Richland County committee hears detailed briefing on impact fees; keeps study in committee

The Richland County Development and Services Committee on Feb. (date not specified) received a presentation on impact fees and voted to keep the topic in committee for further study and possible budget consideration.

Assistant County Administrator Eric Jensen told the committee that impact fees can only be used prospectively—“going forward, they’re for new development,” he said—and that drafting a defensible impact-fee program is a technical exercise that typically requires hiring an outside consultant. Jensen told members a full impact-fee study and ordinance preparation would likely cost “probably in the hundred thousand to a hundred and $50,000 range.”

Jensen said a consultant had already identified potential service categories for Richland County—sheriff, transportation, EMS, fire, solid waste, water and sewer—and noted the consultant had listed stormwater as a possible eighth category but that the county lacks a sufficiently detailed stormwater master plan to support a fee for that service now. He said impact-fee structures vary widely across jurisdictions and that fee programs must be tailored to local service levels, cost allocations and growth forecasts.

Committee members pressed Jensen on how impact fees are assessed and collected. He said impact fees must be tied to the actual capital cost attributable to new development (for example, per-unit shares of a wastewater project) and cannot be inflated beyond the measured impact. He explained that jurisdictions commonly bond for infrastructure, then recoup the portion attributable to new development as new units come online, and that impact-fee proceeds are often combined with other funding sources rather than expected to pay for entire projects alone.

Members also asked about who ultimately pays the fees. Jensen said the collection mechanism depends on how a local program is structured: in some places the developer pays at permitting, elsewhere a developer-created financing district or special assessment (often referenced in other states as a Mello-Roos structure) shifts costs differently. He reiterated that impact fees shift more of the cost of new infrastructure to new development rather than the general tax base.

After discussion, Councilwoman Fan moved to keep the issue in committee for further study and to solicit feedback on the full consultant report. The motion was seconded and approved in a roll-call vote with all present committee members voting yes: Branham; Terracio; Baron; English; and Newton.

The committee directed staff to notify council members that the consultant’s full feasibility report is in the meeting packet and to solicit written feedback before the next committee meeting. Jensen and staff said the committee will need to decide whether to fund a formal study in the current fiscal year or request funding in the next budget cycle.

The presentation and committee discussion emphasized four practical points: impact fees are prospective only; they must be tied to specific capital projects and cost allocations; a professionally prepared study is necessary and relatively costly; and fees are typically combined with other funding sources and can be used to pay bonded projects over time.

Next steps identified by members include continued committee discussion, review of the consultant’s spreadsheets and consideration of funding for a formal study in the FY26 budget process.