5.5. ERMUSR 05-10-2011MEMORANDUM
TO: Elk River Municipal Utilities Commission
FROM: Catherine Mehelich, Director of Economic Development
DATE: May 10, 201 I
SUBJECT: Review and Consider Policy for Water Access Charge Payment
Program
Attachment
• DRAFT Policy for Water Access Charge Payment Program
City Staff has recently been receiving concern from new restaurants regarding the financial
impact of the WAC and SAC fees issued at the time of the building permit. City Staff would
like to discuss the attached draft policy with the Commission at its regular meeting. The
program was modeled after the City of Brooklyn Park which offers the financing program as
an incentive fox new or expanding full-service restaurants. The program allows the
restaurant to pay the Water Access Charge fee over time through their utility bill versus at
die time the building permit is issued. Attorney Peter Beck has reviewed the draft policy and
will provide any comments at the meeting. City Staff proposes that the City Council
consider a similar policy for a Sewer Access Charge Payment Program.
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mcmo.doc
POLICY
Elk River Municipal Utilities
Water Access Charge Payment Program
In order to minimize the impact of the payment of the Water Access Charge (WAC) to new
or expanding full service restaurant businesses within the City of Elk River, the Elk River
Municipal Utilities will provide a loan option to pay the Water Access Charge fee over time
versus at the time the building permit is issued.
Payments will be billed and paid quarterly in conjunction with the user's water bill. The
interest rate applied to the loan will be fixed to the Elk River Municipal Utilities investment
rate at the time of the loan. Loans with a repayment schedule of 3 years or less will be
charged an interest rate equal to the Elk River Municipal Utilities investment rate. Those
with a repayment schedule greater than 3 years will be charged an interest rate of 1% above
the Elk River Municipal Utilities investment rate, with no repayment schedule to exceed 5
years.
Participants in the program need to be individually metered occupants and the m;n;mum
WAC fee to utilize this program is $5,000, with a max;mum loan amount being $50,000.
Loans will be secured by a Promissory Note executed by both the property owner and
business pledging to repay the Note. The Note is also secured by the Elk River Municipal
Utilities' abilityto file a lien against the propenyin the form of a special assessment for
repayment of the WAC.