You asked if (1) the statutes allow towns to assess developer impact fees to offset the cost of roads, schools, police, or other municipal services that support new development and (2) what legislative history exists on this issue.

SUMMARY

The statutes do not authorize towns to assess developers with general impact fees for infrastructure improvements or town services. But they do allow developers to pay fees in lieu of requirements for (1) open space, (2) parking, and (3) affordable housing. In each case the funds can only be used for purposes related to that requirement.

A review of the legislative transcripts on the most recent changes of these "fees in lieu of" requirements shows the debate focused on whether the requirements were practical given real situations and not on the larger issue of whether towns should be allowed to charge impact fees to offset the cost of providing municipal services.

Over the last 20 years, the legislature has considered a number of bills that would allow towns to impose impact fees, but none have made it far in the legislative process. In 1987, sHB 6177 reached the floor, but was recommitted to the Finance, Revenue and Bonding Committee.

FEES IN LIEU OF OPEN SPACE, PARKING, OR AFFORDABLE HOUSING REQUIREMENTS

The statutes do not authorize towns to assess developers with general impact fees for infrastructure improvements or town services. The Connecticut Supreme Court ruled towns could only impose these fees if the statutes specifically authorized such action (Avonside Inc. V. Zoning and Planning Commission of Avon, 153 Conn. 232 (1965)). Statutes that specifically allow towns to let developers pay a fee instead of meeting a town's open space, parking, or affordable housing requirements, all laws passed after the 1965 decision, appear to confirm the legislature's intent of only allowing such fees in limited instances, according to land use expert Terry Tondro (Connecticut Land Use Regulations, 2ed (1992), p. 261). (For details on impact fees allowed by other states see OLR report 2000-R-0757. )

Towns must use the fees from each of these areas for related purposes and not for general municipal functions. For example, the subdivision statute that allows towns with open space requirements to accept fees in lieu of open space land, specifies the fees can only be used to preserve or acquire open space, recreational, or agricultural land (CGS § 8-25). Likewise, the statute authorizing inclusionary zoning to promote affordable housing requires any payment in lieu of the affordable housing requirements to go into an affordable housing trust fund (CGS § 8-2i).

But the zoning statute on parking requirements allows the fees to be used for municipal parking facilities; traffic-, transportation-, and carpooling-related capital projects; and providing or operating transit facilities (CGS § 8-2c). This is the only statute of this type that allows fees to be used for operating expenses.

LEGISLATIVE HISTORY

A review of the legislative transcripts shows the floor debate focused on whether the requirements were practical and not on whether towns should be allowed to charge impact fees to offset the cost of providing municipal services.

PA 90-239 (HB 5771) made a number of changes to open space statutes including allowing developers to pay a fee in lieu of meeting the land donation requirements. The House debate (May 1, 1990) centered on how the existing law did not produce substantial open space parcels, but instead created "dozens of minute parcels" that are not connected and often end up being used for illegal dumping. Bill proponents cited the contention of town planners that developments where 20% of the land was designated for open space resulted in parcels unconnected to larger open tracts. Planners asked that towns be given the option of accepting fees to offset future costs of purchasing or maintaining open space that can be incorporated into larger open space plans.

PA 90-286 (HB 5988) broadened the parking requirement statute to allow the fees to be used for transit facility operating costs. Debate centered around how allowing fees for operating costs was a departure from the previous state policy of only allowing the fees to be used for capital expenditures. The proponents argued that those operating transit for elderly and disabled people wanted the additional funding source to leverage more federal funds for the service. The act maintained other uses of the fees, such as parking or transportation capital projects. This debate (April 30,1990) indicates that some legislators were reluctant to use such fees for other than capital projects.

PA 91-204 (HB 7118) authorized towns to use inclusionary zoning to encourage affordable housing and, as part of this, allowed them to accept fees in lieu of the developers meeting the affordable housing requirements. The amendment allowing fees specified the money must go into housing trust fund. In remarking on the amendment, Rep. Martin Looney emphasized it would not allow municipalities to transfer the money into a general fund or use it for general municipal purposes (May 15, 1991). There was no substantive debate on the amendment.

These examples appear to show that the legislature only intends these fees to be accepted in very specific situations and, once accepted, to be used for specific purposes.

JM: ts