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Fort Collins opens review of impact fees for 2026, seeks to align fees with city values and housing goals
Summary
Staff outlined a plan to reopen 2023 impact-fee studies and review level-of-service inputs, square-footage assumptions and growth apportionment so fees can better reflect council priorities such as infill, active modes and housing affordability; staff proposed a legal review and a 2025 workshop with proposed updates for 2026 adoption.
Josh Birx, deputy director of sustainability, and Joe Wimmer, utilities finance director, told council that the city will reopen the 2023 studies on capital expansion and transportation impact fees to examine inputs that determine fee amounts and to explore whether fee structure adjustments can better align with the city's planning and housing objectives.
Why this matters: Impact fees fund capital facilities needed to serve new growth but also add to the cost of new housing. Council asked staff to examine whether fee inputs and the fee schedule (for example, how fees scale by residential square footage) reflect the city's priorities on infill, multimodal transportation and housing affordability.
What staff said they will do
- Reopen 2023 studies and review key levers: staff listed candidate levers including level-of-service assumptions (existing vs. desired service), square-footage maximums used in per-unit fees (the current methodology caps at 2,200 sq ft), growth apportionment between infill and greenfield, and the interaction of capital expansion fees with utilities and plant investment fees.
- Legal review and schedule: an outside legal review will examine current fee structure against evolving case law; staff said they plan to bring proposed updates to the Council Finance Committee and a council workshop in 2025 and seek adoption for implementation in 2026, aligning timing with utilities fee schedules.
- Fiscal magnitude: staff said the 2023 comprehensive studies would have produced about $1 million more in annual fee revenue compared with adopting inflationary adjustments alone; staff therefore framed updates as meaningful to capital planning but also noted trade-offs between higher fees and housing costs.
Council input and priorities
Councilmembers urged mapping potential fee levers to council values (for example, active transportation and infill), considering narrower road cross-sections when appropriate, and ensuring any fee schedule changes explicitly consider truly affordable housing projects. Several members noted that while per-unit fee changes may represent a small percentage of a market-rate home's cost, the aggregate effect on multifamily developments and large projects could be significant.
Next steps
Staff will perform the comprehensive input review, provide a legal memorandum, test alternative fee schedules (including different square-footage tiers and infill scaling), and return with proposed updates, impacts and trade-offs in 2025 for council consideration ahead of a 2026 adoption cycle.
