published, the first notice of the hearing not less than fifteen
nor more than thirty days before the scheduled date of the hearing, in
a newspaper of general circulation within the jurisdiction of the
governmental entity. A second notice of the hearing on adoption of
the capital improvements plan, containing the same information, must
be published in the same manner at least seven days before the
scheduled date of the hearing. The notices also must include a
statement that the governmental entity must make available to the
public, upon request, the following:
(1) proposed land use assumptions;
(2) a copy of the proposed capital improvements plan or
amendments to it; and
(3) a statement that a member of the public affected by the
capital improvements plan or amendments has the right to appear at
the public hearing and present evidence regarding the proposed
capital improvements plan or amendments.
The governmental entity must send notice of the intent to hold a
public hearing by mail at least fifteen days before the hearing date to
a person who has requested, in writing, notification of the hearing
date. However, the governmental entity may require that a person
making a request for notification, renew the request not more
frequently than once each year, in accordance with a schedule
determined by the governmental entity, in order to continue receiving
the notices.
(D) If the governmental entity makes a material change in the
capital improvements plan or amendment, further notice and hearing
must be provided before the governmental entity adopts the revision
if the governmental entity makes a finding that further notice and
hearing are required in the public interest.
(E) Following adoption of the initial capital improvements plan,
a governmental entity must conduct a public hearing to consider
adoption of an ordinance authorizing the imposition of development
impact fees. Notice of the hearing must be provided in the same
manner as defined in subsection (C) of this section for adoption of a
capital improvements plan.
(F) Nothing contained in this section alters the procedures for
adoption of an ordinance by the governmental entity, except that a
development impact fee ordinance must not be adopted as an
emergency measure and must not take effect earlier than thirty days
subsequent to adoption.
Section 6-7-1360. (A) All development impact fees must be based
on a reasonable and equitable formula or method based on generally
acceptable accounting principles under which the development
impact fee imposed does not exceed a proportionate share of the costs
incurred or to be incurred by the governmental entity in providing
system improvements to serve the new development. The
proportionate share is the cost attributable to the new development
after the governmental entity considers the following:
(1) any appropriate credit, offset, or contribution of money,
dedication of land, or construction of system improvements;
(2) payments reasonably anticipated to be made by or as a result
of a new development in the form of user fees, debt service
payments, or taxes including, but not limited to, sales and property
taxes that are dedicated for system improvements for which
development impact fees would otherwise be imposed; and
(3) all other available sources of funding the system
improvements.
(B) In determining the proportionate share of the cost of system
improvements to be paid, the following factors must be considered by
the governmental entity imposing the development impact fee:
(1) the cost of existing system improvements resulting from new
development within the service area or areas;
(2) the means by which existing system improvements have
been financed;
(3) the extent to which the new development will contribute to
the cost of system improvements through taxation, assessment, or
developer or landowner contributions, or has previously contributed
to the cost of system improvements through developer or landowner
contributions.
(4) the extent to which the new development is required to
contribute to the cost of existing system improvements in the future.
(5) the extent to which the new development must be credited
for providing system improvements, without charge to other
properties within the service area or areas;
(6) the time and price differential inherent in a fair comparison
of fees paid at different times; and
(7) the availability of other sources of funding system
improvements including, but not limited to, user charges, general tax
levies, intergovernmental transfers, and special taxation. The
governmental entity must develop a plan for alternative sources of
revenue.
Section 6-7-1370. (A) Each governmental entity intending to
impose a development impact fee must prepare a capital
improvements plan. For governmental entities required to undertake
comprehensive planning pursuant to Chapter 7, Title 6, the capital
improvements plan must be prepared and adopted according to the
requirements contained in the local planning law, Article 7, Chapter
7, Title 6, and must be included as an element of the comprehensive
plan. The capital improvements plan must be prepared by qualified
professionals in fields relating to finance, engineering, planning, and
transportation. The persons preparing the plan must consult with the
development impact fee advisory committee. The capital
improvements plan must contain:
(1) a general description of all existing public facilities and their
existing deficiencies within the service area or areas of the
governmental entity, a reasonable estimate of all costs, and a plan to
develop the funding resources related to curing the existing
deficiencies including, but not limited to, the upgrading, updating,
improving, expanding, or replacing of these facilities to meet existing
needs and usage;
(2) a commitment by the governmental entity to use other
available sources of revenue to cure existing system deficiencies;
(3) an analysis of the total capacity, the level of current usage,
and commitments for usage of capacity of existing capital
improvements, which must be prepared by a qualified professional
planner or by a qualified engineer licensed to perform engineering
services in this State;
(4) a description of the land use assumptions by the government
entity;
(5) a definitive table establishing the specific level or quantity
of use, consumption, generation, or discharge of a service unit for
each category of system improvements and an equivalency or
conversion table establishing the ratio of a service unit to various
types of land uses, including residential, commercial, agricultural,
and industrial;
(6) a description of all system improvements and their costs
necessitated by and attributable to new development in the service
area based on the approved land use assumptions, to provide a level
of service not to exceed the level of service currently existing in the
community or service area;
(7) the total number of service units necessitated by and
attributable to new development within the service area based on the
approved land use assumptions and calculated in accordance with
generally accepted engineering or planning criteria;
(8) the projected demand for system improvements required by
new service units projected over a reasonable period of time not to
exceed twenty years;
(9) identification of all sources and levels of funding available
to the governmental entity for the financing of the system
improvements;
(10) if the proposed system improvements include the
improvement of public facilities under the jurisdiction of this State or
another governmental entity, then an agreement between
governmental entities must specify the reasonable share of funding
by each unit, but the governmental entity authorized to impose
development impact fees must not assume more than its reasonable
share of funding joint improvements, nor may the agreement permit
expenditure of development impact fees by a governmental entity that
is not authorized to impose development impact fees unless the
expenditure is pursuant to a developer agreement under Section
6-7-1430;
(11) a schedule setting forth estimated dates for commencing and
completing construction of all improvements identified in the capital
improvements plan; and
(12) a statement that development impact fees on a new
development are not used to cure deficiencies in existing public
facilities within the service area or areas of the governmental entity.
(B) The governmental entity imposing a development impact fee
must update the capital improvements plan at least once every five
years. The five-year period commences on the date of the original
adoption of the capital improvements plan. The updating of the
capital improvements plan must be made in accordance with
procedures provided in Section 6-7-1350.
(C) The governmental entity must adopt a capital budget annually.
Section 6-7-1380. (A) In the calculation of development impact
fees for a particular project, credit or reimbursement must be given
for the present value of any construction of system improvements or
contribution or dedication of land or money required by a
governmental entity from a developer for system improvements of
the category for which the development impact fee is being collected.
Credit or reimbursement must not be given for project improvements.
(B) If a developer is required to construct, fund, or contribute
system improvements in excess of the development project's
proportionate share of system improvement costs, the developer must
receive a credit on future impact fees or be reimbursed, at the
developer's choice, for excess construction, funding, or contribution
from development impact fees paid by future development that
impacts the system improvements constructed, funded, or contributed
by the developer or fee payer.
(C) If credit or reimbursement is due to the developer pursuant to
this section, the governmental entity must enter into a written
agreement with the fee payer, negotiated in good faith, before the
construction, funding, or contribution. The agreement must provide
for the amount of credit or the amount, time, and form of
reimbursement.
Section 6-7-1390. (A) An ordinance imposing development
impact fees must require that all development impact fee funds be
maintained in one or more interest-bearing accounts within the capital
projects fund. Accounting records must be maintained for each
category of system improvements and the service area in which the
fees are collected. Interest earned on development impact fees must
be considered funds of the account on which it is earned, and must be
subject to all restrictions placed on the use of development impact
fees under the provisions of this article.
(B) Expenditures of development impact fees must be made only
for the category of system improvements and within or for the benefit
of the service area for which the development impact fee was
imposed as shown by the capital improvements plan and as
authorized in this article. Development impact fees must not be used
for any purpose other than system improvement costs to create
additional improvements to serve new growth.
(C) As part of its annual audit process, a governmental entity must
prepare an annual report describing the amount of all development
impact fees collected, appropriated, or spent during the preceding
year by category of public facility and service area.
(D) Collected development impact fees must be expended within
five years from the date they were collected, on a first-in, first-out
basis. Funds not expended within the prescribed times must be
refunded pursuant to Section 6-7-1400.
Section 6-7-1400. (A) A governmental entity that adopts a
development impact fee ordinance must refund to the owner of record
of property on which a development impact fee has been paid if:
(1) service is available but not provided;
(2) a building permit or permit for installation of a
manufactured home is denied or abandoned; or
(3) the governmental entity, after collecting the fee when
service is not available, has failed to appropriate and expend the
collected development impact fees pursuant to Section 6-7-1390(D).
(B) When the right to a refund exists, the governmental entity must
send a refund to the owner of record within ninety days after it is
determined by the development impact fee advisory committee that
a refund is due subject to subsection (A).
(C) A refund must include the pro rata portion of interest earned
while on deposit in the impact fee account.
(D) A person entitled to a refund has standing to sue for a refund
under the provisions of this article if there has not been a timely
payment of a refund pursuant to subsection (B) of this section.
Section 6-7-1410. (A) A governmental entity that adopts a
development impact fee ordinance must provide for administrative
appeals by the developer or fee payer from discretionary action or
inaction by or on behalf of the governmental entity.
(B) A fee payer may pay a development impact fee under protest
in order to obtain a development approval or building permit. A fee
payer making the payment is not estopped from exercising the right
of appeal provided in this article, nor is the fee payer estopped from
receiving a refund of any amount considered to have been illegally
collected. Instead of making a payment of development impact fees
under protest, a fee payer may, at his option, post a bond or submit
an irrevocable letter of credit for the amount of impact fees due,
pending the outcome of an appeal.
(C) A governmental entity that adopts a development impact fee
ordinance must provide for mediation by a qualified independent
party, upon voluntary agreement by the fee payer and the
governmental entity, to address a disagreement related to the impact
fee for proposed development. The ordinance must provide that
mediation may take place at any time during the appeals process and
participation in mediation does not preclude the fee payer from
pursuing other remedies provided for in this section. The ordinance
must provide that mediation costs be shared equally by the fee payer
and the governmental entity.
Section 6-7-1420. A governmental entity may provide in a
development impact fee ordinance the method for collection of
development impact fees including, but not limited to:
(1) additions to the fee for reasonable interest and penalties for
nonpayment or late payment;
(2) withholding of the certificate of occupancy, or building permit
if no certificate of occupancy is required, until the development
impact fee is paid;
(3) withholding of utility services until the development impact
fee is paid; and
(4) imposing liens for failure to timely pay a development impact
fee.
Section 6-7-1430. Nothing in this article prevents or prohibits
private agreements between property owners or developers, this
State, or other governmental entities in regard to the construction or
installation of system improvements or providing for credits or
reimbursements for system improvement costs incurred by a
developer including interproject transfers of credits or providing for
reimbursement for project improvements that are used or shared by
more than one development project. If it can be shown that a
proposed development has a direct impact on a public facility under
the jurisdiction of the Department of Transportation, then the
agreement must include a provision for the allocation of impact fees
collected from the developer for the improvement of the public
facility by the department.
Section 6-7-1450. (A) The provisions of this article do not repeal
any existing laws authorizing a governmental entity to impose fees
or require contributions or property dedications for capital
improvements. Ordinances imposing development impact fees must
be brought into conformance with the provisions of this article within
one year after the effective date of this article. Impact fees collected
and developer agreements entered into before the expiration of the
one-year period are not invalid by reason of this article.
Notwithstanding another provision of law, after adoption of a
development impact fee ordinance in accordance with the provisions
of this article, development requirements for system improvements
must be imposed by governmental entities only by way of
development impact fees imposed pursuant to the ordinance.
(B) Notwithstanding another provision of this article, property for
which a valid building permit or certificate of occupancy has been
issued or construction has commenced before the effective date of a
development impact fee ordinance must not be subject to additional
development impact fees.
(C) That portion of a project for which a preliminary plat has been
approved before the effective date of a development impact fee
ordinance is not subject to development impact fees for subsequent
development approved, including building permits and certificates of
occupancy."
SECTION 2. This act takes effect upon approval by the Governor.
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