As they look for ways to fund the building of new roads to accommodate growth, Tremonton officials are looking into the possibility of adding a transportation fee to the list of impact fees the city charges for new buildings.
Impact fees are one-time charges imposed by local governments to pay for the impact on infrastructure caused by new development. Growth in the form of new homes and businesses requires expansion or enlargement of public facilities to maintain a certain level and quality of public services for all residents, and impact fees are a common way of paying for it.
For a single-family residential building permit, Tremonton currently charges impact fees of about $9,000 per acre. Those include flat fees for water, sewer, parks, fire and police services, as well as a variable fee for storm water services based on lot size.
At its most recent meeting on Dec. 3, the Tremonton City Council discussed adding a transportation impact fee to that list. City Manager Shawn Warnke said the city has never charged such a fee in the past, but a recently completed transportation plan shows that growth will require “a lot” of roads to be built over the next 10 to 20 years.
The council authorized spending up to $8,000 for an engineering firm to determine whether such a fee would be a feasible way to help pay for new roads.
The city will be working with Horrocks Engineering, a firm it has worked with before on transportation studies.
Warnke said a transportation impact fee would likely be somewhere between $600 and $1,500 per equivalent residential unit, depending on the project.
“They essentially will determine the highest fee that can be justified based on our individual projects and the cost of those projects,” he said. “A grocery store would cost more, based on traffic. It depends on specific land uses.”
While Tremonton has never charged an impact fee for transportation, Warnke said many Utah cities already do, “especially as you get deeper into the Wasatch Front.”
Any new impact fee would ultimately have to be enacted through a city ordinance.
Warnke said it’s important to address the city’s transportation infrastructure now, especially with some major developers turning an eye toward Tremonton as they look for new places to build.
Two Cache Valley-based companies, Visionary Homes and Sadler Construction, are gearing up to build large housing developments in the city, and Wasatch Development Group is also working with the city on a downtown apartment project.
“Some larger developments, in order to accommodate growth they want, they need to build where there are facilities,” he said. “You don’t see those going in where the facilities aren’t there to support the growth.”
While Horrocks will focus solely on the transportation issue, Tremonton is also working with two other firms, Zions Public Finance and Jones & Associaties, which are looking at the city’s existing impact fee structure to determine if adjustments might be needed in other areas as well.
Warnke said impact fees alone won’t pay for new roads. He said the funding would have to come from multiple sources, including the city’s general fund, and possibly through higher taxes down the road.
“Sometimes if you’re not growing fast enough, impact fees are not always the best mechanism to fund facilities because you have a short window of time,” he said. “What I see is the city investing in transportation, and fees could help with these future transportation corridors we need.”