Impact Fees: Back on our Radar but Troubling for Purchasers of New Construction Homes

How many acres does a new school require?

In looking at communities’ Impact Fee ordinances (sometimes called “land-cash donations”), some eye-popping requirements begin to unfold.

We haven’t heard much about Impact Fees in the last five or six years as new home construction came to a virtual halt around 2007. But that is likely to change as new home construction starts up again. Impact fees will certainly be on our radar again.

Impact fees are based on state statute which requires a developer to “donate” land that is needed to accommodate the new school children in the affected school district.  Often, instead of a land donation, a cash equivalent is assessed of the developer.  Impact fee ordinances usually include projections on how many new students are expected to enter the school enrollment due to the “impact” of all the new homes.

Here are some examples of abuse in Northern Illinois:

  • One rural community that has historically been against “sprawl” requires 25 acres for 450 student elementary school students.
  • Another community requires 70 acres for a 1,500 student high school.  They actually built a brand new state-of-art high school for 2,000 students on 35 acres.  It also included a middle school. \
  • Another community still requires 15 acres for an elementary school.  Their school district recently shut down two elementary schools.

The Illinois State Board of Education recommends that school district plan a 5-20-30 approach acreage requirements: 5 acres for elementary school, 20 for middle school, and 30 for high school.   Add an acre for every 100 students – so 1,500 high school would need about 45 acres.

Until recently, the Arizona-based Council of Educational Facility Planners International (CEFPI), like the Illinois State Board of Education, recommended large sites for new schools.  CEFPI’s old guidelines called for a minimum of one acre of land for every 100 students plus 10 acres for an elementary school, 20 acres for a middle school, and 30 acres for a high school.  In 2004, they dropped the guidelines because they encouraged sprawl.  Instead they push for a more “program needs” based approach with in-fill development.

So how does this translate to the new homeowner?  This scheme artificially inflates the cost of a new home by literally thousands of dollars.  In many of the examples shared above, homeowners will be paying twice as much in impact fees because greedy communities over-inflate their acreage needs.  Couple this with out-dated acreage values (some haven’t been updated in nearly a decade), government pushes homeowners further away.

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