Development-specific revenues are important: They ensure that everyone who benefits from a municipal service or public infrastructure helps pay for it. Communities should work with developers and businesses to ensure adequate funding for public infrastructure as development is approved. All communities should emulate municipalities and counties across the region that use agreements with developers to fund infrastructure improvements.{{See, for example, the case study on the Village of Romeoville in Chicago Metropolitan Agency for Planning, “Tax Policies and Land Use Trends,” 2017, https://cmap.illinois.gov/wp-content/uploads/Tax-Policy-and-Land-Use-strategy-paper.pdf}}

There are many best practice strategies available. Communities with existing development might work with businesses that would specifically benefit from improved infrastructure to fund those investments via special districts or fees. Recapture agreements with developers help local governments recoup expenditures on prior infrastructure improvements. Communities should work with developers of projects expected to have a significant impact on municipal operations or infrastructure costs to cover these costs.

As part of development approvals, local governments also often approve the construction of new infrastructure. This new infrastructure will eventually incur long-term maintenance and reconstruction costs. Local ordinances govern the extent and type of infrastructure that new developments require. Closely evaluating what infrastructure is truly required to support development can help reduce costs in the long-term.

Action 1

Provide assistance to local jurisdictions in assessing the short and long-term fiscal impacts of development.

Implementers

Partners such as ULI, Government Finance Officers Association, and others

Action 2

Employ development-specific revenues to reduce public costs of new development.

Implementers

Municipalities and counties

Action 3

Perform fiscal impact analysis to properly employ development-specific revenues and associated agreements.

Implementers

Local governments

Action 4

Review development ordinances to ensure that road, water, and other infrastructure requirements are appropriately scaled to support development and optimize long-term costs and needs.

Implementers

Local governments

Action 5

Provide materials on best practices in fiscal impact assessment and assessing costs in development approval processes.

Implementers

CMAP, and partners such as ULI and the Metropolitan Mayors Caucus