Development Impact Fees: Is Limited Cost Internatlization Actually Smart Growth?

Sprawl has defined development in the United States for the past fifty years. As people have moved from the cities to the suburbs, communities have been faced with staggering infrastructure, social, and environmental costs. Many municipalities have attempted to recoup costs of this development by imposing impact fees—charges on development used to pay for necessary public services. Many environmental and smart growth advocates have embraced impact fees as a cost-internalizing approach to regulating growth. Federal and state courts, however, have placed substantial constraints on the scope of the costs that municipalities are able to recover through impact fees. Furthermore, because the most direct infrastructure costs are more readily recouped, development may occur in areas where the lack of these services would otherwise have been prohibitive, while remaining social costs are borne by society at large. This Comment cautions local governments to be wary of using impact fees as a tool to address the broader impacts of sprawl, and urges them to balance the benefits of limited cost recovery with the effect of accommodating growth that might otherwise not occur