Entropy Model for Consistent Impact‐Fee Assessment

Abstract

Impact fees are charges paid by developers to defray the costs of capital improvements made necessary by development. The charges are based on the impact a development has on a facility. Fees should be set to cover costs and ensure consistent charges to different developments and over time. The relationship between the fee and usage can be determined to meet these objectives. When several developments occur simultaneously on a congested network or where there are alternative paths between origin and destinations, there are no normative methods for attributing the traffic on a facility to a particular development. This paper describes a consistent approach to setting impact fees based on transportation planning procedures, highway cost allocation methods, and entropy maximization. This approach determines the most likely allocation of link volumes to developments given the origin‐destination matrix and equilibrium flows. The method is demonstrated through its application to a simplified network model of the Pittsburgh, Pennsylvania, area.