CC 2020-01-28_08d Annual Adjustment of Sewer Connection FeesMEMORANDUM
TO: CITY COUNCIL
FROM: NICOLE VALENTINE, ACCOUNTING MANAGER
SUBJECT: CONSIDERATION OF ADJUSTMENT OF SEWER CONNECTION FEES
BASED ON CHANGES IN THE ENGINEERING NEWS RECORD
CONSTRUCTION COST INDEX
DATE: JANUARY 28, 2020
SUMMARY OF ACTION:
Adoption of a Resolution approving the annual adjustment of Sewer Connection Fees.
IMPACT ON FINANCIAL AND PERSONNEL RESOURCES:
The adoption of the Resolution will adjust the Sewer Connection Fees charged for new
development projects for 2020. The revenue generated from this adjustment is dependent
on the amount of new development in the community during the coming year.
RECOMMENDATION:
It is recommended the City Council adopt a Resolution approving an adjustment to the
City’s Sewer Connection Fees based on changes in the Engineering News Record (ENR)
Construction Cost Index (CCI).
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.
4507 set sewer connection fees for 2013 and authorized that the sewer connection fees
be adjusted each year in accordance with the percentage increase based on changes in
the annual average Engineering News Record Construction Cost Index.
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.
The calculation shown below provides documentation that a 1.98% increase in the ENR
CCI warrants an adjustment in the City’s Sewer Connection Fees.
Item 8.d. - Page 1
CITY COUNCIL
CONSIDERATION OF ADJUSTMENT OF SEWER CONNECTION FEES
JANUARY 28, 2020
PAGE 2
The calculation adjusts the fees as follows:
Factor = 1 + Current Index – Base Index for Date of Adoption
Base Index for Date of Adoption
The calculation is as follows:
1.0198 = 1 + 11,281 – 11,062
11,062
ALTERNATIVES:
The following alternatives are provided for City Council consideration:
1. Adopt the Resolution;
2. Do not adopt the Resolution and request further information; or
3. Provide direction to staff.
ADVANTAGES:
By approving the recommended fees, the City will be able to recover the estimated cost
of providing services to new development.
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 at City Hall and on the City’s website in accordance with
Government Code Section 54954.2.
Item 8.d. - Page 2
RESOLUTION NO.
A RESOLUTION 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 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
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 28th day of January, 2020.
Item 8.d. - Page 3
RESOLUTION NO.
PAGE 2
CAREN RAY RUSSOM, MAYOR
ATTEST:
KELLY WETMORE, CITY CLERK
APPROVED AS TO CONTENT:
JAMES A. BERMAN, CITY MANAGER
APPROVED AS TO FORM:
TIMOTHY J. CARMEL, CITY ATTORNEY
Item 8.d. - Page 4
2011 2012 2013-2019 2019 2020
ENR Index 8802 9070 9308 11062 11281
Residential - per dwelling unit
Single Family 1,029$ 1,056$ 1,084$ 1,288$ 1,313$
Multifamily (a)763 783 804 955 974
Trailer Park/Mobile Home 844 866 889 1,056 1,077
Non-Residential - per water meter size (b)
5/8 inch 1,029$ 1,056$ 1,084$ 1,288$ 1,313$
3/4 inch 1,543 1,583 1,625 1,931 1,969
1 inch 2,575 2,642 2,712 3,223 3,286
1 1/2 inch 5,150 5,285 5,423 6,445 6,573
2 inch 8,240 8,456 8,677 10,312 10,516
3 inch 15,451 15,856 16,271 19,337 19,720
4 inch 25,752 26,427 27,119 32,228 32,866
6 inch 51,503 52,852 54,237 64,455 65,732
8 inch 103,007 105,706 108,475 128,912 131,464
10 inch 154,510 158,558 162,712 193,367 197,196
12 inch 226,614 232,551 238,644 283,605 289,220
(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 (11,281) / (11,062)
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:
SEWER CONNECTION FEES
EFFECTIVE 03/30/2020
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.
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 publication.
EXHIBIT A
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