City staff outlines new impact-fee credit policy required by state law

Rick Schafer, a city staff member, told the Municipal Utility Board on Dec. 18 that recent state legislative changes require water providers to adopt policies to grant credits for water conservation and reuse measures.

"They required, water providers...it needed to be effective by 01/01/2026," Schafer said, summarizing the timing and the mandate. He said the staff proposal and ordinance (O2025-50) in the board packet would allow up to a 10% credit on residential meter sizes. Schafer provided context on current fees, saying the normal water impact fee for a standard residential meter is just over $2,300 and the wastewater fee is just over $2,200, and that the city collected about $225,000 in water impact fees in FY25 and slightly under $200,000 in wastewater fees.

Board members asked how the new credits would relate to other impact-fee categories. One member asked whether legislation allows set-asides for parks or "quality of life" projects; Schafer said there are parks impact fees but that he could not give details on that program in open session. Schafer also described that the five-year impact-fee update process is beginning, that a separate advisory committee will be set up during the next 10–11 months, and that the board and council will see follow-up items as staff completes the update work.

Because the ordinance had already been considered by city council earlier in the week, Schafer presented the policy primarily for information and to answer board questions rather than to request an action. The board did not take formal action on the policy at the meeting.