The URL can be used to link to this page

Home My WebLink About10.B.1. Residential Sewer Availability Charge Credit Policy-Res. No. 7213 /0. ( /. CITY OF SHAKOPEE Memorandum TO: Mayor and City Council Mark McNeill, City Administrator FROM: Bruce Loney, Public Works Director Julie A. Linnihan, Finance Director SUBJECT: Residential Sewer Availability Charge (SAC) Credit Policy DATE: July 2, 2012 Comment: Introduction: The City Council directed staff to prepare and present a policy to guide the use of Sewer Availability Charges (SAC). These credits specific to residential policy are available to the City as a result of Rahr Malting coming off the Metropolitan Council - Environmental Services (MCES). Attached is the draft residential SAC credit policy for Council review and discussion. Background: The City has been the recipient of a sum of SAC credits that may allow for economic development use specific to the enhancement or development of underdeveloped or non- developed land. This policy may provide a basis for decision making that will follow the guidance and recommendations for consistent application of the use of credits. As you may recall, this draft policy was presented to the EDAC in February, 2012, was discussed and approved for presentation to the City Council. City staff continues to review and discuss this policy after EDAC and Council review. This will further refine the specific steps that will be followed, pending a request for the use of existing SAC credits. The request for use of SAC credits is applicable to the existing business sector, as well as new commercial ventures. As the City considers application for the use of the remaining SAC credits, staff will bring forward each request for discussion and approval. Similar to the previous policy, the City Council adopted Resolution 7184 adopting a SAC credit policy and for commercial and industrial properties. The City Council then requested a policy to provide SAC credits to residential properties. Staff has reviewed the number of Residential Individual Sewage Treatment Systems (ISTS) in the City and their location. The total number of ISTS is over 750 which results in a potential use greater than SAC credit units available. Staff has identified 29 residential ISTS within the existing Municipal Urban Service Area (MUSA) as shown on the attached map. Also, there are 79 ISTS with 500 feet of Dean Lake and O'Dowd Lake, outside of the MUSA. Staff believes these two areas would be the areas of environmental concern because of the two lakes previously mentioned. The ISTS in MUSA are located near existing sanitary sewers. Note that the existing sewer system is not currently extended to the Dean Lake or O'Dowd Lake areas. Alternatives: 1. Discuss the draft Residential SAC Credit Policy and provide staff direction. 2. Table for more information. Recommendation: Staff recommends alternative no. 1, discuss the draft Residential SAC Credit Policy and provide staff direction and comments for a final adoption. Action Required: Alternative No. 1, discuss the Draft Residential SAC Credit Policy and provide staff direction. Bruce Loney Public Works Director RESOLUTION NO. 7213 A RESOLUTION ADOPTING A RESIDENTIAL SEWER AVAILABILITY CHARGE (SAC) CREDIT POLICY WHEREAS, the City of Shakopee has been the recipient of a sum of Sewer Availability Charge (SAC) credit that may provide a financial incentive tool specific to the connection of properties to the City's sanitary sewer in order to protect the environment; and, WHEREAS, Sewer Availability Charge credits will be available to existing residential properties within the existing MUSA of the community and within 500 feet of O'Dowd and Dean Lake; and, WHEREAS, a Sewer Availability Charge Credit Policy will provide a basis for decision making that will follow the guidance and recommendations for consistent application of these credits; and, WHEREAS, City staff will continue to monitor and appraise the City Council as to the status of the existing Credits available for said program; and, WHEREAS, as each application for the use of the remaining SAC credits is made, it will be presented to City Council for their consideration. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF SHAKOPEE, MINNESOTA, that the Residential Sewer Availability Charge (SAC) Credit Policy attached hereto and made a part hereof, is hereby adopted. Adopted in session of the City Council of the City of Shakopee, Minnesota, held this day of , 2012. Mayor of the City of Shakopee ATTEST: City Clerk DRAFT RESIDENTIAL SEWER AVAILABILITY CHARGE (SAC) CREDIT POLICY General Purpose and Objective for Creating this Policy. To provide financial incentive for residential properties to connect to City Sanitary Sewer and to protect the environment. The City is committed to promoting quality of ground water supply. II. Background. A. Metropolitan Council Sewer Availability Charge When there is new construction or a change in use of a property that requires additional sanitary sewer capacity, a fee is charged by the Metropolitan Council- Environmental Services. The fee is based on a determination of the number of sewer availability charge (SAC) units. One SAC unit equals 274 gallons of daily wastewater flow (based on the Metropolitan Council's calculation of what a single family dwelling produces in one day). The fee for each Metropolitan Council SAC unit is as charged by the Metropolitan Council. If the property has a change in use, the SAC fee is reduced by any previous SAC payments. In September, 2008, the City received 1,494 SAC credits from Rahr Malting coming from the regional system. As a result, the City has a limited `bank' of Metropolitan Council SAC credits that can be applied city -wide. A credit is equivalent to the fee for one SAC unit. The total number of City credits is automatically reduced when new SAC units are required for new construction or additional SAC units are required for a change in use of a property. B. City Sewer Availability Charges In 1994, the City adopted access fees for the sanitary sewer system (SAC). Those fees are used for construction of other MCES interceptors and long -term maintenance of the City sanitary sewer system. For any construction project or change in use, the City SAC is the same as the number of units determined by the Metropolitan Council. However, city fees will be imposed only for the units resulting from an expansion or a change of use that requires additional charges. The total number of units for a project may be reduced in instances where the use was established prior to adoption of the City fees. III. Potential Situations for City Assistance The following list provides examples of potential residential properties that may benefit from City assistance: ISTS within existing MUSA Individual Sewage Treatment Systems (ISTS) connecting to available City sewer within Municipal Urban Service Area (MUSA) ISTS by Dean Lake & Protection of lakes in City O'Dowd Lake DRAFT RESIDENTIAL SEWER AVAILABILITY CHARGE (SAC) CREDIT POLICY Page 2 In making a decision or considering a request under this residential assistance policy, the Council may wish to consider the number of available City -owned Metropolitan Council SAC Credits, the City's future need for credits, and the benefits to the environment of the community. IV. Basic Requirements In addition to the requirements of the application/approval process described below, the following basic tenets shall apply: Assessment or Loan Agreements: • Agreements may be developed to bear interest as determined • Period of agreements shall not exceed five (5) years or as approved by Council • The owner of record must execute an agreement and waiver wherein the amount of the assessment or loan (per agreement) shall be recorded and assessable to the property in the event of default according to the terms of the agreement Any applicant who has not been in good standing with the City, in regards to licenses, fees or other specific charges will not be considered for this program. V. Financing Upon application, the City may consider an interest bearing loan or assessment that allows financing of sewer access charges. The loan or assessment must be approved by City Council. In general, payments shall be placed in a pre - determined fund. Use of funds will be subject to Council approval. Nothing herein shall imply or suggest that the City is under any obligation to provide incentives to any applicant. VI. Criteria for Evaluating Requests The following may be utilized in evaluating request for use of SAC Credits: • Does the request provide for benefit to the environment? DRAFT RESIDENTIAL SEWER AVAILABILITY CHARGE (SAC) CREDIT POLICY Page 3 VII. Application/Approval Process The City may charge a fee for requests under this policy, and these fees will be adopted annually during the fee schedule review. The City reserves the right to determine and limit the amount of SAC credits that are applied for by any one applicant. This is to allow for the maximum utilization and benefit of the credits. The following information must be submitted for application for request of SAC Credits: • Property Owner Name • Address • Legal Description • Name of Authorized Representative or Contact • Any Anticipated "Change of Use" that the project will result in • Narrative Explaining the Request When the complete packet of information is received, staff will review the application and contact the applicant for any additional information needed to process the application. Upon review, the appropriate documents and information will be presented to the City Council for their consideration. DRAFT oe W' O '1 J i I 11 O'DowdLake -J -J .) (f• »,.. i ( R6 3 I ' , . 1 - .; 4" I ■ 1 sir 1 • se Ow' • 0 _ J 1 1 I i P • ISTS Individual Sewage Treatment Systems (ISTS) SHAKOPEE 0 1,000 2,000 4,000 �_ "" " "'°` 79 total ISTS's within 500 feet within 500 feet of Dean and O'dowd Lakes 1 Feet of Deans and o'Dowd lakes • • • • • • I • IMO Ilk • 11 a • • —JI ■II • ISTS Individual Sewage Treatment Systems (ISTS) MUSA Boundary 29 ISTS within 0 1 250 2,500 5 000 SHAKOPEE the MUSA boundary .... " Residential within MUSA Bounda Feet