| Water and the
Law Do Elected Officials Need to have Engineering and Financial Degrees? by David B. Hartvigsen (Published in the Utah Water Users Association, July 1999) Earlier this year, the Utah Supreme Court issued a decision in a case that focused on the assessment of impact fees by local governments on new water and sewer hookups. In that case, Home Builders Association v. American Fork City, the association alleged that the city failed to comply with certain court-mandated requirements in adopting its impact fee ordinances. Those court-mandated requirements are commonly called the "Banberry factors" because they were first set forth in 1981 in the Utah Supreme Court's decision in Banberry Development Corp. v. South Jordan City. The association argued that the impact fees it was required to pay were illegal and should be refunded because it learned that the mayor and city council did not consider any of the Banberry factors when they adopted the city's water and sewer impact fee ordinances. In fact, the city officials were unable to describe how the city had arrived at the amount of these particular impact fees. The trial court therefore ruled that the impact fees were invalid, even though the city officials also testified that they had relied the numbers and analysis provided by the city's staff in adopting the impact fees. The real issue in the Home Builders case was how to apply the Banberry factors, i.e., are they a mandatory check list that must be addressed one-by-one by the governing body before enacting impact fee ordinances or are they mere guidelines to assist in arriving at "reasonable" and appropriate impact fees? The Supreme Court ruled that the Banberry factors are the latter and specifically rejected the association's assertion that the city council had to personally attend to the fact-gathering and number-crunching on each of the Banberry factors. The Court further stated that it is appropriate and common for staff and outside consultants to perform such tasks. The duty of the governing body is to take the results of that fact-gathering and analysis and to take appropriate action thereon. The Supreme Court obviously decided this case correctly. If it had ruled in favor of the association, elected officials would be required to perform tasks the average citizen simply is not trained for; a bad public policy for all concerned. A better reasoned response to the impact fee problems was enacted by the Utah Legislature in 1995. That enactment, known as the "Impact Fees Act" and found in Chapter 36 of Title 11 of the Utah Code, established strict requirements for supporting and justifying impact fees. However, it also provided substantial protections to the governmental entities that adopt certain procedures set forth therein. These include a limited, 30-day window for challenging impact fees after payment, a limitation in information that can be used to challenge the impact fees, a requirement that the impact fees be upheld if supported by substantial evidence, and attorney fees for the prevailing party. Therefore, all local governments assessing impact fees should review the Act and their ordinances or rules to be certain that they are taking advantage of these protections. Any comments or questions can be directed to the author at (801) 413-1600. |
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