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HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 04/03/2018 - FIRST READING OF ORDINANCE NO. 051, 2018, AMENDINGAgenda Item 10 Item # 10 Page 1 AGENDA ITEM SUMMARY April 3, 2018 City Council STAFF Shane Boyle, Civil Engineer III Eric Potyondy, Legal SUBJECT First Reading of Ordinance No. 051, 2018, Amending Chapter 26 of the Code of the City of Fort Collins Regarding Reimbursement Agreements for the Construction of Water and Sewer Mains. EXECUTIVE SUMMARY The purpose of this item is to amend City Code sections related to reimbursement agreements for the construction of water and sewer mains. These sections of Code define requirements by which private parties may seek reimbursement from adjacent property owners for installation of public water and sewer infrastructure. As written, the Code language applies to greenfield development, which is growing less common in Fort Collins. The proposed Code changes would make the reimbursement agreements also applicable to infill, redevelopment, and existing development and thus be more useful to the City and developers. STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on First Reading. BACKGROUND / DISCUSSION City Code Sections 26-121, 26-285, 26-369, and 26-372 apply to reimbursement agreements and allow for private parties who are installing public infrastructure that is also able to serve adjacent properties to require reimbursement from those adjacent properties when they connect to the public system. As written, the Code language applies to greenfield development, which is no longer very common in Fort Collins. The proposed Code changes would make the reimbursement agreements also applicable to infill and redevelopment, and thus be more useful to the City and the types of development now being currently pursued. There are multiple developments within Fort Collins that were constructed prior to City sewer being available in these areas. Therefore, these developments are on individual septic systems. As these septic systems begin to fail, homeowners are interested in installing public sewer mains into and through their development to allow for connection to City sewer which is a health and safety benefit to the City. The proposed Code changes would allow for homeowner(s) to install the sewer mains and require reimbursement from adjacent homes that could also be served by the new sewer mains. As the adjacent homes connect into the new sewer main, those homeowners would be required to pay for their share of the public system. CITY FINANCIAL IMPACTS No financial impacts to the City are anticipated with the proposed Code changes. Agenda Item 10 Item # 10 Page 2 BOARD / COMMISSION RECOMMENDATION At its March 15, 2018 meeting, the Water Board voted unanimously to recommend approval of the proposed Code changes. PUBLIC OUTREACH As this Code change is at the request from homeowners and no impact to the City of development community is anticipated, public outreach was done in the form of a City website update. The proposed Code change was placed on the City’s web page on January 31, 2018. ATTACHMENTS 1. Water Board minutes, March 15, 2018 (draft) (PDF) Excerpt from Unapproved Water Board Minutes – March 15, 2018 Reimbursement Agreement Code Change (Attachments available upon request) Civil Engineer III Shane Boyle, Utilities Water Systems Engineering, provided a summary of the proposal for City Council to make changes to City Code sections related to reimbursement agreements for the construction of water and sewer mains. These sections of code define requirements for which private parties may seek reimbursement from adjacent property owners for installation of public water and sewer infrastructure. As written, the code language specifically applies to greenfield development. The proposed code changes would make the reimbursement agreements also applicable to infill, redevelopment, and existing development. Two neighborhoods are currently in the process and waiting for the code change. Discussion Highlights Board members commented on and inquired about various related topics including sewer main size; billing; fees; and the reimbursement. Board Member Mike Brown moved that Water Board recommends City Council adopt the updated City Code sections related to Reimbursement Agreement and ordinance on first reading. • Board Member Phyllis Ortman seconded the motion. • Vote on the Motion: It passed unanimously, 7-0. ATTACHMENT 1 -1- ORDINANCE NO. 051, 2018 OF THE COUNCIL OF THE CITY OF FORT COLLINS AMENDING CHAPTER 26 OF THE CODE OF THE CITY OF FORT COLLINS REGARDING REIMBURSEMENT AGREEMENTS FOR THE CONSTRUCTION OF WATER AND SEWER MAINS WHEREAS, the City owns and operates a water utility and a wastewater utility; and WHEREAS, City Code has historically provided for the City to enter into reimbursement agreements with developers for the construction of water and/or sewer mains under City Code Sections 26-121, 26-285, 26-369, and 26-372; and WHEREAS, the term “developer” is defined in Chapter 26 of City Code as “any person who plats and improves undeveloped land for industrial, commercial, residential or mixed use thereby creating a demand for City utility services”; and WHEREAS, under such reimbursement agreements, the developer would construct and pay for a water and/or sewer main located either through undeveloped areas to reach and serve the developer’s property, or along the perimeter of the developer’s property; and WHEREAS, such reimbursement agreements have acted as a useful mechanism in certain circumstances by which water and/or wastewater service may be extended; and WHEREAS, the current sections of City Code regarding such reimbursement agreements are tailored to the extension of water and/or wastewater service by developers to undeveloped property to be platted; and WHEREAS, there are certain properties and groupings of properties within Fort Collins that are within the water and wastewater utilities’ respective service areas, but which are not currently served by the water and/or wastewater utility, and which would require the construction of water and/or sewer mains to serve such properties; and WHEREAS, it would be preferable for the City and to the benefit of the health, safety, and welfare of the citizens of Fort Collins to extend water and wastewater service to such properties; and WHEREAS, allowing reimbursement agreements to potentially be used to extend water and wastewater service to such properties would further and provide an additional mechanism for reaching this goal; and WHEREAS, it would be beneficial to the water and/or wastewater utility to extend water and/or sewer mains to be able to serve all properties within the water and wastewater utilities’ respective service areas in order to advance the general purposes of those utilities, and it also would, among other things, expand the customer base and increase revenues for these utilities; and -2- WHEREAS, it would be beneficial to the water and wastewater utilities’ respective ratepayers to provide additional mechanisms to construct water and/or sewer mains using private funds; and WHEREAS, the Water Board has recommended that the Council approve the changes made herein; and WHEREAS, the City Manager and City staff have recommended to the City Council that City Code Sections 26-121, 26-285, 26-369 and 26-372 be amended as set forth below. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS, as follows: Section 1. That the City Council hereby makes and adopts the determinations and findings contained in the recitals set forth above. Section 2. That Section 26-121 of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 26-121. - Reimbursement assessments. (a) Any applicant desiring to take and use City water for the first time on premises subject to a developer’s reimbursement agreement with the City, as provided in § 26-372, shall pay any front footage charges and adjustments assessed to the property pursuant to such agreement on account of the developer’s installing person’s extension of the City water main adjacent to the premises if the applicant’s service line will be connected directly and not through an ancillary distribution line to such main and the applicant did not participate in the original cost of such extension. This fee shall be paid at the time the water service permit is issued in addition to all other connection charges. The applicant may not avoid payment of this charge by requesting connection to another water main if the proposed service line is, in the opinion of the Utilities Executive Director, best capable of being connected to the main which is the subject of the reimbursement agreement. . . . Section 3. That Section 26-285 of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 26-285. - Reimbursement assessments. (a) An applicant desiring an original connection to the wastewater utility for premises subject to a developer’s reimbursement agreement with the City, as provided in § 26-372, shall pay any front footage charges and adjustments assessed to the property pursuant to such agreement on account of the developer’s installing person’s extension of the public sewer -3- adjacent to the premises, if the applicant’s service line will be connected to such main directly, and not through an ancillary collection line, and the applicant did not participate in the original cost of its construction. This fee shall be paid at the time the sewer connection permit is issued in addition to all other connection charges. The applicant may not avoid payment of this charge by requesting connection to another sewer main if in the opinion of the Utilities Executive Director the proposed service line is best capable of being connected to the main which is the subject of the reimbursement agreement. . . . Section 4. That Section 26-369 of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 26-369. - Subdivisions and developments. . . . (b) A developer shall install at self-expense all mains, service lines and other appurtenances to, in and through the development. The City shall participate in the developer’s cost of installing oversized mains as provided in § 26-371. The City may also accommodate the developer and other eligible persons by attempting to collect reimbursement fees from properties outside the development benefited by the developer’s extensions of mains through undeveloped areas as provided in § 26-372. . . . Section 5. That Section 26-372 of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 26-372. - Reimbursement agreements. (a) When a developer or any other person constructs a water or sewer main through undeveloped areas to reach and serve such installing person’s property or constructs such a line main on the perimeter of the property, the entire cost of the main shall be the responsibility of such person. If such developer installing person enters into a reimbursement agreement with the City in the time and manner prescribed by this Section, then the City may assess a charge per connection or per frontage foot to each adjacent property connecting to the affected water or sewer main at the time a connection permit is issued for that property. If per connection, the charge shall be calculated as the cost of the water or sewer main divided by the number of potential connections to adjacent properties. If per frontage, the charge shall be calculated as the cost of the water or sewer main multiplied by the length of the frontage of the property to be charged (in feet) divided by the total length of the water or sewer main (in feet). It shall be in the Utilities Executive Director’s discretion to determine whether to base the charge on connections or frontage, based on an equitable distribution of costs and other relevant considerations. If the front footcharge is collected, the City shall reimburse the -4- originalinstalling developerperson to the extent of such collection after deducting a service charge of three (3) percent to cover administrative costs. All costs for the construction of the water and sewer linesmains must be fully paid by the installing developer person before such person is entitled to reimbursement under any agreement established hereunder. (b) The amount of the reimbursement assessed by the City for each adjacent property as it develops connects to the affected water or sewer main may be based on the original cost of design and construction of the lines mains plus an adjustment for inflation based on the construction cost index for Denver, Colorado, as published monthly by “Engineering News-Record.” In no case shall the front foot charge reflect less than the original cost of installation through the undeveloped properties. The costs of design and construction of the improvements may include engineering fees and any costs incurred by the developer installing person for the formation or administration of a special improvement district. Reimbursement of the installing developer person is contingent on actual collection of the front foot charge by the City. (c) In order to obtain approval of a reimbursement agreement from the City, the developer installing person shall provide the utility with copies of the following within ninety (90) days from acceptance of the utility lineswater or sewer main by the City Engineer: (1) Completed bid forms from at least three (3) qualified contractors with an indication of which contractor was awarded the project. The bid forms must contain the description, estimated quantity, and unit price for each item included in the project. Each bid must be genuine and not a collusive or sham bid; (2) Any invoice from the developer’s installing person’s engineer for any fees assessed on the project; (3) The contractor’s application for final payment approved by the developer's installing person’s engineer; (4) A letter from the developer installing person and/or contractor certifying that final payment has been received by the contractor; (5) A letter from the developer installing person and/or engineer certifying that final payment of engineering fees has been made; (6) A map prepared by a licensed engineer or surveyor which shows: a. The location of the utility linewater or sewer mains constructed; b. The name of the owner of each property which has frontage along the utility linewater or sewer main; -5- c. The amount of frontage each property has along the utility linewater or sewer main; d. The number of connections anticipated to be made to the water or sewer main from the properties along the main; e. The location of stubs from the water or sewer main to each property along the main, if such stubs have been required by the Utilities Executive Director; df. The acreage and parcel number of each property along the utility line water or sewer main; and eg. A reference to the book and page and/or reception number from the county records where the information for each property was obtained. (7) Any other information deemed necessary by the Utilities Executive Director. (d) If the foregoing information is not submitted by the developer installing person within the ninety-day period provided, then reimbursement will shall be denied. If the information is timely submitted, the City will review it and prepare a reimbursement agreement to be signed by both the developer installing person and the City Manager. All reimbursement agreements shall be recorded with the county clerk and the installing person shall be responsible for such recording costs. (e) The term of any reimbursement agreement established hereunder shall not exceed a period of ten (10) years from the date of its execution regardless of whether or not the original costs have been fully reimbursed. The City Council may approve one (1) extension of the agreement by resolution, not to exceed an additional ten (10) years, if application for the City Council approves such a resolution for an extension is made prior to the expiration of the original ten-year period. The City is not liable for any portion of the uncollected balance. (f) The books and records of the developer installing person relating to the costs of the water and sewer mains for which the developer installing person seeks reimbursement shall be open to the City at all reasonable times for the purpose of auditing and verifying the developer’s installing person’s costs. -6- Introduced, considered favorably on first reading, and ordered published this 3rd day of April, A.D. 2018, and to be presented for final passage on the 17th day of April, A.D. 2018. __________________________________ Mayor ATTEST: _______________________________ City Clerk Passed and adopted on final reading on the 17th day of April, A.D. 2018. __________________________________ Mayor ATTEST: _______________________________ City Clerk