08f Annual Adjustment of Sewer Connection FeesMEMORANDUM
TO: CITY COUNCIL
FROM: ANGELA KRAETSCH, DIRECTOR OF ADMINISTRATIVE SERVICE
SUBJECT: CONSIDERATION OF ANNUAL ADJUSTMENT OF SEWER
CONNECTION FEES BASED ON CHANGES IN THE ENGINEERING
NEWS RECORD CONS'rRUCTION COST INDEX
DATE: JANUARY 10,2012
RECOMMENDATION:
It is recommended the City Council adopt the attached Resolution approving the annual
adjustment to the sewer connection fees based on changes in the Engineering News
Record (ENR) Construction Cost lndex (CCI).
IMPACT ON FINANCIAL AND PERSONNEL RESOURCES:
The adoption of the attached Resolution will increase the sewer connection fees
charged for new development projects in 2012. The revenue generated from this
increase is dependent on the amount of new development in the community during the
coming year.
No or minimal future staff time is projected.
BACKGROUND:
Ordinance 528 C.S. amended section 13.12.190 of the Arroyo Grande Municipal 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 set sewer connection fees and requires that the sewer connection fee be adjusted
each January 1 in accordance with the percentage increase based on changes in the
annual average Engineering News Record Construction Cost Index.
ANALYSIS OF ISSUES:
The calculation shown below provides documentation that a 3.05% increase in the ENR
warrants an adjustment in the sewer connection fee.
Overall lndex
ENR Annual Average for 2012 9,070
ENR Annual Average for 201 1 8,802
Change 268
Percent Increase 26818,802 = 3.05%
Agenda Item 8.f.Page 1
CITY COUNCIL
SEWER CONNECTION FEE ADJUSTMENT
JANUARY 10,2012
PAGE 2
Attached to this report is a Resolution to adjust these sewer connection fees and which
delineates the service provided by the City, the current fee charged for that service, the
CCI, and the recommended adjusted fee.
ALTERNATIVES:
The following alternatives are provided for City Council consideration:
Adopt the Resolution adjusting sewer connection fees;
Do not adopt the Resolution and postpone adjustment until July 2012;
Modify staff recommendation;
Provide direction to staff.
ADVANTAGES:
By approving the recommended fees, the City will be able to maximize revenue by
recovering the estimated cost of providing the service.
DISADVANTAGES:
The only disadvantage identified in relation to this recommendation is an increased cost
to new development.
ENVIRONMENTAL REVIEW:
No environmental review is required for this item.
PUBLIC NOTIFICATION AND COMMENTS:
'The Agenda was posted in front of City Hall on Thursday, January 5, 2012. The
Agenda and report were posted on the City's website on Friday, January 6, 2012. No
public comments were received.
Agenda Item 8.f.Page 2
RESOLUTION NO.
A RESOLU'TION OF THE CITY COUNCIL OF THE CITY
OF ARROYO GRANDE ADJUSTING SEWER
CONNECTION FEES BY 'THE CHANGE IN THE
ENGINEERING NEWS RECORD CONSTRUCTION COST
INDEX
WHEREAS, the City Council adopted Ordinance 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 pursuant to the above referenced Ordinance;
and
WHEREAS, Resolution 3567 authorizes an annual adjustment in the sewer connection
fees based on the changes in the annual average Engineering News Record
Construction Cost Index.
NOW, THEREFORE BE IT RESOLVED that the City Council of the City of Arroyo
Grande hereby adopts the sewer connection fees set forth in Exhibit "A" attached hereto
and incorporated herein by this reference as though set forth in full. In accordance with
Government Code Section 66017 this Resolution shall take effect sixty (60) days after
its adoption.
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
of ,2012.
Agenda Item 8.f.Page 3
RESOLUTION NO.
PAGE 2
TONY FERRARA, MAYOR
ATTEST:
KELLY WETMORE, CITY CLERK
APPROVED AS TO CONTENT:
STEVEN ADAMS, CITY MANAGER
APPROVED AS TO FORM:
TIMOTHY J. CARMEL, CITY ATTORNEY
Agenda Item 8.f.Page 4
EXHIBIT A
SEWER CONNECTION FEES
EFFECTIVE 3/9/12
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
ENR Index 7966 831 0 8570 8802 9070
Residential - per dwelling unit
Single Family $ 932 $ 972 $ 1,002 $ 1,029 $ 1,060
Multifamily (a) 690 720 743 763 786
Trailer ParkIMobile Home 764 797 822 844 870
Non-Residential - per water meter size (b)
518 inch $ 932
314 inch 1,396
1 inch 2,331
1 112 inch 4,661
2 inch 7,458
3 inch 13,983
4 inch 23,305
6 inch 46,610
8 inch 93,221
10 inch 139,831
12 inch 205,085
(a) Multifamily includes duplex, triplex, apartments, and condominiums
(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 518 inch meter.
The connection fees shall be increased each January 1 with the annual percentage increase of the
annual average ENR Construction Cost lndex as established in the Engineering News Record
publication.
Adjustment Formula:
Adjusted Fee = (Current Fee) x (Current Year ENR index) I (Prior Year ENR index)
Agenda Item 8.f.Page 5
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Agenda Item 8.f.Page 6