The new fees are based on projected student enrollment growth and vary based on housing type. Fees for new single family home development will jump from $5,570 to $11,391.
Housing developers in Scarborough will have to pay increased "impact" fees — double in some cases — after the Town Council passed a revised impact fee schedule.
Scarborough is one of the state's fastest-growing towns, having added a significant number of new housing units over the past few years.
The increase is aimed at raising $52 million in revenue to help offset the cost of new school construction. The new fees are based on anticipated student enrollment growth from projected new housing starts and vary based on housing type.
Fees for new single family homes — which the town projects will make up 40% of new housing construction — will jump from $5,570 to $11,391.
Fees for other types of housing also more than double under the new schedule, to $5,696 per unit for buildings with up to four units, and $3,987 per unit for structures housing up to nine units.
The lowest fee will be applied to high-density multifamily units, and that drops from the current $1,410 per unit to $1,139.
Units of affordable housing — for residents earning no more than 80% of the area median income — and workforce housing — for residents earning more than 120% of the AMI — will be charged half of the prescribed fees.
Housing growth is projected to be close to 260 units annually; 7,800 units over 30 years. Student capacity is anticipated to grow by nearly 21%.
School improvement costs are projected to total $251 million, including the $140 million bond voters passed in November 2025, $81 million in financing costs and $30 million remaining from past school facilities upgrades.
Potential legal challenge
Attorney Alyssa Tibbetts, representing the growing Downs development, objected to the principle behind the fees.
"Assessing a fee because the town needs revenue to pay for debt services is not the same as apportioning the cost of infrastructure improvement made necessary by development. The fee has to be related to the actual impact of the development," Tibbetts said in the public hearing portion of Wednesday night’s meeting.
She cited Maine law and told Town Council that the fee structure errs in presuming school enrollment necessarily increases with new construction. She also cited a decline this year in Scarborough school enrollment.
“The Downs alone has a significant number of one- and two- bedroom units that have very few school age children. Of the 610 units built since 2018, there are just 62 school age children as of June 2025."
Tibbetts asked the Town Council to delay a decision until members reviewed more data regarding unit size, bedroom count and student enrollment, “to more clearly demonstrate how the impact fee is proportionally related to the development’s use of the infrastructure to be funded.”
She added: “It is my opinion that this formula does not meet the statutory requirements of Maine law and would not withstand legal challenge.”
Town manager's take
Town manager Tom Hall said that while town's legal counsel had not reviewed the revised fee schedule, “I’m extremely confident in the methodology. We have been working on this for 18 months."
Karen Martin, executive director of Scarborough Economic Development Corp., which crafted the proposed schedule, added that the rates are expected to be regularly reviewed and adjusted as necessary to ensure that projections are reasonable and that the fees collected total $52 million over 30 years.
The new fee schedule passed 6-1 with Town Council member Scott Doherty opposed.
