City Council Agenda and Packet 2019 11 25 SP

Home Browse Search

SUBJECT: WATER TAP FEE CALCULATION AND APPROVAL PROCESS DATE: NOVEMBER 25, 2019 PAGE2OF3 How Water Tap Fees are Calculated under Chapter 13.12 • From LMC § 13.12.040.A.3: "Tap fees shall be based on and used for growth related capital expansion costs for water resources, water supply, water storage, transmission, treatment and distribution facilities, related costs and factors" "The tap fees shall reflect the City's overall costs incurred to provide services for which the tap is requested and for which the tap fee is designed." • So when the cost of one of those factors, such as the water resource (in this case CBT), sharply rises, this will cause a sharp rise in the tap fee • Tap fees are paid by new users on the system, so the tap fee must reflect the rising cost of the water resource in order to properly account for the City's overall costs incurred to provide water service to these new users as required by the Code. City Council Options • Take no action. Water tap fees set by the City Manager will go into effect as set forth in the current table on page 9 of 11 of Fees Established by City Manager and will become effective three months from the date of approval. • Pursuant to Section 13.12.040.A.4 of the LMC, City Council may by resolution call up a current table of tap fees adopted by the City Manager and require adjustments that are consistent with Chapter 13.12 o These changes would remain effective for the balance of the calendar quarter • City Council could amend Section 13.12.040 to change how tap fees are established The City Manager has been establishing water tap fees for almost 20 years. The methodology for the calculation changed in 2013/2014, however the fee established by the City Manager has always been "based on and used for growth related capital expansion costs of water supply, water storage, transmission, treatment and distribution facilities, related costs and factors." (see Section 3 of Ordinance No. 1339, Series 2000 — this language is the same as in current 13.12.040.A.3). FISCAL IMPACT: The tap fees impact help support the City's cost to purchase water, as well as the costs associated with water facilities and capital projects, such as pipes, water treatment, water storage, and water pumping. PROGRAM/SUB-PROGRAM IMPACT: This item impacts the Utilities program area, Water sub -program. Tap fees help the city fulfill the goal of ensuring safe, reliable, great tasting water. CITY COUNCIL COMMUNICATION 3