HomeMy WebLinkAboutCC 2025-01-28_09c Adjustment of Sewer Connection FeesItem 9.c.
MEMORANDUM
TO: City Council
FROM: Nicole Valentine, Director of Administrative Services
SUBJECT: Annual Adjustment of Sewer Connection Fees
DATE: January 28, 2025
RECOMMENDATION:
1) Adopt a Resolution approving the annual adjustment of Sewer Connection Fees to
increase fees by 1.6%, consistent with the Engineering News Record (ENR) Construction
Cost Index (CCI); and
2) Make findings as included in the attached Resolution that establishing sewer
connection fees are not a project subject to the California Environmental Quality Act
(“CEQA”) because the action has no potential to result in either a direct, or reasonably
foreseeable indirect, physical change in the environment. (State CEQA Guidelines, §§
15060, subd. (c)(2)-(3), 15378.).
IMPACT ON FINANCIAL AND PERSONNEL RESOURCES:
Adoption of the Resolution will increase the Sewer Connection Fees charged for new
sewer connections, effective February 18, 2025. The revenue generated from this
adjustment is dependent on the amount of new sewer connections in the community
during the coming year.
BACKGROUND:
Ordinance 528 C.S. amended Section 13.12.190 of the Arroyo Grande Mu nicipal Code
to provide that, for each connection of a building to a public sewer, a connection fee will
be charged and that the amount of the fee shall be set by resolution. Resolution No. 3567
authorized that the sewer connection fees be adjusted each ye ar in accordance with the
percentage increase in the annual average ENR CCI.
The previous rate increase of 2.7% was approved by the City Council on January 23,
2024, and became effective on March 25, 2024.
ANALYSIS OF ISSUES:
Sewer Connection Fees, enacted pursuant to Section 13.12.190 of the City Municipal
Code, are collected to help pay for improvements and future sewer system capacity as
necessary to meet the needs of the City resulting from growth and expansion.
Page 70 of 462
Item 9.c.
City Council
Annual Adjustment of Sewer Connection Fees
January 28, 2025
Page 2
The calculation shown below provides documentation that the ENR CCI warrants a 1.6%
increase in the City’s Sewer Connection Fees.
The calculation adjusts the fees as follows:
1 + Current Index – Base Index for Date of Adoption = Factor
Base Index for Date of Adoption
For the current year, the calculation is as follows:
1 + 13,571 – 13,358 = 1.016 = 1.6%
13,358
The existing and proposed fees implementing a 1.6% ENR CCI increase are set forth in
Exhibit A to the attached Resolution. If approved, the effective date of the new fees will
be February 18, 2025.
ALTERNATIVES:
The following alternatives are provided for the Council’s consideration:
1. Adopt a Resolution approving the annual adjustment of Sewer Connection Fees
to increase fees by 1.6%, consistent with the Engineering News Record (ENR)
Construction Cost Index (CCI); and Make findings as included in the attached
Resolution that establishing sewer connection fees are not a project subject to the
California Environmental Quality Act (“CEQA”) because the action has no potential
to result in either a direct, or reasonably foreseeable indirect, physical change in
the environment. (State CEQA Guidelines, §§ 15060, s ubd. (c)(2)-(3), 15378.);
2. Do not adopt the Resolution and request further information; or
3. Provide other direction to staff.
ADVANTAGES:
By implementing the previously authorized adjustments, the City will be able to recover
the estimated cost of providing infrastructure and services to new sewer connections.
DISADVANTAGES:
The disadvantage identified in relation to this recommendation is an increased cost to
new sewer connections.
ENVIRONMENTAL REVIEW:
Adopting the Resolution establishing sewer connection fees are not a project subject to
the California Environmental Quality Act (“CEQA”) because the action has no potential to
result in either a direct, or reasonably foreseeable indirect, physical change in the
environment. (State CEQA Guidelines, §§ 15060, subd. (c)(2)-(3), 15378.).
Page 71 of 462
Item 9.c.
City Council
Annual Adjustment of Sewer Connection Fees
January 28, 2025
Page 3
PUBLIC NOTIFICATION AND COMMENTS:
The Agenda was posted at City Hall and on the City’s website in accordance with
Government Code Section 54954.2.
ATTACHMENTS:
1. Proposed Resolution
Page 72 of 462
ATTACHMENT 1
RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF ARROYO GRANDE APPROVING THE ANNUAL
ADJUSTMENT OF SEWER CONNECTION FEES TO
INCREASE FEES BY 1.6% CONSISTENT WITH THE
ENGINEERING NEWS RECORD CONSTRUCTION COST
INDEX
WHEREAS, the City Council adopted Ordinance No. 528 C.S. amending Section
13.12.190 of the Municipal Code regarding sewer connection fees; and
WHEREAS, pursuant to Section 13.12.190, the City Council may by Resolution
establish the amount of the sewer connection fees; and
WHEREAS, Resolution No. 4507 authorizes an annual adjustment in the sewer
connection fees based on the changes in the annual average Engineering News Record
(ENR) Construction Cost Index (CCI).
WHEREAS, it is determined that an increase of 1.6% of the ENR CCI has been
calculated to warrant an adjustment to the City sewer connection fees, effective
February 18, 2025.
NOW, THEREFORE BE IT RESOLVED that the City Council of the City of Arroyo
Grande hereby implements the CCI increase to the sewer connection fees set forth in
Exhibit “A” attached hereto and incorporated herein by this reference as though set forth
in full. The adjusted sewer connection fees shall take effect on February 18, 2025.
On motion of Council Member , seconded by Council Member
, and on the following roll call vote, to wit:
AYES:
NOES:
ABSENT:
The foregoing Resolution was passed and adopted this 28th day of January, 2025.
Page 73 of 462
RESOLUTION NO.
PAGE 2
CAREN RAY RUSSOM, MAYOR
ATTEST:
JESSICA MATSON, CITY CLERK
APPROVED AS TO CONTENT:
MATTHEW DOWNING, CITY MANAGER
APPROVED AS TO FORM:
ISAAC ROSEN, CITY ATTORNEY
Page 74 of 462
RESOLUTION NO.
PAGE 3
2021 2022 2023 2024 2025
ENR Index 11455 12133 13007 13358 13358
Residential - per dwelling unit
Single Family 1,445$ 1,530$ 1,640$ 1,667$ 1,693$
Multifamily (a)1,071 1,135 1,216 1,236 1,256
Trailer Park/Mobile Home 1,185 1,255 1,346 1,367 1,389
Non-Residential - per water meter size (b)
5/8 inch 1,445$ 1,530$ 1,640$ 1,667$ 1,693$
3/4 inch 2,166 2,295 2,460 2,499 2,539
1 inch 3,615 3,829 4,105 4,171 4,238
1 1/2 inch 7,231 7,659 8,210 8,342 8,475
2 inch 11,569 12,254 13,137 13,347 13,560
3 inch 21,694 22,978 24,633 25,027 25,427
4 inch 36,157 38,298 41,055 41,712 42,379
6 inch 72,313 76,594 82,108 83,422 84,757
8 inch 144,627 153,189 164,219 166,846 169,516
10 inch 216,940 229,783 246,327 250,268 254,272
12 inch 318,177 337,014 361,278 367,059 372,932
(a) Multifamily includes duplex, triplex, apartments, and condominiums
Adjustment Formula:
Adjusted Fee = (Current Fee) x (Current Year ENR index) / (Prior Year ENR index)
Adjusted Fee = (Current Fee) x (13571) / (13358)
The connection fees shall be increased each year with the annual percentage increase of the
annual average ENR Construction Cost Index as established in the Engineering News Record
EXHIBIT A
SEWER CONNECTION FEES
EFFECTIVE 2/18/2025
For each connection of a building sewer to a public sewer, a connection fee shall be collected
by the City before the permit for the connection work is issued. The amount of the fee
collected is as follows:
Connection Fee
(b) For meter sizes larger than shown, connection fee determined based on the ratio of the
maximum safe operating capacity of the meter to that of a 5/8 inch meter.
Page 75 of 462