Official Web Site of the City of Phoenix

Development Impact Fees

Beginner's Guide

• What are Impact Fees?
• Why are Impact Fees Charged?
• When are Impact Fees assessed?
• Where are Impact Fees assessed in the city of Phoenix?

1.1 What are Impact Fees?

Impact fees are funds used to build a portion of the new infrastructure that is needed to provide services to new development.

Impact fees are charged when:

1. Construction permits are issued in a fee area or, in the case of water and wastewater, when the development ties into City services;
2. A new use, such as a new structure or expanded structure, is requested;
3. A change to a more intense use is requested;
4. A property adds new City of Phoenix water or sewer service (even if the property is in the county);
5. Additional Drainage Fixture Units (DFUs) are added to an existing structure.

Impact fees are based on the type of land use being developed, the building area, gross site area, water meter sizes and the drainage fixture characteristics of the proposed development. The amount charged for impact fees is based on the estimated demand the development will place on City services and the estimated taxes the new development will generate to pay for new infrastructure.

Currently, impact fees are charged in six of the City's fifteen village areas, leaving most of the City's area without impact fees for new development. However, since a great deal of development is taking place within these six areas, impact fees are an important part of the City's strategy for dealing with infrastructure issues.

1.2 Why are Impact Fees charged?

In rapidly growing communities, impact fees make new residences and businesses pay their fair share of new infrastructure costs for such necessities as:

• Equipment repair
• Fire protection
• Libraries
• Open space
• Parks and trails
• Police
• Roadway facilities
• Solid waste disposal
• Storm drainage
• Water and wastewater

Impact fees also help make growth acceptable to existing residents. By collecting impact fees that take into account the future tax-generating capabilities of the new developments, the City of Phoenix can show its citizens that new growth is paying it fair share of infrastructure costs.

1.3 When are Impact Fees assessed?

Impact fees are paid when an improvement is made to a property or existing structure. Impact fees are not required when a change in zoning takes place or when property is subdivided. In situations where the property is still part of the County, but will soon be annexed, the City will generally require that permits be acquired and impact fees be paid for new construction once annexation has taken place. In those cases where a property owner attempts to avoid impact fees by building while under County jurisdiction and then applying for annexation, the City will likely refuse to annex the property.

Impact fees are paid to the Development Services Department at the time building permits are purchased. In those cases where a water and/or wastewater hookup is being provided, the fees are paid when the permit is issued for the water meter.

1.4 Where are Impact Fees assessed in the city of Phoenix?

Impact fees are currently charged in three of the northernmost villages and in three of the southernmost villages. Most of the City's large, undeveloped areas that require extensive infrastructure improvements are found in these villages. Impact fees are assessed in the following areas:

• Ahwatukee
• Deer Valley
• Desert View
• Estrella
• Laveen
• North Gateway

More detailed information is provided in Impact Fee Areas (Maps, etc.), and clicking on the appropriate link above will display the map for each area.

Last modified on 05/28/2009 13:28:00