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Pros: <br />• Flexible funds which could be used for park acquisition, and operations and <br />maintenance. <br />• Preserves borrowing capacity. <br />• Relatively easy to collect and reporting costs are usually low. <br />• Saves interest costs. <br />Cons: <br />• Would complete with other current programs funded by room and car rental <br />taxes. <br />• Funds may be insufficient. <br />• May not relate payment to benefits received. <br />• Revenue fluctuates with tourism and convention activity and with the strength of <br />the economy. <br />System Development Charges (Impact Fees) <br />What is it: A one -time fee charged at the time a permit is issued for a new development <br />Who pays: Developer of project <br />Relevant Types: <br />a) Parks and Recreation <br />b) Stormwater — can be used for land acquisition where land conservation plays a role <br />in managing stormwater <br />Pros: <br />• Fairly reliable source of funding when new building is occurring. <br />• Can be used to pay off bonds that are related to serving new development. <br />• Revenue can keep pace if provider increases level of service standards. <br />• Provides funds to meet new demand created by new development at comparable <br />levels of existing service. <br />• Intended to cover some or all of the cost associated with expanding public <br />facilities to accommodate new development. <br />• Each provider can set its charges based on the cost of providing the facilities to <br />meet local standards. <br />Cons: <br />• Can only be used to maintain current level of service (i.e., acres /1000 persons) <br />• Revenue fluctuates with development cycles. <br />• Adverse effects on housing affordability. <br />• Adds cost to development. <br />• In some instances can decreased availability of affordable housing. <br />• New or fee increases are likely to meet resistance from the development and <br />real- estate community. <br />Open Space Acquisition Funding and Protection Strategies - Draft October 2001 3 <br />