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5.4. ERMUSR 04-10-2012Elk River .~ Municipal Utilities 13069 Orono Parkway • P.O. Box 430 Elk River, MN 55330-0430 UTILITIES COMMISSION MEETING Phone: 763.441.2020 Fax: 763.441.8099 www. elkrivemtili ties. com TO: FROM: Elk River Municipal Utilities Commission Troy Adams, P.E. -Utilities Director John Dietz -Chair Daryl Thompson -Vice Chair Al Nadeau -Trustee MEETING DATE: AGENDA ITEM NUMBER: A ril 10, 2012 5.4 SUBJECT: Payment of Private Water Line Connection and Re air Costs Memorandum of Understandin BACKGROUND: At the April 2 City Council meeting, Council reviewed and adopted: an Ordinance allowing for the assessment of costs associated with private utility line repairs, a Petition, Waiver, Agreement and Policy based on the Ordinance, and a Memorandum of Understanding with Elk River Municipal Utilities regarding Payment of Private Water Line Connection and Repair Costs. DISCUSSION: Over the past months, staff has worked with City staff and Legal Counsel on the development of a tool for City and Utilities staff to assess costs associated with private utility line repairs that are determined necessary to protect the health and safety of the public. The result of the collaboration is a tool that works seamlessly with the Utilities and City to ensure repair work can be completed. ACTION REQUESTED: Staff recommends adopting the Payment of Private Water Line Connection and Repair Costs Memorandum of Understanding with the City of Elk River. ATTACHMENTS: • Ordinance of the City bf Elk River Amending Chapter 78, Article 1 of the Elk River Code of Ordinances to add New Division 1, Providing for the Payment and Assessment of the Costs to Repair Private Utility Lines. • Petition, Waiver, and Agreement for the Payment of the Cost of Repairs to Private Utility Lines and Assessment of Amounts Paid as a Special Charge. • City of Elk River Policy for Payment and Assessment of the Costs to Repair Private Utility Lines. • Payment of Private Water Line Connection and Repair Costs Memorandum of Understanding with the City of Elk River. P~RAYI EE R E R pR 1 1 Y/"~~UR P O W E R E D T O S E R V E ORDINANCE NO. 12-_ CITY OF ELK RIVER AN ORDINANCE OF THE CITY OF ELK RIVER AMENDING CHAPTER 78, ARTICLE I OF THE ELK RIVER CODE OF ORDINANCES TO ADD NEW DIVISION 1, PROVIDING FOR PAYMENT AND ASSESSMENT OF THE COSTS TO REPAIR PRIVATE UTILITY LINES The City Council of the City of Elk River hereby ordains as follows: Section 1. That Chapter 78, Article I of the City of Elk River Code of Ordinances shall be amended to add new Division 1, which shall read as follows: Division 1. Payment and Assessment of Costs to Repair Private Utility Lines. Section 78-1. Findin¢ of Public Health and Safety Hazard. a) The City Council finds that failure to maintain in good, operable condition private water and sanitary sewer utility lines creates public health and safety hazazds on private property which must be eliminated. b) In addition to the provisions of chapter 46, article II of this code, which declazes defective sewage systems and plumbing a nuisance affecting the public's safety and health and authorizes the City to abate such nuisances and to assess the costs therefor to the affected properties, the City Council finds that it is necessazy and in the public interest to provide a mechanism for costs incurred by private property owners to eliminate such public health and safety hazazds on private property to be assessed against the property as a special assessment. Section 78-2. Petition Authorized. Property owners who have private water and/or sanitary sewer lines which have failed, and such failure has been determined by City land development staff to be a public health or safety hazard, may petition the City, on a form provided by the City, to pay the costs to repair the private utility lines and to assess amounts paid as a special charge under Minnesota Statutes, Section 429.101. The City may accept or reject such petitions in its sole discretion, and may impose such conditions and requirements to acceptance as it deems appropriate. Section 78-3. Work to be Completed by Property Owner. If a petition to pay and assess the costs of repair is accepted by the City, installation of the required repairs to private utility lines on private property shall be the responsibility of the PETITION, WAIVER AND AGREEMENT FOR PAYMENT OF THE COST OF REPAIRS TO PRIVATE UTILITY LINES AND ASSESSMENT OF AMOUNTS PAID AS A SPECIAL CHARGE UNDER MINNESOTA STATUTES, SECTION 429.101 TO: City Council of the City of Elk River located at (the Owners), owners of the property Exhibit A attached hereto (the Property), and legally described on Petition the City of Elk River (the City) to pay the costs of certain repairs (the Repairs) to private utility lines located on the Property or in the Right-of--Way directly adjacent to the Property, including: Repair of private water service line(s) currently connected to the City System Repair of private sanitary sewer service line(s) currently connected to the City System In an amount not to exceed that set forth on Exhibit B attached hereto (the Cost of Repairs), And to levy a special assessment against the Property in the amount of the Cost of Repairs as an unpaid special charge pursuant to Minnesota Statutes, Section 429.101. Owners acknowledge and agree: 1) that there has been a failure of the private utility lines on the Property; 2) that the existing services are connected to the public system; 3)that the failure of the utility lines has created a public health and safety hazazd neaz the failure; 4) that the Work identified on Exhibit B is reasonable and necessary to eliminate the public health and safety hazazd on the Property; 5) that the Cost of the Work identified on Exhibit B is reasonable and necessary to affect the Work and is the responsibility of Owners; and 6) that Owners have been provided the opportunity to pay the Cost of the Work without the City's involvement and have elected, instead, to petition the City to pay the Cost of the Work and to assess the full amount of the Cost of the Work to the Property. Owners acknowledge that the City may accept or reject this Petition, Waiver and Agreement in its sole discretion, for any reason, including, but not limited to, the availability of City funds to pay the Costs of the Work and agree, if the City accepts this Petition, Waiver and Agreement: 1) to have the Repairs identified on Exhibit B completed as required by the policies and ordinances of the City; 2) that the Repairs performed shall be privately contracted by the Owners; 3) that the City shall bear no responsibility for or liability related to the performance of the Repairs; 4) that Owners shall hold harmless and indemnify the City from any claims related to the performance of the Repairs; 5) to procure and pay the cost of all permits required for the EXHIBIT A Legal Description CITY OF ELK RIVER POLICY FOR PAYMENT AND ASSESSMENT OF THE COSTS TO REPAIR PRIVATE UTILITY LINES Adopted: Apri12, 2012 The City of Elk River has adopted an ordinance which provides for payment and assessment of the costs to repair private utility lines. As detailed in the ordinance, the following policy has been developed to detail (i) projects eligible for this program; (ii) petitions which may be accepted by the City Administrator; (iii) petitions which may only be accepted by the City Council; (iv) the number of annual installments over which amounts paid and assessed will be levied; and (v) the interest rate applicable to unpaid installments. Policv 1. Eligible Projects Eligible sewer or water service repairs projects include those specific cases that pose a direct risk to public health and safety. These include but aze not limited to the following examples: A) The repair of a leakine sewer or water service that has created a public health, or safety hazazd on the property or to imnrovements within the public right-of--way, or on a neiehboring~roperty. B) The sepazation of a shared sewer or water service line. C) The proper abandoning or disconnection of a sewer or water service line that has been disconnected from a building. D) The reconnection of a private sewer or water service line if modifications to the public mains has caused the property owner to no longer have service in the existing location. Other eligible projects will be considered by the City on an individual basis. All work shall be contracted between the Property owner and their Contractor. The City will reimburse eligible costs in accordance with the terms listed below, but shall not warrant or be involved in any claims that arise from the work. 2. Eligible Project Costs Eligible expenses include costs that are directly related to the repair of said service line and restoration of disturbed areas that have resulted from the construction. Expenses related to plumbing on the interior of a building will only be covered if the plumbing work is required to facilitate proper repair with the external sewer or water service line work. MEMORANDUM OF UNDERSTANDING BETWEEN ELK RIVER MUNICIPAL UTILITIES AND THE CITY OF ELK RIVER, MINNESOTA REGARDING PAYMENT OF PRIVATE WATER LINE CONNECTION AND REPAIR COSTS This MEMORANDUM OF UNDERSTANDING, hereinafter refen•ed to as "MOU", is hereby made and entered into on this day of , 2012, by and between the City of Elk River, Minnesota, hereinafter referred to as the "City" and Elk River Municipal Utilities, hereinafter referred to as the "Utilities". 1.0 Purpose The purpose of this MOU is to address the payment of costs for the connection and repair of private water lines within the City of Elk River, Minnesota. 2.0 Connection and Repair of Private Water Lines The City Council of the City of Elk River has adopted an ordinance which provides for payment by the city and assessment to the property owner of the costs to connect and repair private utility lines. This ordinance authorizes private property owners who are required to connect to the city water utility, or who have private water lines which have failed, to petition the City to pay the costs of connection or repair of the private water line and to assess amounts paid by the City as a special charge to the owner's property. The ordinance further provides that the City Council will establish policies regazding when and on what terms the costs to connect or repair private water lines will be eligible for payment and assessment. 3.0 Payment and Reimbursement of Elk River Municipal Utilities The City and Utilities agree that when payment of the costs to connect or repair private water lines has been approved pursuant to the City Code and the City Council policies, payment of the approved costs will be made by Utilities, the City will assess the costs paid by Utilities to the property, and the City will reimburse Utilities for the costs paid as the special assessments aze paid. City and Utilities staff aze directed to coordinate and adopt appropriate procedures to implement this payment and reimbursement process. 4.0 Termination of MOU This MOU may be cancelled or terminated without cause by either party by giving (30) calendar days advance written notice to the other party. Such notification shall state the effective date of termination or cancellation. Any and all amendments must be made in writing and must be agreed to and executed by the parties before becoming effective. Cancellation of this MOU shall not affect the parties rights and responsibilities regazding payments already approved and made by Utilities.