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Council authorizes sewer connection for proposed 228-unit development, contingent on development agreement
Summary
Council voted to allow a sewer connection for a proposed 228-unit apartment/condo project in the cityimpact area, contingent on a development agreement that addresses impact-fee parity and required infrastructure extension.
The Rexburg City Council on June 26 authorized public works to provide sewer service to a proposed 228-unit apartment/condominium project located outside the city limits but inside the citydefined impact area, provided the developer enters a development agreement that addresses impact fees and annexation obligations.
Staff explained gravity sewer access to the site is unlikely before late next year, so the developer would either construct a pressure sewer to reach the city line or use a temporary on-site system until gravity service is available. The citys standard one-time capacity/impact fees would normally be higher for properties outside city limits (staff cited a one-time capacity figure of about $447,336 for water and sewer outside-city rates versus approximately $648,432 for the same development if annexed and paying full impact fees). Staff clarified those capacity and impact fees are one-time charges to buy capacity in the system, not annual rates.
Developer representatives described a project of four-story insulated-concrete buildings with rooftop amenity spaces and geothermal rooftop systems; they said they could install a pressure sewer extension at their cost and were willing to execute a development agreement that would defer the city-equivalent impact fees and remit them when units call for service or are sold. The developers also committed to recorded agreements promising annexation when the property becomes annexable.
Council debated fairness and precedent, noting that charging a higher outside-city premium can be a development hurdle while annexation requirements are complicated by intervening property owners. After discussion the council moved and passed a motion to allow the connection, contingent on a development agreement that settles impact-fee parity and obligations (the agreement will specify whether impact fees are prepaid on sale or collected at call-for-service).
Staff and the developers will draft the development agreement for council approval. If the parties cannot reach an agreement that ensures fees are ultimately equivalent to city rates (either by prepayment or other enforceable means), the city may charge the outside-city premium.
