 The Toledo Blade
June 26, 2000 Commercial and residential developers in Ohio and across the nation are understandably worried about the financial ramifications of the Ohio Supreme Court's ruling on impact fees. But they can't have their cake and eat it, too. If they're determined to build huge, sprawling complexes in the middle of nowhere, they're going to have to chip in to build the means to get there. For the first time, the high court has ruled that local governments can charge developers an impact fee to offset the costs of extending infrastructure to commercial and residential developments built outside existing accommodations. The 4-3 decision only applies to road improvements, but it certainly represents a chink in the armor of developers who have, to a degree, been enjoying a free lunch at the expense of local municipalities for years. The court majority ruled that developers who share the benefit from new roads stretching out to their developments should also share the burden for paying for them. The court majority, which paired Republicans Chief Justice Thomas Moyer, Justice Andy Douglas, and Justice Evelyn Lundberg Stratton with Democrat Justice Francis Sweeney, rejected the Dayton Home Builders Association's argument that the fee imposed by the city of Beavercreek in Green County was an unconstitutional tax. Chief Justice Moyer said the city - whose charter prohibits an income tax - met the test of shared financial responsibility with developers by proving a reasonable relationship between the city's interest in building new roads and the expected increase in traffic generated by the developments. Moreover, the chief justice wrote, the city showed that the fee it collects relates to the benefits the developers would enjoy from the new roads. Republican Justices Paul Pfeifer, and Deborah Cook, along with Democrat Justice Alice Robie Resnick, dissented. Justice Pfeifer argued that "Beavercreek is attempting to force developers to pay for improvements or additions to infrastructure as a quid pro quo for developing a site, even when the improvements or additions occur beyond the property lines of the development." That was a key complaint of the homebuilders association, which challenged the legitimacy of a fee to fund major road improvements constructed off development sites. But home builders and commercial developers better realize that local governments do not have unlimited resources to oblige every far-flung development with new and improved roads. The only choice for financially-strapped Beavercreek, according to city attorney Mark Wallach, was "allowing its traffic situation to deteriorate badly or curtailing new development." Collecting fees from developers whose choice of location clearly strains local roadway budgets is an economic compromise whose time has come. Urban sprawl is unfortunately an open field for developers riding the trend to build farther down the highway. It is only fair they contribute to the new roads leading to their success. Back to Ohio state page
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