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H.B. 205 Enrolled

             1     

IMPACT FEE AMENDMENTS

             2     
2010 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: Stephen E. Sandstrom

             5     
Senate Sponsor: Howard A. Stephenson

             6     
             7      LONG TITLE
             8      General Description:
             9          This bill amends impact fee provisions relating to school districts and charter schools.
             10      Highlighted Provisions:
             11          This bill:
             12          .    requires that an impact fee enactment allow, in certain circumstances, a developer
             13      to receive a credit against or proportionate reimbursement of an impact fee,
             14      including a school district or charter school;
             15          .    amends requirements for a capital facilities plan;
             16          .    amends provisions relating to an impact fee enactment;
             17          .    amends provisions relating to impact fees; and
             18          .    makes technical corrections.
             19      Monies Appropriated in this Bill:
             20          None
             21      Other Special Clauses:
             22          None
             23      Utah Code Sections Affected:
             24      AMENDS:
             25          11-36-201, as last amended by Laws of Utah 2009, Chapters 181, 188, 286, and 323
             26          11-36-202, as last amended by Laws of Utah 2009, Chapters 181, 286, and 323
             27     
             28      Be it enacted by the Legislature of the state of Utah:
             29          Section 1. Section 11-36-201 is amended to read:


             30           11-36-201. Impact fees -- Analysis -- Capital facilities plan -- Notice of plan --
             31      Summary -- Exemptions.
             32          (1) (a) (i) Each local political subdivision and private entity shall comply with the
             33      requirements of this chapter before establishing or modifying any impact fee.
             34          (ii) A fee that meets the definition of impact fee under Section 11-36-102 is an impact
             35      fee subject to this chapter, regardless of what term the local political subdivision or private
             36      entity uses to refer to the fee.
             37          (iii) A local political subdivision or private entity may not avoid application of this
             38      chapter to a fee that meets the definition of an impact fee under Section 11-36-102 by
             39      referring to the fee by another name.
             40          (b) A local political subdivision may not:
             41          (i) establish any new impact fees that are not authorized by this chapter; or
             42          (ii) impose or charge any other fees as a condition of development approval unless
             43      those fees are a reasonable charge for the service provided.
             44          (c) Each local political subdivision shall ensure that the impact fees comply with the
             45      requirements of this chapter.
             46          (d) (i) Each local political subdivision and private entity shall ensure that each impact
             47      fee collected on or after May 12, 2009 complies with the provisions of this chapter, even if the
             48      impact fee was imposed but not paid before May 12, 2009.
             49          (ii) Subsection (1)(d)(i) does not apply to an impact fee that was paid before May 12,
             50      2009.
             51          (2) (a) Before imposing impact fees, each local political subdivision and private entity
             52      shall, except as provided in Subsection (2)(f), prepare a capital facilities plan to determine the
             53      public facilities required to serve development resulting from new development activity.
             54          (b) (i) As used in this Subsection (2)(b):
             55          (A) (I) "Affected entity" means each county, municipality, local district under Title
             56      17B, Limited Purpose Local Government Entities - Local Districts, special service district
             57      under Title 17D, Chapter 1, Special Service District Act, school district, interlocal cooperation


             58      entity established under Chapter 13, Interlocal Cooperation Act, and specified public utility:
             59          (Aa) whose services or facilities are likely to require expansion or significant
             60      modification because of the facilities proposed in the proposed capital facilities plan; or
             61          (Bb) that has filed with the local political subdivision or private entity a copy of the
             62      general or long-range plan of the county, municipality, local district, special service district,
             63      school district, interlocal cooperation entity, or specified public utility.
             64          (II) "Affected entity" does not include the local political subdivision or private entity
             65      that is required under this Subsection (2) to provide notice.
             66          (B) "Specified public utility" means an electrical corporation, gas corporation, or
             67      telephone corporation, as those terms are defined in Section 54-2-1 .
             68          (ii) Before preparing or amending a capital facilities plan, each local political
             69      subdivision and each private entity shall provide written notice, as provided in this Subsection
             70      (2)(b), of its intent to prepare or amend a capital facilities plan.
             71          (iii) Each notice under Subsection (2)(b)(ii) shall:
             72          (A) indicate that the local political subdivision or private entity intends to prepare or
             73      amend a capital facilities plan;
             74          (B) describe or provide a map of the geographic area where the proposed capital
             75      facilities will be located;
             76          (C) be:
             77          (I) sent to each county in whose unincorporated area and each municipality in whose
             78      boundaries is located the land on which the proposed facilities will be located;
             79          (II) sent to each affected entity;
             80          (III) sent to the Automated Geographic Reference Center created in Section
             81      63F-1-506 ;
             82          (IV) sent to the association of governments, established pursuant to an interlocal
             83      agreement under Chapter 13, Interlocal Cooperation Act, in which the facilities are proposed
             84      to be located;
             85          (V) (Aa) placed on the Utah Public Notice Website created under Section 63F-1-701 ,


             86      if the local political subdivision:
             87          (Ii) is required under Subsection 52-4-203 (3) to use that website to provide public
             88      notice of a meeting; or
             89          (IIii) voluntarily chooses to place notice on that website despite not being required to
             90      do so under Subsection (2)(b)(iii)(C)(V)(Aa)(Ii); or
             91          (Bb) sent to the state planning coordinator appointed under Section 63J-4-202 , if the
             92      local political subdivision does not provide notice on the Utah Public Notice Website under
             93      Subsection (2)(b)(iii)(C)(V)(Aa) or for a private entity;
             94          (VI) sent to the registered agent of the Utah Home Builders Association;
             95          (VII) sent to the registered agent of the Utah Association of Realtors; and
             96          (VIII) sent to the registered agent of the Utah Chapter of the Associated General
             97      Contractors of America; and
             98          (D) with respect to the notice to an affected entity, invite the affected entity to provide
             99      information for the local political subdivision or private entity to consider in the process of
             100      preparing, adopting, and implementing or amending a capital facilities plan concerning:
             101          (I) impacts that the facilities proposed in the capital facilities plan may have on the
             102      affected entity; and
             103          (II) facilities or uses of land that the affected entity is planning or considering that may
             104      conflict with the facilities proposed in the capital facilities plan.
             105          (c) The plan shall identify:
             106          (i) demands placed upon existing public facilities by new development activity; and
             107          (ii) the proposed means by which the local political subdivision will meet those
             108      demands.
             109          (d) A municipality or county need not prepare a separate capital facilities plan if the
             110      general plan required by Section 10-9a-401 or 17-27a-401 , respectively, contains the elements
             111      required by Subsection (2)(c).
             112          (e) (i) If a local political subdivision chooses to prepare an independent capital
             113      facilities plan rather than include a capital facilities element in the general plan, the local


             114      political subdivision shall:
             115          (A) before preparing or contracting to prepare or amending or contracting to amend
             116      the independent capital facilities plan, send written notice:
             117          (I) to:
             118          (Aa) the registered agent of the Utah Home Builders Association;
             119          (Bb) the registered agent of the Utah Association of Realtors; and
             120          (Cc) the registered agent of the Utah Chapter of the Associated General Contractors of
             121      America;
             122          (II) stating the local political subdivision's intent to prepare or amend a capital
             123      facilities plan; and
             124          (III) inviting each of the notice recipients to participate in the preparation of or
             125      amendment to the capital facilities plan; and
             126          (B) before adopting or amending the capital facilities plan:
             127          (I) give public notice of the plan or amendment according to Subsection (2)(e)(ii)(A),
             128      (B), or (C), as the case may be, at least 10 days before the date of the public hearing;
             129          (II) make a copy of the plan or amendment, together with a summary designed to be
             130      understood by a lay person, available to the public;
             131          (III) place a copy of the plan or amendment and summary in each public library within
             132      the local political subdivision; and
             133          (IV) hold a public hearing to hear public comment on the plan or amendment.
             134          (ii) With respect to the public notice required under Subsection (2)(e)(i)(B)(I):
             135          (A) each municipality shall comply with the notice and hearing requirements of, and,
             136      except as provided in Subsection 11-36-401 (4)(f), receive the protections of Sections
             137      10-9a-205 and 10-9a-801 and Subsection 10-9a-502 (2);
             138          (B) each county shall comply with the notice and hearing requirements of, and, except
             139      as provided in Subsection 11-36-401 (4)(f), receive the protections of Sections 17-27a-205 and
             140      17-27a-801 and Subsection 17-27a-502 (2); and
             141          (C) each local district, special service district, and private entity shall comply with the


             142      notice and hearing requirements of, and receive the protections of, Section 17B-1-111 .
             143          (iii) Nothing contained in this Subsection (2)(e) or in the subsections referenced in
             144      Subsections (2)(e)(ii)(A) and (B) may be construed to require involvement by a planning
             145      commission in the capital facilities planning process.
             146          (f) (i) A local political subdivision with a population or serving a population of less
             147      than 5,000 as of the last federal census need not comply with the capital facilities plan
             148      requirements of this part, but shall ensure that:
             149          (A) the impact fees that the local political subdivision imposes are based upon a
             150      reasonable plan; and
             151          (B) each applicable notice required by this chapter is given.
             152          (ii) Subsection (2)(f)(i) does not apply to private entities.
             153          (g) (i) Subject to Subsection (2)(g)(iii), the plan shall include a public facility for
             154      which an impact fee may be charged or required for a school district or charter school if the
             155      local political subdivision is aware of the planned location of the school district facility or
             156      charter school:
             157          (A) through the planning process; or
             158          (B) after receiving a written request from a school district or charter school that the
             159      public facility be included in the plan.
             160          (ii) If necessary, the plan shall be amended to reflect a public facility described in
             161      Subsection (2)(g)(i).
             162          (iii) (A) In accordance with Subsections 10-9a-305 (4) and 17-27a-305 (4), a local
             163      political subdivision may not require a school district or charter school to participate in the
             164      cost of any roadway or sidewalk.
             165          (B) Notwithstanding Subsection (2)(g)(iii)(A), if a school district or charter school
             166      agrees to build a roadway or sidewalk, the roadway or sidewalk shall be included in the plan.
             167          (3) In preparing the plan, each local political subdivision shall generally consider all
             168      revenue sources, including impact fees and anticipated dedication of system improvements, to
             169      finance the impacts on system improvements.


             170          (4) A local political subdivision or private entity may only impose impact fees on
             171      development activities when its plan for financing system improvements establishes that
             172      impact fees are necessary to achieve an equitable allocation to the costs borne in the past and
             173      to be borne in the future, in comparison to the benefits already received and yet to be received.
             174          (5) (a) Subject to the notice requirement of Subsection (5)(b), each local political
             175      subdivision and private entity intending to impose an impact fee shall prepare a written
             176      analysis of each impact fee that:
             177          (i) identifies the anticipated impact on or consumption of any existing capacity of a
             178      public facility by the anticipated development activity;
             179          (ii) identifies the anticipated impact on system improvements required by the
             180      anticipated development activity to maintain the established level of service for each public
             181      facility;
             182          (iii) demonstrates how those anticipated impacts are reasonably related to the
             183      anticipated development activity;
             184          (iv) estimates the proportionate share of:
             185          (A) the costs for existing capacity that will be recouped; and
             186          (B) the costs of impacts on system improvements that are reasonably related to the
             187      new development activity; and
             188          (v) based upon those factors and the requirements of this chapter, identifies how the
             189      impact fee was calculated.
             190          (b) Before preparing or contracting to prepare the written analysis required under
             191      Subsection (5)(a), each local political subdivision or private entity shall provide:
             192          (i) public notice; and
             193          (ii) written notice:
             194          (A) to:
             195          (I) the registered agent of the Utah Home Builders Association;
             196          (II) the registered agent of the Utah Association of Realtors; and
             197          (III) the registered agent of the Utah Chapter of the Associated General Contractors of


             198      America;
             199          (B) indicating the local political subdivision or private entity's intent to prepare or
             200      contract to prepare a written analysis of an impact fee; and
             201          (C) inviting each notice recipient to participate in the preparation of the written
             202      analysis.
             203          (c) In analyzing whether or not the proportionate share of the costs of public facilities
             204      are reasonably related to the new development activity, the local political subdivision or
             205      private entity, as the case may be, shall identify, if applicable:
             206          (i) the cost of each existing public facility that has excess capacity to serve the
             207      anticipated development resulting from the new development activity;
             208          (ii) the cost of system improvements for each public facility;
             209          (iii) other than impact fees, the manner of financing each public facility, such as user
             210      charges, special assessments, bonded indebtedness, general taxes, or federal grants;
             211          (iv) the relative extent to which development activity will contribute to financing the
             212      excess capacity of and system improvements for each existing public facility, by such means
             213      as user charges, special assessments, or payment from the proceeds of general taxes;
             214          (v) the relative extent to which development activity will contribute to the cost of
             215      existing public facilities and system improvements in the future;
             216          (vi) the extent to which the development activity is entitled to a credit against impact
             217      fees because the development activity will dedicate system improvements or public facilities
             218      that will offset the demand for system improvements, inside or outside the proposed
             219      development;
             220          (vii) extraordinary costs, if any, in servicing the newly developed properties; and
             221          (viii) the time-price differential inherent in fair comparisons of amounts paid at
             222      different times.
             223          (d) Each local political subdivision and private entity that prepares a written analysis
             224      under this Subsection (5) shall also prepare a summary of the written analysis, designed to be
             225      understood by a lay person.


             226          (6) Each local political subdivision that adopts an impact fee enactment under Section
             227      11-36-202 on or after July 1, 2000 shall, at least 10 days before adopting the enactment:
             228          (a) submit a copy of the written analysis required by Subsection (5)(a) and a copy of
             229      the summary required by Subsection (5)(d) to:
             230          (i) each public library within the local political subdivision;
             231          (ii) the registered agent of the Utah Home Builders Association;
             232          (iii) the registered agent of the Utah Association of Realtors; and
             233          (iv) the registered agent of the Utah Chapter of the Associated General Contractors of
             234      America; and
             235          (b) obtain a written certification from the person or entity that prepares the written
             236      analysis which states as follows:
             237          "I certify that the attached impact fee analysis:
             238              1. includes only the costs for qualifying public facilities that are:
             239                  a. allowed under the Impact Fees Act; and
             240                  b. projected to be incurred or encumbered within six years after each
             241      impact fee is paid;
             242              2. contains no cost for operation and maintenance of public facilities;
             243              3. offsets costs with grants or other alternate sources of payment;
             244              4. does not include costs for qualifying public facilities that will raise the level
             245      of service for the facilities, through impact fees, above the level of service that
             246      is supported by existing residents; and
             247              5. complies in each and every relevant respect with the Impact Fees Act."
             248          (7) Nothing in this chapter may be construed to repeal or otherwise eliminate any
             249      impact fee in effect on the effective date of this chapter that is pledged as a source of revenues
             250      to pay bonded indebtedness that was incurred before the effective date of this chapter.
             251          Section 2. Section 11-36-202 is amended to read:
             252           11-36-202. Impact fees -- Enactment -- Required and allowed provisions --
             253      Limitations -- Effective date.


             254          (1) (a) Each local political subdivision and private entity wishing to impose impact
             255      fees shall pass an impact fee enactment.
             256          (b) The impact fee imposed by that enactment may not exceed the highest fee justified
             257      by the impact fee analysis performed pursuant to Section 11-36-201 .
             258          (c) In calculating the impact fee, a local political subdivision or private entity may
             259      include:
             260          (i) the construction contract price;
             261          (ii) the cost of acquiring land, improvements, materials, and fixtures;
             262          (iii) the cost for planning, surveying, and engineering fees for services provided for
             263      and directly related to the construction of the system improvements; and
             264          (iv) debt service charges, if the political subdivision might use impact fees as a
             265      revenue stream to pay the principal and interest on bonds, notes, or other obligations issued to
             266      finance the costs of the system improvements.
             267          (d) In calculating an impact fee, a local political subdivision may not include an
             268      expense for overhead unless the expense is calculated pursuant to a methodology that is
             269      consistent with:
             270          (i) generally accepted cost accounting practices; and
             271          (ii) the methodological standards set forth by the federal Office of Management and
             272      Budget for federal grant reimbursement.
             273          (e) In calculating an impact fee, each local political subdivision shall base amounts
             274      calculated under Subsection (1)(c) on realistic estimates, and the assumptions underlying those
             275      estimates shall be disclosed in the impact fee analysis.
             276          (f) Each local political subdivision and private entity that intends to enact an impact
             277      fee enactment shall:
             278          (i) at least 10 days before the date of the public hearing:
             279          (A) make a copy of the impact fee enactment available to the public; and
             280          (B) mail a written copy of the impact fee enactment to:
             281          (I) the registered agent of the Utah Home Builders Association;


             282          (II) the registered agent of the Utah Association of Realtors; and
             283          (III) the registered agent of the Utah Chapter of the Associated General Contractors of
             284      America; and
             285          (ii) (A) for a municipality, comply with the notice and hearing requirements of, and,
             286      except as provided in Subsection 11-36-401 (4)(f), receive the protections of Sections
             287      10-9a-205 and 10-9a-801 ;
             288          (B) for a county, comply with the notice and hearing requirements of, and, except as
             289      provided in Subsection 11-36-401 (4)(f), receive the protections of Sections 17-27a-205 and
             290      17-27a-801 ; and
             291          (C) for a local district or special service district, comply with the notice and hearing
             292      requirements of, and receive the protections of, Section 17B-1-111 .
             293          (g) Nothing contained in Subsection (1)(f) may be construed to require involvement
             294      by a planning commission in the impact fee enactment process.
             295          (2) The local political subdivision or private entity shall ensure that the impact fee
             296      enactment:
             297          (a) contains:
             298          (i) a provision establishing one or more service areas within which the local political
             299      subdivision or private entity calculates and imposes impact fees for various land use
             300      categories;
             301          (ii) (A) a schedule of impact fees for each type of development activity that specifies
             302      the amount of the impact fee to be imposed for each type of system improvement; or
             303          (B) the formula that the local political subdivision or private entity, as the case may
             304      be, will use to calculate each impact fee;
             305          (iii) a provision authorizing the local political subdivision or private entity, as the case
             306      may be, to adjust the standard impact fee at the time the fee is charged to:
             307          (A) respond to:
             308          (I) unusual circumstances in specific cases; or
             309          (II) a request for a prompt and individualized impact fee review for:


             310          (Aa) the development activity of the state or a school district or charter school; and
             311          (Bb) an offset or credit for a public facility for which an impact fee has been or will be
             312      collected; and
             313          (B) ensure that the impact fees are imposed fairly; and
             314          (iv) a provision governing calculation of the amount of the impact fee to be imposed
             315      on a particular development that permits adjustment of the amount of the fee based upon
             316      studies and data submitted by the developer; and
             317          (b) allows a developer, including a school district or charter school, to receive a credit
             318      against or proportionate reimbursement of an impact fee if the developer:
             319          (i) dedicates land for a system improvement;
             320          (ii) builds and dedicates some or all of a system improvement; or
             321          (iii) dedicates a public facility that the local political subdivision or private entity and
             322      the developer agree will reduce the need for a system improvement.
             323          (3) (a) A local political subdivision or private entity may include a provision in an
             324      impact fee enactment that:
             325          (i) provides an impact fee exemption for:
             326          (A) development activity attributable to:
             327          (I) low income housing;
             328          (II) the state;
             329          (III) a school district; or
             330          (IV) a charter school; or
             331          (B) other development activity with a broad public purpose; and
             332          (ii) establishes one or more sources of funds other than impact fees to pay for that
             333      development activity.
             334          (b) An impact fee enactment that provides an impact fee exemption for development
             335      activity attributable to a school district or charter school shall allow either a school district or a
             336      charter school to qualify for the exemption on the same basis.
             337          (4) A local political subdivision or private entity shall include a provision in an impact


             338      fee enactment that requires a credit against impact fees for any dedication of land for,
             339      improvement to, or new construction of, any system improvements provided by the developer
             340      if the facilities:
             341          (a) are system improvements; or
             342          (b) (i) are dedicated to the public; and
             343          (ii) offset the need for an identified system improvement.
             344          (5) A local political subdivision may not:
             345          (a) impose an impact fee to:
             346          [(a)] (i) cure deficiencies in a public facility serving existing development; or
             347          [(b)] (ii) raise the established level of service of a public facility serving existing
             348      development[.]; or
             349          (b) delay the construction of a school or charter school because of a dispute with the
             350      school or charter school over impact fees.
             351          (6) Notwithstanding the requirements and prohibitions of this chapter, a local political
             352      subdivision may impose and assess an impact fee for environmental mitigation when:
             353          (a) the local political subdivision has formally agreed to fund a Habitat Conservation
             354      Plan to resolve conflicts with the Endangered Species Act of 1973, 16 U.S.C. Sec 1531, et seq.
             355      or other state or federal environmental law or regulation;
             356          (b) the impact fee bears a reasonable relationship to the environmental mitigation
             357      required by the Habitat Conservation Plan; and
             358          (c) the legislative body of the local political subdivision adopts an ordinance or
             359      resolution:
             360          (i) declaring that an impact fee is required to finance the Habitat Conservation Plan;
             361          (ii) establishing periodic sunset dates for the impact fee; and
             362          (iii) requiring the legislative body to:
             363          (A) review the impact fee on those sunset dates;
             364          (B) determine whether or not the impact fee is still required to finance the Habitat
             365      Conservation Plan; and


             366          (C) affirmatively reauthorize the impact fee if the legislative body finds that the
             367      impact fee must remain in effect.
             368          (7) (a) Notwithstanding any other provision of this chapter:
             369          (i) an impact fee to pay for a public safety facility that is a fire suppression vehicle
             370      may not be imposed on residential components of development;
             371          (ii) an impact fee may not be imposed on a school district or charter school for a park,
             372      recreation facility, open space, or trail;
             373          (iii) an impact fee may not be imposed on development activity that consists of the
             374      construction of a school, whether by a school district or a charter school, if:
             375          (A) the school is intended to replace another school, whether on the same or a different
             376      parcel;
             377          (B) the new school creates no greater demand or need for public facilities than the
             378      school [being replaced] or school facilities, including any portable or modular classrooms that
             379      are on the site of the replaced school at the time that the new school is proposed; and
             380          (C) the new school and the school being replaced are both within:
             381          (I) the boundary of the local political subdivision; or
             382          (II) the jurisdiction of the private entity;
             383          (iv) an impact fee may not be imposed on a school district or charter school unless:
             384          (A) the development resulting from the school district or charter school's development
             385      activity directly results in a need for additional system improvements for which the impact fee
             386      is imposed; and
             387          (B) the impact fee is calculated to cover only the school district or charter school's
             388      proportionate share of the cost of those additional system improvements;
             389          (v) an impact fee for a road facility may be imposed on the state only if and to the
             390      extent that:
             391          (A) the state's development causes an impact on the road facility; and
             392          (B) the portion of the road facility related to an impact fee is not funded by the state or
             393      by the federal government; and


             394          (vi) to the extent that the impact fee includes a component for a law enforcement
             395      facility, the impact fee may not be imposed on development activity for:
             396          (A) the Utah National Guard;
             397          (B) the Utah Highway Patrol; or
             398          (C) a state institution of higher education that has its own police force.
             399          (b) If the imposition of an impact fee on a new school is not prohibited under
             400      Subsection (7)(a)(iii) because the new school creates a greater demand or need for public
             401      facilities than the school being replaced, the impact fee may be based only on the demand or
             402      need that the new school creates for public facilities that exceeds the demand or need that the
             403      school being replaced creates for those public facilities.
             404          (8) Notwithstanding any other provision of this chapter, a local political subdivision
             405      may impose and collect impact fees on behalf of a school district if authorized by Section
             406      53A-20-100.5 .
             407          (9) An impact fee enactment may not take effect until 90 days after it is enacted.


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