Wednesday, September 5, 2007

New Goldwater Institute Lawsuit against Mesa Cultural Facilities Impact Fee

Group seeks strict adherence to law requiring fees be directly related to new growth

The Goldwater Institute today filed a legal challenge against Mesa's "cultural facilities" impact fee, in an effort to force the city to abide by its legal requirement that impact fees must be for necessary public services related to new development.

Under Arizona law and the federal Constitution, development or "impact" fees are supposed to be limited to the costs for necessary city services that new residential development imposes on a community, such as roads and sewers. Arizona law provides strict boundaries for charging impact fees: cities "may assess development fees to offset costs to the municipality associated with providing necessary public services to a development." But many Arizona cities have begun using impact fees to raise revenue for wholly unrelated items. This lawsuit directly challenges one of those fees.

"We hope this legal challenge sends a message to cities across Arizona that the thirst for government revenue does not override the law," said Clint Bolick, the director of the Goldwater Institute Scharf-Norton Center for Constitutional Litigation.

Mesa's "cultural facilities" impact fee, which has increased from $59 per home in 1998 to $221 today, abuses the purpose of impact fees. Cultural facilities like museums and performing arts centers are not necessary public services. Furthermore, the particular facilities for which these fees are being collected have already been built, and the city has no plans to construct new facilities as a consequence of new residential development.

The practical result of this abuse is that rising impact fees are contributing to housing affordability problems. While home builders initially pay the fees in exchange for building permits, they are eventually passed along to home buyers through higher prices. A study published by found that in the Phoenix area, every $1,000 in added cost pushes a median-priced home out-of-reach for an estimated 1,130 families. Chandler recently raised its fees from $13,587 to $19,538 per home; Avondale from $9,999 to $18,021; and Mesa from $5,233 to $8,532.

The lawsuit was filed in Maricopa County Superior Court on behalf of the Home Builders Association of Central Arizona. The Home Builders v. Mesa complaint is available online.

The Goldwater Institute is a nonprofit public policy research and litigation organization whose work is made possible by the generosity of its supporters. Thanks to a challenge grant, all contributions designated for the Goldwater Institute Scharf-Norton Center for Constitutional Litigation will be matched dollar-for- dollar to support these cases.Please click here to make a tax- deductible contribution.

Starlee Rhoades
Director of Communications
(602) 462-5000 x 226

Clint Bolick
Director, Goldwater Institute Scharf-Norton Center for Constitutional Litigation
(602) 462-5000

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