Fees, we can't make it more fun, or can we?

For years there has been much attention paid to construction fees. The differences between municipalities are great and especially for building projects with a substantial building sum, the building fees can be high. For example, Rotterdam has a maximum fee of € 1,300,000, Zoetermeer a maximum fee of € 2,000,000 and The Hague even a maximum fee of € 2,500,000. The question therefore regularly arises: are municipalities allowed to levy so many fees? The case law of the tax courts shows that with considerable regularity it is ruled that no legal fees should have been levied! Usually this is because the fee regulations are inadequate.

In a large number of dues issues, arguments are raised that have little chance of success in view of the Municipal Law and case law. In any case, the following principles can be derived from the Municipal Law and case law:

• There should be no unreasonable or arbitrary fees.
• Municipalities are free to choose the apportionment measure for fees, but the carrying capacity principle may not be used.
• The estimated income must not exceed the estimated expenses in this respect. This is not considered on a permit-by-permit basis, but it must be assessed whether all estimated income for all environmental permits in the year in question taken together does not exceed the expenses for those permits.
• No direct relationship is (therefore) required between the amount of the fees and the services provided.
• A fixed modest rate is allowed (e.g., 1.4% of the construction cost).

Looking at these principles, there seems to be little room left to successfully challenge a dues bill, but appearances can be deceptive. Case law from the past two years shows that a large number of fee regulations have been declared non-binding, resulting in no fees being payable at all! For example, one or more dues regulations of the municipalities of Utrecht, Nijmegen, Amersfoort, Roosendaal, Wijchen, Vianen, Pijnacker-Nootdorp, Harenkarspel and Dantumadiel have been declared non-binding.

In most cases where the tax court rules that no dues are due, it is because the municipality did not correctly estimate the charges and revenues. It regularly happens that a municipality has not estimated revenues that it should have expected, as a result of which that municipality has assumed too low a revenue in the estimates. In addition, costs are often attributed to the provision of services that should not be attributed to them, such as costs for enforcement, costs for objection and appeal procedures, as well as indirect costs.

It also occurs with some regularity that formal requirements are violated in the collection of fees. This is the case, for example, when the charging officer is found not to be competent.

Looking at the jurisprudence of the tax courts, it is worthwhile, in the case of fees of any size, to check carefully whether the fees charged may actually be levied. If so, it may turn out that the municipality is not allowed to charge a fee or is allowed to charge a much lower amount, thus saving a lot of costs.

Starting next July 1, there is an additional reason to pay attention. As of that date, municipalities can no longer charge fees in connection with a zoning plan that is older than ten years for services that, on the one hand, are related to that zoning plan and, on the other hand, are performed after the zoning plan is older than ten years. This follows from Section 3.1(4) of the Spatial Planning Act. It is generally assumed that it follows from this that municipalities can no longer charge fees for environmental permits for construction activities, environmental permits for use contrary to a zoning plan as well as requests to amend a zoning plan.

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