Anger Rising Over Refunds of School Impact Fee

A resident of Paju, Gyeonggi Province, could not control his anger when he dropped by the city hall to get a refund on the school impact fee.

“Kim” paid two million won (1,500 U.S. dollars) after buying a newly built apartment from the initial buyer who signed a contract with the builder in 2002. Though Kim offered to show a receipt for the fee and the sales contract, the city rejected his refund request.

A Paju official said a refund was impossible since the contract had no special agreement proving that Kim paid the fee. Kim was told to receive documents saying the initial buyer transferred the responsibility of paying the school impact fee to Kim.

After several failed attempts, Kim managed to contact the initial buyer but lost contact a few days later.

“In 2002, no one expected the government to refund the fee. That’s why I didn’t sign a special agreement when I made the contract,” Kim said.

On the other hand, initial buyers of newly built apartments can get the school impact fee refunded without written documents since their sales records are kept by provincial governments.

The Paju city government says, “The Education Ministry ordered all provincial governments to refund the school impact fee only to initial buyers or those offering documents containing special agreements to prevent fraud. The only available measure is a civil lawsuit.”

An apartment resident in the southern city of Ulsan also failed to get the fee refunded. Though she signed special agreements at the conclusion of the sales contract, she had a copy of her receipt, not the original. She was told to get the original from the initial buyer, but has no idea who initially bought the apartment since the home has been sold three times.

People who paid the school impact fee say they have failed to get a refund.

The Korea Taxpayers Federation said, “It is hard for apartment buyers who paid the school impact fee to keep original receipts and contract documents for several years. Worse, the government even urges taxpayers to suggest special agreements, meaning it is unwilling to refund the money.”

The federation is urging the government to immediately ease requirements.

The Association of Victims of School Impact Fees also said, “If the government declines to change the requirements, we have no choice but to sue the initial apartment buyers. The government’s inefficient system should change.”

sukim@donga.com