In the context of impact fees, “nexus” refers to the connection or relationship between new development and the need for additional public infrastructure or services. The concept of nexus is crucial in determining the legality and fairness of impact fees.
To impose impact fees legally and defensibly, there must be a clear nexus established between the proposed fee and the specific impacts generated by the new development. This means that the fees should be directly related to the costs of providing public infrastructure or services made necessary by the development.
For example, if a new housing development is expected to increase the demand for roads, schools, and parks in a community, impact fees levied on the developers should be earmarked for funding the construction or expansion of these facilities to accommodate the anticipated growth.
Local governments typically conduct studies to assess the impacts of new development on public infrastructure and services. These studies help establish the nexus between development and the need for additional facilities or improvements. The methodology used in these studies should be transparent and based on reliable data to ensure that impact fees are justified and legally defensible.
If the nexus between development and the need for infrastructure improvements is not clearly established, impact fees may be challenged legally as arbitrary or excessive. Therefore, it’s essential for policymakers to carefully consider the nexus when designing and implementing impact fee programs to ensure fairness and compliance with legal requirements.