Developers in Austin will pay higher fees to the city for their new projects in 2023.

The Austin City Council voted in September to update its parkland dedication requirements for new developments. Parkland dedication fees for residential developments will go up 10 percent. In addition, the council instituted a parkland dedication requirement for new projects intended for office, retail, industrial, and hotel uses, the first time it's levied such charges on commercial developments.

The city charges the fees to offset the effects of population growth and related development by creating new parkland. To meet the requirement, developers can donate land, pay fees to a fund the city uses to buy new parkland or build park amenities, or a combination of the two.

In addition to instituting fees for commercial developments, the council made several changes to the residential fee program, which has been in place for decades. According to a city press release, the ordinance now: 1) ensures that fee rates are locked in at the time of the project’s permit application and won't change during its review cycle, 2) makes "all types of government-operated affordable housing programs" eligible for affordable housing waivers, and 3) clarifies the qualifications of land within the 25-year floodplain as dedicated parkland. Those changes also apply to the new commercial development fee.

Austin voters approved a $149 million bond  for use on parks, including the purchase of new land, in 2018.

The council at first considered raising park fees for new residential projects to more than double what current calculation prescribes — a move that would have increased the fee for a single-family home from  about $5,000 to about $11,000. After getting pushback from developers, it kept the hike to 10 percent or less by limiting the land cost per person it considers as part of its formula.

The city will explore further changes to the parkland dedication ordinance through outreach to park advocates, housing affordability advocates, and development representatives. 

The new commercial fees will go into effect in January.