Growth Impact Action Committee

Selected Portions of the “South Carolina Development Impact Fee Act”

I have reordered the following selected quoted portions of the “South Carolina Development Impact Fee Act" in an effort to pull out sections that I consider most relevant to general understanding in a more easily assimilable form.  I hope this proves useful.

§6-1-930 (B)(2) “The amount of the development impact fee must be based on actual improvement costs or reasonable estimates of the costs, supported by sound engineering studies.”

§ 6-1-940 “Amount of impact fee . . .  The impact fee ordinance must: . . . (2) specify the system improvements for which the impact fee is to be used;”

§6-1-920 (21) “‘System improvements’ means capital improvements [“improvements with a useful life of five years or more . . . “] to public facilities which are designed to provide service to a service area.”

§6-1-920 (18) “‘Public facilities’ means (a) water supply production, treatment, laboratory, engineering, administration, storage, and transmission facilities;

(b) wastewater collection, treatment, laboratory, engineering, administration, and disposal facilities;

(c) solid waste and recycling collection, treatment, and disposal facilities;

(d) roads, streets, and bridges including, but not limited to, rights‑of‑way and traffic signals;

(e) storm water transmission, retention, detention, treatment, and disposal facilities and flood control facilities;

(f) public safety facilities, including law enforcement, fire, emergency medical and rescue, and street lighting facilities;

(g) capital equipment and vehicles, with an individual unit purchase price of not less than one hundred thousand dollars including, but not limited to, equipment and vehicles used in the delivery of public safety services, emergency preparedness services, collection and disposal of solid waste, and storm water management and control;

(h) parks, libraries, and recreational facilities. 

Important note – new school construction is not included in the above listing.  Also impact fees may not be imposed on anything below $100,000.  

§6-1-920 (19) “‘Service area’ means, based on sound planning or engineering principles, or both, a defined geographic area in which specific public facilities provide service to development within the area defined.  Provided, however, that no provision in this article may be interpreted to alter, enlarge, or reduce the service area or boundaries of a political subdivision which is authorized or set by law.”

§6-1-950 (B) “[T]he local planning commission shall develop, within the time designated in the resolution, and make recommendations to the governmental entity for a capital improvements plan and impact fees by service unit.” (emphasis added)

§6-1-920 (20) “’Service unit’ means a standardized measure of consumption, use, generation, or discharge attributable to an individual unit of development calculated in accordance with generally accepted engineering or planning standards for a particular category of capital improvements.”

§6-1-960 “The capital improvements plan must contain: . . .(5) a description of all system improvements and their costs necessitated by and attributable to new development in the service area, based on the approved land use assumptions, to provide a level of service not to exceed the level of service currently existing in the community or service area, unless a different or higher level of service is required by law, court order, or safety consideration; . . . .”

§6-1-990 (A) “The impact fee imposed upon a fee payor may not exceed a proportionate share of the costs incurred by the governmental entity in providing system improvements to serve the new development. The proportionate share is the cost attributable to the development after the governmental entity reduces the amount to be imposed by the following factors:

(1) appropriate credit, offset, or contribution of money, dedication of land, or construction of system improvements;  and

(2) all other sources of funding the system improvements including funds obtained from economic development incentives or grants secured which are not required to be repaid.  (B) . . . . ‘ (Emphasis added.)

§6-1-920 (17) “’Proportionate share’ means that portion of the cost of system improvements determined pursuant to Section 6‑1‑990 which reasonably relates to the service demands and needs of the project.”  (Emphasis added.)

§6-1-1020 (A) “An impact fee must be refunded to the owner of record of property on which a development impact fee has been paid if:

(1) the impact fees have not been expended within three years of the date they were scheduled to be expended on a first‑in, first‑out basis;  or

(2) a building permit or permit for installation of a manufactured home is denied.”

§6-1-1070 (B) “A governmental entity may enter into an agreement with another unit of government including, but not limited to, a special purpose district that does not provide water and wastewater utilities, a school district, and a public service district, that has the responsibility of providing the service for which an impact fee may be imposed. The determination of the amount of the impact fee for the contracting governmental entity must be made in the same manner and is subject to the same procedures and limitations as provided in this article. The agreement must provide for the collection of the impact fee by the governmental entity and for the expenditure of the impact fee by another unit of government including, but not limited to, a special purpose district that does not provide water and wastewater utilities, a school district, and a public services district unless otherwise provided by contract.”  (Emphasis added.)

Former county council attorney Trefor Thomas’s opinion that impact fees can not be collected by the county for new school construction or expansion needed due to population growth, because the Horry County school district is a separate taxing authority is moot, regardless of the validity of that opinion, because new school construction or expansion is not included in §6-1-920 (18) – a listing of the public facilities for which impact fees may be imposed in South Carolina.

The following are other selections that I consider of more than simply administrative interest:

§6-1-940 (4) (c) “ the impact fee must be paid no earlier than the time of issuance of the building permit or issuance of a development permit if no building permit is required. “

§6-1-1040.  “Collection of development impact fees.

A governmental entity may provide in a development impact fee ordinance the method for collection of development impact fees including, but not limited to:  . . .

 (2) withholding of the certificate of occupancy, or building permit if no certificate of occupancy is required, until the development impact fee is paid; “

§6-1-970. “Exemptions from Impact Fees. . . . (7) all or part of a particular development project if:

(a) the project is determined to create affordable housing;  and

(b) the exempt development’s proportionate share of system improvements is funded through a revenue source other than development impact fees. “

§6-1-920. (1) “’Affordable housing’ means housing affordable to families whose incomes do not exceed eighty percent of the median income for the service area or areas within the jurisdiction of the governmental entity.”

§6-1-1000 “Fair compensation or reimbursement of developers for costs, dedication of land or oversize facilities.

A developer required to pay a development impact fee may not be required to pay more than his proportionate share of the costs of the project, including the payment of money or contribution or dedication of land, or to oversize his facilities for use of others outside of the project without fair compensation or reimbursement. “

§6-1-1050 “ Permissible agreements for payments or construction or installation of improvements by fee payors and developers;  credits and reimbursements.

A fee payor and developer may enter into an agreement with a governmental entity, including an agreement entered into pursuant to the South Carolina Local Government Development Agreement Act, providing for payments instead of impact fees for facilities or services. That agreement may provide for the construction or installation of system improvements by the fee payor or developer and for credits or reimbursements for costs incurred by a fee payor or developer including interproject transfers of credits or reimbursement for project improvements which are used or shared by more than one development project. An impact fee may not be imposed on a fee payor or developer who has entered into an agreement as described in this section.

§6-1-1070 “Shared funding among units of government;  agreements.

(A) If the proposed system improvements include the improvement of public facilities under the jurisdiction of another unit of government including, but not limited to, a special purpose district that does not provide water and wastewater utilities, a school district, and a public service district, an agreement between the governmental entity and other unit of government must specify the reasonable share of funding by each unit. The governmental entity authorized to impose impact fees may not assume more than its reasonable share of funding joint improvements, nor may another unit of government which is not authorized to impose impact fees do so unless the expenditure is pursuant to an agreement under Section 6‑1‑1050 of this section.

(B)  “ (Emphasis added.) See the last quote above the dotted line for (B)

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