Impact Fee - Linkage and Mitigation Fees

Linkage and Mitigation Fees

Since impact fees have been so widely accepted with cities, counties, and states they have helped to lead to the development/encroachment of other types of regulation fees. Two main examples are linkage fees and mitigation fees.

Linkage fees are levied in some states (like MA, NJ & CA) on nonresidential and market-rate multifamily residential projects, normally upon receipt of the building permit or prior to construction. The proceeds are used to fund the construction of affordable housing residential developments. Arguments against linkage fees are similar to impact fees, including the question of whether local governments have the right to enact these types of programs. Linkage fees and Inclusionary zoning regulations are two examples of local government methods to boost the supply of affordable housing.

Mitigation fees are similar to impact and linkage fees but they differ in their focus on the environment. These fees are charged to reimburse or compensate the community for the negative impact that development may have on the community. In some cases these fees are used to help preserve a component of the local environment and regulate pollution. There is debate about whether these types of fees are a legally acceptable form of government funding like impact and linkage fees are.