Authorizes the counties to assess impact fees, and transfers revenues to a new state special fund, to help pay for state highway improvements that serve new or more intensive development; provided that the fees collected be expended only in the county in which the assessed project is situated. (SD1)
TWENTY-SECOND LEGISLATURE, 2004
STATE OF HAWAII
A BILL FOR AN ACT
RELATING TO IMPACT FEES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The purpose of this Act is to clarify county authority to assess impact fees for state highway improvements. This Act also establishes a new special fund for the department of transportation to administer county impact fees assessed for state highway projects.
SECTION 2. Chapter 264, Hawaii Revised Statutes, is amended by adding a new part to be appropriately designated and to read as follows:
"PART . IMPACT FEES
§264-A Definitions. As used in this part, unless the context requires otherwise:
"Capital costs" means part or all of the cost for capital improvements. Capital costs may include costs to acquire right-of-way, plan, design, engineer, finance, and construct improvements including costs of management and consultant fees. Capital costs shall not include periodic maintenance and other operating costs.
"Department" means the department of transportation.
"Development" means any artificial change to real property that requires a county grading or building permit including, but not limited to, construction, expansion, enlargement, alteration, or erection of buildings or structures.
"Director" means the director of transportation.
"Impact fee" means an assessment on development used to incrementally fund a fair share of the capital costs of public highway improvements reasonably needed to serve that development.
"State highway improvements" means capital improvements to the physical infrastructure of state highways.
§264-B Highway development special fund. (a) There is established in the state treasury the highway development special fund to be administered by the department, into which shall be deposited:
(1) Transfers of county impact fees assessed under part VIII of chapter 46 to pay for state highway improvements;
(2) Interest from investment of deposits; and
(3) Legislative and county appropriations.
(b) Moneys in the highway development special fund shall be used for the following purposes:
(1) Capital costs of qualifying proposed state highway improvements;
(2) Reevaluation of the need, geographic limitations, amount, and use of impact fees;
(3) Transfers to reimburse other special funds for expenditures which otherwise might have been funded with moneys in the highway development special fund;
(4) Transfers under sections 36-27 and 36-30;
(5) Refunds under section 264-D; and
(6) The department’s costs to implement this part, including but not limited to costs to administer the highway development special fund.
(c) The department may establish accounts in the highway development special fund as necessary to implement this part and rules adopted by the department.
§264-C Authority to assess impact fees. Upon compliance with §264-F, the counties are authorized to assess, impose, levy, and collect impact fees for any development pursuant to ordinances adopted under section 46-142 and this part and the department is authorized to receive those funds.
§264-D Refund of impact fees to county. Upon the request of a county, the department shall refund impact fees transferred to the highway development special fund which have not been expended or encumbered for purposes established under this part within six years after collection under part VIII of chapter 46.
§264-E Adoption of rules. The department may adopt rules pursuant to chapter 91 to implement this part.
§264-F County ordinances and rules. Notwithstanding section 264-C, no county shall assess impact fees for state highway improvements without the director’s consent.
§264-G Limitations on actions. A civil lawsuit contesting an action by the department or a county under this part or under part VIII of chapter 46 shall be filed within sixty calendar days after the date of the action."
SECTION 3. Section 46-143, Hawaii Revised Statutes, is amended by amending subsections (c) and (d) to read as follows:
"(c) The pro rata amount of each impact fee shall be based upon the development and actual capital cost of public facility expansion, or a reasonable estimate thereof, to be incurred [
by the county or board].
(d) An impact fee shall be substantially related to the needs arising from the development and shall not exceed a proportionate share of the costs incurred or to be incurred [
by the county or board] in accommodating the development. The following seven factors [ shall] may be considered [ in determining a proportionate share of public facility capital improvement costs:] when enacting or adopting impact fees:
(1) The level of public facility capital improvements required to appropriately serve a development, based on a needs assessment study that identifies:
(A) Deficiencies in existing public facilities;
(B) The means, other than impact fees, by which existing deficiencies will be eliminated within a reasonable period of time; and
(C) Additional demands anticipated to be placed on specified public facilities by a development;
(2) The availability of other funding for public facility capital improvements, including but not limited to user charges, taxes, bonds, intergovernmental transfers, and special taxation or assessments;
(3) The cost of existing public facility capital improvements;
(4) The methods by which existing public facility capital improvements were financed;
(5) The extent to which a developer required to pay impact fees has contributed in the previous five years to the cost of existing public facility capital improvements and received no reasonable benefit therefrom, and any credits that may be due to a development because of such contributions;
(6) The extent to which a developer required to pay impact fees over the next twenty years may reasonably be anticipated to contribute to the cost of existing public facility capital improvements through user fees, debt service payments, or other payments, and any credits that may accrue to a development because of future payments; and
(7) The extent to which a developer is required to pay impact fees as a condition precedent to the development of non-site related public facility capital improvements[
, and any offsets payable to a developer because of this provision]."
SECTION 4. Section 46-144, Hawaii Revised Statutes, is amended to read as follows:
§46-144 Collection and expenditure of impact fees. Collection and expenditure of impact fees assessed, imposed, levied, and collected for a specific development shall be reasonably related to the benefits accruing to the county in which the development[
.] is situated. To determine whether the fees are reasonably related, the impact fee ordinance or board rule shall provide that:
(1) Upon collection, the fees shall be deposited in a special trust fund or interest-bearing account. The portion that constitutes recoupment may be transferred to any appropriate fund;
(2) Collection and expenditure shall be localized to provide a reasonable benefit to the county in which the development[
.] is situated. A county or board shall establish geographically limited benefit zones for this purpose; provided that zones shall not be required if a reasonable benefit can be otherwise derived. Benefit zones shall be appropriate to the particular public facility and the county or board. A county or board shall explain in writing and disclose at a public hearing reasons for establishing or not establishing benefit zones;
(3) Except for recoupment, impact fees shall not be collected from a developer until approval of a needs assessment study that sets out planned expenditures bearing a substantial relationship to the needs or anticipated needs created by the development;
(4) Impact fees shall be expended for public facilities of the type for which they are collected and of reasonable benefit to the county in which the development[
.] is situated; and
(5) Within six years of the date of collection, the impact fees shall be expended or encumbered for the construction of public facility capital improvements that are consistent with the needs assessment study and of reasonable benefit to the county in which the development[
.] is situated."
SECTION 5. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 6. The revisor of statutes shall substitute appropriate section numbers for the letters used to designate the new sections in Section 2 of this Act.
SECTION 7. This Act shall take effect upon its approval, provided that Section 3 shall take effect retroactive to October 1, 2002.