Oakland holds first reading of impact-fee ordinance after Raftelis study shows rising capital costs

Oakland on July 8 held a work session and the first reading of Ordinance 2025-04, which would update the town’s impact-fee schedule for police, parks and recreation, administrative facilities, water and wastewater.

Michelle Galvin of consulting firm Raftelis told the commission the revised study (dated July 1) updates the town’s cost assumptions and allocation methods and reflects a new Capital Improvement Program. “Impact fees are one-time charges charged to new development to recover the costs of providing capital equipment needed to meet the demands of growth,” Galvin said, summarizing the statutory framework that governs what projects can be recovered through fees.

The study lists existing and planned infrastructure: roughly $840,000 in current police investment plus about $3 million in planned station expansion and roughly $1.4 million in vehicles over 10 years; about $2.9 million in existing parks investment and $1.6 million of additional park projects; water plant upgrades estimated at about $7.9 million plus roughly $2.5 million in transmission work; and the town’s sewer assets of about $3.9 million. Raftelis calculated that these changes would raise municipal and utility fees substantially — for example a municipal-side increase of about $935 for a single-family home and a roughly 39–43% increase for water and wastewater in the consultant’s scenarios.

Commissioners challenged aspects of the parks calculation and whether routine maintenance should be excluded. Several members said they wanted to avoid underfunding park upkeep and asked whether items such as additional playground equipment, shade structures, or new trail connections could be included. Galvin and town attorney Stephanie explained that under the state impact-fee standard, maintenance and replacement of existing assets are generally excluded; only capital improvements that expand capacity to serve new growth meet the “nexus” test.

The commission discussed options for addressing parks needs without risking a legal challenge. Staff said some mobility/transportation projects (trails and sidewalk connections) could be funded through a separate transportation/mobility fee, and commissioners asked whether the town could set aside impact-fee proceeds to land-bank park sites in future growth areas.

Attorney Stephanie advised the commission that the fee study’s dual rational-nexus methodology is the professionally recommended approach and warned that adopting fees inconsistent with the study’s results could invite legal challenge. The ordinance is scheduled for a second reading and possible adoption on July 22; staff noted the controlling statute requires a 90-day notice period between adoption and an effective date.

Next steps: the town will take the ordinance through its July 22 meeting (second reading). Staff and the consultant were asked to confirm the CIP line-item detail used in the calculation, revisit whether any reasonable, formal park acquisition plans can be documented for inclusion, and summarize legal risks of alternative approaches ahead of the next hearing.