Land Dedication or Impact Fee
Town of Payson, Arizona

Park Development Impact Fee
Staff Report

This proposed fee program will focus solely on the provision of active recreation sites for the local population. The Town of Payson currently has two community parks. Green Valley Lakes Park and Rumsey Park. Green Valley Lake has been designated a leisure recreation facility m contrast to Rumsey Park which provides active recreation facilities such as hall fields, tennis courts. basketball courts, volleyball courts, swimming pool etc.. Active recreation :facilities has been determined to be the priority need for the Town of Payson.

In 1990 the Town of Payson provided 7.6 acres of activity recreation community park per thousand residents. With the constant growth experienced during the past years that standard bas dropped to 5.8 acres per thousand residents. This represents a decrease of 31% from 1990 to 1995. As growth continues the Town will continue to see a deterioration in this standard unless some efforts are expended to find adequate funding sources to maintain an adequate standard of active recreational facilities for both current and future residents of the Town of Payson. The
goal is to prevent both over use and congestion within our active recreation program.

As we can see our service levels are decreasing as growth continues" and this decrease will continue on this downward path unless the Town actively pursues a course of action to secure adequate funding for active recreation facilities. 

The Town has recently acquired 23.2 acres of land adjacent to Rumsey Park to be utilized to expand our current active recreation park services.
In order to facilitate the creation of an appropriate fee for future development the Town needs to determine appropriate land acquisition costs and appropriate development costs for an active recreation park facility. The next step will be to apportion these costs to future and current residents to ensure that future growth pays only their fare share of the cost to maintain the current service level. 

Land Acquisition:
The land acquisition cost are determined by the price which the Town paid for the 23.2 acre site. This cost was equal to $776,000 or $33.448 per acre.

Development Costs:
The cost per acre to develop an active recreation park facility was determined by conducting an inventory of Rumsey Park. This inventory revealed that it would cost $1,850.992 to replace facilities currently available. This amount does not include the Rodeo Arena, as this was not seen as a major component of an active recreation facility. Utilizing this method it was calculated that it currently cost the Town $28,922 per acre to develop active recreation park :facilities., based on our current availability of these facilities.

ORDINANCE NO.487
                      AN ORDINANCE OF THE MAYOR AND COMMON COUNCIL OF THE TOWN OF PAYSON, ARIZONA, AMENDING THE UNIFIED DEVELOPMENT CODE OF THE TOWN OF PAYSON, AMENDING ORDINANCE NO.465 OF THE TOWN OF PAYSON AND ESTABLISHING DEVELOPMENT IMPACT FEES.

                      WHEREAS, new development within the Town of Payson imposes burdens upon the Town of Payson to provide additional necessary public services to such development; and

                      WHEREAS, new development ought to pay development ip1pact fees which are reasonably related to the burden imposed upon the Town of Payson to provide additional necessary public services for the beneficial use. of such development and the occupants thereof; and

                      WHEREAS, the Mayor and Common Council of the Town of Payson desire to establish the amount of and methods .and procedures for the imposition and collection of development impact fees and for the use of impact: fees collected by the Town of Payson,

                      NOW, THEREFORE, THE MAYOR AND COMMON COUNCIL OF THE TOWN OF PAYSON. ARIZONA, DO HEREBY ORDAIN AS FOLLOWS:

Section I. The Mayor and Common Council of the Town of Payson, Arizona, do hereby find as follows:

1. New residential development imposes increased and excessive demands upon the facilities of the Town of Payson.

2. New residential development overburdens the abilities of existing public facilities to provide for new residents and such development is anticipated to continue to place demands upon the Town to provide public facilities to serve it.

3. The contribution made or to be made in the future by new development from taxes, fees or assessments by the property owner towards the capital costs of the necessary public services do not. generate sufficient funds to provide public facilities to serve such new development.

4. The Mayor and Common Council of the Town of Payson have considered such contribution made or to be made in the future by taxes, fees or assessments by the property owner toward the capital costs of the necessary' public service covered by the development impact. fees provided for in this Ordinance.

5. To the extent t11at new development places demands upon the public facilities of the Town of Payson, those demands should be satisfied by shifting the responsibility for financing the provision of such facilities from the public to the development creating the demands after considering the contribution made or to be made in the future by taxes, fees or assessments by the property owner of new development toward the capital costs of such necessary public facilities.

6. The Town of Payson is responsible for and is committed to providing public facilities at levels necessary to cure any existing deficiencies in already developed areas.

7. Impact fees collected pursuant to this Ordinance may not be. used to cure existing deficiencies in public facilities. The development impact fees provided for in this Ordinance will result in the provision of new public facilities which will provide a beneficial use to new development which creates the demand for such new public facilities and which pays the development impact fees utilized for financing such new public facilities.

8. The Community Development Department of the Town of Payson has prepared reports assessing the cost of the impact of new development. upon existing and future Town park, recreation and street public facilities.

9. Development impact fees in the aggregate .amount of $1 ,247.00 and the categories thereof which are assessed pursuant to this Ordinance bear a reasonable relationship to the burden imposed upon the Town of Payson to provide additional necessary public services and facilities to new development.

10. The fees established in this Ordinance Number 487 are established and assessed upon new development in a non-discriminatory manner.

Section 2. This Ordinance Number 487 is enacted pursuant to the general police power and the authority granted to the Town of Payson by A.R.S. § 9-463.05.

Section 3. Section 5-13, entitled "Development Impact Fees" is hereby added to the Unified Development Code of the Town of Payson. and shall read as follows:

Section 5-13 TITLE
           This Section shall be known and may be cited as the Town of Payson "Development Impact Fee Code."

5-13-00 1 PURPOSE AND INTENT
           This Development Impact Fee Code is for the purpose of assisting the Town of Payson in the implementation of the Town of Payson Master Plan and such other plans as may be adopted by the Town from time to time by requiring that new development pay for its fair share of public facilities to serve the demands imposed upon the Town by new development through the imposition of development impact fees that will be used to finance, defray or reimburse all or a portion of the costs incurred by the Town of Payson for public facilities that serve such development. .

5-13-002 APPLICABILITY

1. This Development Impact Fee Code applies to all fees imposed by the Town of Payson to finance capital facilities, the need for which is created by new development.
2. Any person who, after the effective date of this Code, undertakes a residential development project within the Town of Payson. shall pay a development impact fee as provided for this Code at time of applying for a building permit and shall not receive a building permit until such development impact fee is paid,

5-13-003 EXEMPTIONS
This Development Impact Fee Code does not apply to:

1. Alterations or expansions of an existing building where no additional residential units are created and where the use is not changed;
2. The construction of accessory buildings or structures;
3. The replacement of a destroyed or partially destroyed building or structure; with a new building or structure of the same size and use where no additional residential units are created; or
4. The installation of a replacement mobile or modular home on a lot or other such site when a development impact fee for such site has previously been paid pursuant to this Code.

Any claim of exemption must be made by the applicant no later than the time of application for a building permit or permit for mobile home installation. Any claim not so made shall be deemed to be waived.

5-13-004 DEFINITIONS

1. Building permit means an official document issued by the Building Official which authorizes construction, alteration, enlargement, conversion, reconstruction, remodeling, rehabilitation, erection, moving or repair of a building or structure, Building permit, for the purposes of this Code, shall include a mobile home permit issued by the Town of Payson for the installation or placement of a mobile or manufactured housing unit,
2. Capital improvement means land or facilities used for purposes or transportation and transit, including without limitation, streets, street lighting and traffic control devices and Supporting improvements, roads, overpasses, bridges, airports and related facilities; land or facilities for flood-control purposes; land or facilities for parks and recreational improvements; land or facilities for public safety, including police and fire facilities; land or facilities for libraries and public art; land or facilities for public buildings of all kinds; and land or facilities for any other capital project identified by the Town of Payson in its annual Capital Improvements Plan or Capital Improvements Project List. Capital improvement also includes design, engineering, inspection, resting, planning, legal costs, land acquisition, and all other costs associated With construction of a public facility. Capital improvement shall not include costs to operate and maintain the improvement.
3. Capital Improvements Plan means the annual plan for capital improvements adopted by the Mayor and Common Council of the Town of Payson, describing the approximate location, size, time of availability and estimated cost of capital improvement projects and identifying sources of funding for such capital improvement projects, as modified after its adoption from time to time.
4. Capital Improvements Project List means the list adopted or reviewed annually by the Mayor and Common Council which describes the approximate location, size, rime of availability and estimated cost of each capital improvement to be funded in whole or in part from a particular development impact fee account.
5. Collection means the point at which the development impact fee is actually paid to the Town of Payson. 
6. Commitment or committed means earmarking development impact fees to fund or partially fund capital improvements serving new development projects.
7. Development or development project means any project undertaken for the purpose of development, including without limitation, a project involving the issuance of a permit for construction, reconstruction, or change of use, but not a project involving the issuance of a permit to operate or to remodel, rehabilitate or improve an existing structure, which docs not change the density or intensity of use, nor the rebuilding of a structure destroyed or damaged by an act of God, nor the replacement of one mobile or modular home with another on the same pad if no new dwelling unit is added.
8. Development impact fee means a monetary exaction imposed and collected by the Town of Payson pursuant to this Section as a condition of or in connection with approval of a development project for the purpose of defraying all or some of the Town's cost or repaying costs previously expended from other Town funds for capital improvements.
9. Residential dwelling unit means a manufactured home, site built home, apartment, condominium unit, modular home or other residential dwelling unit used for living purposes or one or more rooms in a building or a portion of a room, designed or intended to be used, or actually used, for occupancy by one family for living and sleeping quarters and containing one kitchen only, including a mobile home, but not hotel or motel units.
10. Fee payer means a person applying for the issuance of a building permit for a residential development project.
11. Non-residential development project means all developments other than residential development projects.
12. Residential development project means any development undertaken which creates a new dwelling unit.

5-13-005 PAYMENT OF FEE
          The fee payer shall pay the development impact fee provided for pursuant to this Code to the Community Development Department prior to the issuance of a building permit or mobile home permit.

5-13-006 PARK FACILITIES DEVELOPMENT IMPACT FEES
           The Town of Payson Community Development Department shall collect from each fee payer a park facilities development impact fee for each residential dwelling unit in the sum of $647.00.

5-13-007 STREETS DEVELOPMENT IMP ACT FEE
           The Town of Payson Community Development Department shall collect from each fee payer a streets development impact fee for each residential dwelling unit in the sum of $600.00.

5-3-008 PUBLIC SAFETY DEVELOPMENT IMPACT FEE (RESERVED)

5-13-009 LIBRARY DEVELOPMENT IMPACT FEE (RESERVED)

5-13-010 IMPACT FEE ACCOUNTS

1. For each type of development impact fee established pursuant to this Code, the Town of Payson shall establish an impact fee account. The development impact fees collected shall be deposited in each respective such account according to the type of improvement for which the development impact fee is collected, The funds of these accounts shall not be commingled with other funds of the Town of Payson. The funds of each such account shall be accounted for separately. Any account previously established for the deposit of funds which would have been development impact fees under this Development Impact Fee Code shall be deemed an impact fee account for the purposes of this Code.
2. Each impact fee account shall be interest-bearing, and the accumulated interest shall become part of the account and shall be credited to the fund upon which it is earned,

5.13.011 USE OF DEVELOPMENT IMPACT FEE PROCEEDS
           Development impact fees may be expended only for the type; of capital improvements for which they were imposed and collected and according to the time limits and procedt1res established in this Code. Development impact fees may be used to pay the principal, interest, and other costs of bonds, notes and other obligations issued or undertaken by or on behalf of the Town to finance such improvements. In the event that the Town provides advance capital facilities to meet the demands of future developments, development impact fee proceeds may be used as provided for herein and in the manner provided by law to reimburse the Town for the cost of advance capital facilities. The Town of Payson shall be entitled to retain up to five percent of the amount of development impact fees collected as reimbursement for the expense of collecting the fee and administering this Code.

5-13-012 CAPITAL IMPROVEMENTS PROJECT LIST
           Each year, at the time of considering the annual budget for the Town of Payson and the Capital Improvements Plan, the Mayor and Common Council shall review the Town's Capital Improvements Project List and provide for the expenditure of funds from each development impact fee account as it deems appropriate.

5-13-013 REFUNDS

1. Upon application of the property owner, the Town shall refund that portion of any development impact fee which has been on deposit over ten (10) years and which is unexpended and uncommitted. The refund shall be made to the then current owner or owners of lots or units of the development project or projects.
2. The Town may refund by direct payment, by offsetting the refund against other development impact fees due for development projects by the owner on the same or other property, or otherwise by agreement with the owner.

5.13.0 14 CREDITS

1. A property owner who dedicates land or otherwise contributes funds for capital improvement as defined in this Code may be eligible for a credit for such contribution against the development impact fee otherwise due.
2. The Public Works Engineer shall calculate and make: reconunendatiol1s concerning the following and the Town Manager shall determine:
                       1. The value of the developer contribution;
                       2. Whether the contribution meets capital improvement needs for which the particular impact fee has been imposed; and
                       3. Whether the contribution will substitute or otherwise reduce the need for capital improvements anticipated to be provided with development impact fee funds. In no event, however, shall the credit exceed the amount of the otherwise applicable development impact fee.
3. Any application for credit must be submitted on forms provided by the Town before development project approval. Applicants for credit for construction of improvements shall submit acceptable engineering drawings and specifications and construction cost estimates to the Public Works Engineer.
4. Credit for the dedication of land shall be valued by the Town Manager based upon the recommendation of the Public Works Engineer or by an appraisal for such purposes. Credit for the dedication of land shall be provided when the real properly has been conveyed to the Town of Payson and accepted by the Mayor and Common Council of the Town of Payson.
5. The amount of any credit shall be determined by the Town of Payson.
6. Any application for credit must be made no later than the time of application for a building permit or permit for installation of a manufactured or mobile home. Any claim not so made shall be deemed waived.
7. Credits shall not be transferable from one development project to another without the approval of the Mayor and Common Council.

Section 4. Ordinance. Number 465 is hereby amended to add Sections 5- 13-001 through 5- 13-014, inclusive, to the Unified Development Code, which Sections shall read as set forth in this Ordinance Number 487.

Section 5. In the event of a conflict between the provisions of this Ordinance Number 487 and the. provisions of any other ordinance or resolution establishing or amending impact fees as set forth in this Ordinance, the provisions of this Ordinance shall prevail and govern.

Section 6. If any section, subsection, sentence, clause, phrase or portion of this Ordinance Number 487 is for any reason held to be: invalid or unconstitutional by the final decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance Number 487. The Mayor and Common Council of the Town of Payson declare that it would have adopted this Ordinance Number 487 and each section subsection, sentence, clause, phrase or portion thereof despite the fact that any one or more sections, subsections, sentences, clauses, phrases or portions would be declared invalid or unconstitutional.

Section 7, This Ordinance shall become effective ninety (90) days from the date of its adoption by the. Mayor and Common Council of the Town of Payson.

PASSED AND ADOPTED BY THE MAYOR AND COMMON COUNCIL OF THE TOWN OF PAYSON this 23rd day of January, 1997, by the following vote:

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