Mundelein aims to clear up impact fee misconceptions

The village of Mundelein is clarifying some misconceptions on local impact fees.

Impact fees for schools, parks and libraries according to Illinois Municipal Code (65 ILCS 5/11-12-5) are optional. That means some municipalities may not collect impact fees from their developers, according to a news release from the village.

Impact fees initially were designed for a developer to donate land to the taxing body to assist with growth generated by the new development. When some taxing bodies said they didn’t need land and would prefer cash, rules and formulas were created to keep the cash impact fee donation equivalent to a land donation.

Impact fee ordinances try to determine the amount of land that is needed for the school or park district in order to serve the population that will emerge from newly constructed homes in the district’s jurisdiction.

Impact fees are based on a formula applied to all new houses and often are determined by characteristics of the house.

For example, the number of bedrooms is taken as a proxy for the number of children that might live in the house and this proxy is used to levy school-related impact fees.

Impact fees cannot be used for operational costs of schools, libraries or park districts. That includes staff salaries, new materials or technologies or ongoing maintenance and utilities. Fees only can be used for land acquisition costs and capital expenditures (“bricks and mortar”).

All developments and developers have to be treated equally and follow the laws and case precedent set when determining the amount of impact fees. Anything different would impact the village’s ability to bring new development to Mundelein. Following these laws and constraints is a fair process for all developers and taxing bodies in a community that collects impact fees.

Municipalities are bound by state law, legal precedent on what a developer is to pay, and case law. Case law is very clear.

The typical school impact fee formula will make projections on the number of acres of land that is needed for the schoolchildren who will reside in the new homes. That number of acres is then multiplied by the fair market value of an acre of land in order to get a cash value for the calculation of the per-home impact fee.

School enrollment projections should be considered. If the student population from existing homes (not new construction) is declining, that should be considered in any new impact fee requirement or increase.