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HomeMy WebLinkAboutSpecial Committee for Studying Connection Charge Fee Policy 07-12-1972COUNTY SANITATION DISTRICTS OF ORANGE COUNTY, CALIFORNIA P. 0. BOX B127, FOUNTAIN VALLEY, CALIFORNIA 9270E 1OB44 ELLIS AVENUE (EUCLID OFF -RAMP, SAN DIEGO FREEWAY) January 12, 1973 RE: JANUARY 3RD PUBLIC HEARING -- PROPOSED SEWER CONNECTION CHARGE ORDINANCE NO. 303 TELEPHONES: AREA CODE 714 S40-2910 962-2411 This is to advise that the District No. 3 Board of Directors continued the subject hearing to March 7, 1973, at 7:30 p.m., in response to several requests due to the holidays. The firm of Stone and Youngberg, Municipal Financing Consultants, has been engaged to study the District's funding requirements. Their report and recommendation will be considered at the March 7th hearing. On or about March 1st the recommendations of the consultant will be forwarded to those interested persons and entities receiving this notice. The complete report will be available for study and review at the District's office. The Board has directed the District's staff to proceed with discussions with the local sewering entities concerning an agreement for collection of sewer connection charges which will be necessary in the event a connection charge ordinance is adopted by the District. Norman E. Culver Chairman cc: Directors, District No. 3 Agenda item No s COUNTY SANITATION DISTRICTS of ORANaE COUNTY. CALIFORNIA 'i P.O. BOX 8127 10844 ELLIS AVENUE FOUNTAIN VALLEY, CALIFORNIA 92708 (714) 540-2910 October 27, 1972 (714) 962-2411 REPORT OF THE SPECIAL COMMITTEE FOR STUDYING ANNEXATION AND CONNECTION FEE POLICY - COUNTY SANITATION DISTRICTS NOS., 2 AND 3 Committee Meeting October , 197 . Thursday - 12:00 Noon Present (District 2) Present (District. 3) Don Smith, Chairman Norman dulver, Chairman Henry Wedaa Wade Herrin Mark Stephenson Mark Stephenson Wade Herrin Absent Absent • Donald Fox Edward Just Jack Green Preset -At Fred A. Harper Paul G. Brown Conrad Hohener ' Don Martinson The two Districts' special committees have met -jointly on three occasions to consider several connection charge concepts. The committees are recommending the enclosed draft ordinance for consideration by the two Districts' Boards at a special meeting to be held November 2nd at 7:00 p.m. _ At the last meeting of the committees, the staff was directed to modify the proposed connection charge ordinance to reflect a minimum connection charge for single family dwellings and industrial and commercial developments. The enclosed draft ordinance establishes the following charges for new construction: 1. Single family dwelling buildings, $50 per dwelling unit 2. Multiple family dwelling buildings, $125 per dwelling unit e 3. Commercial, industrial and public buildings: Diameter of Building Sewer Charge 6 inches or less .$50 8 inches 100 10 inches 200 12 inches 300 The basic connection charge -is the single family .dwelling. charge of $50. It is recommended that the single family dwellings be charged the minimum charge in that the District's sewer system capacity has primarily anticipated this type of general development. Multiple Dwellings. The type of densities which are accompanied by development of apartments places an unusual demand on the sewer system when compared to single family development. Also, the District tax revenue received from high density properties is not adequate when the volume.of sewage produced -is considered. I , Commercial and 'Industrial Charges. The one-time connection _16* charge for new commercial and industrial properties is based'on the size of the building sewer. These charges are nominal as they are subject to an excess capacity connection charge based on the actual. use of the sewerage facilities, as covered in Article 6(b) of the ordinance. As the Directors will recall, -the District No. 2 Board re- affirmed its intent to continue with the present annexation policy which currently establishes an annexation fee of $369 per acre. The original proposal which was submitted to the -various cities and sanitary districts for comment provided for the following connection charges: $100 per dwelling unit for single family and multiple dwellings, and $50 per 1000/sq. ft. building for commercial and industrial properties JUSTIFICATION FOR CONNECTION CHARGES 1. Necessity for Additional Funds for Capital Outlay. The Districts' Master Plans for the construction of needed interceptor sewers to provide the communities within the Districts -2 4 .with proper sewerage facilities have been planned based on the land use plans developed by the local communities and will re- quire a large capital expenditure during the next five years. The cash -flow projections for the Districts indicate that it is necessary to raise additional funds to accomplish the pro- gram. Alternative methods of proceeding are: (A) Not build the facilities - there would be re- strictions on new connections in many areas of the Districts. This is contrary to the • basic function of the Districts. (B) Raise the tax rate to finance the program. (C) Pass a bond issue, which all taxpayers would pay for the next 20 years by increasing the. tax rate, (D) Establish connection charges for new con- struction throughout the District. 2:. Equalize Costs Among Users. Connection charges are very common. Many large sewering agencies have established such a charge in order that at least a portion of the capital outlay funds.necessary are provided by new users to the system i. ho are creating -Fro ner.vess- ty for • v v the � • ..r w� . V W V the V M V✓ .L V the capital outlays. 3. To Hold Down Tax Rates. It is quite obvious that the State and Federal governments are attempting to devise measures to relieve -the homeowner of a portion of his property tax burden. If the Districts chose to increase property tax rates for the purpose of financing capital outlay projects for future users it would, in the ' staff' s opinion, create a serious inequity in that the present users have been paying Sanitation District taxes on their improvements and to raise the rate further to accommodate'newcomers would be unjust. 4. Difficulty in Passing a Bond Issue. A bond issue for new capital outlay projects for the Districts, even if successful (and in the present climate -of public gpinion it is seriously doubted that an election could be successful), would require present users to pay principal and interest on bonds which are primarily for the purpose of providing facilities for newcomers. At current interest rates, the interest to be paid would be excessive and also would impose the burden on present users. -3- ti • 5. Success in other Districts. Districts Nos. 5 and 7 have had a connection charge for many years which has met with very little opposition and have raised sufficient funds so that these two Districts are financially in better shape than Districts Nos. 2 and 3. The public easily grasps the concept of a new user paying for at least a portion of the necessary future outlays. ADDITIONAL COMMITTEE RECOMMENDATIONS: The committees recommend that if the proposed ordinance appears acceptable to the Boards, public hearings be held to permit expressions of opinion by -the public prior to the adoption of any connection charge ordinance. The committee further recommends that the enclosed standard agreement for collection of sewer connection charges, which provides for a collection fee equal t.o 5% of the fees collected, be authorized. COUNTY SANITATION DISTRICTS of ORANGE COUNTY, CALIFORNIA P. O. BOX 5175 10844 ELLIS AVENUE FOUNTAIN VALLEY, CALIFORNIA, 92708 (714) 540-2910 October 24, 1972 (714) 962-2411 SPECIAL COMMITTEES FOR STUDYING ANNEXATION AND CONNECTION FEE POLICY - COUNTY SANITATION DISTRICTS NOS9 2 AND 3 Committee Meeting October 2b , 197 Thurs ay -Noon Committee Members (District 2 Don Smith, Chairman Henry Wedaa Mark Stephenson Edward Just Wade Herrin Committee Members (District 3 Norman Culver, Chairman Wade Herrin Mark Stephenson Jack Green Robert Battin Chairmen Smith and Culver have called a meeting of the Special Committees for 12:00 noon on Thursday, October 26, A light lunch will be served. Fred A. Harper General Manager FAH: j cc: Don Martinson Conrad Hohener COUNTY SANITATION DISTRICTS of ORANGE COUNTY, CALIFORNIA J October 3, 10 D. O. BOX 5175 10844 ELLIS AVENUE FOUNTAIN VALLEY, CALIFORNIA, 92708 (714) 540.2910 (714) 962.2411 DISTRICTS 2 AND 3 CONNECTION CHARGE COMMITTEE Meeting - September 28, 1972 - Noon District No. 2 Present: Don Smith, Chairman Edward Just Wade Herrin Absent: Henry Wedaa Mark Stephenson Others present: Don Martinson, Conrad Hohener, Fred A. Harper Paul G. Brown District No. Present: Norman Culver, Chairman Wade Herrin Donald Fox Absent: Mark Stephenson Jack Green Lowry & Associates Boyle Engineering The purpose of this report is to advise the committee members who were unable to attend the September 28 meeting of the discussion held at that time. The Chairmen advised that they had met jointly the previous day with the Districts' General Manager and the Manager of the Garden Grove Sanitary District, Walter Bressel, to discuss the connection charge policy presently under consideration. The Chairmen reported that most objections to a connection charge appeared to be the concern that property owners within the District who have been paying taxes on undeveloped property would be penalized if a connection charge were to be imposed. The material which was mailed to the committee members prior to the meeting was temporarily set aside for the purpose of discussing a concept which was submitted during the closing minutes of a previous meeting by Director Just. He proposed that the Districts establish a connection charge which would apply to those properties which are developed at a higher density than planned for in the Districts' Master Plans. c _ Following a lengthy discussion concerning some of the problems that might be involved, the engineers representing the two Districts, Low.Ly and Associates for District No. 2 and Boyle Engineering for District No. 3, were directed to investigate the feasibility of the administration of such a concept and report back to the committee at its next meeting which will probably be scheduled for the latter part of October. In addition, the General Manager was requested to discuss this new connection charge proposal with the Districts' legal counsel to determine if there are any legal restrictions. Don E. Smith, Chairman District No. 2 Norman E. Culver, Chairman District No. 3 Special Committee to Study Connection Charge Policy - District No. 2. At -the last meeting of the committees, the staff was directed to modify the proposed connection charge ordinance for ,District No. 2 to reflect a minimum connection charge for single family dwellings and industrial and commercial develop- ments. The enclosed draft ordinance No. 203 (dated September 13, 1972) establishes the following charges for new construction: • .1. Single family dwelling buildings, $50 per dwelling unit 2. Multiple family dwelling buildings, $100 per dwelling unit 3. Commercial, industrial and public buildings: Diameter of Building Sewer Charge 6 .inches or less $50 8 inches 100 10 inches 200 12 inches 300 The basic connection charge is the single family dwelling charge of $50. It is recommended that the single family dwellings be charged the minimum charge in that the District's sewer system capacity has primarily anticipated this type of general development. Multiple Dweilings. The type of densities which are accompanied by -development of apartments -places an unusual demand on the sewer system when compared to single family development. Also, the District tax revenue received from high density properties is not adequate when the volume of sewage produced is considered. Commercial and Industrial Char es. The one-time connection charge for new commercial and industrial properties is based on the size of the building sewer. These charges are nominal as they are subject to an excess capacity connection charge based on the actual use of the sewerage facilities, as covered in Article 6 (b ) of Ordinance No. 203. As the Directors will recall, the District No. 2 Board re- affirmed its intent to continue with the present annexation policy which currently establishes an annexation fee of $369 Per acre. The original proposal which was submitted to the various cities and sanitary districts for comment provided for the following connection charges: $100 per dwelling unit for* single family and multiple dwellings, and $50 per 1000/sq. ft. building for commercial and industrial properties. Enclosed for the Directors' study and comment is a list of reasons for establishing a District connection charge. September 21, 1972 COUNTY SANITATION DISTRICT NO. 2 JUSTIFICATION FOR CONNECTION CHARGES 1. Necessity for Additional Funds for Capital Outlay, The Districts' Master Plan for the construction of needed interceptor sewers to provide the communities within the District with proper sewerage facilities have been planned based on the land use plans developed by the local communities and will require a capital expenditure of $18,112,000 during the next five years. The cash -flow projections for the District indicate that it is necessary to raise additional funds to accomplish the program. Alternative methods of proceeding are: (A) Not build the facilities - there would be re- strictions on new connections in many areas of the District. This is contrary to the basic function of the Districts. (B) Raise the tax rate by $.15 to finance the program. (C) Pass a $355005000 bond issue, which all taxpayers woul—d'p—ay for the next 20 years. Probable tax rate would be .0 per $10.0 assessed* valuation to pay off bonds. (D) Establish connection charges for new -con- struction throughout the District. 2, Equalize Costs Among Users. Connection charges are very common. Many large sewering agencies have established such a charge in order that at least a portion of the capital outlay funds necessary are provided by new users to the system who are creating the necessity for the capital outlays. 3. To Hold Down Tax Rates. ' It is quite obvious that the State and Federal governments are attempting to devise measures to relieve the homeoi%mer of a portion of his property tax burden. If the Districts chose to increase property tax rates for the purpose of financing capital outlay projects for future users it would, in the staff's opinion, create a serious inequity in that the present users have been paying Sanitation District taxes -on their improvements and to raise the rate further to accommodate new comers would be unjust. r 4. Difficulty in Passing a Bond Issue. A bond issue for new capital outlay projects for the Districts, even if successful (and in the present climate of public opinion it is seriously doubted that an election could be successful), would require present users to pay principal and interest on bonds which are primarily for the purpose of providing facilities for newcomers. At current interest, rates, the interest to be paid would be*excessive and also would impose the burden on present users. 5. Success in Other Districts, Districts Nos. 5 and 7 have had a connection charge for many years which has met with.very little opposition and have raised sufficient funds so that these two Districts are financially in better shape than Districts Nos. 2 and 3. The public easily grasps. the concept of a new user paying for at least a portion of the necessary future outlays. Don E. Smith Chairman • DRAr� g-13--72 ORDINANCE NO. 203 AN ORDINANCE MENDING ORDINANCE NO. 202 The Board of Directors of County Sanitation District No. 2 of • Orange County, California, does ordain as follows: ARTICLE 1 Article 2 of Ordinance No. 202 is hereby amended by adding thereto the following sections: (o) District Connection Charge. Is a connection charge imposed by District No. 2 as a charge for the use of District's sewerage facilities whether such connection is made directly to a l District sewerage facility or to a sewer which ultimately discharges into a District sewerage facility. (p) .District Sewerage Facility. Shall mean any.property belonging to County Sanitation District No. 2 used in the treatment, transportation, or disposal of sewage or industrial wastes. (q). Domestic Sewage. Shall mean the liquid and water borne wastes derived from the ordinary living processes, free from indus- trial wastes, and.of such character as to permit satisfactory disposal without special treatment, into the public sewer or by means of a private disposal system. (r)_ Sewerage Facilities. Are any facilities used in the collectioh, transportation, treatment or disposal of sewage and s industrial wastes. (s) Family Ddelling.Building. Is a building designed and used to house families and containing one or more dwelling units. (t) D;felling Unit. Is one or more habitable rooms which are occupied or which are intended or designed to be occupied by one family with facilities for living, sleeping, cooking and eating. (u) Building Sewer, Is *the sewer draining a building and ex- tending beyond the exterior walls thereof and which connects to a District sewerage facility or to a private or public sewerage facility which u, :imately discharges to a District sewerage facile "-y, (v) Other Terms, Any term not herein defined is defined as being the same as set forth in the International Conference of Building Officials Uniform Building Code, 1970 Edition, Volume I. ARTICLE 2 (a) Section (a) of Article 6 of Ordinance No. 202 is amended' to read as follows: (a) District Connection Charges. Before any connection permit shall be issued, the applicant shall pay to -the District or its agent the charges specified herein. (1) Connection Charge for New Construction, Family DkTellinng Build For For each new single family dwelling building constructed, the connection charge shall be $50 per dwelling unit. For each multiple family dwelling building constructed, the connection charge shall be $100 per dwelling unit. (2) Connection Charge for New Construction, Other Than Family Dcrelling Building_. For all other new construction, including but not limited to commercial and industrial buildings, hotels and motels and public buildings, the connection charge for each building sewer shall be as follows: Diameter of Building Sewer Charge 6 inches or less $ 50 8 inches $100 10 inches $200 12 inches $300 (3) Connection Charge for Replacement Buildings_. For new construction replacing former buildings, the connection charge shall be calculated on the same basis as provided in Paragraphs (1) and (2)' - hereinabove. If such replacement construction is commenced within two years after demolition or -2- destruction of the former building, a credit against such charge shall be allowed, calculated on the basis of the current connection charge applicable for the new construction of the building demolished or . destroyed. In no case shall such credit exceed the connection charge. () Connection Charges for Additions to or Alterations of Existing Buildings. In the case of structures where further new construction or alteration is made to increase the occupancy of family dwelling buildings or the area of buildings to be used for other than family dwelling buildings, the connection charge shall be $50 for each dwelling unit added or created and in the case of new construction other than family dwelling buildings which requires the construction of a new building sewer, the connection -charge for each new building sewer shall be as follows: Diameter of Building Sewer CharEe 6 inches or less $ 50 8 inches $100 10 inches $200 12 inches $300 When Charge is to be Paid.. Payment of connection charges shall be required at the time of issuance of the building permit for all construction within the District, excepting in the case of a building legally exempt from the requirement of obtaining a building permit. The payment of the sewer connection charge for such buildings will be required at the time of and prior to the issuing of a plumbing connection permit for any construction within the territorial limits of the District. 3- Schedule of Charges. A schedule of charges specified herein will be' on file in the office of the Secretary of the District and in the Building Department of each city within the District. Biennial Review of Charges. At the end of two years from the effective.date of this ordinance, and every two years thereafter, the Board of Directors • shall review the charges established by this article and if in its judgment such charges require modifi- cation, an amendment to this ordinance will be adopted establishing such modification. ARTICLE 3 Section (b) of Article 6 of Ordinance No. 202 is amended by adding thereto Section (3) to read as follows; (3) When an excess capacity connection charge -is -payable by a user, as hereinabove provided, a credit equal to the connection charge paid by the user, if any, shall be allowed against such excess capacity connection charge. ARTICLE 4 Lxcept as herein amended, Ordinance No. 202 is ratified, re- affirmed and is to become effective , as amended by this Ordinance. The Chairman of the Board of Directors shall sign this Ordinance and the Secretary of the Districts shall attest thereto and certify to the passage of this Ordinance, and shall cause the same to be published once in the , a daily newspaper of general circulation, printed, published and circulated in the District, within fifteen (15) days after the date of passage of this Ordinance by said Board of Directors and said Ordinance shall take effect PASSED AND ADOPTED by the . Board of Directors of County Sani- tation District No. 2 r of Orange County, California, at a regular meeting held on the day of , 1972. Criairman., Board of Directors o County Sanitation District No. 2, ATTEST* - of Orange County, California Secretary, Boara of Directors of County Sanitation District No. 2, of Orange County, California -5- Description Tax Revenue (at current tax rate of $. 4254) gther Revenue Federal & State Participation Joint Works Projects Distric-i Projects Sale of Capacity Rights Miscellaneous Carry -Over from Previous Fiscal Year TOTAL FUNDS AVAILABLE r' P rT-10ITURD,S District Construction S::are of Joint Works Construction Bond Retirement & Interest S ,are of Joint Operating District Operating & Other Expenditures TOTAL EXPENDITURES Gdrry-over to Following Fiscal Year Less: Necessary Reserve for Following Year Dry Period _�und Balance or (Deficit) )ne cent on tax rate will raise COUNTY SANITATION DISTRICT NO. 2 STATEMENT OF PROJECTED CASH FLOW 7--28-72 Revised FISCAL YEARS 1972-73 THROUGH 1976-77 1972-73 1973-74 1974-75 1975-76 1976-77 $ 4,364,000 $ 4,605,000 $ 4,835,000 $ 5,077,000 $ 5,331,000 2;556,000 2,165,000 5,947,000 8,278,000 6,898,000 758,000 845,000 227,000 31,000 15,000 618>000 3?5,000 275,000 225,000 225,000 10,7203000 95753,000 3,786,000 2533000 (i,167,000) $19,o16,000 $17,743,000 $1550705000 $13,864,000 $11,3025000 $ 4, 654, 000 $ 8, 031, 000 $ 3, 800, 000 $ 1, o44, 000 $ 583, 000 3,034,000 4,338,000 93391,000 1o,98o,000 7,84l,000 6125000 5903000 5715000 554,000 536,000 767, 000 787,000 8.28, 00o 1, 081, o00 1, 256, 000 196.,000 211,000 2275000 1,372,000 265,000 $ 9.12635000 $13, 957, 000 $14, 817, 000 $15, 031, 000 $lo, 481, 000 $ % 753,000 . $ 3,786,000 $ 253,000 '$(1,167,000) $ 8213000 7, 070P 000 _ 7, 493, 000 7, 034, 000 5, 320, 000 ' 21285,000 $ 2,683,000 $(3,707.,000) $(6,781,000) $(6,487,000) $(1,464,000) $ 102,585 $ 108,227 $ 1133638 $ 119,321 • $ 125,287 Description Tax Revenue (at current tax rate of $.474o ) Other Revenue Federal & State Participation Joint Works Projects District Projects Sale of Capacity Rights 1,1i. sc ellaneous Carry -Over from Previous Fiscal Year TOTAL FUNDS AVAILABLE i,XP!,HDITURES District Construction Share of Joint Works Construction Bond Retirement & Interest Share of Joint Operating District Operating & other Expenditures TOTAL EXPENDITURES Carry -Over to Following Fiscal Year Less: Necessary Reserve for Following Year Dry Period ""Lind Balance or (Deficit) cent on tax rate will raise UUUIXTY 6I1N.LUATIUN D1bTh1UT NU. -1 STATEMENT OF PROJECTED CASH FLOW FISCAL YEARS 1972--73 THROUGH 1976-77 1972-73 1973-74 1974-75 $ 5,661,000 2,735,000 192,000 177,000 721, 000 11,821,000 $ 5, 944, 000 2,317:000 182,000 1, 000 220, 000 7, 079, 000 $ 6,211,000 6, 366, 000 1,000 150,000 1,682,000 7-28-72 Revised 1975-76 1976-77 $ 6,491,000 $ 6,783,000 8,862,000 - T- 385,000 566,000 153000 150,000 1501000 (3,566,000) (5,868,000) $21,307,000 $15,7�-3,000 $ 1�+,lo,000 $ 12,503,000 $ 8,�65,000 $ 8, 949, 000 3,247,0oo 858,000 792, 000 382,000 $ 7, 478, 000 45 645, 000 827,000 8125000 29%000 $. 5,9523000 101053,000 797,000 8553000 31 % 000 $ 4., 383, 000 11,754,000 77?,000 1,116,000 341,000 $ 13470,000 8,393,000 .756,000 1,296,000 365,000 1 228 000 14o61 000 1 9 6 000 $ 18 71 000 $12 280 000 $ 7,07% 000 ' 7,134,000 $ 11682,3000 '9,o86,000 $ (3,566,000) 9,274,000 $ (5,868,000) 6,226,000 $(3,815,000) 25522,000 $ (555000) $(754043000) $(12,830,000) $(125094,000) $(6,337,000) $ 119,E+10' $ 1253381 $ 131,381 $ 136,919 $ 143,o8o EXCERPT FROM 1972 FEDERAL WATER POLLUTION CONTROL ACT 23 specifications, and estim aces as soon as practicable after the same have been submitted, and his approrcd of any such plans, specifications, and estimates shall be deemed a contractual obligation of the united States for the payment of it-Y proportional contribution to such project. "(b) The Administrator shall, from time to time as the work pro- gresses, make payments to the recipient of a grant for costs of con- struction incurred on a project. These payments shall at nv time exceed the Federal share of the cost Of construction. incurred to the date of the voucher cohering such, payment p1my the federal share of the value of the materials which have been stockpiledin the vicinity of such con- struction in conformity to plans and speci f cations for the project. "(c) After completion of a project awl appro teal of the final voucher by Me Administrator. he dhall pay out of the appropriate sums the un- paid balance of the Federal share payable on account of such project. "LIMITATIONS AND CONDITIONS •"SEc. 204. (a) Before approving.grants for any project for any treatment works under section 201(g) (1) the Administrator shall determine -- "(I) that such works are included In any applicable areawide waste treatment management plait dereloperl, under section 208 of this Act; "(Q) that such ivorks are in conformity with any applicable State plan. under section 303(e) of this Act; "(3) that such works have been. certified by the appropriate State water pollution control agency as entitled to priority over such other works in the State in. accordance with. any applicable State plan under section 303(e) of this Act; "(4) that the applicant proposing to construct such works agrees to pay the Mori -Federal eo48 of such works and has made ade- quate provimorts satisfactory to the Adin.1nistrator for assuring proper and egelent operatio-ti., including the employment of brained management and operations personnel, and the viainte- nanee of such works in accordance frith a J)lan of operation ap- proved by the State trater pollution. control agency ar, as appro- priate, the interstate agency, after construction thereof; 11(5) that the sire and capacity of such trorks relate directly to the needs to be served by such works, itelucling sufft'cient reserve capacity. The amount of reserve capacity provided shall be ap- proved by the Administrator on th.e basi.Y of a comparison of the cost of constructing .-uch reserves as a part of the works to be funded aced the anticipated cost of providing expanded capacity at a date when. 811CIL capacity will be rewired; - "(6) that no speci fle` r160n for bids in connection with .such works $hall he icritten in such a manner as to contain proprietary, exclu- sionary, or discHniirtatory requirements other than. those based upon performance, unleas such requirements are necessary to test or demonstrate a specific thing or to provide for necessary inter- changeability of tarts crap equipment, or at least two brand names or trade narttcs of comparable quality or utility are listed and are fol7ozeed by the word.1�01'equar. "(b) (1) Notu:ithstan7ing any other provision of this title, the Administrator shall not, approve any grant for any treatment, works 24 under section 201(g) (1) of ter :lfarch.l. 1973, unless he shall first have determined that the applicant (A) has adopted or zaiIZ adopt a Sys- tem of charges to assure that each recipient of waste treatment serv- ices within the applica?tt's jurisdiction, a4 determined by the Admin- istrator, will pay its proportionate share of the costs of operation and maintenance (including replacement) of any ivaste treat-7nent, services provided by the applicant; (B) has made provision for the payment to such applicant by the industrial users of the treatment works. of that portion of the cost of construction of such treatment works (ass determined by the Administrator) which is allocable to the treatment of such industrial wastes to the extent attributable to the Federal share of the cost of construction • and. (C) has legal, institutional, managerial, and financial capability to ensure adequate construction, operation, and maintenance of treatment works through,: out the applicant's jurisdiction, as determined by the Administrator. "(2) The Administrator shall.,within one hunndred and eighty dray after the ate or enactniew of the I'edcral Water Pollution. Catttrol ;tct A men( ntcpits of 1972. and niter con.vu.tatio3p. with. appropriate a c, Mterstate. muntc•c pa . 5,1 tntTrtn:uwct to areltcaes. u e- tn.es a > > cca a to pelt ntent of waste tt•eaNnent costs by tncustria and jto»inclustrial recipie0m of tra_ste tread)?ettt services which, shall. �..; s�tais I. (mil ) c•la..ie- of a-yejw of such. Sc rvices. includinQcatcgories Of ant ustruc . uscr.5; II cr;trp•i<[ ar a ItYt ic•lt;ch to determ.aite the cede uaa; of char( e-v ttpt posed on clir..•.cc..); aiul ratc ooeies of 1141?C s rc ectin la actors that in. uence the coat of tc•aste. treatnte)tt, includin( stren th vo .unto, an( c c ? ►•erg Itow rate c laracteri t7v o waste; anc nzvdel -sz/stem s (711. rates o tcser c pargc=s typical of various rca. Wren wor s sc'�'t�i�rq nptc�tic.clprr -ttu pcs rta �•omnzuttt ces. ' to grccrp.tee -8hall -shallrc atn an. « aount of the revenues derived froin the payntv)tt of cots by industrial users of waste treatment serrires, to the extent costs are attributable to the Federal share of eligible project costs provided pursuant to this title as deterrtziazed by the Adnzirrtstra.tor, equal to (A) the amount of the Eton Federal cost of such. 1project paid by the grantee plus (B) the a.nt�ouat, determnined in accordance with, regulations p i?uilgated by the Administrator, necessary - for . future ev pansion. and reconstrvction of the project, except that such retained amount shall not exceed-50 per centum of such re rem ie s f rorpt such project. All re c est ues f rout• suck project not retained by the ,grantee shall he deposited by the Adnz.inistratov in the Treasury as vn iscellaneous receipts. Thant portion of the revenues retai:pted by the grantee ath4butable to clause (B) of the first sentence of this paragrraph. together with a.ny interest thereon shall be used solely for Ae purposes of future expansio)t atud recanstruction of the project. "(4) Approval by the Administrator of a grant to'an interstate agency established by iWerstate compact fo;, any treatment works shall satisfy any other requirement, that such works be authorized by Act of Congress. "ALLOTMENT "Sec. 205. (a) Sunzs authorized to be appropriated pursuant to sec- tiou. 207 for each•jz"sccrl. ,year begitmtittg after June 30, 1972, slcall be allotted by the Administrator aot later thaat. the Jan.tcary 18t imnze- diaie71 precedin.,q the beginning of the fiscal year for which authorized, (,w COUNTY SANITATION DISTRICTS of ORANGE COUNTY, CALIFORNIA R. o. BOX 5175 10844 ELLIS AVENUE FOUNTAIN VALLEY, CALIFORNIA, 9270E (714) 540-2910 (714) 962-241I September 213 1972 TO: MEMBERS OF THE SPECIAL COMMITTEES TO STUDY CONNECTION CHARGE FEE POLICY - DISTRICTS NOS. 2 AND 3 District No.. 2 District No. 3 Don Smith, Chairman Henry Wedaa Mark Stephenson Edward Just Wade Herrin Norman Culver, Chairman Wade Herrin Mark Stephenson Jack Green Donald Fox Committee Meeting September 28, 1972 Thursday - 1 :00 Noon, Adminis ra ive Con erence Room Chairman Culver and I have called a joint meeting of the Special Committees to further consider the establishment of connection charge fees for new construction within Districts Nos. 2 and 3. Other District Directors who are not members of the committees are welcome to attend. In the event a Director wishes to attend who is not a regular committee member, the staff would appreciate it if he would advise Mr. Harper's secretary as a light luncheon will be served. Don E. Smith Chairman cc: Directors of Districts Nos, 2 and 3 C. Arthur Nisson, General Counsel Don Martinson, Lowry & Associates Conrad Hohener, Boyle Engineering Special Committee to Study Connection Charge Policy - District No. 2. At the last meeting of the committees, the staff was directed to modify the proposed connection charge ordinance for District No. 2 to reflect a minimum connection charge for single family dwellings and industrial and commercial develop- ments. The enclosed draft ordinance No. 203 (dated September 13, 1972) establishes the following charges for new construction: 1. Single family dwelling buildings, $50 per dwelling unit 2. Multiple family dwelling buildings, $100 per dwelling unit 3. Commercial, industrial and public buildings: Diameter of Building Sewer 6 inches or less 8 inches 10 inches 12 inches Charge $50 100 200 300 The basic connection charge is the single family dwelling charge of $50. It is recommended that the single family dwellings be charged the minimum charge in that the District's sewer system capacity has primarily anticipated this type of general development. Multiple Dwellings. The type of densities which are accompanied.by development of apartments places an unusual demand on the sewer system when compared to single family development. Also, the District tax revenue received from high density properties is not adequate when the volume of sewage produced is considered. Commercial and Industrial Charges. The one-time connection charge for new commercial and industrial properties is based on the size of the building sewer. These charges are nominal as they are subject to an excess capacity connection charge based on the actual use of the sewerage facilities, as covered in - Article 6(b) of Ordinance No. 203. As the Directors will recall, the District No. 2 Board re- affirmed its intent to continue with the present annexation policy which currently establishes an annexation fee of $369 per acre. The original proposal which was submitted to the various cities and sanitary districts for comment provided for the following connection charges: $100 per dwelling unit for single family and multiple dwellings, and $50 per 1000/sq, ft. building for commercial and industrial properties. Enclosed for the Directors' study and comment is a list of reasons for establishing a District connection charge. -3- r September 21, 1972 COUNTY SAWITATION DISTRICT NO. 2 JUSTIFICATION FOR CONNECTION CHARGES 1. Necessity for Additional Funds for Capital Outlay. The Districts' Master Plan for the construction of needed interceptor sewers to provide the communities within the District with proper sewerage facilities have been planned based on the land use plans developed by the local communities and will require a capital expenditure of $18,112,000 during the next five years., The cash -flow projections for the District indicate that it is necessary to raise additional funds to accomplish the program. Alternative methods of proceeding are: (A) Not build the facilities - there would be re- strictions on new connections in many areas of the District. This is contrary to the basic function of the Districts. (B) Raise the tax rate by $.15 to finance the program. (C) Pass a $3,500,000 bond issue, which all taxpayers would pay for-EHe next 20 years. Probable tax rate would be per $100 assessed valuation to pay off bonds. (D) Establish connection charges for new con- struction throughout the District. 2. Equalize Costs Among Users. Connection charges are very common. Many large sewering agencies have established such a charge in order that at least a portion of the capital outlay funds necessary are provided by new users to the system who are creating the necessity for the capital outlays. 3. To Hold Down Tax Rates. It is quite obvious that the State and Federal governments are attempting to devise measures to relieve the homeowner of a portion of his property tax burden. If the Districts chose to increase property tax rates for the purpose of financing capital outlay projects for future users it would, in the staffs opinion, create a serious inequity in that the present users have been paying Sanitation District taxes on their improvements and to raise the rate further to accommodate new- comers would be unjust. 4. Difficulty in Passing a Bond Issue. A bond issue for new capital outlay projects for the Districts, even if successful (and in the present climate of public opinion it is seriously doubted that an election could be successful), would require present users to pay principal and interest on bonds which are primarily for the purpose of providing facilities for newcomers. At current interest rates, the interest to be paid would be excessive and also would impose the burden on present users. 5. Success in Other Districts. Districts Nos. 5 and 7 have had a connection charge for many years which has met with very little opposition and have raised sufficient funds so that these two Districts are financially in better shape than Districts Nos. 2 and 3. The public easily grasps the concept ofa new user paying for at least a portion 'of the necessary future outlays. Don E. Smith Chairman ti