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Posted on: December 17, 2018

New Development Impact Fees Go Into Effect December 19, 2018


In November 2018, the Portland City Council voted to adopt an impact fee ordinance for all new development projects. The new rules and regulations go into effect on December 19 and apply to all building permit applications submitted following this date. The system will help finance City infrastructure required to accommodate growth, rather than requiring the full cost of these infrastructure projects to come from existing taxpayers.

Impact fees are charges paid by a proposed development to fund the cost of providing municipal facilities that serve that development. In Portland, the fees will pay for transportation, parks and recreation, and wastewater infrastructure. 

“Impact fees are used widely across the country, as well as here in Maine, as a means of requiring that growth ‘pay it’s own way’,” City Manager Jon Jennings said.  “We believe that impact fees will allow the city to plan for sustainable growth well into the future. I’d like to thank everyone who participated in shaping this ordinance, and especially thank Jeff Levine and Nell Donaldson of our Planning Department for their hard work.”   

The City’s Comprehensive Plan lays a strong foundation for future growth in the city over the next 10 years, and speaks to where and how growth should occur, as well as mechanisms for funding growth-related improvements, such as impact fees. Impact fees will help ensure that there is infrastructure capacity to support the growth envisioned in the Comprehensive Plan.

The ordinance is the product of a year-long research and planning effort on the part of several city departments. The project involved the hiring of a consultant, TischlerBise, with strong national experience developing impact fee systems. The City also held eight formal public meetings to review the new ordinance, including workshops before the Planning Board, Economic Development Committee, and City Council, before the Planning Board unanimously recommended the ordinance to the City Council for adoption. 

The impact fee ordinance was developed with the help of a stakeholder committee, including developers, neighborhood association representatives, and members of the community with a stake in the city’s economic development. The effort also included a third-party analysis by Colliers’ International that showed that the fees as proposed would have minimal impacts on returns across the range of development types studied.   

For transportation and parks and recreation, the amount of impact fees is determined based on the type and scale of development proposed. For wastewater, the fee is based on the size and number of water meters proposed. In cases of redevelopment, building additions, or changes of use, a credit is granted for existing uses or water meters on site, and the fee is calculated based on the difference between the old and new use. 

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