test, however, one-quarter or more of the burden of these fees could fall on the owners of undeveloped land.
The analysis in this chapter also reveals that fees or negotiated charges on developers for infrastructure that does not benefit new residents will only increase the burden landowners bear. In addition, development fees generally confer a small capital gain on existing homeowners and, to the extent that housing construction is competitive, do not place any burden on developers.
Special assessments appear to provide a better way to ensure that the costs of new infrastructure fall on the beneficiaries. Under the same assumptions listed above, the burden of special assessments falls entirely on the people who benefit, namely the people who buy new housing. Thus with wellfunctioning markets and sensible decisions about infrastructure investment, special assessments avoid the problems of unfair burdens on landowners and unfair gains to existing homeowners. 26
Finally, empirical research concerning the impact of development fees on housing and land prices faces severe obstacles and so far has not yielded clear-cut results. Although a few studies suggest that the implementation of development fees to pay for new infrastructure raises housing prices, these studies raise more questions than they answer. Given the growing popularity of development fees, more empirical work is clearly needed.