Adopt an Ordinance Amending Chapter 35 Water and Sewers, Article III, Charges, of the City Code, to amend Division 1, Section 35-58 "Assessment of Front Footage Charges for Service Connection"; Division 3, Sewer Per Acre Charges, Section 35-82 "Definitions" and Section 35-84 "Calculation of the Per Acre Charge, Section 35-85 "Assessment and Payment of the Per Acre Charge; Refund to a Developer; Administration"; and Division 4, Water Main Capacity Charges, Section 35-88 "Definitions", Section 35-91 "Assumptions to be Used to Calculate Maximum Day Demand", Section 35-92 "Calculation of the Water Main Capacity Charge", and Section 35-93 "Assessment and Payment of the Water Main Capacity Charge; Refund to a Developer and City; Administration" (ALL COUNCIL DISTRICTS)

It is recommended that the City Council adopted the attached ordiance amending Chapter 35 Water and Sewers, Article III, Charges, of the City Code, to amend Division 1, Section 35-58 "Assessment of Front Footage Charges for Service Connection"; Division 3, Sewer Per Acre Charges, Section 35-82 "Definitions" and Section 35-84 "Calculation of the Per Acre Charge, Section 35-85 "Assessment and Payment of the Per Acre Charge; Refund to a Developer; Administration"; and Division 4, Water Main Capacity Charges, Section 35-88 "Definitions", Section 35-91 "Assumptions to be Used to Calculate Maximum Day Demand", Section 35-92 "Calculation of the Water Main Capacity Charge", and Section 35-93 "Assessment and Payment of the Water Main Capacity Charge; Refund to a Developer and City; Administration".  

On May 7, 2019, the City Council approved M&C (G-19537) to adopt the new Installation Policy and Design Criteria for Water, Wastewater and Reclaimed Water Infrastructure.  As part of this work, it was recognized that updates to the City Code regarding the existing cost recovery charges consisting of the Front Footage, Sewer Per Acre, and Water Main Capacity charges were required to reflect updates in the new Installation Policy and Design Criteria manual. 

These changes are needed to support the revised Water Department policy adopted May 7, 2019. The changes to these charges were presented to DAC last year to receive feedback. The Water Department received consensus from DAC members at that presentation.

The following updates are shared across the three cost recovery types:

1. Previous refund period to developers consisting of 10 years with a possible 10 year extension, by request, is changed to a fixed 20 year collection period.
2. Definitions are updated for consistency across all three cost recovery types.
3. Annual cost adjustments for applicable charges for inflation is added at two percent (2\%).  The Consumer Price Index for all items less food and energy, from July 2014 to April 2019, from the United States Department of Labor, Bureau of Labor Statistics, was used to create the cost adjustment rate.
4. Administration language was revised to be consistent across the three cost recovery types.

The following updates are cost recovery type specific:

1. Front Footage Charge
   1. Add language to charge up to, but not greater than, 50\% for a frontage main on a developer- initiated sanitary sewer or water line.
2. Sewer Per Acre Charge
   1. Add language stating City shall be responsible for providing calculated basin area on sewer mains that have City cost participation for over-sizing developer-initiated approach sewer mains.
3. Water Main Capacity Charge
   1. Update Section 35-91, Assumptions to be Used to Calculate Maximum Day Demand, to update the average daily demand calculations table and estimated population density from the new Installation Policy and Design Criteria Manual.
   2. Update Section 35-92, Calculation of the Water Main Capacity Charge, to a) update the maximum design capacity requirements; b) have exhibits and calculations prepared by City staff rather than the developer on projects in which the City cost participates; c) update the calculation to be based on the change in MGD capacity due to oversizing the approach water main; and d) for developers to recoup a portion of their costs along the frontage main that they installed. 
   3. Update Section 35-93, Assessment and Payment of the Water Main Capacity Charge; Refund to a Developer and City; Administration, to update administrative language to match the new Installation Policy and Design Criteria Manual.

A Form 1295 is not required for this contract because:  This M&C does not request approval of a contract with a business entity.