Agenda - Planning Commission - 03/05/2015

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Zoning Bulletin February 10, 2015 !Volume 9 1 Issue 3 stances allowed refund of the fees to the current property owners rather than to the original payors. The Background/Facts: Under New Hampshire statutory law, RSA 674:16 and RSA 674:21, municipal impact fee ordinances must: "establish reasonable times after which any portion of an impact fee which has not become encumbered or otherwise legally bound to be spent for the purpose for which it was collected shall be refunded . . . upon the failure of the legislative body to appropriate the municipality's share of the capital improvement costs within a reasonable time . . . [and no later than] 6 years." In 1999, in accordance with New Hampshire statutory law, the Town of Pelham (the "Town") adopted an impact fee ordinance (the "Ordinance"). That Ordinance allowed the Town to assess fees on new development in order to pay for capital improvements necessitated by the development. The Ordinance also required that if the Town failed to spend or otherwise encumber the impact fees within six years, "[t]he current owners of property on which impact fees have been paid may apply for a full or partial refund of such fees, together with any accrued interest." K.L.N. Construction Company, Inc., Cormier & Saurman, LLC, and Brian Soucy were all residential real estate developers (the "Developers"). Subsequent to the enactment of the Ordinance, the Developers paid impact fees to the Town pursuant to the Ordinance. After paying the impact fees, the Developers sold the related properties to individual homeowners. The fees paid by the Developers were not totally spent or otherwise encumbered by March 2012. At that time, the Developers filed an action in superior court. They sought the refund of impact fees that they had paid more than six years earlier. The Town argued that, under the Ordinance, only a current property owner was entitled to a refund of impact fees. Since the Developers had each sold the related properties, the Town maintained that the Developers lacked standing (i.e., the legal right) to seek a refund of the impact fees. The superior court agreed with the Town and dismissed the case. The court concluded that the governing state statute, RSV 674:21,V(e), did not prevent municipalities from choosing to direct refunds to the current prop- erty owner. The Developers appealed. DECISION: Judgment of superior court affirmed. The Supreme Court of New Hampshire concluded that the Town was within its authority to enact the Ordinance, directing that any refund of impact fees be paid to the current property owner. In so concluding, the court interpreted the governing statute, RSV 674:21,V(e). Looking at the plain language of the statute, the court found that the term "refund" was not defined. The Developers had argued that, in the absence of a stated recipient for the unencumbered or unspent fees, the term "refund" in the statute must be given its "plain meaning" of "to pay back or to reimburse." Consequently, they asserted that the unencumbered fees must be paid to the original payor or its successor in interest. © 2015 Thomson Reuters 3