H.B. 274

1

LOCAL GOVERNMENT FEES AND CHARGES
2 TO STATE AGENCIES
3 2009 GENERAL SESSION
4 STATE OF UTAH
5 Chief Sponsor: C. Brent Wallis
6 Senate Sponsor: ____________
7
8 LONG TITLE
9 General Description:
10 This bill modifies provisions related to local government fees and other charges to state
11 agencies.
12 Highlighted Provisions:
13 This bill:
14 . clarifies that impact fees may not be imposed on state agencies;
15 . prohibits counties, municipalities, local districts, and special service districts from
16 charging state agencies utility connection fees that exceed the local government's
17 actual cost of connecting the utility to the state agency's facility;
18 . authorizes counties, municipalities, local districts, and special service districts to
19 charge state agencies the actual cost of providing infrastructure if the need for the
20 infrastructure arises directly because of a state facility and the infrastructure is
21 necessary to allow the local government to provide utility service to the state
22 facility;
23 . requires counties, municipalities, local districts, and special service districts to place
24 funds collected from a state agency for infrastructure in a dedicated account and to
25 return any surplus promptly after completion of the infrastructure;
26 . authorizes counties, municipalities, local districts, and special service districts to
27 charge a state agency for its actual consumption of service provided by a local

28 government utility; and
29 . prohibits counties, municipalities, local districts, and special service districts from
30 charging other fees or charges relating to the design or construction of a state
31 facility.
32 Monies Appropriated in this Bill:
33 None
34 Other Special Clauses:
35 None
36 Utah Code Sections Affected:
37 AMENDS:
38 11-36-201, as last amended by Laws of Utah 2008, Chapters 70, 360, and 382
39 17B-1-103, as last amended by Laws of Utah 2008, Chapters 3 and 360
40 17D-1-106, as enacted by Laws of Utah 2008, Chapter 360
41 ENACTS:
42 10-8-85.4, Utah Code Annotated 1953
43 17-50-327, Utah Code Annotated 1953
44 17B-1-118, Utah Code Annotated 1953
45
46 Be it enacted by the Legislature of the state of Utah:
47 Section 1. Section 10-8-85.4 is enacted to read:
48 10-8-85.4. Limit on municipal connection fees and other charges to state agencies.
49 (1) As used in this section:
50 (a) "Connection fee" means a fee that a municipality charges to connect a state facility
51 to a municipal utility in order for the municipality to provide service to the state facility.
52 (b) "Municipal utility" means any water system, sewer system, storm water system, or
53 electrical system provided by the municipality.
54 (c) "State agency" means the state or any agency, department, or division of the state.
55 (d) "State facility" means a building or other public facility constructed, owned, or
56 controlled by a state agency.
57 (2) A municipality may not charge a state agency a connection fee that exceeds the
58 municipality's actual cost of connecting the municipal utility to a state facility.

59 (3) (a) A municipality may charge and collect from a state agency the actual cost of
60 providing infrastructure if:
61 (i) the need for the infrastructure arises directly because of a state facility; and
62 (ii) the infrastructure is necessary in order for the municipality to be able to provide
63 municipal utility service to the state facility.
64 (b) A municipality shall:
65 (i) place all funds received from a state agency under Subsection (3)(a) in a dedicated
66 account; and
67 (ii) promptly return to the state agency any funds remaining in that dedicated account
68 after completion of the infrastructure for which the funds were collected.
69 (4) A municipality may charge and collect from a state agency for the state agency's
70 actual consumption of service provided by a municipal utility.
71 (5) Except as provided in this section, a municipality may not charge a state agency any
72 fee or charge for or relating to the design or construction of a state facility.
73 Section 2. Section 11-36-201 is amended to read:
74 11-36-201. Impact fees -- Analysis -- Capital facilities plan -- Notice of plan --
75 Summary -- Exemptions.
76 (1) (a) Each local political subdivision and private entity shall comply with the
77 requirements of this chapter before establishing or modifying any impact fee.
78 (b) A local political subdivision may not:
79 (i) establish any new impact fees that are not authorized by this chapter; or
80 (ii) impose or charge any other fees as a condition of development approval unless
81 those fees are a reasonable charge for the service provided.
82 (c) Notwithstanding any other requirements of this chapter, each local political
83 subdivision shall ensure that each existing impact fee that is charged for any public facility not
84 authorized by Subsection 11-36-102 (12) is repealed by July 1, 1995.
85 (d) (i) Existing impact fees that a local political subdivision charges for public facilities
86 authorized in Subsection 11-36-102 (12) need not comply with the requirements of this chapter
87 until July 1, 1997.
88 (ii) By July 1, 1997, each local political subdivision shall:
89 (A) review any impact fees in existence as of the effective date of this act, and prepare

90 and approve the analysis required by this section for each of those impact fees; and
91 (B) ensure that the impact fees comply with the requirements of this chapter.
92 (2) (a) Before imposing impact fees, each local political subdivision and private entity
93 shall, except as provided in Subsection (2)(f), prepare a capital facilities plan.
94 (b) (i) As used in this Subsection (2)(b):
95 (A) (I) "Affected entity" means each county, municipality, local district under Title
96 17B, Limited Purpose Local Government Entities - Local Districts, special service district
97 under Title 17D, Chapter 1, Special Service District Act, school district, interlocal cooperation
98 entity established under Chapter 13, Interlocal Cooperation Act, and specified public utility:
99 (Aa) whose services or facilities are likely to require expansion or significant
100 modification because of the facilities proposed in the proposed capital facilities plan; or
101 (Bb) that has filed with the local political subdivision or private entity a copy of the
102 general or long-range plan of the county, municipality, local district, special service district,
103 school district, interlocal cooperation entity, or specified public utility.
104 (II) "Affected entity" does not include the local political subdivision or private entity
105 that is required under this Subsection (2) to provide notice.
106 (B) "Specified public utility" means an electrical corporation, gas corporation, or
107 telephone corporation, as those terms are defined in Section 54-2-1 .
108 (ii) Before preparing or amending a capital facilities plan, each local political
109 subdivision and each private entity shall provide written notice, as provided in this Subsection
110 (2)(b), of its intent to prepare or amend a capital facilities plan.
111 (iii) Each notice under Subsection (2)(b)(ii) shall:
112 (A) indicate that the local political subdivision or private entity intends to prepare or
113 amend a capital facilities plan;
114 (B) describe or provide a map of the geographic area where the proposed capital
115 facilities will be located;
116 (C) be sent to:
117 (I) each county in whose unincorporated area and each municipality in whose
118 boundaries is located the land on which the proposed facilities will be located;
119 (II) each affected entity;
120 (III) the Automated Geographic Reference Center created in Section 63F-1-506 ;

121 (IV) the association of governments, established pursuant to an interlocal agreement
122 under [Title 11,] Chapter 13, Interlocal Cooperation Act, in which the facilities are proposed to
123 be located;
124 (V) the state planning coordinator appointed under Section 63J-4-202 ;
125 (VI) the registered agent of the Utah Home Builders Association;
126 (VII) the registered agent of the Utah Association of Realtors; and
127 (VIII) the registered agent of the Utah Chapter of the Associated General Contractors
128 of America; and
129 (D) with respect to the notice to an affected entity, invite the affected entity to provide
130 information for the local political subdivision or private entity to consider in the process of
131 preparing, adopting, and implementing or amending a capital facilities plan concerning:
132 (I) impacts that the facilities proposed in the capital facilities plan may have on the
133 affected entity; and
134 (II) facilities or uses of land that the affected entity is planning or considering that may
135 conflict with the facilities proposed in the capital facilities plan.
136 (c) The plan shall identify:
137 (i) demands placed upon existing public facilities by new development activity; and
138 (ii) the proposed means by which the local political subdivision will meet those
139 demands.
140 (d) A municipality or county need not prepare a separate capital facilities plan if the
141 general plan required by Section 10-9a-401 or 17-27a-401 , respectively, contains the elements
142 required by Subsection (2)(c).
143 (e) (i) If a local political subdivision chooses to prepare an independent capital
144 facilities plan rather than include a capital facilities element in the general plan, the local
145 political subdivision shall:
146 (A) before preparing or contracting to prepare or amending or contracting to amend the
147 independent capital facilities plan, send written notice:
148 (I) to:
149 (Aa) the registered agent of the Utah Home Builders Association;
150 (Bb) the registered agent of the Utah Association of Realtors; and
151 (Cc) the registered agent of the Utah Chapter of the Associated General Contractors of

152 America;
153 (II) stating the local political subdivision's intent to prepare or amend a capital facilities
154 plan; and
155 (III) inviting each of the notice recipients to participate in the preparation of or
156 amendment to the capital facilities plan; and
157 (B) before adopting or amending the capital facilities plan:
158 (I) give public notice of the plan or amendment according to Subsection (2)(e)(ii)(A),
159 (B), or (C), as the case may be, at least 14 days before the date of the public hearing;
160 (II) make a copy of the plan or amendment, together with a summary designed to be
161 understood by a lay person, available to the public;
162 (III) place a copy of the plan or amendment and summary in each public library within
163 the local political subdivision; and
164 (IV) hold a public hearing to hear public comment on the plan or amendment.
165 (ii) With respect to the public notice required under Subsection (2)(e)(i)(B)(I):
166 (A) each municipality shall comply with the notice and hearing requirements of, and,
167 except as provided in Subsection 11-36-401 (4)(f), receive the protections of Sections
168 10-9a-205 and 10-9a-801 and Subsection 10-9a-502 (2);
169 (B) each county shall comply with the notice and hearing requirements of, and, except
170 as provided in Subsection 11-36-401 (4)(f), receive the protections of Sections 17-27a-205 and
171 17-27a-801 and Subsection 17-27a-502 (2); and
172 (C) each local district, special service district, and private entity shall comply with the
173 notice and hearing requirements of, and receive the protections of, Section 17B-1-111 .
174 (iii) Nothing contained in this Subsection (2)(e) or in the subsections referenced in
175 Subsections (2)(e)(ii)(A) and (B) may be construed to require involvement by a planning
176 commission in the capital facilities planning process.
177 (f) (i) A local political subdivision with a population or serving a population of less
178 than 5,000 as of the last federal census need not comply with the capital facilities plan
179 requirements of this part, but shall ensure that:
180 (A) the impact fees that the local political subdivision imposes are based upon a
181 reasonable plan; and
182 (B) each applicable notice required by this chapter is given.

183 (ii) Subsection (2)(f)(i) does not apply to private entities.
184 (3) In preparing the plan, each local political subdivision shall generally consider all
185 revenue sources, including impact fees, to finance the impacts on system improvements.
186 (4) A local political subdivision or private entity may only impose impact fees on
187 development activities when its plan for financing system improvements establishes that
188 impact fees are necessary to achieve an equitable allocation to the costs borne in the past and to
189 be borne in the future, in comparison to the benefits already received and yet to be received.
190 (5) (a) Subject to the notice requirement of Subsection (5)(b), each local political
191 subdivision and private entity intending to impose an impact fee shall prepare a written analysis
192 of each impact fee that:
193 (i) identifies the impact on system improvements required by the development activity;
194 (ii) demonstrates how those impacts on system improvements are reasonably related to
195 the development activity;
196 (iii) estimates the proportionate share of the costs of impacts on system improvements
197 that are reasonably related to the new development activity; and
198 (iv) based upon those factors and the requirements of this chapter, identifies how the
199 impact fee was calculated.
200 (b) Before preparing or contracting to prepare the written analysis required under
201 Subsection (5)(a), each local political subdivision or private entity shall provide:
202 (i) public notice; and
203 (ii) written notice:
204 (A) to:
205 (I) the registered agent of the Utah Home Builders Association;
206 (II) the registered agent of the Utah Association of Realtors; and
207 (III) the registered agent of the Utah Chapter of the Associated General Contractors of
208 America;
209 (B) indicating the local political subdivision or private entity's intent to prepare or
210 contract to prepare a written analysis of an impact fee; and
211 (C) inviting each notice recipient to participate in the preparation of the written
212 analysis.
213 (c) In analyzing whether or not the proportionate share of the costs of public facilities

214 are reasonably related to the new development activity, the local political subdivision or private
215 entity, as the case may be, shall identify, if applicable:
216 (i) the cost of existing public facilities;
217 (ii) the manner of financing existing public facilities, such as user charges, special
218 assessments, bonded indebtedness, general taxes, or federal grants;
219 (iii) the relative extent to which the newly developed properties and other properties
220 have already contributed to the cost of existing public facilities, by such means as user charges,
221 special assessments, or payment from the proceeds of general taxes;
222 (iv) the relative extent to which the newly developed properties and other properties
223 will contribute to the cost of existing public facilities in the future;
224 (v) the extent to which the newly developed properties are entitled to a credit because
225 the local political subdivision or private entity, as the case may be, requires its developers or
226 owners, by contractual arrangement or otherwise, to provide common facilities, inside or
227 outside the proposed development, that have been provided by the local political subdivision or
228 private entity, respectively, and financed through general taxation or other means, apart from
229 user charges, in other parts of the service area;
230 (vi) extraordinary costs, if any, in servicing the newly developed properties; and
231 (vii) the time-price differential inherent in fair comparisons of amounts paid at
232 different times.
233 (d) Each local political subdivision and private entity that prepares a written analysis
234 under this Subsection (5) on or after July 1, 2000 shall also prepare a summary of the written
235 analysis, designed to be understood by a lay person.
236 (6) Each local political subdivision that adopts an impact fee enactment under Section
237 11-36-202 on or after July 1, 2000 shall, at least 14 days before adopting the enactment, submit
238 a copy of the written analysis required by Subsection (5)(a) and a copy of the summary
239 required by Subsection (5)(d) to:
240 (a) each public library within the local political subdivision;
241 (b) the registered agent of the Utah Home Builders Association;
242 (c) the registered agent of the Utah Association of Realtors; and
243 (d) the registered agent of the Utah Chapter of the Associated General Contractors of
244 America.

245 (7) Nothing in this chapter may be construed:
246 (a) to repeal or otherwise eliminate any impact fee in effect on the effective date of this
247 chapter that is pledged as a source of revenues to pay bonded indebtedness that was incurred
248 before the effective date of this chapter[.]; or
249 (b) to authorize the imposition of an impact fee on the state or any agency, department,
250 or division of the state.
251 Section 3. Section 17-50-327 is enacted to read:
252 17-50-327. Limit on county connection fees and other charges to state agencies.
253 (1) As used in this section:
254 (a) "Connection fee" means a fee that a county charges to connect a state facility to a
255 county utility in order for the county to provide service to the state facility.
256 (b) "County utility" means any water system, sewer system, storm water system, or
257 electrical system provided by the county.
258 (c) "State agency" means the state or any agency, department, or division of the state.
259 (d) "State facility" means a building or other public facility constructed, owned, or
260 controlled by a state agency.
261 (2) A county may not charge a state agency a connection fee that exceeds the county's
262 actual cost of connecting the county utility to a state facility.
263 (3) (a) A county may charge and collect from a state agency the actual cost of
264 providing infrastructure if:
265 (i) the need for the infrastructure arises directly because of a state facility; and
266 (ii) the infrastructure is necessary in order for the county to be able to provide county
267 utility service to the state facility.
268 (b) A county shall:
269 (i) place all funds received from a state agency under Subsection (3)(a) in a dedicated
270 account; and
271 (ii) promptly return to the state agency any funds remaining in that dedicated account
272 after completion of the infrastructure for which the funds were collected.
273 (4) A county may charge and collect from a state agency for the state agency's actual
274 consumption of service provided by a county utility.
275 (5) Except as provided in this section, a county may not charge a state agency any fee

276 or charge for or relating to the design or construction of a state facility.
277 Section 4. Section 17B-1-103 is amended to read:
278 17B-1-103. Local district status and powers.
279 (1) A local district:
280 (a) is:
281 (i) a body corporate and politic with perpetual succession;
282 (ii) a quasi-municipal corporation; and
283 (iii) a political subdivision of the state; and
284 (b) may sue and be sued.
285 (2) A local district may:
286 (a) acquire, by any lawful means, or lease any real or personal property necessary or
287 convenient to the full exercise of the district's powers;
288 (b) acquire, by any lawful means, any interest in real or personal property necessary or
289 convenient to the full exercise of the district's powers;
290 (c) transfer an interest in or dispose of any property or interest described in Subsections
291 (2)(a) and (b);
292 (d) acquire or construct works, facilities, and improvements necessary or convenient to
293 the full exercise of the district's powers, and operate, control, maintain, and use those works,
294 facilities, and improvements;
295 (e) borrow money and incur indebtedness for any lawful district purpose;
296 (f) issue bonds, including refunding bonds:
297 (i) for any lawful district purpose; and
298 (ii) as provided in and subject to Part 11, Local District Bonds;
299 (g) levy and collect property taxes:
300 (i) for any lawful district purpose or expenditure, including to cover a deficit resulting
301 from tax delinquencies in a preceding year; and
302 (ii) as provided in and subject to Part 10, Local District Property Tax Levy;
303 (h) as provided in Title 78B, Chapter 6, Part 5, Eminent Domain, acquire by eminent
304 domain property necessary to the exercise of the district's powers;
305 (i) invest money as provided in Title 51, Chapter 7, State Money Management Act;
306 (j) (i) impose fees or other charges for commodities, services, or facilities provided by

307 the district, to pay some or all of the district's costs of providing the commodities, services, and
308 facilities, including the costs of:
309 (A) maintaining and operating the district;
310 (B) acquiring, purchasing, constructing, improving, or enlarging district facilities;
311 (C) issuing bonds and paying debt service on district bonds; and
312 (D) providing a reserve established by the board of trustees; and
313 (ii) take action the board of trustees considers appropriate and adopt regulations to
314 assure the collection of all fees and charges that the district imposes;
315 (k) if applicable and subject to Section 17B-1-118 , charge and collect a fee to pay for
316 the cost of connecting a customer's property to district facilities in order for the district to
317 provide service to the property;
318 (l) enter into a contract that the local district board of trustees considers necessary,
319 convenient, or desirable to carry out the district's purposes, including a contract:
320 (i) with the United States or any department or agency of the United States;
321 (ii) to indemnify and save harmless; or
322 (iii) to do any act to exercise district powers;
323 (m) purchase supplies, equipment, and materials;
324 (n) encumber district property upon terms and conditions that the board of trustees
325 considers appropriate;
326 (o) exercise other powers and perform other functions that are provided by law;
327 (p) construct and maintain works and establish and maintain facilities, including works
328 or facilities:
329 (i) across or along any public street or highway, subject to Subsection (3) and if the
330 district:
331 (A) promptly restores the street or highway, as much as practicable, to its former state
332 of usefulness; and
333 (B) does not use the street or highway in a manner that completely or unnecessarily
334 impairs the usefulness of it;
335 (ii) in, upon, or over any vacant public lands that are or become the property of the
336 state, including school and institutional trust lands, as defined in Section 53C-1-103 , if the
337 director of the School and Institutional Trust Lands Administration, acting under Sections

338 53C-1-102 and 53C-1-303 , consents; or
339 (iii) across any stream of water or watercourse, subject to Section 73-3-29 ;
340 (q) perform any act or exercise any power reasonably necessary for the efficient
341 operation of the local district in carrying out its purposes;
342 (r) designate an assessment area and levy an assessment on land within the assessment
343 area, as provided in Title 11, Chapter 42, Assessment Area Act;
344 (s) contract with another political subdivision of the state to allow the other political
345 subdivision to use the district's surplus water or capacity or have an ownership interest in the
346 district's works or facilities, upon the terms and for the consideration, whether monetary or
347 nonmonetary consideration or no consideration, that the district's board of trustees considers to
348 be in the best interests of the district and the public; and
349 (t) upon the terms and for the consideration, whether monetary or nonmonetary
350 consideration or no consideration, that the district's board of trustees considers to be in the best
351 interests of the district and the public, agree:
352 (i) with:
353 (A) another political subdivision of the state; or
354 (B) a public or private owner of property:
355 (I) on which the district has a right-of-way; or
356 (II) adjacent to which the district owns fee title to property; and
357 (ii) to allow the use of property:
358 (A) owned by the district; or
359 (B) on which the district has a right-of-way.
360 (3) With respect to a local district's use of a street or highway, as provided in
361 Subsection (2)(p)(i):
362 (a) the district shall comply with the reasonable rules and regulations of the
363 governmental entity, whether state, county, or municipal, with jurisdiction over the street or
364 highway, concerning:
365 (i) an excavation and the refilling of an excavation;
366 (ii) the relaying of pavement; and
367 (iii) the protection of the public during a construction period; and
368 (b) the governmental entity, whether state, county, or municipal, with jurisdiction over

369 the street or highway:
370 (i) may not require the district to pay a license or permit fee or file a bond; and
371 (ii) may require the district to pay a reasonable inspection fee.
372 (4) (a) A local district may:
373 (i) acquire, lease, or construct and operate electrical generation, transmission, and
374 distribution facilities, if:
375 (A) the purpose of the facilities is to harness energy that results inherently from the
376 district's:
377 (I) operation of a project or facilities that the district is authorized to operate; or
378 (II) providing a service that the district is authorized to provide;
379 (B) the generation of electricity from the facilities is incidental to the primary
380 operations of the district; and
381 (C) operation of the facilities will not hinder or interfere with the primary operations of
382 the district; and
383 (ii) (A) use electricity generated by the facilities; or
384 (B) subject to Subsection (4)(b), sell electricity generated by the facilities to an electric
385 utility or municipality with an existing system for distributing electricity.
386 (b) A district may not act as a retail distributor or seller of electricity.
387 (c) Revenue that a district receives from the sale of electricity from electrical
388 generation facilities it owns or operates under this section may be used for any lawful district
389 purpose, including the payment of bonds issued to pay some or all of the cost of acquiring or
390 constructing the facilities.
391 (5) A local district may adopt and, after adoption, alter a corporate seal.
392 Section 5. Section 17B-1-118 is enacted to read:
393 17B-1-118. Limit on local district connection fees and other charges to state
394 agencies.
395 (1) As used in this section:
396 (a) "Connection fee" means a fee that a local district charges to connect a state facility
397 to a district utility in order for the local district to provide service to the state facility.
398 (b) "District utility" means any water system, sewer system, storm water system, or
399 electrical system provided by the local district.

400 (c) "State agency" means the state or any agency, department, or division of the state.
401 (d) "State facility" means a building or other public facility constructed, owned, or
402 controlled by a state agency.
403 (2) A local district may not charge a state agency a connection fee that exceeds the
404 local district's actual cost of connecting the district utility to a state facility.
405 (3) (a) A local district may charge and collect from a state agency the actual cost of
406 providing infrastructure if:
407 (i) the need for the infrastructure arises directly because of a state facility; and
408 (ii) the infrastructure is necessary in order for the local district to be able to provide
409 local district utility service to the state facility.
410 (b) A local district shall:
411 (i) place all funds received from a state agency under Subsection (3)(a) in a dedicated
412 account; and
413 (ii) promptly return to the state agency any funds remaining in that dedicated account
414 after completion of the infrastructure for which the funds were collected.
415 (4) A local district may charge and collect from a state agency for the state agency's
416 actual consumption of service provided by a local district utility.
417 (5) Except as provided in this section, a local district may not charge a state agency any
418 fee or charge for or relating to the design or construction of a state facility.
419 Section 6. Section 17D-1-106 is amended to read:
420 17D-1-106. Special service districts subject to other provisions.
421 (1) A special service district is, to the same extent as if it were a local district, subject
422 to and governed by:
423 (a) Sections 17B-1-105 , 17B-1-107, 17B-1-108 , 17B-1-109 , 17B-1-110 , 17B-1-111 ,
424 17B-1-112 , 17B-1-113, [and] 17B-1-116, and 17B-1-118 ;
425 (b) Sections 17B-1-304 , 17B-1-305, 17B-1-306 , 17B-1-307 , 17B-1-310 , 17B-1-312 ,
426 and 17B-1-313 ;
427 (c) Title 17B, Chapter 1, Part 6, Fiscal Procedures for Local Districts;
428 (d) Title 17B, Chapter 1, Part 7, Local District Budgets and Audit Reports;
429 (e) Title 17B, Chapter 1, Part 8, Local District Personnel Management; and
430 (f) Title 17B, Chapter 1, Part 9, Collection of Service Fees and Charges.

431 (2) For purposes of applying the provisions listed in Subsection (1) to a special service
432 district, each reference in those provisions to the local district board of trustees means the
433 governing authority.




Legislative Review Note
as of 1-16-09 3:13 PM

Office of Legislative Research and General Counsel