Impact Fee Study

 

In mid-2017, the City Council adopted Portland's Plan 2030, a new comprehensive plan designed to guide the city’s growth and change over the next ten years. Among the plan’s recommendations is a strong commitment to exploring new ways of funding our critical facilities and services, particularly as they are used by a growing number of residents, workers, and visitors.  

The revenue necessary to build city facilities and provide essential services is generated through a variety of mechanisms – including property taxes, state and federal aid, and outside grants. Portland’s Plan recognizes the possibility of another element in this equation – a systematic means of assessing capital costs when it comes to new growth. This idea is premised on the concept that when development occurs it can bring many benefits, but it also affects the existing infrastructure around it by adding more cars, bikes, and pedestrians to the streets, increasing sewer flows into the city’s systems, and infusing additional visitors into the city’s parks and open spaces.  

On November 19, 2018, the City Council formally adopted an impact fee ordinance to establish a predictable, equitable, and efficient way of assessing the impact of incremental growth on transportation, wastewater, and parks and recreation infrastructure in the city. By and large, this system will replace the current practice of assessing project mitigation for this infrastructure on a case-by-case basis.

WHAT ARE IMPACT FEES?

Impact fees are charges paid by new development to fund the cost of providing municipal facilities to serve that development. Impact fees are widely used throughout the United States to assess the cost of new development’s share of schools; fire and police facilities; stormwater and sewer infrastructure; parks, open spaces, and trails; and transportation systems. Impact fees have been used in some communities in the United States for the past 50+ years.

WHAT IS THE HISTORY ON IMPACT FEES IN MAINE?  AND WHO ELSE HAS THEM?

In the late 1980s, the legislature laid the foundation for impact fees in Maine with the Comprehensive Planning and Land Use Regulation Act of 1987. In the time since, Maine communities both large and small have developed impact fee ordinances. Brunswick, Freeport, Lewiston, Saco, York, Gorham, Windham, and Scarborough all have impact fees, and although the fees and their specific uses may vary, they are all fundamentally designed as a way for growth to ‘pay its own way.’ 

HOW WERE PORTLAND’s IMPACT FEES DEVELOPED?

In late 2017, the Council directed the Department of Planning and Urban Development, in coordination with the Department of Public Works and the Parks, Recreation, and Facilities Department, to begin an investigation of impact fees. This effort, begun in earnest in the early spring of this year, focused on developing impact fee systems for multi-modal transportation infrastructure, parks and open space, and wastewater infrastructure. The study’s first step was to compile data, including population and employment growth projections, that served as the foundation for the impact fee analysis. The analysis phase, where the work of determining the impacts of development on a per unit, per trip, or per square foot basis occurred, continued through the late spring and summer. Ultimately, a draft impact fee ordinance was presented to the Planning Board, Economic Development Committee and City Council in October and November of 2018.

What Are the Major Work Products of the impact fee study?

Demographic Data and Development Projections Memo (June 5, 2018)

Impact Fee and Budget FAQs (August 12, 2018)

Draft Maximum Supportable Fee Calculations (September 24, 2018)

Impact Fee Analysis, Colliers International (September 20, 2018)

Final Impact Fee Study (October 19, 2018)

Final Impact Fee Ordinance (November 19, 2018)

PUBLIC INVOLVEMENT

public meetings

Over the course of the Impact Fee Study, there were a series of formal public meetings, including workshops and hearings with the Planning Board and City Council. These included the following:

- November 19, 2018 City Council Hearing. On November 19, the Council unanimously adopted an impact fee ordinance. For more information, visit the City Council’s website here.

- October 16, 2018 Economic Development Committee Hearing. On October 16, 2018, the Economic Development Committee of the Council met to consider a final draft impact fee ordinance. At the meeting, the Committee voted to recommend the ordinance to the full City Council. For more information, read the EDC report here.

- October 9, 2018 Planning Board Hearing. On October 9, the Planning Board met to consider a final draft impact fee ordinance. At the meeting, the Planning Board voted to recommend the ordinance to the full City Council for adoption. For more information, read the Planning Board report here.

- October 2, 2018 Economic Development Committee Hearing. On October 2, the EDC met to consider the final draft impact fee ordinance. For more information, read the EDC memo here.

- September 24, 2018 Council Workshop. On September 24, the City Council met in a workshop setting to review fee calculations and a draft impact fee ordinance. For more information, read the Council memo here.

- September 20, 2018 Planning Board Workshop. On September 20, the Planning Board met to review fee calculations and a draft impact fee ordinance. For more information, read the Planning Board memo here.

- September 18, 2018 Economic Development Committee Workshop. On September 18, the Economic Development Committee met to review fee calculations and a draft impact fee ordinance. For information, visit the EDC website here.

- June 5, 2018 Economic Development Committee Workshop - On June 5, the Economic Development Committee met for the first time on the Impact Fee Study. Read the Economic Development Committee memo here.

- May 17, 2018 Planning Board Workshop - On May 17, the Planning Board met for an introduction to the Impact Fee Study. The workshop included an overview of the scope of the study and broad discussion on approach. Read the Planning Board memo here.

Stakeholder Group

In addition to engaging representatives of various city departments whose work is related directly to the concept of impact fees, the city met several times over the course of the study with a stakeholder group representing a range of community stakeholders. This group provided feedback as the city developed assumptions, conducted the analysis, and prepared draft impact fees.   

Contact

Questions or comments? Please contact Nell Donaldson at recodeportland@portlandmaine.gov

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