HomeMy WebLinkAboutMemo - Mail Packet - 9/19/2017 - Memorandum From Lance Smith And Donnie Dustin Re: Ordinance No. 116, 2017 Adopted September 5, 2017: Calculation Of The Revised Cash-In-Lieu (Cil) Rate Adopted With The Water Supply Requirements (Wsr)Utilities
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PO Box 580
Fort Collins, CO 80522
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utilities@fcgov.com
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MEMORANDUM
DATE: September 8, 2017
TO: Mayor Troxell and Councilmembers
FROM: Lance Smith, Utilities Strategic Finance Director
Donnie Dustin, P.E., Water Resources Manager
THROUGH: Darin Atteberry, City Manager
Kevin R. Gertig, Utilities Executive Director
RE: Ordinance No. 116, 2017 adopted September 5, 2017: Calculation of the revised
cash-in-lieu (“CIL”) rate adopted with the Water Supply Requirements (“WSR”)
Bottom Line:
This memo addresses a Councilmember request during the September 5 City Council meeting by
outlining how adjustments were made to the CIL rate during the meeting to recognized the 3-
month delayed implementation of the WSR changes, and how they would have applied to other
recommended implementation dates.
Background:
The proposed CIL rate was $16,700 per acre-foot of WSR, but was adjusted to $17,300 during
the meeting. This was calculated as follows:
Assumed 300 acre-feet of WSR would be met during the delay between adoption and the
January 1, 2018 implementation date (based on average WSR met in past 3 years)
Subtracted that 300 acre-feet from the increased firm yield portion of the proposed CIL
rate calculation as follows:
o Proposed CIL rate: $129.9M (value of future investment) / 7,800 acre-feet
(increased firm yield) = $16,700 per acre-foot of WSR (rounded to nearest $100)
o Approved CIL rate: $129.9M (value of future investment) / 7,500 acre-feet
(increased firm yield) = $17,300 per acre-foot of WSR (rounded to nearest $100)
It was also requested to show what the adjusted CIL rate would have been with the other
implementation dates that were proposed. Using the same methodology as above, but adjusting
the assumed amount of WSR that would have been met between adoption and the various
implementation dates (including seasonal variability in WSR met), the following adjusted CIL
rates would have been proposed:
October 1, 2017 (immediate): $16,700
January 1, 2018 (3-month delay): $17,300 (adopted)
DocuSign Envelope ID: C50A4E11-48A7-4837-8EE6-5CDA599A9C9D
April 1, 2018 (6-month delay): $17,600
October 1, 2018 (1-year delay): $18,600
Staff will consider other methodologies for adjusting the CIL rate based on implementation
delays for any future CIL rate adjustments, which will be reviewed and changed (if needed)
every two years along with other City impact fees. Therefore, Council can review the
implications to the CIL rate of delayed implementation before future adopting potential changes.
CC: Carol Webb, Water Resources & Treatment Operations Manager
DocuSign Envelope ID: C50A4E11-48A7-4837-8EE6-5CDA599A9C9D