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Nebraska Supreme Court Upholds Impact Fees in Lincoln
The Nebraska Supreme Court ruled recently that the city of Lincoln’s impact fees are valid. The decision was a defeat for Lincoln-area builders who had argued that fees were an illegal tax because they were not specifically authorized by Nebraska state statute.
The court determined that the city’s home rule charter implies authority to collect the impact fee.
“We are very disappointed, but we respect the decision of the State Supreme Court in ruling that impact taxes are legal,” said Allen Barber, 2006 president of the Home Builders Association of Lincoln (HBAL) and president of Barber Custom Homes. “With single family building permits being down 40% over the last two years, we believe that impact fees have had a very negative effect upon the construction industry in Lincoln.”
In 2003, the city began collecting impact fees on new developments for water and sewer, roads and parks. Since the fees went into effect, the city has collected approximately $12 million in fees on 6,400 building permits. Roughly $4.5 million of the money collected so far has already been spent by city agencies.
HBAL and Hartland Homes, a Lincoln-area builder, challenged the fees, appealing a district judge’s ruling to the state Supreme Court. The Nebraska Supreme Court heard arguments on the legality of the city’s impact fees in September.
“We hope to work closely with the current administration in developing a plan to best use the funds which have accumulated since June 2003, and examine ways to modify the current system to make it more fair, especially to first-time home buyers,” Barber said. “As an industry, we believe that Lincoln is a great city and we know that to remain a great city it must continue to grow and create new jobs and businesses that attract new citizens.”
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