Impact Fees

The idea behind these charges is simple: growth should help pay for the roads, water and sewer capacity, parks, fire stations, and other infrastructure it creates, rather than shifting that cost to existing residents. That is what impact fees are, one-time charges a city or town adds to a new home to help cover the cost of the public services that new home will use. In Arizona, the legal term is development fees.

The fees are set by the local jurisdiction and usually charged when you pull the building permit, so they are part of your upfront permit costs. Amounts vary widely by city and by the categories that city has adopted, and they can run from a few thousand dollars to well over ten thousand for a single-family home. Fast-growing suburbs on the metro edge often charge more than built-out core cities.

Arizona law tightly controls these fees. A.R.S. 9-463.05 lets a municipality charge development fees only for a list of allowed infrastructure types, requires the fee to be roughly proportionate to the actual burden the new home creates, and bars cities from using the money for unrelated spending. Cities must adopt a written fee schedule and an infrastructure improvements plan to support it.

For example, a custom home in a growing town like Buckeye or Queen Creek may carry development fees covering water, wastewater, roads, parks, and public safety, totaling more than a home of the same size inside the City of Phoenix. Unincorporated county land may have no municipal development fees at all, though other charges still apply.

Impact fees are separate from your plan review and inspection fees, and separate from utility hookup or meter charges, though all of them are collected by the AHJ around permitting. Because the numbers swing so much by location, we price the specific city's current fee schedule into the budget before you commit to a lot.