Prosperity Price-Why Development Impact Fees are somehow important?

As an adult, you may have come across several types of fees and if you are a part of a community then you will have come across the impact fee. Though the Impact fees are not praised or appreciated everywhere around the US even in Canada where the court of Queen’s Bench Winnipeg ruled against the development impact fee, the impact fee is a one-time amount that one will have to pay for ongoing development projects. According to traditional wisdom from private and public interests is that the development impact fees can limit the growth and development of any infrastructure, and acts as a fake tax on per capita, reducing the investment, and the potential job growth will be redirected to the other “no serious projects”.

Those who support will argue that impact fees are helpful in creating investment within the community, encourage economic growth by providing new infrastructure on time, and expanding buildable land. Given the fact that the impact fee is often paid for public infrastructure projects, and to understand how it will support the local economy which is also known as local job growth is the key. Continue reading the following for more information.

Property Tax Is Failing

Property tax has been a greater part of the modern economy to gain enough funds that will be sufficient to start new infrastructure projects or improve an existing one. One of the major reasons would be increasing political resistance to property taxes that are compromising the conventional ways to pay for infrastructure. To gain everything through property taxes the property rate should be too higher or the tax rate should be increased to fulfill the funds.

Efficient Way to Pay for Infrastructure

Though the impact fees don’t really show the full price of the development project, the impact fees do create a direct link between those who are going to pay for the improvement and for those who will be receiving them, and they will also encourage economic efficiency. The obvious direct economic benefits include the actual investment or infrastructure such as new roads, sewer extension, new schools, parks, and community homes. The indirect benefit can be the predictability in the marketplace that where the new project will occur and how the developers will be treated equally.

Increase the Buildable Land Availability

Without having the city impact fees, the local Govt will not have enough funds to accommodate the rapid population growth within the city. Having the impact fees will make sure that are about to have important infrastructure funds for water, sewerage, roads, and schools alike that will open new ways for development projects in the city. This will make it easier for one to get the land that is available to build or start the project near the urban area.

Job Growth Doesn’t Slow Down!

This is a misconception regarding the impact fee that with the impact fee at least there will be an effect in the local economy which refers to the job growth. At most, the impact fees are the base where the job growth in the local economy will sustain and at least not go down.

Final Words

Yes, some arguments show that why impact fees should b illegal but the fact is, if impose and spent wisely, this can be a key to create more developed communities and accommodate the population growth in the cities.