Land records · Parcel maps · October 6, 2026
What Is an Impact Fee? New Construction Fees Explained
What is an impact fee? A one-time charge on new development to pay for roads, schools, parks, or utilities that growth requires. How fees are set and paid.
What is an impact fee? An impact fee is a one-time charge that a local government collects from new development to help pay for the public facilities that growth requires, such as roads, schools, parks, fire stations, and water and sewer capacity. Fees are usually set by ordinance based on the type and size of development and are collected when a building permit or certificate of occupancy is issued. They can add thousands of dollars to the cost of a new house, and amounts vary widely between communities. This page is general land-records background, not legal advice.
What impact fees pay for
| Facility | Example use |
|---|---|
| Transportation | Road widening, intersections |
| Schools | New classrooms or schools |
| Parks | Land and improvements |
| Public safety | Fire and police facilities |
| Water and sewer | Treatment and line capacity |
| Stormwater | Drainage improvements |
Fees generally must be spent on new capacity, not routine maintenance or existing deficiencies.
How fees are calculated
Communities usually base fees on studies estimating the cost of facilities needed per unit of new development. A single-family house may pay one rate and an apartment another; commercial fees are often based on square footage or traffic generated. Some places scale residential fees by house size.
Legal limits
Courts generally require a reasonable connection between the fee and the impact of the development, and the fee must be roughly proportional to that impact. The U.S. Supreme Court has applied these limits to monetary conditions on permits, including fees set by legislation. State laws also regulate whether and how local governments can charge impact fees, and some states do not authorize them at all.
When they are paid
Most communities collect impact fees at building permit issuance, though some collect at certificate of occupancy or allow deferrals. Fees for an addition or ADU may be lower or waived. See can I build an ADU on my lot.
Impact fees vs other charges
| Charge | What it is |
|---|---|
| Impact fee | One-time charge for growth-related facilities |
| Connection or tap fee | Charge to connect to water or sewer |
| Permit fee | Covers the cost of reviewing plans and inspecting |
| Special assessment | Charge on specific properties for nearby improvements |
See what is a special assessment.
Credits and exemptions
Developers who build roads or donate land may receive credits. Some communities exempt affordable housing, replacement homes, or small additions. Ask the planning or building department.
Finding fee schedules
Fee schedules are often posted on city or county websites. Building departments can estimate fees for a specific project. Permit records may show fees paid for past construction. See how to find building permits for a property.
Effect on buyers
Buyers of new homes usually pay impact fees indirectly through the price. People building on a vacant lot should budget for them along with permit and utility connection fees.
Bottom line
An impact fee is a one-time charge on new development that funds roads, schools, parks, and utilities needed for growth. Fees vary widely, are usually paid at building permit, and must be reasonably related to a project’s impact. Check local fee schedules before buying land to build. Find county planning and permit offices via the Platbookmapper map.
What is an impact fee FAQ
Who pays impact fees?
The developer or builder, usually at building permit.
Are impact fees the same as property taxes?
No, they are one-time charges on new development.
Can impact fees be waived?
Some communities exempt affordable housing or small projects.
Do additions pay impact fees?
Sometimes, often at reduced rates; check local rules.
How much are impact fees?
They vary widely, from little to many thousands of dollars per home.