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..... <br />.. ... <br />Craig Benedict- OCSchFee.doc ~ ~ Page <br />,. ..,~r. <br />~. <br />~_ ~ ~'~ <br />School Impact Fees Orange County, North Carolina <br />earned on the separate fund should be credited to the fund. School District staff should <br />prepare an annual statement on impact fee collections and expenditures. <br />All costs in the impact fee calculations are given in current dollars with no assumed <br />inflation rate over time. Necessary cost adjustments can be made as part of the <br />recommended evaluation and update of fees, every two to five years. In the interim <br />years between updates, Orange County may adjust for inflation in construction costs by <br />means of an index like the one published by engineering News Record (ENR). This <br />index, which is available on the internet, may be applied against the adopted fee <br />schedule. If cost estimates change significantly, Orange County should redo the fee <br />calculations. <br />If a specific development proposal is expected to have significantly different demand <br />generators than those used in this study, Orange County may allow or require a <br />developer to submit an independent impact fee analysis with adequate documentation <br />of alternative factors. Administrative procedures for the independent analysis should be <br />included in the ordinance that implements the impact fees. <br />Specific policies and procedures related to site-specific credits should be addressed in <br />the ordinance that establishes the school impact fees. Project improvements normally <br />required as part of the development approval process are not eligible for credits against <br />impact fees. If a developer constructs or provides a system improvement that was <br />' included in the fee calculations, it will be necessary for Orange County to either <br />reimburse the developer or provide a credit against the fees in the area that benefits <br />from the system improvement. The latter option is more difficult to administer because <br />it creates unique fees for specific geographic areas. Based on TA's experience, it is <br />better for the County to establish a reimbursement agreement with the developer that <br />constructs a system improvement. The reimbursement agreement should be limited to <br />a payback period of no more than ten years and the County should not pay interest on <br />Z8 <br />