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Lawmakers say limits on impact fees legal, despite threat of lawsuit

Lawmakers and the governor said legislation passed earlier this year that limits development-impact fees is legal, despite threats of a lawsuit from municipalities.

A spokesman for Brewer said she wasn’t concerned about a lawsuit.

“I think the governor’s comfortable with the legality of what she’s signed,” Paul Senseman said.

House Speaker Kirk Adams made similar comments. “We do not believe that provision is unconstitutional,” he said.

Arizona municipalities are considering suing the state over a budget provision limiting the fees they can charge developers, saying the new law was approved unconstitutionally. The measure would prevent cities and towns from adopting new development-impact fees or increasing existing fees for two years. The fees are applied to new construction and generally pay for services such as streets, sewers and other local services.

Ken Strobeck, executive director of the League of Arizona Cities and Towns, said legal problems were created when lawmakers tacked the measure onto the budget during a special legislative session. “It’s outside the scope of the call of the special session,” he said.

The special session, which Gov. Jan Brewer called for in July, originally was limited to fixing the state’s budget shortfall and approving a sales tax increase. However, several weeks later, she amended the call and expanded it to include anticipated legislation on tax reform and voter-protection reform.

Strobeck said the League is still weighing its options, but will likely make a decision next month. He said there is an argument to be made that the provision, although included in a budget bill, has nothing to do with the state’s budget.

If the League follows through with its lawsuit, Rep. Michele Reagan said it could be the first of many dominoes to fall.

“I feel it’s going to spur other people to file lawsuits,” she said. “Who’s going to be next? Who else is going to find something to sue over?”

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