What impact do the fees have?

Both Kalispell and Whitefish are re-examining the impact fees they currently assess, and that’s no surprise.

Impact fees are, at best, an imperfect solution to a real problem. Although they are often a convenient way for municipalities to raise money to offset the costs of growth, impact fees can also be an impediment to growth — and that is a danger that can’t be ignored.

An advisory committee in Whitefish is recommending that the City Council should eliminate impact fees for water, City Hall, Emergency Services Center and the parks maintenance building, and keep the wastewater, stormwater and paved trail fees.

Meanwhile, Kalispell’s council is studying proposals to increase water and sewer impact fees substantially. In the case of the water connections, developers might be asked to pay 16 percent more to hook up to city water. In the case, of sewer impact fees, developers could be facing a whopping 100 percent or even 200 percent increase.

The experience of both cities convinces us that impact fees bring as much harm as good to the table. Cities that are short on cash need to be creative about adding sources of revenue, and it seems logical to tap developers for help in funding services that will often need to be expanded as a result of growth promoted by those developers.

On the other hand, many cities would be happy to pay developers to come to their communities because growth is an important barometer of the economic health of a community. Cities that aren’t growing have many more problems than cities that are.

For that reason, municipalities have to make sure that they don’t put too big a squeeze on developers. You definitely don’t want to discourage significant building projects that will mean more jobs, more shopping, more opportunity for the community.

Kalispell suspended its transportation impact fees last year, as an acknowledgment that in a bad economy, cities don’t want to do anything to discourage needed growth. Whitefish, too, is recognizing that some fees just don’t make sense. After all, just how do you justify charging new businesses and residents an extra fee to fund construction of a City Hall that will benefit all residents equally?

To be fair, our local residents need to recognize that new construction has both costs and benefits, and cities don’t want to increase the costs to the point where we all lose the many benefits.

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Editorials represent the majority opinion of the Daily Inter Lake’s editorial board.