08-12-1996 Council Packet - Laserfiche WebLink

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¥ Request for Council Action page 2 of 2 August 8, 1996 John O’Sullivan Appeal of Local SAC and WAC Charges Staff then surveyed other cities to get an idea of what a reasonable fee would be. Fees in other cities are generally in the range of $200.00 to $1,500.00 per unit (please see the attached survey). Based on this range, staff recomuieiided the local access charge be tied to the Metropolitan Council ’s SAC charge which is $900.00 pe*" unit. The purpose of the local SAC and WAC charges is to collect revenue to accurately reflect the level of usage of the water and sewer system, in relation to the cost of constructing the system. Regular sewer and water fees reflect the cost of maintaining and repairing existing lines, facilities, etc. The local SAC and WAC charges reflect the costs of both the initial installation of lines and facilities, and the future replacement and expansion of the lines and facilities. It is important that these fees be collected at the time the expansion of usage by individual properties occuis. These funds can then be set aside to cover at least a portion of the cost of the future expansion or replacement of the system. If this does not happen, development may continue to intensify with no plan for addressing capacity expansion needs until the specific development occurs which requires the expansion. TTie result of this would be either that the last development would have to pay the full cost of the expansion, or the city would be placed in the position of trying to assess the benefitti d properties for the expansion project. This could be very difficult since those properties that had been able to expand their sewer and water usage prior to the need for the expansion project would make the case that the expansion is not benefitting them. A somewhat similar situation, but dealing with new development, is the sewer expansion for the Highway 12 area. This sewer expansion was planned so that the cost was built into a connection charge that is collected at the time development occurs in the area to be served by the sewer expansion. The amount of the connection charge related to the sewer expansion was set at $1,200.00 per unit. Staff Recommendation It is reasonable that a developer should make some form of payment related to city sewer and water capacity and availability when the development results in a substantial increase in water and sewer usage. The $900 per unit SAC and WAC charges, while being toward the high end of what other cities charge, are still a reasonable cost for sewer and water servic ’f the O’Sullivan development was occurring in the Highway 12 area, the sewer and water connection charges would be over $8,000 per unit (sewer and water combined). This would result in a total cost exceeding $176,000. It is staffs recommendation that the local SAC and WAC charges remain at the current level and that those charges related to the O’Sullivan development be paid. COUNCIL ACTION REQUESTED Motion to deny the appeal of John O’Sullivan of the local SAC and WAC charges related to his development project at 3340 Shoreline Drive.