PERMIT FEES

When planners talk about “affordable housing,” they leave out one crucial detail: impact and connection fees.

These are charges the city slaps on every new unit — supposedly to cover roads, schools, parks, and utilities. In reality, they act like a hidden tax that drives up housing costs, pads city budgets, and makes homeownership even less attainable.

1. What Are Impact & Connection Fees?

Impact Fees — charged for schools, parks, and transportation.
Connection Fees — for hooking up to water, sewer, and utilities.
On paper, they sound reasonable. But in practice, they add tens of thousands of dollars per unit before a single shovel hits the ground.
For a fourplex or townhouse project, that’s 4X the revenue the city collects compared to a single home.

2. The Local Reality

In Bellingham and across Washington:
Fees can range from $20,000–$40,000+ per unit.
They are non-negotiable — paid up front, passed on to buyers and renters.
The more units a project has, the more money the city makes.
That’s why “Middle Housing” isn’t about affordability. It’s about multiplying the city’s fee revenue.

3. Who Really Benefits?

Cities: rake in more revenue per parcel.
Planners: justify bigger budgets.
Developers: pass the fees onto buyers or renters.

Meanwhile, families face higher purchase prices, higher rents, and fewer options for true ownership.

4. Why It Matters for “Affordability”

Every dollar in fees is baked into the final cost of a home. Middle Housing units may be smaller — but with fees stacked on top, the price per square foot often goes up.
So when the City claims density “makes housing affordable,” ask them: How can it be affordable when fees add $40,000 per unit before construction even starts?

5. What You Can Do

Ask Questions — Demand transparency on where these fees really go.
Follow the Money — Compare fee revenue growth against actual school seats, park space, or road improvements.
Stay Informed — Subscribe to the Real Issues Podcast for weekly deep dives into housing costs.