Building permit impact refers to how construction and renovation activity affects property assessments and taxes. When buildings are constructed or significantly improved, their assessed values increase to reflect the new or enhanced structures, expanding the municipal tax base. This 'assessment growth' generates additional property tax revenue without raising rates on existing properties. Municipal budget planning often includes projections of building permit impact based on anticipated development. During construction booms, permit impact can contribute significantly to revenue growth, while slowdowns reduce this source of natural budget growth. Tracking permit activity helps forecast future assessment changes.