Impact Fees – Why This Is Important

What are Impact Fees ?

Impact fees are fees a local government may impose when a permit is issued to fund the cost incurred by the local government on capital facilities (i.e. city center, library, museum) needed to serve a new development. (C.R.S. 29-20-104.5)

John Watson, a member of the Sunshine Boys, began the conversation with city council in 2013. Mr. Watson, a former developer, was shocked that Littleton did not impose impact fees on new development to help mitigate some of the expenses brought on by new development. In other words, growth should pay for growth.

In August of 2013 an ordinance was passed that codified impact fees for Littleton and they have been collected ever since. This Tuesday, December 15, 2015, city council will hear, on second reading, several ordinances that will allow the council to use impact fees collected from Littleton Village (old Marathon Oil property), The Meadows at Platte Canyon (Mineral and Platte Canyon), the Jamison Street project (Jamison and Broadway) and the apartment complex at County Line and C470 to be used to help fund the building of a new fire station in TrailMark.

TrailMark is located about five miles south of Littleton and is part of the Littleton community. (Just west of Chatfield Reservoir off of Wadsworth). If the ordinances are approved by council on Dec. 15, 2015, impact fees and general fund monies will be used to pay for the fire station; a deficiency that has existed for years and this point is critical as you will see.

Now no one is doubting that there are issues with the emergency response times in TrailMark and they deserve a resolution.  But, using impact fees to address an existing deficiency in capital facilities appears to be a violation of the state law and the city’s own ordinance.

The state law states that the “local government shall quantify the reasonable impacts of proposed development on existing capital facilities” and can charge only what is “necessary to defray such impacts directly related to proposed development.” Language could be manipulated in connecting Littleton Village (and the other developments mentioned) as the reason for  the stress upon fire services thus requiring a new station in TrailMark.  But the law also states, “No impact fee …shall be imposed to remedy any deficiency in capital facilities that exists without regard to the proposed development.” The lack of a fire station in TrailMark is an existing deficiency and therefore impact fees cannot be used to fund those capital needs; in my opinion.

On Dec. 15th the council is scheduled to vote on several ordinances that will approve the use of impact fees to pay for the new fire station in TrailMark.   The station has been labeled as multi-purpose, which will allow the council to raid the impact fees from the police and facility funds as well. To date the following has been collected in the three funds that are the point of this post.

Facilities         $665,000                   Police     $132,000               Fire   $98,000

The total of the three funds is insufficient to pay for the structure but not to worry! One of the ordinances scheduled for Tuesday night’s meeting would approve a loan from the general fund to the impact fee funds (yes all three would be infused with our tax payer dollars) to cover the shortfall. The funds are to be repaid over the next three years by future projects that may or may not come to Littleton.  And there is concern about whether this is leal as well.  How do you connect a future development’s impact on a facility that has already been built?

Why Should You Care?

Several citizens believe the council will be violating not only the state law but their own ordinance that states the need to “respect broad equal protection concepts to ensure there is an essential nexus between the capital facility impact fee imposed and the mitigation of specific adverse impacts associated with new development.” Is there an “essential nexus” between a fire station in TrailMark and Littleton Village? Do we really want our general fund to be raided ($1,988,000) to overstate the impact fee fund accounts so council can say that the impact fees paid for the proposed facility?

This loan is too risky – if you have any history in Littleton you know that there was another interfund loan years ago – money taken from the Water Fund and never repaid. This will most likely go the same way leaving taxpayers with the debt. If council was voting to loan their own money to the impact fee funds would they approve the request or would they deem it too risky? If it would be too risky for them to use their own money why isn’t it too risky to use the taxpayer’s money?

What Did The Consultant Say?

Going back to council’s own study session, prior to the approval of our impact fee ordinance, there was some discussion about the need for more parking at Bemis Library. Bruce Beckman, our current mayor, asked if they could use the library impact fees to pay for a parking expansion at Bemis. The response was emphatic – No, the parking lot expansion would be an existing deficiency and therefore the impact fees could not be used to fund such a project.

Using that as an analogy, why would it be legal for the council to use impact fees collected from the developers of recent projects in Littleton to pay for the building of a new fire station in TrailMark when the need for a fire station is an existing deficiency?

The time to speak up is now. Let your council representatives know that you want the impact fees collected from each developer to be spent to mitigate the impact that new development has on the community and not to be spent in what appears to be a violation of the state law or the city’s own ordinance. You can email your concerns to Wendy Hefner at and request that your email be distributed to all council members.  Don’t wait to make your concerns known.  Or, come to the meeting on Tuesday, December 15 and address the council during the public hearing.

But There’s More!

We would like to say that is all there is but this issue gets murkier and murkier as you get into the funding. It has been described as a shell game on steroids, sleazy, too complicated to follow, and how can they do that? If we tried to get into all the details of the “shell game” your eyes would glaze over. You would quit reading – we wanted to quit! But we didn’t. Two council members have been asked if they could explain the funding mechanism presented by the city manager; both said they did not understand it either! But, they both voted to approve the scheme on first reading! Hopefully there will be enough exchange at the next meeting that everyone in the room will understand the entire funding scheme before the vote takes place to approve.

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