With changes to state law, Missoula County will remove impact fees from certain types of development and ask an advisory board to review any assessments to ensure they align with the county's development goals.
The Montana Legislature recently amended state law regarding impact fees, including the fees local governments can charge new development. The Missoula City Council is undergoing the same process.
“We need to remove impact fees from parks and general government, because they're no longer authorized under the new legislation,” said Karen Hughes, director of county planning. “We also need to remove the admin fees – also no longer authorized – and we need to amend the language regarding inflationary adjustments.”
Local governments use impact fees as a tool to ensure new development pays its share of the services needed to support it. The fees represent a one-time charge, though recent legislation placed limitations on the types of fees cities and counties can collect.
Among them, Senate Bill 133 removed the once-allowed administrative fee and required that impact fees not increase more than the rate of inflation. Senate Bill 532 also revised zoning laws, allowing for accessory dwelling units.
“You're not allowed to collect impact fees for ADUs for areas zoned under county zoning,” said Hughes. “We're adding that exception to the fee resolution.”
Neither the city nor the county can estimate the amount of revenue that may be lost under the changes, since the legislation is still relatively new. But Hughes said it could impact some categories of development.
“The county will have to look elsewhere to fund facilities that support expanded development for general government, and also the parks facilities,” she said. “We can't use impact fees for either of those categories.”
In reviewing the resolution, Hughes said other issues came to light. The county had been assessing non-residential fees for Frenchtown Rural Fire, emergency management and sheriff on a flat fee rather than a structure fee based on square feet.
The county, for now, will leave the fee flat to continue coaxing new development to desired locations. Hughes said the county will direct its impact fee committee to look at those fees and offer recommended adjustments.
“It's very common for fee studies, when a governing body adopts them, that you might do some adjustments,” said Hughes. “This would be that opportunity to make sure we're not over-assessing or limiting some development we'd like to see.”
