For a number of years now, Londonderry has stopped charging Impact Fees on developers. The Town moved to permanently suspend the program after several years since there is currently an excess of $10,000 in unanticipated funds related to the fees.
This past Monday, Oct. 16, the council held a discussion and subsequent vote on whether the money should be accepted into the general fund.
Impact fees were charges by the town to help the town cover additional costs to road upkeep, police, fire, schools, etc. that a land development may affect. The amount of fees charged depends on the size of the property and where it’s located. The town stopped collecting these fees since February of 2013. According to the law, any fees not spent must be returned to the developer within six years of the original collection. As of the end of September, the fees total $131,880.09.
With the program expiring, that leaves some money to either be spend or returned. Doug Smith, the director of finance for Londonderry, recommended to the council that the expired fees be refunded. “Fees were collected under the ordinance that weren’t spent by the Town within the six year statutory period,” said Smith. Fees in this category total 58,717.04 dollars (including interest.)
Not all the impact fees will be returned. Some of them will be spent to pay down the mortgage for new police and buildings, according to Chairman Tom Dolan. This is allowed through Order 2017-26, which states the Town Council can transfer the impact fees to the general fund if they are only used for “the reimbursement of the Town or School District for the cost of public capital improvements for which they were collected….” The amount of money from fees that was allocated for police and for costs total 73,163.05 dollars. The Town Council approved moving the money to the general fund.
Dolan said the program was being ended because the council didn’t like the program. It’s now officially closed, but the fees collected after Nov. 1, 2011 will be returned since they will not have hit the six-year expiration mark and there are no planned projects for the town to spend the money on.
Residents Chris and Debra Paul, also owners of Nutfield Publishing had raised concerns earlier in the meeting, during public comment, that what they had paid toward Impact Fees in the past had expired and should be returned in full. They felt the funds were not being used correctly and thought that the amount extracted was greater than the impact their business had on the community. The amount paid was about $3,500, to which only about $1,500 would be paid back through the town’s disbursement.
Dolan instructed Kevin and Doug Smith to work with the Paul’s to come to an understanding.
Resident Ray Breslin wondered why the surplus was being placed into the general fund to which Councilor Dolan said that under the law it was the appropriate thing to do.