Legislative Update in Pennsylvania

February 2013Articles In the Zone

House Bill No. 148 proposes to amend the Pennsylvania Municipalities Planning Code (MPC) by authorizing municipalities and school districts to impose development impact fees.

House Bill No. 148 first proposes to amend Section 502-A of the MPC to change the current term "impact fee" to "transportation impact fee" and then revise Section 503-A of the MPC to account for the revision. The foregoing change would not substantively alter the right of a municipality to impose what House Bill No. 148 proposes to call a "transportation impact fee." A "transportation impact fee" would assume the current definition of an "impact fee," or "a charge or fee imposed by a municipality against new development in order to generate revenue for funding the costs of transportation capital improvements necessitated by and attributable to new development." Municipalities currently are permitted to collect the foregoing fee.

Most significantly, however, House Bill No. 148 proposes to permit municipalities and school districts to impose development impact fees. The proposed legislation would add various definitions to the MPC, including the following definition of "development impact fee:”

A charge imposed upon new development by a governmental entity to fund all or a portion of the public facility's capital improvement costs affected by the new development from which it is collected.

Furthermore, the following definitions, among others, would also be relevant:

• Governmental entity: A municipality or school district.
• Capital improvements: Improvements and equipment that increase or improve the service capacity of a public facility and have a useful life to ten years or more.
• Public facilities: School facilities and municipal facilities.
• School facilities: Public schools and equipment.
• Municipal facilities (in part): Police, emergency medical, rescue and fire protection facilities and equipment.

The proposed legislation includes mechanisms for calculating development impact fees and various requirements related to development impact fees. Interestingly, the proposed legislation would allow governmental entities to accept the dedication of land or the construction of public facilities or capital improvements in lieu of payment of development impact fees if various criteria are met.

Representative Scott Petri, who represents the 178th Legislative District, which includes portions of Bucks County, was one of the legislators who introduced House Bill No. 148. In connection with House Bill No. 148, Representative Petri authored a memorandum to all House of Representative members that, in part, stated the following:

Under my legislation, municipalities or school districts considering the adoption of development impact fees would need to conduct needs assessment for the type [of] public facilities or capital improvements require[d] by new residential, commercial or industrial development. Such new development would then be assigned a fee based on the proportionate share of the cost of new public facilities. For purposes of this bill, public facilities would include public schools, police stations, fire house, parks and other recreation facilities."

As for the status of House Bill No. 148, shortly after it was introduced, it was referred to the Committee on Local Government, where it remains.

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