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Development Impact Fee Frequently Asked Questions (FAQs)


Below are some frequently asked questions in regards to impact fees. 


What is a development impact fee?
A development impact fee, or simply, impact fee, is a charge on new development to pay for the construction or expansion of off-site capital improvements that are necessitated by and benefit the new development.  The funds collected can not be used for operations, maintenance, or repair of existing facilities.


When did impact fees first become popular?
Nationally, impact fees first started in Florida and California during the late 1970s.  In Arizona, legislation giving municipalities the ability to assess impact fees was first passed in 1988.  County impact fees were enabled by legislation in 2000.


When did Peoria first implement impact fees?
Peoria first implemented development impact fees in 1991.  The fees were updated in 1999 and have been updated biennially since then.


What impact fee categories does Peoria assess?
Peoria assesses an impact fee in two broad categories: General Government and Utilities.  The General Government category is broken down further into the following fees: libraries, neighborhood parks, community parks, trails, open space, law enforcement, fire protection, general government, and transportation (streets and intersections).  The Utilities category is broken down further into water expansion, wastewater expansion, water resource, water reuse irrigation and solid waste.


How does Peoria develop impact fees?
To assist staff in developing impact fees, Peoria hires an outside consultant to formulate legally defensible impact fees.  Peoria undergoes two impact fee studies, one for General Government Fees and one for Utility Fees.  For a detailed explanation on how Peoria's impact fees are calculated, please see the impact fee studies found on the Impact Fee Main Page.


How do impact fees differ from taxes?
Impact fees are part of the development approval process. Requiring an impact fee to provide adequate public facilities is similar to meeting site planning and zoning requirements.


Do I have to pay an impact fee for tenant improvements, an addition to my home, or a remodel of my residence?
In general, impact fees are only charged on new construction.  Any construction that does not create an additional dwelling unit or additional square footage on a non-residential property does not require the payment of impact fees.


When do I pay the impact fee?
Impact fees are paid at the time of building permit issuance.


What are Peoria’s impact fees?
A schedule of Peoria’s impact fees can be found on the Impact Fee Main Page.


How much will I have to pay in impact fees?
There are different impact fees for different land uses and different impact fee zones throughout Peoria, so one answer will not suffice.  For an estimate of development impact fees, please see the impact fee calculator found on the Impact Fee Main Page.


Does Peoria have separate impact fee zones?
Yes, Peoria has different impact fee zones for the transportation impact fee.  There are three transportation impact fee zones: South, Central, and North.  For a map of the transportation impact fee zones, please see the Transportation Impact Fee Zones Map on the Impact Fee Main Page.


How do impact fees benefit existing, as well as new residents?
The adoption of impact fees reduces pressure on local residents to raise taxes and fees.  In addition, if new development pays for its own capacity-enhancing infrastructure needs, any current funds that have been designated to pay for those projects can be shifted to the more immediate needs of existing residents, such as for facility maintenance and rehabilitation.


What are impact fee credits?
When a developer contributes actual off-site facility improvements or dedications that mitigate the impact of a particular project and the need for impact fee-related public facilities, the project's impact fee should be reduced by the value of the improvement or dedication. Reductions can be done through offsets or reimbursements.  Offsetting means reducing the total impact fee paid at the time of payment and reimbursing means paying the developer for a portion of the impact fee after the impact fee payment has been made.  Offsets and reimbursements are given to ensure that new development does not pay twice for the same facilities.


How are impact fee credits calculated?
Impact fee credits are calculated by using modeled costs, or values developed in conjunction with the impact fee study.  The modeled costs are based upon the cost estimates of the projects used in the impact fee study and not based on the cost or the value of the improvements or dedications.


How do I know if my project is eligible to receive impact fee credits?
Projects that have significant transportation components are most commonly eligible for impact fee credits.  Please see the Transportation IIP Map, found on the Impact Fee Main Page, to see if your project may be eligible for impact fee credits. To verify if you are eligible for impact fee credits in other impact fee categories, please contact Katie Gregory  at 623-773-7364  or via email at katie.gregory@peoriaaz.gov.


How do I apply for an impact fee credit?
Please contact katie Gregory at katie.gregory@peoriaaz.gov for more information.


Where can I find more information on Peoria’s impact fees?  
If you would like more information about Peoria’s impact fees or have a question that was not answered on this website, please contact Katie Gregory at 623-773-7364 or via email at Katie.Gregory@peoriaaz.gov.