Chapter 305

2007 -- H 5696 AS AMENDED

Enacted 07/06/07

A N A C T

RELATING TO TOWNS AND CITIES - DEVELOPMENT IMPACT FEE ACT

Introduced By: Representatives San Bento, and Schadone

Date Introduced: February 28, 2007

It is enacted by the General Assembly as follows:

     SECTION 1. Section 45-22.4-5 of the General Laws in Chapter 45-22.4 entitled "Rhode

Island Development Impact Fee Act" is hereby amended to read as follows:

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 may 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. In no case shall impact fees be retained longer than twelve (12)

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 collected in full upon to the issuance of certificate of shall be collected in full

upon the issuance of the certificate of occupancy or other final action authorizing the intended use

of a structure. Nothing contained in this chapter shall prevent a municipality from continuing to

assess and/or collect an impact fee at an earlier time so long as the municipality does so pursuant

to an ordinance enacted at least ninety (90) days prior to the effective date of this chapter [July

22, 2000].

      (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 the effective date of this chapter [July

22, 2000] and is in compliance with this chapter in all other respects pursuant to section 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 section 45-22.4-5(a)(2).

      (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 for 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: 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 which is owned or controlled by federal or

state government is converted to private ownership or control.

      (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 which 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)

which it deems appropriate.

     SECTION 2. This act shall take effect upon passage.

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LC02140

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