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Substitute Bill BL2020-276

An ordinance amending Title 5 of the Metropolitan Code to establish a development impact fee.

WHEREAS, the recent population growth in Nashville and Davidson County has negatively impacted the Metropolitan Government’s ability to provide adequate schools facilities and other public facilities and infrastructure; and

WHEREAS, the Metropolitan Council has determined that the need for public facilities within the area of the metropolitan government is reasonably related to new development in the county.

NOW, THEREFORE, BE IT ENACTED BY THE COUNCIL OF THE METROPOLITAN GOVERNMENT OF NASHVILLE AND DAVIDSON COUNTY:

Section 1. Title 5 of the Metropolitan Code is hereby amended by adding the following new Chapter 5.34 – Development Impact Fee:

Chapter 5.34 Development Impact Fee

5.34.010 Findings and purpose.
The recent population growth in Nashville and Davidson County has negatively impacted the Metropolitan Government’s ability to provide adequate schools facilities and other public facilities and infrastructure. This has led to inequities in certain areas of Nashville and Davidson County, and has impacted the quality of life of residents. The Metropolitan Council has determined that the need for public facilities within the area of the Metropolitan Government is reasonably related to new development in the county. The purpose of this chapter is to provide a funding mechanism to enable the Metropolitan Government to help address the need for public facilities and infrastructure resulting from development.

5.34.0210 Definitions.
As used in this chapter, the following terms have the meanings ascribed herein:

"Building" means any structure built for the support shelter, or enclosure of persons, chattels, or movable property of any kind; the term includes a mobile home. This will not pertain to buildings used for agricultural purposes;

"Building permit" means a permit for development issued by the Metropolitan Government;

"Certificate of occupancy" means a license for occupancy of a building or structure issued by the Metropolitan Government;

"Development" means the construction, building, reconstruction, erection, extension, betterment, or improvement of land providing a building or structure or the addition to any building or structure, or any part thereof, which provides, adds to or increases the floor area of a residential or non-residential use;

"Dwelling unit" means a room, or rooms connected together constituting a separate, independent housekeeping establishment for owner occupancy, rental or lease on a daily, weekly, monthly, or longer basis; physically separated from any other room or dwelling units which may be in the same structure; and containing independent cooking and sleeping facilities

"Floor area" means:
For non-residential development, the total of the gross horizontal area of all floors, including usable basements and cellars, below the roof and within the outer surface of the main walls of principal or accessory buildings or the center lines of party walls separating such buildings or portions thereof, or within lines drawn parallel to and two feet within the roof line of any building or portions thereof without walls, but excluding arcades, porticoes, and similar open areas which are accessible to the general public, and which are not designed or used as sales, display, storage, service, or production areas; and
For residential development, the total of the gross horizontal area of all floors, including basements, cellars, or attics that are heated or air-conditioned living space, or are designed to be finished into heated or air-conditioned living space at a future date;

“Impact fee” means the privilege tax levied pursuant to this chapter;

"Metropolitan council" means the Metropolitan County Council of the Metropolitan Government of Nashville and Davidson County;

"Non-residential" means the development of any property for any use other than residential use, except as may be exempted by this section;

"Person" means any individual, firm, co-partnership, joint venture, association, corporation, estate, trust, business trust, receiver, syndicate, or other group or combination acting as a unit, and the plural as well as the singular number;

"Place of worship" means that portion of a building, owned by a religious institution which has tax-exempt status, which is used for worship services and related functions; provided, however, that a place of worship does not include buildings or portions of buildings which are used for purposes other than for worship and related functions or which are or are intended to be leased, rented or used by persons who do not have tax-exempt status;

"Public buildings" means a building owned by the state of Tennessee or any agency thereof, a political subdivision of this state, including, but not limited to, the Metropolitan Government and its satellite cities, or the federal government or any agency thereof;

"Public facility" means a physical improvement undertaken by the Metropolitan Government, including and limited to the following: roads and bridges, jails and law enforcement facilities, schools, government buildings, fire stations, sanitary landfills, water, and wastewater and drainage projects; and

"Residential" means the development of any property for a dwelling unit or units.


5.34.020 Impact fee established.
A. Engaging in the act of development within the area of the Metropolitan Government, except as provided in subsection B., is declared to be a privilege upon which the Metropolitan Government may levy a tax in an amount not to exceed the rate set forth in subsection C.
B. This section does not apply to the development of:
1. Public buildings;
2. Places of worship;
3. Barns or outbuildings used for agricultural purposes;
4. Replacement structures for previously existing structures destroyed by fire or other disaster;
5. Additions to a single-family dwelling;
6. A structure owned by a non-profit corporation which is a qualified 501(c)3 corporation under the Internal Revenue Code;
7. Permanent residential structures replacing mobile homes where the mobile home is removed within thirty (30) days of the issuance of the certificate of occupancy for the permanent residential structure provided that the permanent structure is a residence for the owner and occupant of the mobile home and that owner and occupant has resided on the property for a period of not less than three (3) years; or
8. Buildings moved from one site within the area of the metropolitan government to another site within the area of the Metropolitan Government.
C. 1. For the exercise of the privilege described herein, the following tax is imposed on new development within the area of the Metropolitan Government:
(a) One dollar ($1.00) per gross square foot of residential development; and
(b) Two dollars ($2.00) per gross square foot of non-residential development.

5.34.030 Collection of impact fee.
The impact fee established by this chapter shall be collected at the time of application for a building permit for development as herein defined. No building permit for development shall be issued unless the impact fee has been paid in full to the department of codes administration.

5.34.040 Use of impact fee proceeds.
All impact fee revenue collected shall be used to provide public facilities, the need for which is reasonably related to new development.

5.34.060 Effective date.
The provisions of this chapter shall only become effective upon the enactment of enabling legislation by the Tennessee General Assembly authorizing the Metropolitan Government to levy the privilege tax set forth in this chapter, and shall remain in effect for so long the state enabling legislation remains in effect.

Section 2. The Metropolitan Planning Department, the Department of Codes Administration, and the Department of Finance are hereby authorized and directed to develop administrative guidelines, procedures, regulations, and forms necessary to properly implement, administer, and enforce this chapter, subject to approval of the Metropolitan Council by resolution.

Section 3. This ordinance shall take effect from and after its passage, the welfare of The Metropolitan Government of Nashville and Davidson County requiring it.

Sponsor(s)

Jonathan Hall

Legislative History

Substitute acceptedJune 16, 2020

Failed on Second ReadingJune 16, 2020

Requests for ADA accommodation should be directed to the Metropolitan Clerk at 615-862-6770.

Last Modified: 06/29/2020 4:59 PM