While everyone talks about that there should be growth in the community then they often don’t talk about the impact fee or in this case development impact fee. You might have come across this as there has been quite a discussion on the Winnipeg impact fee for which the court of Queen’s Bench decision was against it and now the authorities will have to refund. The impact fee is charged once for the cost that is associated with the infrastructure compulsory for new development. Part of what they sound like, they aren’t taxed they are just the fee for utilities such as schools water, roads, and parks sewer lines, and library services.
The idea of Development Impact Fee
The development impact fee will directly be used to support the development of the existing utility services that aren’t sufficient for the growing population within the area. The idea behind the development impact fee is that the member of the community will pay an amount of fee for the improvement of the utility service or development of the new one because the existing one is failing to accommodate. Impact fees are a popular idea in areas where the growth rate is rapid and the existing infrastructure is failing to keep up with the new population.
What Is It For?
These fees can help communities to avoid uncontrolled citizen growth in an urban area. If some properties are far away from the urban areas or if they are far away from the infrastructure hub, there will be less risk involving that the developer will skip the land close to the urban area and start developing areas far away from existing infrastructure. With the existence of the Developing Impact fee, the developers are more likely to develop the desired property that is closer to the city center. Impact funds have advantages for developments as well. They can make sure that new development will receive funding that is required before the development is complete.
When to Contact Lawyer?
A real estate lawyer has experience in Impact fee in your area is very helpful in determining that if the impact fee is legal or not. As a developer in the area with an impact fee, you will have to decide how you will offset the fee. You can either choose to share some of the cost of the project on your own or you can pass it as a whole to your buyer. In an area with high demand, you can simply pass on the fee to your buyers; however, take a look at your impact fee competition as well. This is because of the fact you may be touching the impact fee boundary and find yourself in competition with other builders or the housing prices that are lower as those do not have any impact on the impact fee.
Why It Is Criticized?
After the Winnipeg impact fee decision, there has been a debate that should it be ended or there should be alternates. First of all, if there is land in the urban areas that need to be developed then instead of imposing a fee that is equal to the property tax, why not find a way to find a cheaper alternative to complete the project. It is also better to discuss with the community if they want to contribute equally to improve the existing infrastructure. Not only this can lead to a better solution, but families with fixed incomes and heavy bills will also have a sense of relief from impact fees that may seem unnecessary for them
