§ 45-22.4-5. Collection and expenditure of impact fees.
(a) The collection and expenditure of impact fees must be reasonably related to the benefits
accruing to the development paying the fees. The ordinance shall consider the following
requirements:
(1) Upon collection, impact fees must be deposited in a special proprietary fund, which
shall be invested with all interest accruing to the trust fund;
(2) Within eight (8) years of the date of collection, impact fees shall be expended or
encumbered for the construction of public facilities' capital improvements of reasonable
benefit to the development paying the fees and that are consistent with the capital
improvement program;
(3) Where the expenditure or encumbrance of fees is not feasible within eight (8) years,
the governmental entity may retain impact fees for a longer period of time if there
are compelling reasons for the longer period. The governing body shall identify, in
writing, the compelling reasons for retaining impact fees for a longer period of time
over eight (8) years. In no case shall impact fees be retained longer than ten (10)
years.
(b) All impact fees imposed pursuant to the authority granted in this chapter shall be
assessed upon the issuance of a building permit or other appropriate permission to
proceed with development and shall be collected only upon the issuance of the certificate
of occupancy or other final action authorizing the intended use of a structure.
(c) A governmental entity may recoup costs of excess capacity in existing capital facilities,
where the excess capacity has been provided in anticipation of the needs of new development,
by requiring impact fees for that portion of the facilities constructed for future
users. The need to recoup costs for excess capacity must have been documented by a
preconstruction assessment that demonstrated the need for the excess capacity. Nothing
contained in this chapter shall prevent a municipality from continuing to assess an
impact fee that recoups costs for excess capacity in an existing facility without
the preconstruction assessment so long as the impact fee was enacted at least ninety
(90) days prior to July 22, 2000, and is in compliance with this chapter in all other
respects pursuant to § 45-22.4-7. The fees imposed to recoup the costs to provide the excess capacity must be based
on the governmental entity's actual cost of acquiring, constructing, or upgrading
the facility and must be no more than a proportionate share of the costs to provide
the excess capacity. That portion of an impact fee deemed recoupment is exempted from
provisions of subsection (a)(2) of this section.
(d) Governmental entities may accept the dedication of land or the construction of public
facilities in lieu of payment of impact fees provided that:
(1) The need for the dedication or construction is clearly documented in the community's
capital improvement program or comprehensive plan;
(2) The land proposed for dedication or the facilities to be constructed are determined
to be appropriate for the proposed use by the local governmental entity;
(3) Formulas and/or procedures for determining the worth of proposed dedications or constructions
are established.
(e) Exemptions:
(1) Impact fees shall not be imposed for remodeling, rehabilitation, or other improvements
to an existing structure, or rebuilding a damaged structure, unless there is an increase
in the number of dwelling units or any other measurable unit for which an impact fee
is collected. Impact fees may be imposed when property that is owned or controlled
by federal or state government is converted to private ownership or control.
(2) Nothing in this chapter shall prevent a municipality from granting any exemption(s)
that it deems appropriate.