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Consultant outlines proposed water and sewer impact fees; council to consider public hearing
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Summary
Cody Dieter, an impact‑fee consultant, told Fountain Green City Council the maximum culinary water impact fee in the draft study would be $5,042 per equivalent residential connection and that a proposed sewer package could raise sewer impact fees to as much as $14,756 per ERC; the council asked staff to prepare public‑hearing materials for a decision at a future meeting.
Cody Dieter, a consultant presenting an impact‑fee study for Fountain Green, told the City Council on Sept. 18 that the analysis follows state statute and measures how new development’s demand should pay for new capacity. For culinary water, Dieter said the modeled components — water rights, source, and storage — add up to a maximum impact fee of $5,042 per equivalent residential connection (ERC). For sanitary sewer, his example package of projects would produce a maximum fee of $14,756 per ERC, largely driven by a lagoon expansion the study priced at several million dollars.
Dieter said the methodology starts with a 20‑year demand projection (118 ERCs in the study), measures existing level of service and remaining excess capacity, and assigns the dollar value of that excess to future growth. He emphasized that grants reduce the feeable amount while loans and debt service may be included. Dieter gave examples: Fountain Green currently has excess storage and distribution capacity but is constrained by water rights (about 59 ERCs of rights remaining against forecast need); the storage and source components were valued from historic project costs.
Council members pressed on how the fees would affect typical homebuilders and young families. Councilmember Rod said a one‑time $3,000 increase could “price our kids out of being able to build here.” Dieter and other council members noted the fee is a one‑time charge at building permit (not applied to existing resale purchases) and that construction loans commonly roll fees into financing. Members also discussed how accessory dwelling units (ADUs) on the same connection are generally not assessed unless a separate water connection is added.
On sewer, Dieter described mode options including a 25‑acre lagoon expansion and a rehabilitation/screening device; he said the assumed 75% grant for the larger expansion is a major driver of the fee and that lower grant outcomes would raise the fee materially. Councilmembers asked about the six‑year “spend/encumber” rule in recent state law for collected impact fees; Dieter recommended working with the consultant team to define projects and a spend‑out schedule or debt encumbrance so the city would comply.
No ordinance was adopted Sept. 18. Dieter explained the next steps: if the council wants a fee different from the city’s current amount, state rules require making the public facility plan and impact analysis available for 14 days and holding a public hearing, then adopting an ordinance (90 days to effective date after adoption). Staff indicated they would prepare the public‑facility plan and impact fee materials for a hearing the council may schedule next month.
Council discussion highlighted three tradeoffs: (1) higher fees shift capital costs to new growth rather than current ratepayers, (2) fees chosen now can reduce future rate increases, and (3) large projects dependent on competitive grants increase uncertainty. Several members asked staff to return with the documents and a recommended public‑hearing date so the council can decide whether to adopt any change before the end of the year.