Impact Fees and User Rates

Impact Fees

Many entities cannot fund all improvements needed to sustain growth while maintaining current levels of service using only revenues generated by property taxes or other current revenue sources. Thus, they assess impact fees to mitigate the costs of accommodating new growth and ensure current taxpayers are not unfairly burdened.


An impact fee is distinctly different from a tax, special assessment, building permit fee, hook-up fee, or other reasonable permit or application fee. It is assessed one time, generally at building permit issuance. Impact fees serve three main purposes: 1) proportionally allocate the costs of future projects to the new development they will be constructed to serve, 2) allow new customers to purchase equity in the existing system, and 3) perpetuate the historic level of service paid to growth related facilities.

Washington County Water Conservancy District, Utah - Capital Facilities Plan and Impact Fee Study
Weber Basin Water Conservancy Discrict, Davis County, Utah - Impact Fee Study

User Rates

User rates must follow defensible methodologies based on reasonable planning, cost and demand projections. It is important that each customer class pays its fair share of costs associated with each utility and that no user is unfairly burdened with costs that relate to another customer class. The consultants at Lewis Young analyze historic demands for each customer class and clearly justify the method of cost allocation. Lewis Young calculates rates based upon cost of service principles and the costs and revenue requirements needed to maintain a viable utility.

Ogden City, UT - Service Fee Rate Study
South Valley Sewer District, Salt Lake County, UT - Sewer Rate Analysis