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apportioned. As a result, some local governments recently have become <br /> interested iq adopting exaction fees, which allow public facility costs to be more <br /> carefully and equitably apportioned to particular projects. An impact fee is a <br /> type of exaction that is (1} in the form of a predetermined money payment; (2) <br /> assessed as a condition to the issuance of a building permit, an occupancy <br /> permit, or plat approval; (3) pursuant to local government powers to regulate <br /> new grow'th and development and provide for adequate public facilities and <br /> services; and (4) levied to fund large-scale, off-site public facilities and services <br /> necessary to serve new development.20...These four elements distinguish impact <br /> fees from taxes, special assessments, user fees, and other types of fees such as <br /> fees in lieu of mandatory dedication or construction. <br /> <br /> It is important to distinguish an impact fee from an impact tax. In theory, <br />impact fees derive from the police power of government the power to regulate <br />private activity to protect the public health, safety, and welfare. In contrast, taxes <br />derive from a distinctly different power--the power to tax which is exercised to <br />raise revenue. This distinction can be blurred in practice, because a system of <br />impact fees can have sizable revenue-generating potential, and impact taxes <br />can be tailored to resemble impact fees. For example, impact fees cannot <br />exceed the prorated share of the public facility costs that can fairly be attributed <br />to a development, and revenues must be spent in such a way as to benefit <br />sufficiently the residents or users of the development for which the fees were <br />imposed. However, an impact tax may also be devised whose revenues are <br />restricted to providing capital funds for a particular type of public facility (for <br />example, schools) in a manner that benefits those in whose behalf the tax is <br /> <br /> Brian W. Blaesser and Christine M. Kenlopp, "Impact Fees: The Second Generation,' Journal <br />of Urban and Contemporary Law 38 (1990): 55, 64. <br /> <br />32 <br /> <br /> <br />