Public Notice of Fee or Tax Changes

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Arizona Revised Statutes (A.R.S. §9-499.15) requires that government entities provide notification about proposed changes to taxes and fees. When the City of Tempe has such a change to report, it will be posted to this page.

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Development Impact Fees

On January 9, 2025, the City Council adopted a resolution to adopt the Land Use Assumptions and Infrastructure Improvement Plan related to Fire, Police, Parks and Recreation, Streets, and Water and Wastewater Development Fees. The proposed fees and the methodology for determining those fees are set forth in the report: Final Land Use Assumptions and Infrastructure Improvements Plan with Development Fees Report. A stakeholders meeting was held on August 21, 2024, to review the report.

Information relating to the Land Use Assumptions, Infrastructure Improvements Plan and proposed fees can be found at the link below: Land Use Assumptions,
Infrastructure Improvements Plan, and Development Fee Report PDF

A public hearing will be held at the Tempe City Council Regular Meeting, February 20, 2025, at 6:00 p.m., for the purpose of receiving public comment on proposed Fire, Police, Parks and Recreation, Streets, and Water and Wastewater Development Impact Fees at least 30 days before adoption of the fees.

The upcoming public meetings are listed below. Unless otherwise noted, meetings will be held at 6:00 p.m. at the Tempe City Council Chambers, 31 E. Fifth Street, Tempe, Arizona, 85281.

Feb 20: Development Fees - Public Hearing
Apr 10: Development Fees - Adoption

The development fees are expected to go in effect on June 24, 2024, if adopted by Mayor and Council.

Posted on January 10, 2025

Water, Wastewater and Solid Waste Rate Adjustments Notice of Intention

In 2024, the Public Works Department staff worked with a contractor to complete a Water, Wastewater, Stormwater and Solid Waste Rate Study (2024 Utility Rate Study). Based on the results of the 2024 Utility Rate Study, staff recommends additional funding of $7.7 million to support water services, $5.9 million for wastewater services and $750,000 for solid waste services over a 12-month period. The additional funding will vary by classification, based on current revenue generated as compared to the cost to provide the service. The typical Tempe single-family residential customer receiving water, wastewater and solid waste services will experience a monthly utility bill increase of $7.87 per month.

These recommended funding adjustments are necessary to ensure the financial stability of the Water, Wastewater and Solid Waste Utilities through recovery of operating costs and collection of revenue sufficient to finance capital improvement projects and maintain the fund balances at policy level.

In accordance with A.R.S. § 9-511.01 and A.R.S. § 9-499.15 a public hearing at a Tempe City Council meeting will be held on February 20, 2025, in the Tempe City Council Chambers located at the Harry E. Mitchell Government Complex, 31 E. 5th Street, Tempe, Arizona at 6:00 p.m. for the purpose of receiving public comment on the recommended rate adjustments from the 2024 Utility Rate Study. A written report including the schedule and fee amounts is available at the City Clerk’s Office, 31 East Fifth Street, Tempe, Arizona and on the City's website at tempe.gov/utilityratestudy.

Infrastructure Improvement Plan and Land Use Assumptions

On Thursday, June 20, 2024, at 4:00 p.m., a public Issue Review Session (IRS) was held during the Tempe Council Work Study Session. The meeting was held at the Tempe Council Chambers, 31 E. Fifth Street, Tempe, Arizona.

The City currently has development fees in place for the following categories: Fire, Police, Parks and Recreation (implemented in 2021), Water and Wastewater, and Streets (implemented in 2020). TischlerBise has been retained to do an update of the fees for Fire, Police, Parks and Recreation, Water and Wastewater, and Streets as required by state statute.

As required by legislation, development impact fees must be updated every five years and TischlerBise has developed the draft LUA and IIP. The LUA is based on current land use and population projections developed from information gathered for and used in Tempe’s General Plan 2050 and supplemented with Maricopa Association of Governments data. The LUA projects changes in land uses, densities, intensities, and population for Tempe’s service area. The IIP establishes the capital projects included in the development fee calculations.

Draft Tempe Land Use Assumptions and Infrastructure Improvements Plan (PDF)

Public Meetings

Unless otherwise noted, meetings will be held at 6:00 p.m. at the Tempe City Council Chambers, 31 E. Fifth Street, Tempe, Arizona, 85281.

July and September 2024 – Stakeholder Meeting(s), Date and Location TBD.
September 19, 2024 – Public Hearing on the Land Use Assumptions and Infrastructure Improvement Plan.
November 7, 2024 – Adoption of the Land Use Assumptions and Infrastructure Improvement Plan.
December 19, 2024 - Public Hearing on the Impact Fees.
January 23, 2025 – Adoption of Impact Fees. Fees will take effect on April 8, 2025.

State Legislation

Arizona’s enabling act for municipalities is codified in Sec. 9-463.05, Arizona Revised Statutes (ARS). In 2011, the legislature passed SB 1525, which was signed by the governor on April 26, 2011. SB 1525 constituted a major overhaul of Arizona’s enabling act for municipalities. Click on the link below to view the full statute.

A.R.S. §9-463.05

Development Impact Fee Information

The City’s Development Impact Fee Ordinance establishes the procedures and standards for the creation of the Development Impact Fee Program. For Annual Development Fee Reports, studies, and Biennial Audit Reports, please visit: City of Tempe: Open Books – Development Impact Fees

Posted on June 26, 2024

Police Video Record Fee

The City of Tempe hereby gives notice of intent to impose a new police video record fee in the maximum amount of $46 per video hour. A Tempe City Council meeting will be held on June 6, 2024, and June 27, 2024, in the Tempe City Council Chambers located at the Harry E. Mitchell Government Complex, 31 E. 5th Street, Tempe, Arizona at 6 p.m. for the purpose of holding a public hearing and receiving public comment on the recommended fee.

Pursuant to Arizona Revised Statute 9-499.15, a written report supporting the new fee is available here.

POSTED: April 25, 2024

Upcoming Residential Rental Tax Changes

Effective Jan. 1, 2025 the City of Tempe will no longer impose Transaction Privilege Tax (TPT) on income received from residential rentals with stays of 30 days or more also known as long-term rentals (business code: 45).

Rents received for periods December 2024 and prior remain taxable, including unlicensed properties and/or returns that may not have been filed and/or paid. The December 2024 reporting period (Due Jan. 20, 2025) is still required to be filed and paid.

Short-term rentals (less than 30 days) and commercial leases are not impacted and remain taxable.

Please refer to the Arizona Department of Revenue for further details.

Tobacco Seller's License Fee

The City of Tempe hereby gives notice of intent to impose a new tobacco seller’s annual license fee in the maximum amount of $300. A Tempe City Council meeting will be held on October 12, 2023, and October 26, 2023, in the Tempe City Council Chambers located at the Harry E. Mitchell Government Complex, 31 E. 5th Street, Tempe, Arizona at 6 p.m. for the purpose of holding a public hearing and receiving public comment on the recommended fee.