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Indian River County I Impact Fee Update Study • The fiscal burden of providing countywide services must be borne by property owners in both the unincorporated and incorporated areas of the county. Measurement of Level-of-Service for Impact Fee Calculation Purposes Florida law requires that there be a "reasonable connection" or "rational nexus" between the demand for new facilities created by development and the amount of the impact fees charged; and, that there be a "reasonable connection" or "rational nexus" between the amount of the fees charged and provision of new facilities to those paying the fees. This test, roughly speaking, assures that new growth is paying for its facilities, not existing needs, and that existing development is not shouldering the burdens created by new growth. In part to meet these criteria, the practice in Florida, when calculating impact fees, is to base impact fee amounts for new growth on either the level of service (LOS) being provided to existing development, which measures the investment made by the existing development or the adopted LOS standard that shows the future commitment levels of a community, whichever is lower. Although the LOS measure (or "units," so to speak) in the impact fee calculation tends to be based on a single variable, such as acres of land for parks, number of student stations per student for educational facilities, etc., the true measure of level of service delivered and the demand created by new development includes the value of all related capital assets that must be in place to deliver the infrastructure. For example, in the case of educational facilities, the School District's current adopted LOS standard is one permanent student station for each student. For impact fee calculation purposes, the value of the station used in the calculations includes all capital assets needed countywide to provide educational services, such as buildings, land, furniture/fixture/equipment, transportation and ancillary facilities, etc. In other words, to provide the student station, the school district must also provide land, furniture, buses, and other infrastructure. Or, for example, a park includes not only park land, but also recreational facilities, such as baseball/softball fields, tennis courts, picnic tables, etc. Impact fee calculations for County parks, therefore, have included the value of both the land and recreational facilities that are owned and provided by the County to calculate a cost per acre figure to reflect both land and improvement costs for each acre of parks to be built with impact fee revenues. In the 2014 fee update, the existing achieved LOS was maintained to reach the figure of asset value per resident. This LOS will be achieved through the purchase of park land, first, and the subsequent improvement of those lands once they are acquired and sufficient impact Tindale-Oliver&Associates, Inc. Indian River County September 2014 6 Impact Fee Update Study