8.7 SR 08-05-2013 City of
EW REQUEST FOR ACTION
River
TO ITEM NUMBER
Mayor and City Council 8.7
AGENDA SECTION MEETING DATE PREPARED BY
General Business June 3, 2013 Jeremy Barnhart,Deputy Director,
COD
ITEM DESCRIPTION REVIEWED By
Service Availability Charge (SAC) Deferment Policy Cal Portner, City Administrator
REVIEWED BY
ACTION REQUESTED
Approve by motion an amendment to the policy pertaining to payment and assessment of the costs to
connect and repair private utility lines.
BACKGROUND/DISCUSSION
In December 2012, the Council approved a policy and supporting ordinance that allowed for the payment
of costs and connection charges associated with private lines over time,via the MN Stat. 429 assessment
process. The policy established a maximum term of 10 years.
In June 2013, the Council agreed to allow this policy to apply to the payment of connection charges only,
at the request of Natures Dry Cleaning. On July 15,2013, the Council approved a petition written for
Natures Dry Cleaning that outlined a 5-tyear payback. Nature's Dry Cleaning requests a term of at least 7
years.
After review of the policy,it is staff's recommendation to expand the policy to incorporate criteria and
framework for the connection charge issue.
The policy establishes criteria where connection charges could be financed (single-family residential,
unique service or industry,redevelopment, or a doubling of SAC units). Further, the revised policy
establishes a table for the payment term for non-single-family uses: $25,000 to $50,000 up to 3 years,
$50,001 to $100,000 up to 7 years, and $100,001 to $150,000 up to 10 years.
The ordinance effectively sunsets on December 31,2015, at which time the Council could determine
whether an extension is appropriate.
FINANCIAL IMPACT
None
ATTACHMENTS
• Existing ordinance
• Sample petition
• Draft policy
POWERED By
A IR
ORDINANCE NO. 12-
CITY OF ELK RIVER
AN ORDINANCE OF THE CITY OF ELK RIVER AMENDING CHAPTER 78,
ARTICLE I, DIVISION 1 OF THE ELK RIVER CODE OF ORDINANCES, WHICH
PROVIDES FOR PAYMENT AND ASSESSMENT OF THE COSTS TO CONNECT
AND REPAIR PRIVATE UTILITY LINES
The City Council of the City of Elk River hereby ordains as follows:
Section 1. That Chapter 78, Article I, Division 1 of the City of Ells River Code of Ordinances
shall be amended to read as follows:
Division 1.
Payment and Assessment of Costs to Connect or Repair Private Utility Lines.
Section 78-1. Finding of Public Health and Safety Hazard.
a) The City Council finds that failure to connect to the city water system as required by
section 78-21 of this code, failure to connect to the city sewer and sewage disposal
system as required by section 78-97(d) of this code, and failure to maintain in good,
operable condition private water and sanitary sewer utility lines, creates public health and
safety hazards on private property which must be eliminated.
b) In addition to the provisions of section 78-22 and section 78-97(d), which authorize the
city to make connections to the city water and sanitary sewer systems and to assess the
costs therefore to the affected property, and the provisions of chapter 46, article II of this
code, which declares 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 necessary and
in the public interest to provide a mechanism for costs incurred by private property
owners to eliminate such public health and safety hazards on private property to be
assessed against the property as a special assessment.
Section 78-2. Petition Authorized.
Property owners who are required to connect to the city water and/or sanitary sewer
system pursuant to section 78-21 and section 78-97(d) of this code, or 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 connect (including any outstanding lateral/trunk
assessments and applicable water and sewer connection charges) or 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 connection or repair is accepted by the City,
installation of the required connections and/or repairs to private utility lines on private property
shall be the responsibility of the property owner, shall be contracted for by the property owner,
shall be completed by the property owner as required by the policies and ordinances of the City
of Elk River and Elk River Municipal Utilities, and shall be inspected and accepted by the city
building official before payment of costs is made.
Section 78-4. Payment and Assessment of Costs Authorized.
a) Upon completion and acceptance by the City of all work required, the City will make
payment to the party or parties who performed the work in an amount not to exceed
that set forth in the petition accepted by the City. Such payment by the City, and all
other outstanding fees and charges required for connection to the public systems,
shall constitute a special charge against the affected property pursuant to Minnesota
Statutes, Section 429.101 and shall be specially assessed against the property by the
City pursuant to the provisions of Minnesota Statutes, Section 429.101. Special
assessments levied under this Section shall be payable in a single installment, or by
up to 10 equal annual installments, as provided by the City Council.
b) The City Council shall establish, and may amend from time to time, policies
regarding: (1)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.
Section 78-5. Sunset on Payment and Assessment for Connections.
Petitions to pay and assess the costs of connection to the City water system and the City
sewer and sewage disposal system will not be accepted by the City for any connection
project which is completed after December 31, 2015.
Section 2. That this Ordinance shall be published and take effect as provided by law.
Passed and adopted by the City Council of the City of Ells River this day of , 2012.
John J. Dietz
Mayor
Attest:
Tina Allard
City Clerk
PETITION, WAIVER AND AGREEMENT FOR PAYMENT OF THE COST OF
INSTALLATION AND CONNECTION OF, OR 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 Ells River
(the Owners), owners of the property
located at and legally described on
Exhibit A attached hereto (the Property),
Petition the City of Ells River (the City) to pay the costs of installation and connection of, or
Repairs to, (the Work)private utility lines located on the Property or in the Right-of-Way
directly adjacent to the Property, including:
Installation and connection of private water service lines
Installation and connection of private sanitary sewer service lines
Repair of private water service lines
Repair of private sanitary sewer service lines
Connection charges only
In an amount not to exceed that set forth on Exhibit B attached hereto (Cost of the Work); and,
To levy a special assessment against the Property as an unpaid special charge pursuant to
Minnesota Statutes, Section 429.101 in the amount of the Cost of Work plus the total of the
following charges (if Applicable):.
Cost of the Work(from Exhibit B)
Sewer Access Charge (fill in current year fee)
Water Access Charge (fill in current year fee)
Trunk/Lateral Charges (to be determined based on
costs to provide services)
TOTAL ASSESSMENT AMOUNT
(Sum of all listed amounts)
Owners acknowledge and agree:
Installation and connection: 1) that the Property is required to be connected to
the City water and/or sanitary sewer systems; 2) that the Property is not connected to the public
water and/or sanitary sewer services as required; 3) that the Work identified on Exhibit B is
reasonable and necessary to connect the Property to the City water and/or sanitary sewer system;
4) 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 5) 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.
Repairs: 1) that there has been a failure of the utility lines on the Property;
2) that the failure of the utility lines has created a public health and safety hazard on the
Property; 3) that the Work identified on Exhibit B is reasonable and necessary to eliminate the
public health and safety hazard on the Property; 4) 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
5) 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 Work identified on Exhibit B completed as required by the policies
and ordinances of the City; 2) that the Work 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 Work; 4) that Owners shall hold harmless and indemnify the City from any claims related to
the performance of the Work; 5) to procure and pay the cost of all permits required for the work;
6) to submit evidence to the City that the Work has been inspected and accepted by the City
Building Official; 7) that, upon completion and acceptance of the Work, City shall make
payment to the Owner's contractor or other parties who performed the Work in an amount not to
exceed the Cost of the Work identified on Exhibit B; 8) that payment by the City of the Cost of
the Work shall create an unpaid special charge against the Property; 9) that this unpaid special
charge shall be specially assessed against the Property by the City pursuant to Minnesota
Statutes, Section 429.101; and 10) that the special assessment shall be payable in equal
annual installments with interest accruing on unpaid installments at the rate of %.
Owners expressly waive the right to a hearing on assessments levied pursuant to this
petition; expressly waive objection to any irregularity with regard to the assessment of the
Property for the Cost of the Work; expressly agree that the amount assessed is reasonable;
expressly waive any claim that the amount assessed is excessive; expressly waive all rights of
appeal, including any rights under Chapter 429, Minnesota Statutes, from the assessment by the
City of the Cost of the Work; and expressly agree to pay when due all assessments levied for the
Cost of the Work.
Owners represent and warrant that they are the sole fee Owners of the Property; agree to
make payment of all assessments levied pursuant to this Petition, Waiver and Agreement for
Payment of the Cost of the Work; agree that they shall be personally liable for payments not
made; agree that this Agreement shall be binding on Owners and Owner's successors and
assigns; agree that all assessments levied pursuant to this Petition shall be paid in full prior to or
at the time of transfer of the Property to a subsequent owner; agree that this Agreement may be
recorded against the title to the Property; and agree that any unpaid or outstanding trunk utility
assessments already levied against the Property shall remain in effect and will not be rolled into
the assessments authorized by this Petition, Waiver and Agreement.
Dated this day of , 20
OWNER
By:
Its:
For Office Use
Application Approved:
By:
Date:
Permit No(s):
Work completed on:
Approved for Final Payment:
By:
Date:
EXHIBIT A
Legal Description
EXHIBIT B
Work:
Cost of the Work:
CITY OF ELK RIVER POLICY FOR PAYMENT AND ASSESSMENT OF
THE COSTS TO CONNECT AND REPAIR PRIVATE UTILITY LINES
Adopted:
The City of Ells River has adopted an ordinance which provides for payment and assessment of
costs to install and connect or repair private utility lines. This ordinance also allows for the
payment and assessment of connection charges. 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.
Policy
1. Eligible Projects
Eligible projects include but are not limited to the following:
A) The connection of an existing building to an existing public sanitary and water line(s).
Properties that have both sewer and water service available are required to connect to
both utilities at the same time.
B) The repair of a leaking sewer or water service that has created a public health or
safety hazard on the Property or to improvements within the public right-of-way or on
a neighboring property.
C) The separation of a shared sewer or water service line.
D) The proper abandoning or disconnection of a sewer or water service line that has been
disconnected from a building.
E) 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.
F) Water and Sewer connection and availability charges associated with a project that
meets at least one of the following criteria:
a. single family residential
b. service or industry unique to the City
c. Redevelopment or vacant property
d. Increase of SAC/ WAC units that doubles the number of SAC and WAC units
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 connection or repair of said
service line. This includes the following:
Installation of required pipes and connection to the service stubs
Restoration of disturbed areas
Interior plumbing to facilitate proper connection to the external sewer or water
service line
Abandoning and sealing of existing wells and septic systems
Sewer Access Charge and Water Access Charge (SAC and WAC) for initial
connections or change in use only.
3. Initiation of Project
Projects shall be initiated by the submission of a Petition, Waiver and Agreement, on a
form supplied by the City, which has been signed by the Property Owner.
Eligible Project Costs shall be detailed on Exhibit B of the signed Petition, Waiver and
Agreement and approved by City Staff or the City Council prior to any work being
completed. Any expenses that are determined, by City staff or the City Council, that are
not required to facilitate the service connection or repair, will be deducted from the
requested amount.
All permit fees and any escrow money required by said permits will not be eligible for
reimbursement.
4. Approval and Terms of the Assessment
Petitions for residential uses shall be limited to a minimum request of$3,000 and a
maximum request of$40,000. Petitions for all other uses shall be limited to a minimum
request of$25,000 and a maximum request of$150,000. The City Administrator shall
have the authority to approve all petitions up to $20,000. Those petitions above $20,000
will require the approval of the City Council.
All qualified expenses, reimbursed by the City, will be levied as a special assessment
against the property, pursuant to the Petition, at the current bonding interest rate available
to the City plus a 1.5% administrative fee. The final rate will be determined at the time
of improvement. The term of the assessment will be as follows:
Single Family Residential $3,000 to $5,000 Up to 3-years
Single Family Residential $5,001 to $10,000 Up to 5-years
Single Family Residential $10,001 to Max Up to 15-years
All Other Properties $25,000 to 50,000 Up to 3-years
All Other Properties $50,001 to 100,000 Up to 7-years
All Other Properties $100,001 to 150,000 Up to 10-years
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[S 0
CITY OF ELK RIVER POLICY FOR PAYMENT AND ASSESSMENT OF
THE COSTS TO CONNECT AND REPAIR PRIVATE UTILITY LINES
Adopted:, (Deleted:December 10,2012
The City of Elk River has adopted an ordinance which provides for payment and assessment of
costs to install and connect or repair private utility lines.This ordinance also allows for the
payment and assessment of connection charges. 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.
Policy
1. Eligible Projects
Eligible projects include but are not limited to the following:
A) The connection of an existing building to an existing public sanitary and water line(s).
Properties that have both sewer and water service available are required to connect to
both utilities at the same time,
B) The repair of a leaking sewer or water service that has created a public health or
safety hazard on the Property or to improvements within the public right-of-way or on
a neighboring property.
C) The separation of a shared sewer or water service line.
D) The proper abandoning or disconnection of a sewer or water service line that has been
disconnected from a building.
F,) 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.
F) Water and Sewer connection and availability charges associated with a project that Deleted:Connection charges associated with a
meets at least one of the following criteria: change in use,to include,but are not limited to
a.single family residential Sewer Availability Charges and Water
g y Availability Charges,associated with a project
b.service of industry unique to the City that meets at least one of the criteria outlined in
paragraph 3 below.a.service or industry unique to
c.Redevelopment or vacant property the City¶
d.Increase of SAC/WAC units that doubles the number of SAC and WAC units b.Redevelopment or vacant property¶
c.Substantial increase of SAC/WAC units.
Substantial in this case means a percentage
Other eligible projects will be considered by the City on an individual basis, increase of 100%or greater. ¶
Moved(insertion)[1]
All work shall be contracted between the Property owner and their Contractor. The City (Formatted:Normal,Indent:Left: 1", No l
will reimburse eligible costs in accordance with the terms listed below,but shall not l bullets or numbering J
warrant or be involved in any claims that arise from the work, f Formatted:Indent:Left: 0.75 No bullets or l
l numbering J
-- .._.....-....—.......-_.......
2. Eligible Project Costs Deleted: ¶
Eligible expenses include costs that are directly related to the connection or repair of said
service line. This includes the following:
Installation of required pipes and connection to the service stubs
Restoration of disturbed areas
Interior plumbing to facilitate proper connection to the external sewer or water
service line
Abandoning and sealing of existing wells and septic systems
Sewer Access Charge and Water Access Charge(SAC and WAC)for initial
connections or change in use only.
Moved up[I]:a.service or industry unique to
3. Initiation of Project b.Redevelopment or vacant properly¶
c.Substantial increase cf S AC/WAC units.
Substantial in this case means a percentage
Projects shall be initiated by the submission of a Petition,Waiver and Agreement,on a increaseof 100%orgreater. ¶
9
form supplied by the City,which has been signed by the Property Owner. Deleted:<#>EligibleProjects¶
Eligible Project Costs shall be detailed on Exhibit B of the signed Petition,Waiver and Eligible Projects shall include a$
a.service or industry unique to the City¶
Agreement and approved by City Staff or the City Council prior to any work being b.Redevelopment or vacant property¶
completed. Any expenses that are determined,by City staff or the City Council,that are c.Substantial in this case means a percentage Substantial increase of SAC/WAC units,
not required to facilitate the service connection or repair,will be deducted from the increase of 100%or greater. ¶
requested amount. tI
All permit fees and any escrow money required by said permits will not be eligible for _
reimbursement,,- .. _ _- - .._ - {—Deleted:
4. Approval and Terms of the Assessment
Petitions for residential uses shall be limited to a minimum request of$3,000 and a
maximum request of$40,000. Petitions for all other uses shall be limited to a minimum
request of$25.000 and a maximum request of$150,000. The City Administrator shall Deleted:10
have the authority to approve all petitions up to$20,,,000. Those petitions above$20,000 Deleted:5
will require the approval of the City Council. { Deletes:5
All qualified expenses,reimbursed by the City,will be levied as a special assessment
against the property,pursuant to the Petition,at the current bonding interest rate available
to the City plus a 1.5%administrative fee. The final rate will be determined at the time
of improvement. The term of the assessment will be as follows:
Single Family Residential $3,000 to$5,000 Up to 3-years
Single Family Residential $5,001 to$10,000 Up to 5-years
Single Family Residential $10,001 to Max Up to 15-years -Deleted: 10 1
All Other Properties $�5,D000 to, 0,000 Up to 3-years ( Deleted:3
All Other Properties $50,001 to 100,000 Up to 7-years Deleted:Max
All Other Properties $100,001 to 150,000 Up to 10-years D
Deleted:
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