S 0696 General Bill, By McConnell

Similar(H 3893)
 A BILL TO AMEND CHAPTER 7, TITLE 6, CODE OF LAWS OF SOUTH CAROLINA, 1976,
 RELATING TO PLANNING BY LOCAL GOVERNMENTS, BY ADDING ARTICLE 15 SO AS TO
 ESTABLISH UNIFORM STANDARDS FOR A LOCAL GOVERNMENTAL ENTITY TO REQUIRE A
 DEVELOPER TO PAY A PROPORTIONATE SHARE OF THE COST OF NEW PUBLIC FACILITIES
 NEEDED TO SERVE NEW GROWTH AND DEVELOPMENT, AND TO ESTABLISH PROCEDURES FOR
 ADOPTING A CAPITAL IMPROVEMENTS PLAN, FOR COMPUTING THE PROPORTIONATE SHARE OF
 COSTS, AND FOR PASSING AN ORDINANCE IMPOSING DEVELOPMENT IMPACT FEES.

   04/24/97  Senate Introduced and read first time SJ-6
   04/24/97  Senate Referred to Committee on Judiciary SJ-6

TO AMEND CHAPTER 7, TITLE 6, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO PLANNING BY LOCAL GOVERNMENTS, BY ADDING ARTICLE 15 SO AS TO ESTABLISH UNIFORM STANDARDS FOR A LOCAL GOVERNMENTAL ENTITY TO REQUIRE A DEVELOPER TO PAY A PROPORTIONATE SHARE OF THE COST OF NEW PUBLIC FACILITIES NEEDED TO SERVE NEW GROWTH AND DEVELOPMENT, AND TO ESTABLISH PROCEDURES FOR ADOPTING A CAPITAL IMPROVEMENTS PLAN, FOR COMPUTING THE PROPORTIONATE SHARE OF COSTS, AND FOR PASSING AN ORDINANCE IMPOSING DEVELOPMENT IMPACT FEES.

Whereas, the General Assembly finds that an equitable program for planning and financing the public facilities needed to serve new growth and development, in such a manner as not to restrict unduly or to inhibit growth and development, is necessary to promote and accommodate orderly growth and development and to protect the public health, safety, and general welfare of the citizens of this State; and

Whereas, it is the intent of the General Assembly to:

(1) ensure that adequate public facilities are available to serve new growth and development;

(2) promote orderly growth and development by establishing uniform standards for local governments to require that those who benefit from new growth and development pay a proportionate share of the cost of new public facilities needed to serve that new growth and development;

(3) establish minimum standards for the adoption of development impact fee ordinances by governmental entities;

(4) ensure that those who benefit from new growth and development are required to pay no more than their proportionate share of the cost of public facilities needed to serve new growth and development and to prevent duplicate and ad hoc development requirements;

(5) encourage the construction of affordable housing by ensuring the availability of sufficient infrastructure; and

(6) authorize governmental entities that are authorized to adopt ordinances to impose development impact fees. Now, therefore,

Be it enacted by the General Assembly of the State of South Carolina:

SECTION 1. Chapter 7, Title 6 of the 1976 Code is amended by adding:

Section 6-7-1300. This article may be cited as the 'South Carolina Development Impact Fee Act'.

Section 6-7-1310. As used in this article:

(1) 'Affordable housing' means housing affordable to families whose incomes do not exceed eighty percent of the median income for the service area or areas within the jurisdiction of the governmental entity.

(2) 'Appropriate' means to obligate legally by contract or to otherwise commit to use by appropriation or other official act of a governmental entity.

(3) 'Capital improvements' means improvements with a useful life of ten years or more, by new construction or other action, which increase the service capacity of a public facility.

(4) 'Capital improvement element' means a component of a comprehensive plan, adopted pursuant to this article.

(5) 'Capital improvements plan' means a plan adopted pursuant to this article that identifies capital improvements for which development impact fees may be used as a funding source.

(6) 'Connection charges' means charges for the actual cost of connecting a property to a public water or public sewer system, limited to labor and materials involved in making pipe connections, installation of water meters, and other actual costs. Not included in this definition are system improvement costs, land acquisition, capital construction, engineering or design costs, or upgrading, updating, expansion, repair, or maintenance of existing or new capital improvements.

(7) 'Developer' means a person or legal entity undertaking development.

(8) 'Development' means construction or installation of a building or structure, or a change in use of a building or structure, or a change in the use, character, or appearance of land, that creates additional demand and need for public facilities.

(9) 'Development approval' means written authorization from a governmental entity that authorizes the commencement of a development.

(10) 'Development impact fee' or 'impact fee' means a payment of money imposed as a condition of development approval to pay for a proportionate share of the cost of system improvements needed to serve development. The term does not include:

(a) a charge or fee to pay the administrative, plan review, or inspection costs associated with permits required for development;

(b) connection or hookup charges;

(c) amounts collected from a developer in a transaction in which the governmental entity has incurred expenses in constructing capital improvements for the development if the owner or developer has agreed to be financially responsible for the construction or installation of the capital improvements, unless a written agreement is made pursuant to Section 6-7-1380 for credit or reimbursement; or

(d) a fee imposed by a county in lieu of property taxes, pursuant to Chapter 12, Title 4.

(11) 'Development requirement' means a requirement attached to a developmental approval of a particular development project compelling the payment, dedication, or contribution of goods, services, land, or money as a condition of approval.

(12) 'Fee payer' means that person who pays or is required to pay a development impact fee.

(13) 'Governmental entity' means a unit of local government that is authorized in this act to adopt a development impact fee ordinance.

(14) 'Hook up charges' means charges for the actual cost of connecting a property to a public water or public sewer system, limited to labor and materials involved in making pipe connections, installation of water meters, and other actual costs. Not included in this definition are system improvement costs, land acquisition, capital construction, engineering or design costs, or upgrading, updating, expansion, repair, or maintenance of existing or new capital improvements.

(15) 'Incidental benefits' means benefits that accrue to a property as a secondary result or as a minor consequence of the provision of public facilities to another property.

(16) 'Land use assumptions' means a description of the service area and projections of land uses, densities, intensities, and population in the service area over at least a twenty-year period.

(17) 'Level of service' means a measure of the relationship between service capacity and service demand for public facilities.

(18) 'Manufactured home' means a structure, constructed according to HUD/FHA mobile home construction and safety standards, transportable in one or more sections, which, in the traveling mode, is eight feet or more in width or is forty body feet or more in length, or when erected on site, is three hundred twenty or more square feet, and which is built on a permanent chassis and designed to be used as a dwelling with or without a permanent foundation when connected to the required utilities, and includes the plumbing, heating, air conditioning, and electrical systems contained in it. This term includes a structure that meets all the requirements of this item except the size requirements, and for which the manufacturer voluntarily files a certification required by the secretary of housing and urban development and complies with the standards established under 42 U.S.C. 5401, et seq.

(19) 'Modular building' means a building or building component, other than a manufactured home, that is constructed according to standards contained in the Uniform Building Code, that is of closed construction and is either entirely or substantially prefabricated or assembled at a place other than the building site.

(20) 'Present value' means the total current monetary value of past, present, or future payments, contributions, or dedications of goods, services, materials, construction, or money.

(21) 'Project' means a particular development on an identified parcel of land.

(22) 'Project improvements' means site improvements and facilities planned and designed to provide service for a development project and that are necessary for the use and convenience of the occupants or users of the project.

(23) 'Proportionate share' means that portion of the cost of system improvements determined pursuant to Section 6-7-1360 that reasonably relates to the service demands and needs of the project.

(24) 'Public facilities' means:

(a) water supply production, treatment, storage, and distribution facilities;

(b) wastewater collection, treatment, and disposal facilities;

(c) roads, streets, and bridges, including rights-of-way, traffic signals, landscaping, and local components of state or federal highways;

(d) storm water collection, retention, detention, treatment, and disposal facilities, flood control facilities, bank and shore protection, and enhancement improvements;

(e) parks, open space, and recreation areas, and related capital improvements; and

(f) public safety facilities, including law enforcement, fire, emergency medical and rescue, and street lighting facilities.

(25) 'Recreational vehicle' means a vehicular unit designed primarily as temporary quarters for recreational, camping, or travel use, that either has its own motive power or is mounted on or drawn by another vehicle.

(26) 'Service area' means a defined geographic area identified by a governmental entity or by intergovernmental agreement in which specific public facilities provide service to development within the area defined, on the basis of sound planning or engineering principles, or both.

(27) 'Service unit' means a standardized measure of consumption, use, generation, or discharge attributable to an individual unit of development calculated in accordance with generally accepted engineering or planning standards for a particular category of capital improvements.

(28) 'System improvements,' in contrast to project improvements, means capital improvements to public facilities that are designed to provide service to a service area.

(29) 'System improvement costs' means costs incurred for construction or reconstruction of system improvements, including design, acquisition, engineering, and other costs attributable to the improvements, and also including the costs of providing additional public facilities needed to serve new growth and development. For clarification, system improvement costs do not include:

(a) construction, acquisition, or expansion of public facilities other than capital improvements identified in the capital improvements plan;

(b) repair, operation, or maintenance of existing or new capital improvements;

(c) upgrading, updating, expanding, or replacing existing capital improvements to serve existing development in order to meet stricter safety, efficiency, environmental, or regulatory standards;

(d) upgrading, updating, expanding, or replacing existing capital improvements to provide better service to existing development;

(e) administrative and operating costs of the governmental entity; or

(f) principal payments and interest or other finance charges on bonds or other indebtedness except financial obligations issued by or on behalf of the governmental entity to finance capital improvements identified in the capital improvements plan.

Section 6-7-1320. (A) Governmental entities that comply with the requirements of this article may impose by ordinance development impact fees as a condition of development approval on all developments.

(1) A development impact fee must not exceed a proportionate share of the cost of system improvements determined in accordance with Section 6-7-1360. Development impact fees must be based on actual system improvement costs or reasonable estimates of the costs supported by sound engineering studies.

(2) A development impact fee must be calculated on the basis of levels of service for public facilities applicable to existing development and to new growth and development, and adopted in the development impact fee ordinance of the governmental entity. The construction, improvement, expansion, or enlargement of new or existing public facilities for which a development impact fee is imposed must be attributable to the capacity demands generated by the new development.

(3) Before imposing development impact fees a governmental entity must prepare a report that estimates the effect of recovering capital costs through impact fees on the availability of affordable housing within the political jurisdiction of the governmental entity. This report also must include an estimate of the number of households who would not be able to purchase or rent housing due to the imposition of impact fees.

(B) An ordinance authorizing the imposition of a development impact fee must:

(1) require payment of development impact fee at the time of issuance of the certificate of occupancy, or building permit if no certificate of occupancy is required, or issuance of zoning permit for a manufactured home;

(2) include a provision requiring a governmental entity to provide written certification, at the time of preliminary plat approval or preliminary site plan approval, of the amount of impact fees that are due for each unit of development in a development project for which an individual building permit or certificate of occupancy is issued, binding the governmental entity to the amount of impact fees so certified and prohibiting the governmental entity from charging higher impact fees at the point at which impact fees are collected. The certificate must include an explanation of the calculation of the impact fee, including an explanation of factors considered under Section 6-7-1360, and must specify the system improvements for which the impact fee is intended to be used;

(3) include a provision permitting individual assessments of development impact fees under guidelines established in the ordinance;

(4) include a provision for credits in accordance with the requirements of Section 6-7-1380;

(5) include a provision prohibiting the expenditure of development impact fees except in accordance with the requirements of Section 6-7-1390;

(6) require that development impact fees be spent only for the category of system improvements for which the fees were collected and either within or for the benefit of the service area in which the project is located;

(7) provide for a refund of development impact fees in accordance with the requirements of Section 6-7-1400;

(8) establish a procedure for timely processing of applications for determinations by the governmental entity of development impact fees applicable to all property subject to fees; and individual assessment of development impact fees, credits, or reimbursements to be allowed or paid under this article;

(9) provide for appeals regarding development impact fees in accordance with the requirements of Section 6-7-1410.

(10) provide a detailed description of the methodology by which costs for each service unit are determined. The following methodology is acceptable: the development impact fee for each service unit may not exceed the amount determined by dividing the costs of the capital improvements described in Section 6-7-1370(A)(6) by the total number of projected service units described in Section 6-7-1370(A)(7). If the number of new service units projected over a reasonable period of time is less than the total number of new service units shown by the approved land use assumptions at full development of the service area, the maximum impact fee for each service unit must be calculated by dividing the costs of the part of the capital improvements necessitated by and attributable to the projected new service units described in Section 6-7-1370(A)(7) by the total projected new service units described in that section;

(11) include a schedule of development impact fees for various land uses for a unit of development. The ordinance must provide that a developer has the right to elect to pay a project's proportionate share of system improvement costs by payment of development impact fees according to the fee schedule as full and complete payment of the development project's proportionate share of system improvement costs, except as provided in Section 6-7-1430(C).

(12) exempt from development impact fees the following activities:

(a) rebuilding the same amount of floor space of a structure that was destroyed by fire or other catastrophe;

(b) remodeling or repairing a structure that does not increase the number of service units;

(c) replacing a residential unit, including a manufactured home, with another residential unit on the same lot, if the number of service units does not increase;

(d) placing a temporary construction trailer or office on a lot;

(e) constructing an addition on a residential structure that does not increase the number of service units; and

(f) adding uses that are typically accessory to residential uses, such as tennis courts or clubhouse, unless it is demonstrated clearly that the use creates a significant impact on the capacity of system improvements;

(13) provide for the calculation of a development impact fee in accordance with generally accepted accounting principles. A development impact fee is not invalid because payment of the fee may result in an incidental benefit to owners or developers within the service area other than the fee payer. A development impact fee is invalid if it results in benefits to owners or developers within the service area, other than the fee payer, that are greater than incidental benefits;

(14) include a description of acceptable levels of service for system improvements.

(C) An ordinance authorizing the imposition of a development impact fee may:

(1) provide for the imposition of a development impact fee for system improvement costs incurred subsequent to adoption of the ordinance to the extent that new growth and development will be served by the system improvements;

(2) exempt all or part of a particular development project from development impact fees, if the project is determined to create affordable housing, if the public policy that supports the exemption is contained in the governmental entity's comprehensive plan, and if the exempt development's proportionate share of system improvements is funded through a revenue source other than development impact fees.

(D) After payment of the development impact fees or execution of an agreement for payment of development impact fees, additional development impact fees or increases in fees may not be assessed unless the number of service units increases or the scope of the development changes. If the number of service units increases, the additional development impact fees imposed are limited to the amount attributable to the additional service units or change in scope of the development.

(E) A system for the calculation of development impact fees must not be adopted that subjects a development to double payment of impact fees.

(F) A development impact fee must be assessed for installation of a modular building, manufactured home, or recreational vehicle unless the fee payer can demonstrate by documentation such as utility bills and tax records, either that a:

(1) modular building, manufactured home, or recreational vehicle was legally in place on the lot or space before the effective date of the development impact fee ordinance; or

(2) development impact fee was paid previously for the installation of a modular building, manufactured home, or recreational vehicle on the same lot or space.

Section 6-7-1330. Governmental entities as defined in Section 6-7-1310(13) that are jointly affected by development may enter into intergovernmental agreements with each other or with highway districts for the purpose of developing joint plans for capital improvements or for the purpose of agreeing to collect and expend development impact fees for system improvements, or both, if the agreement complies with applicable state laws. Governmental entities also may enter into agreements with the Department of Transportation for the expenditure of development impact fees pursuant to a developer's agreement under Section 6-7-1430.

Section 6-7-1340. (A) A governmental entity that is considering or that has adopted a development impact fee ordinance, must establish a development impact fee advisory committee, composed of not fewer than five members appointed by the governing authority of the governmental entity. Members of the advisory committee may not be elected officials or employees of the governmental entity. Three or more members must be active in the business of development, building, civil engineering, or other real estate related professional work. An existing planning or planning and zoning commission may serve as the development impact fee advisory committee if no elected officials of the governmental entity serve on these commissions in ex officio or other capacity and if the commission includes three or more members who are active in the business of development, building, civil engineering, or other real estate related professional work; otherwise, three members who are active in the business of development, building, civil engineering, or other real estate related professional work and who are not employees or officials of a governmental entity must be appointed to the committee.

(B) The development impact fee advisory committee serves in an advisory capacity and is established to:

(1) assist the governmental entity in adopting land use assumptions;

(2) review the capital improvements plan and proposed amendments, and file written comments;

(3) monitor and evaluate implementation of the capital improvements plan;

(4) file periodic reports, at least annually, with respect to the capital improvements plan and report to the governmental entity any perceived inequities in implementing the plan or imposing the development impact fees; and

(5) advise the governmental entity of the need to update or revise land use assumptions, capital improvements plan, and development impact fees.

(C) The governmental entity must make available to the advisory committee, upon request, all financial and accounting information, professional reports in relation to other development and implementation of land use assumptions, the capital improvements plan, and periodic updates of the capital improvements plan.

Section 6-7-1350. (A) A development impact fee imposed by a governmental entity must comply with the provisions of this section.

(B) A capital improvements plan must be developed, in coordination with the development impact fee advisory committee, utilizing the land use assumptions most recently adopted by the governmental entity.

(C) At least one public hearing must be held to consider adoption, amendment, or repeal of a capital improvements plan. Two notices, at least one week apart, of the time, place, and purpose of the hearing must be published, the first notice of the hearing not less than fifteen nor more than thirty days before the scheduled date of the hearing, in a newspaper of general circulation within the jurisdiction of the governmental entity. A second notice of the hearing on adoption of the capital improvements plan, containing the same information, must be published in the same manner at least seven days before the scheduled date of the hearing. The notices also must include a statement that the governmental entity must make available to the public, upon request, the following:

(1) proposed land use assumptions;

(2) a copy of the proposed capital improvements plan or amendments to it; and

(3) a statement that a member of the public affected by the capital improvements plan or amendments has the right to appear at the public hearing and present evidence regarding the proposed capital improvements plan or amendments.

The governmental entity must send notice of the intent to hold a public hearing by mail at least fifteen days before the hearing date to a person who has requested, in writing, notification of the hearing date. However, the governmental entity may require that a person making a request for notification, renew the request not more frequently than once each year, in accordance with a schedule determined by the governmental entity, in order to continue receiving the notices.

(D) If the governmental entity makes a material change in the capital improvements plan or amendment, further notice and hearing must be provided before the governmental entity adopts the revision if the governmental entity makes a finding that further notice and hearing are required in the public interest.

(E) Following adoption of the initial capital improvements plan, a governmental entity must conduct a public hearing to consider adoption of an ordinance authorizing the imposition of development impact fees. Notice of the hearing must be provided in the same manner as defined in subsection (C) of this section for adoption of a capital improvements plan.

(F) Nothing contained in this section alters the procedures for adoption of an ordinance by the governmental entity, except that a development impact fee ordinance must not be adopted as an emergency measure and must not take effect earlier than thirty days subsequent to adoption.

Section 6-7-1360. (A) All development impact fees must be based on a reasonable and equitable formula or method based on generally acceptable accounting principles under which the development impact fee imposed does not exceed a proportionate share of the costs incurred or to be incurred by the governmental entity in providing system improvements to serve the new development. The proportionate share is the cost attributable to the new development after the governmental entity considers the following:

(1) any appropriate credit, offset, or contribution of money, dedication of land, or construction of system improvements;

(2) payments reasonably anticipated to be made by or as a result of a new development in the form of user fees, debt service payments, or taxes including, but not limited to, sales and property taxes that are dedicated for system improvements for which development impact fees would otherwise be imposed; and

(3) all other available sources of funding the system improvements.

(B) In determining the proportionate share of the cost of system improvements to be paid, the following factors must be considered by the governmental entity imposing the development impact fee:

(1) the cost of existing system improvements resulting from new development within the service area or areas;

(2) the means by which existing system improvements have been financed;

(3) the extent to which the new development will contribute to the cost of system improvements through taxation, assessment, or developer or landowner contributions, or has previously contributed to the cost of system improvements through developer or landowner contributions.

(4) the extent to which the new development is required to contribute to the cost of existing system improvements in the future.

(5) the extent to which the new development must be credited for providing system improvements, without charge to other properties within the service area or areas;

(6) the time and price differential inherent in a fair comparison of fees paid at different times; and

(7) the availability of other sources of funding system improvements including, but not limited to, user charges, general tax levies, intergovernmental transfers, and special taxation. The governmental entity must develop a plan for alternative sources of revenue.

Section 6-7-1370. (A) Each governmental entity intending to impose a development impact fee must prepare a capital improvements plan. For governmental entities required to undertake comprehensive planning pursuant to Chapter 7, Title 6, the capital improvements plan must be prepared and adopted according to the requirements contained in the local planning law, Article 7, Chapter 7, Title 6, and must be included as an element of the comprehensive plan. The capital improvements plan must be prepared by qualified professionals in fields relating to finance, engineering, planning, and transportation. The persons preparing the plan must consult with the development impact fee advisory committee. The capital improvements plan must contain:

(1) a general description of all existing public facilities and their existing deficiencies within the service area or areas of the governmental entity, a reasonable estimate of all costs, and a plan to develop the funding resources related to curing the existing deficiencies including, but not limited to, the upgrading, updating, improving, expanding, or replacing of these facilities to meet existing needs and usage;

(2) a commitment by the governmental entity to use other available sources of revenue to cure existing system deficiencies;

(3) an analysis of the total capacity, the level of current usage, and commitments for usage of capacity of existing capital improvements, which must be prepared by a qualified professional planner or by a qualified engineer licensed to perform engineering services in this State;

(4) a description of the land use assumptions by the government entity;

(5) a definitive table establishing the specific level or quantity of use, consumption, generation, or discharge of a service unit for each category of system improvements and an equivalency or conversion table establishing the ratio of a service unit to various types of land uses, including residential, commercial, agricultural, and industrial;

(6) a description of all system improvements and their costs necessitated by and attributable to new development in the service area based on the approved land use assumptions, to provide a level of service not to exceed the level of service currently existing in the community or service area;

(7) the total number of service units necessitated by and attributable to new development within the service area based on the approved land use assumptions and calculated in accordance with generally accepted engineering or planning criteria;

(8) the projected demand for system improvements required by new service units projected over a reasonable period of time not to exceed twenty years;

(9) identification of all sources and levels of funding available to the governmental entity for the financing of the system improvements;

(10) if the proposed system improvements include the improvement of public facilities under the jurisdiction of this State or another governmental entity, then an agreement between governmental entities must specify the reasonable share of funding by each unit, but the governmental entity authorized to impose development impact fees must not assume more than its reasonable share of funding joint improvements, nor may the agreement permit expenditure of development impact fees by a governmental entity that is not authorized to impose development impact fees unless the expenditure is pursuant to a developer agreement under Section 6-7-1430;

(11) a schedule setting forth estimated dates for commencing and completing construction of all improvements identified in the capital improvements plan; and

(12) a statement that development impact fees on a new development are not used to cure deficiencies in existing public facilities within the service area or areas of the governmental entity.

(B) The governmental entity imposing a development impact fee must update the capital improvements plan at least once every five years. The five-year period commences on the date of the original adoption of the capital improvements plan. The updating of the capital improvements plan must be made in accordance with procedures provided in Section 6-7-1350.

(C) The governmental entity must adopt a capital budget annually.

Section 6-7-1380. (A) In the calculation of development impact fees for a particular project, credit or reimbursement must be given for the present value of any construction of system improvements or contribution or dedication of land or money required by a governmental entity from a developer for system improvements of the category for which the development impact fee is being collected. Credit or reimbursement must not be given for project improvements.

(B) If a developer is required to construct, fund, or contribute system improvements in excess of the development project's proportionate share of system improvement costs, the developer must receive a credit on future impact fees or be reimbursed, at the developer's choice, for excess construction, funding, or contribution from development impact fees paid by future development that impacts the system improvements constructed, funded, or contributed by the developer or fee payer.

(C) If credit or reimbursement is due to the developer pursuant to this section, the governmental entity must enter into a written agreement with the fee payer, negotiated in good faith, before the construction, funding, or contribution. The agreement must provide for the amount of credit or the amount, time, and form of reimbursement.

Section 6-7-1390. (A) An ordinance imposing development impact fees must require that all development impact fee funds be maintained in one or more interest-bearing accounts within the capital projects fund. Accounting records must be maintained for each category of system improvements and the service area in which the fees are collected. Interest earned on development impact fees must be considered funds of the account on which it is earned, and must be subject to all restrictions placed on the use of development impact fees under the provisions of this article.

(B) Expenditures of development impact fees must be made only for the category of system improvements and within or for the benefit of the service area for which the development impact fee was imposed as shown by the capital improvements plan and as authorized in this article. Development impact fees must not be used for any purpose other than system improvement costs to create additional improvements to serve new growth.

(C) As part of its annual audit process, a governmental entity must prepare an annual report describing the amount of all development impact fees collected, appropriated, or spent during the preceding year by category of public facility and service area.

(D) Collected development impact fees must be expended within five years from the date they were collected, on a first-in, first-out basis. Funds not expended within the prescribed times must be refunded pursuant to Section 6-7-1400.

Section 6-7-1400. (A) A governmental entity that adopts a development impact fee ordinance must refund to the owner of record of property on which a development impact fee has been paid if:

(1) service is available but not provided;

(2) a building permit or permit for installation of a manufactured home is denied or abandoned; or

(3) the governmental entity, after collecting the fee when service is not available, has failed to appropriate and expend the collected development impact fees pursuant to Section 6-7-1390(D).

(B) When the right to a refund exists, the governmental entity must send a refund to the owner of record within ninety days after it is determined by the development impact fee advisory committee that a refund is due subject to subsection (A).

(C) A refund must include the pro rata portion of interest earned while on deposit in the impact fee account.

(D) A person entitled to a refund has standing to sue for a refund under the provisions of this article if there has not been a timely payment of a refund pursuant to subsection (B) of this section.

Section 6-7-1410. (A) A governmental entity that adopts a development impact fee ordinance must provide for administrative appeals by the developer or fee payer from discretionary action or inaction by or on behalf of the governmental entity.

(B) A fee payer may pay a development impact fee under protest in order to obtain a development approval or building permit. A fee payer making the payment is not estopped from exercising the right of appeal provided in this article, nor is the fee payer estopped from receiving a refund of any amount considered to have been illegally collected. Instead of making a payment of development impact fees under protest, a fee payer may, at his option, post a bond or submit an irrevocable letter of credit for the amount of impact fees due, pending the outcome of an appeal.

(C) A governmental entity that adopts a development impact fee ordinance must provide for mediation by a qualified independent party, upon voluntary agreement by the fee payer and the governmental entity, to address a disagreement related to the impact fee for proposed development. The ordinance must provide that mediation may take place at any time during the appeals process and participation in mediation does not preclude the fee payer from pursuing other remedies provided for in this section. The ordinance must provide that mediation costs be shared equally by the fee payer and the governmental entity.

Section 6-7-1420. A governmental entity may provide in a development impact fee ordinance the method for collection of development impact fees including, but not limited to:

(1) additions to the fee for reasonable interest and penalties for nonpayment or late payment;

(2) withholding of the certificate of occupancy, or building permit if no certificate of occupancy is required, until the development impact fee is paid;

(3) withholding of utility services until the development impact fee is paid; and

(4) imposing liens for failure to timely pay a development impact fee.

Section 6-7-1430. Nothing in this article prevents or prohibits private agreements between property owners or developers, this State, or other governmental entities in regard to the construction or installation of system improvements or providing for credits or reimbursements for system improvement costs incurred by a developer including interproject transfers of credits or providing for reimbursement for project improvements that are used or shared by more than one development project. If it can be shown that a proposed development has a direct impact on a public facility under the jurisdiction of the Department of Transportation, then the agreement must include a provision for the allocation of impact fees collected from the developer for the improvement of the public facility by the department.

Section 6-7-1450. (A) The provisions of this article do not repeal any existing laws authorizing a governmental entity to impose fees or require contributions or property dedications for capital improvements. Ordinances imposing development impact fees must be brought into conformance with the provisions of this article within one year after the effective date of this article. Impact fees collected and developer agreements entered into before the expiration of the one-year period are not invalid by reason of this article. Notwithstanding another provision of law, after adoption of a development impact fee ordinance in accordance with the provisions of this article, development requirements for system improvements must be imposed by governmental entities only by way of development impact fees imposed pursuant to the ordinance.

(B) Notwithstanding another provision of this article, property for which a valid building permit or certificate of occupancy has been issued or construction has commenced before the effective date of a development impact fee ordinance must not be subject to additional development impact fees.

(C) That portion of a project for which a preliminary plat has been approved before the effective date of a development impact fee ordinance is not subject to development impact fees for subsequent development approved, including building permits and certificates of occupancy."

SECTION 2. This act takes effect upon approval by the Governor.