Bill prohibits local governments from imposing ‘fees’
The bill –
Prohibits localities and the state from imposing a charge and calling it a “fee” unless the charge relates to a direct and immediate specific service, good, or permit received by the person paying the charge.
Redefines the term “fee” in state code.
Purports to tie all other government entities such as water and sewer authorities who charge fees to “direct and immediate” benefits or services or permits.
The bill reopens all of the litigation defining the standards under which localities set and charge fees.
The bill threatens the ability of a locality to create maintenance, replacement, pay-go and debt service reserve funds. For example, a locality would not be able to charge connection fees that are intended to be collected to fund a plant expansion.
The bill affects existing bond indentures with revenue covenants which may affect a locality’s bond rating.