Recently, the Wisconsin State Legislature made sweeping changes to impact fees (as outlined in Wisconsin Act 243) that will likely affect your municipality and could require you to update your ordinances and impact-fee studies.
Changes you should know about:
Your municipality must now provide detailed reports to impact fee payers on how you will spend the fee. R/M recommends that you fulfill this requirement by providing developers with a copy of your impact-fee studies. If your studies are outdated, they should be updated.
Developers may now defer payment on impact fees exceeding $75,000 for four years. If you construct the impact fee-funded facilities earlier, the developer must pay the full impact fee six months before you spend the revenue. Previously, developers paid impact fees when you issued building permits.
The timeline for spending impact fee revenue has been shortened to eight years (longer time limits may apply in specific cases). Previously, statutes allowed municipalities to specify their own reasonable time limits considering the appropriate planning and financing period for the type of facility.
Aggrieved parties now have ninety days following the fee’s due date to file a petition. Before Act 243, aggrieved parties had only sixty days to file their petitions.
Your municipality is now barred from using impact fees for operation or maintenance expenses of public facilities. It is also prohibited to use the fees to expand service capacity beyond that which is needed to serve the development for which the fee was created.
While these restrictions may make using impact fees more challenging, your municipality can still use these fees to fund vital projects. If you need to revise your ordinances to reflect these extensive law changes, or if you need to update your impact-fee studies, please contact an expert at Ruekert & Mielke today.
About the Author
Edward F. Maxwell
Edward joined Ruekert & Mielke, Inc. (R/M) in 2017 as a financial analyst. Before joining R/M, he worked in private-sector finance, analyzing capital investments, forecasting expenses and revenue, and crafting department budgets. At R/M, he creates financial solutions for all clients, from municipalities to corporate businesses.