Impact fees for Cottonwood?
Capital improvement projects expected to cost $52 million
It seems as though everyone has impact fees flowing through their minds now.
Sedona's got them and Camp Verde voters recently approved them. Clarkdale just issued a notice of intent to assess impact fees. Although Jerome does not have them, officials were quick to add the word "yet." And now, Cottonwood is looking to implement them.
The Cottonwood City Council decided to move forward with the numbers identified in a study by the city's consultant firm, Coe and Van Loo, and economists.com.
Cottonwood's proposed fees are different from Sedona's, Camp Verde's and Clarkdale's proposed fees in that they just are only looking at charging impact fees for water and wastewater. However, that may change, too.
According to the consultant's study, impact fees are defined as a "One time charge paid by new developments to finance the construction of public facilities needed to serve it. By implementing impact fees, cities ensure that existing ratepayers are not funding the cost of new development."
Currently, the city charges a flat rate of $1,500 for new residential units to connect to the sewer system. Rates vary for commercial development connections.
The proposed fees would be for impact on the water and sewer system. They would be $5,843 for a 5/8-inch meter -- rising significantly as the meter size gets larger.
The issue of implementing impact fees really came to light when the city looked at future capital improvement projects and their relation to growth.
For the water system, the city is expecting to put $25.6 million into capital improvements over the next 10 years, according to the capital improvement plan.
Of that, $18 million is growth related. It is a very similar story when looking at wastewater -- $26.4 million is going to be needed for capital improvements, with $24.7 million of that related to growth.
Utilities Director Dan Lueder said proposed impact fees, with interest, are expected to cover growth. Impact fees are placed into an account and can be used only for growth related projects. Impact fees would be used to pay for collection systems, a new wastewater treatment facility, federally required arsenic remediation and other projects, Lueder said.
The proposed $5,843 water and wastewater impact fee for a 5/8-inch meter on a residential unit falls in the middle as far as surrounding municipalities' total fees. One thing to keep in mind, other municipalities' impact fees include police, transportation and other impacts, while at the same time, some don't include water, such as Sedona. Cottonwood's fees are only for impacts to water and wastewater.
Sedona's total fees range from $8,589 to $11,215, Clarkdale's proposed fees are $10,987, while Camp Verde's fees are $2,267 (fees are little lower if the unit is a manufactured home).
The city's focus now is only on water and wastewater impacts. The issue of implementing more fees for growth's impact on police, library, parks and recreation and other facilities and infrastructure was also briefly discussed last week. These fees are expected to be an issue for discussion in future council sessions.
Water and wastewater impact fees need to be brought back to the council for formal approval or denial. According to the city clerk's office, if approved, implementation would occur 90 days following.