COEUR d’ALENE — Mayor Jim Hammond said he is looking forward to a solid proposal on changing Coeur d’Alene’s impact fees “as soon as possible.”

“Implementation needs to occur, post haste, because we are so far behind,” he said during a workshop on impact and annexation fees Tuesday.

The city’s current impact fees were established in 2004 and the annexation fee was last calculated in 1998. Neither have been updated, leading officials to examine fee methodology and alternatives.

Hammond told members of the City Council, Planning Commission and city staff the city has let its impact fees stand unchanged for “far too long and we can’t afford to let it go any further."

The city took its allowable 3% property tax increase in its recently adopted 2023-24 budget. Adjusting impact fees could prevent the need to do that.

“We need to keep moving forward,” Hammond said.

About 30 people participated in the 90-minute workshops in the Library Community Room.

According to a report in the city's preliminary financial plan for 2022-23, a goal was to "Seek every remedy for growth to pay for itself through an increase in annexation fees, increase in impact fees, and low tax increases."

The city, the FCS Group, Iteris and Welch Comer developed a 38-page impact fee study that was the basis of Tuesday's meeting.

Impact fees, which are one-time fees, help pay for fire, police, park and transportation needs to keep up with growth.

The city has identified nearly $35 million in future needs in fire, police and parks departments, and even more than that in transportation.

The population of Coeur d’Alene is expected to grow by 13,000 to 72,000 residents from 2024 to 2034.

The city currently assesses an annexation fee of $750 per dwelling unit. According to the study, if it was adjusted for inflation, it would be $1,419 today. One proposal calls for increasing that to $1,133.

The city’s current development impact fees on a single-family home and multi-family building per unit are $138 for fire, $70.31 for police and $755.97 for parks. Impact fees for transportation depend on which area of the city the property is in and range from $630 to $857.

The city “may adopt a methodology for charging single-family impact fees based on their floor-area size,” according to a city report.

Under one proposal, if impact fees were increased, the city would receive about $9,000 for a 2,300-square-foot home. In comparison, the same home in Post Falls would generate $13,645 in impact fees; $7,511 in Nampa and $6,129 in Hayden.

Under another example of an 89-room hotel, new impact fees could total $405,662 in Coeur d’Alene; $303,910 in Post Falls; $324,049 in Nampa and $170,712 in Hayden.

Lynn Fleming, Planning Commission member, expressed concern about the cost to a new hotel.

"I don’t think we should be as heavy-handed on the hotels,” she said.

Councilman Dan Gookin said, before moving too far along in the process, he wanted to know a few things about impact fees.

“I want to know what the law is. I want to know how they’re calculated, I want to know what they're justified for. I want to know all that background," he said.

Hammond said he would be interested in seeing plans to implement fee increases in steps rather than all at once.

He questioned basing impact fees on the size of a home. He said many new, larger homes in the area are occupied by retired couples.

Hammond said he wasn’t sure if the city could justify higher impact fees in such cases because those two people are creating the same impact on services whether they're in a 1,000-square-foot home or a 5,000-square-foot home.

“We want to be sure we’re on good, solid ground with that one,” he said.