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HomeMy WebLinkAboutResolution 4972 Stating Conditions to Consider Annexation of Property Located within the Riverside County Water and Sewer District No. 310 COMMISSION RESOLUTION NO. 4972 A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF BOZEMAN, MONTANA, STATING THE CONDITIONS NECESSARY FOR THE COMMISSION TO CONSIDER ANNEXATION OF PROPERTY LOCATED WITHIN THE RIVERSIDE COUNTY WATER AND SEWER DISTRICT NO. 310. WHEREAS, the City of Bozeman (".City") has established comprehensive annexation goals and policies to provide for orderly, well-planned growth of the City; and WHEREAS, the City established these goals and policies in accordance with annexation statutes as set forth in Title 7, Chapter 2, MCA; and WHEREAS, it is the goal of the City to encourage annexations of land contiguous to the City; and WHEREAS, the City seeks to annex all property contracting with the City for services; and WHEREAS, it is the goal of the City to require annexation of all land proposed for development lying within the service boundary of the existing sewer system as depicted in the Bozeman Community Plan (Growth Policy), and to encourage annexations within the urban growth area identified in the Growth Policy; and WHEREAS, it is the policy of the City to require annexation of any contiguous property for which City services are requested or for which City services are currently being contracted; and Page 1 of 14 Resolution 4972,Riverside Annexation Conditions WHEREAS, Riverside County Water and Sewer District No. 310 ("District") is a water and sewer district organized and operating pursuant to §7-13-2200 et seq., MCA, and is located contiguous to the City; and WHEREAS, in December of 2011, the Montana Department of Environmental Quality ("MDEQ")conducted an inspection of the District's wastewater facilities and informed the District of a number of deficiencies that needed to be corrected with respect to treatment and disposal of its wastewater; and WHEREAS, the District is comprised of and serves properties contiguous to the City described as Riverside Manor Subdivision, Riverside Greens Subdivision, and Riverside Country Club ("Riverside Properties"); and WHEREAS, the City's water reclamation facility (WRF) is contiguous to the Riverside Properties and has the capacity to treat and dispose of the wastewater that is collected within the District; and WHEREAS, in 2014, the City Commission heard a request from the District and several owners of Riverside Properties to enter into an interlocal agreement with the District that would have connected the District's wastewater collection system to the WRF; at that time, the City Commission determined that should the City agree to assist the District and its residents in addressing the District's wastewater issues, annexation could not be delayed for longer than 18 months after the connection; and WHEREAS, since 2014 the District has been pursuing options related to addressing the wastewater issues raised by the MDEQ; and WHEREAS, on March 17, 2016, the MDEQ issued its Administrative Order on Consent (AOC) (Docket No. WQ-15-18) requiring the District to develop a compliance plan explaining how the District intends to return its wastewater treatment operations to compliance with the Page 2 of 14 Resolution 4972,Riverside Annexation Conditions Montana Water Quality Act and Montana's Public Water Supply Laws; and WHEREAS,in May of 2018 the District communicated to MDEQ its preferred alternative for complying with MDEQ's AOC is to connect its wastewater collection system to the City's VW; and WHEREAS,in 2018 the District and the City renewed discussions regarding entering into an agreement with the City whereby the City would treat and dispose of the wastewater collected within the District and Riverside Properties would petition to be annexed into the City as a condition of receiving wastewater services; and WHEREAS, §7-13-4314, MCA, and Sec. 40.03.1380, BMC, provide that any person, firm, or corporation receiving sewer or wastewater service outside of the incorporated city limits may be required by the City, as a condition to initiate or extend such service, to consent to annexation of the property served by the City; and WHEREAS,the City believes that annexation is an appropriate prerequisite to providing wastewater services to the Riverside Properties and, upon the filing of a petition for annexation pursuant to §7-2-4601, MCA, the City will provide a plan for the extension of municipal services to the area to be annexed; and WHEREAS, an extension of services plan can be specifically tailored to Riverside Properties, for extending each municipal service based on the present circumstances concerning existing services, systems, and facilities so as to, in part, recognize the character of existing neighborhoods; and WHEREAS,a petition for annexation and an extension of service plan may address issues that are in the best interests of the City and its inhabitants, as well as the Riverside Properties and their inhabitants, such as, but not limited to, rights of way, easements, transportation facilities, water rights or cash-in-lieu, waivers of right to protest creation of special improvement districts (SID) and/or special districts or maintenance districts, impact fees and water and sewer hookup Page 3 of 14 Resolution 4972,Riverside Annexation Conditions fees, recognition of existing improvements and reservation of existing maintenance responsibilities; and WHEREAS,the City and the District may enter into an agreement for the City to acquire the District's wastewater collection facilities and to treat and dispose of the wastewater collected within the Riverside Properties pursuant to §7-11-101 et seq. MCA(an"Interlocal Agreement"); and WHEREAS, the District represents to the City that connecting the District's wastewater effluent to the City's WRF, which will involve designing and constructing additional infrastructure (the"Project")will address the issues raised by the MDEQ with the District as well as improve water quality in the East Gallatin River—a benefit to residents of the Riverside Properties,the residents of the City of Bozeman, Gallatin County, and the State of Montana; and WHEREAS, upon request of the District the City desires to provide the District and its residents a framework within which a petition for annexation will be favorably received for the Riverside Properties; and WHEREAS,the City recognizes that the Riverside Properties consists of existing platted subdivisions with more than 100 property owners with existing neighborhood characteristics; and WHEREAS,the City Commission recognizes providing such a framework in a non-binding manner may facilitate a final resolution to the District's wastewater compliance issues with the MDEQ and facilitate resolving the issue of whether the City will participate in such a solution on behalf of the District and the Riverside Properties. NOW, THEREFORE, BE IT RESOLVED by the City Commission of the City of Bozeman, Montana: Section I The Commission determines it will be in the best interests of the City of Bozeman and its Page 4 of 14 Resolution 4972,Riverside Annexation Conditions residents, visitors, and businesses and of the owners and residents of the Riverside Properties to extend the boundaries of the City of Bozeman to include said Riverside Properties within the corporate limits of said City of Bozeman, Montana. The terms and conditions under which the City Commission would look favorably upon a petition for annexation, submitted pursuant to Title 7, Chapter 2, Part 46, MCA, are as follows: 1. Petition for Annexation. To consider annexation of the Riverside Properties the owners of the Riverside Properties must, along with paying all required fees, submit a written petition containing a description of the area requested to be annexed, the requested zoning, and signed by more than 50%of the resident electors owning real property in the area to be annexed or the owner or owners of real property representing 50% or more of the total area to be annexed. The Commission will look most favorably upon a petition containing more than 60% of the above. 2. Processing of the Petition. Upon receipt of a petition, the City will process the petition pursuant to Montana law in the same manner as all other petitions for annexation, including all applicable zoning procedures,so that the petition can be properly and timely placed on the City Commission agenda for consideration. 3. Post Annexation Treatment. Consistent with the City's policy and the manner in which it treats other annexed properties, the Riverside Properties will become part of the City upon annexation for all municipal and governmental purposes including voting, debts, taxation,representation,enforcement of laws and ordinances including the City's Unified Development Code (UDC), etc. Upon annexation, the Riverside Properties and their owners/residents shall be entitled to the same privileges and benefits as provided to other parts of the City and their residents. The Commission, however, recognizes that the Riverside Properties are unique in that they have been part of established neighborhoods with their own character for many years. As such, the Commission will not at this time require property owners to upgrade streets and sidewalks within the District to City standards at the time the Riverside Properties are annexed, or otherwise change the Page5of14 Resolution 4972, Riverside Annexation Conditions physical appearance of the neighborhoods. Such a decision,however, cannot bind future city commissions, which may require property owners to do so. a. Until the Project is completed, the District must be responsible for collecting and treating wastewater collected within its boundaries, as well as charging and collecting the appropriate fees for the same. b. Upon completion of the Project, the City will charge all costs for wastewater collection and processing directly to the owners/residents of the annexed properties in the same manner as all other City wastewater customers. The City will require property owners or the District as a condition of receiving wastewater service to install water meters on their water service to determine the volume of wastewater generated by the Riverside Properties. In addition, the City will determine the assessment rate and methodology for wastewater treatment including any additional charges for operation of any required lift stations. c. Property owners may plow their own streets though all properties within the area to be annexed will be subject to full City street maintenance assessments. 4. Existing Rural Improvement Districts(RIDS). The Commission recognizes the Riverside Properties appear to be included in Gallatin County's Rural Improvement District(RID) Maintenance Program through RID 308 and RID 346. At the time of submission of the petition for annexation, the owners of the Riverside Properties will need to explain how these RIDs will be addressed, with the understanding the existence of the RIDS cannot reduce the assessments by the City for street and tree, and arterial and collector district assessments. The City will not be responsible for any outstanding maintenance assessments or indebtedness the Riverside Properties may have for these RIDs. The City encourages the Riverside Properties to request Gallatin County use existing RID funds to make scheduled maintenance. Page 6 of 14 Resolution 4972,Riverside Annexation Conditions 5. Central Valley Fire District Debt. The City understands the Central Valley Fire District (CVFD), of which the Riverside Properties are currently located within, may have undertaken financial commitments related to construction of a new fire station. At the time of submission of a petition for annexation the District or the Riverside Properties must inform the City of the manner in which the District or the Riverside Properties will release and hold the City harmless from any ongoing or future debt services payments to the CVFD. 6. District/Riverside Properties Responsible for All Costs of the Project/Financing Options. The District and/or the Riverside Properties shall be solely responsible for paying for all costs of the Project. If the Riverside Properties desire for the City to create a SID for selling bonds to finance the costs of the Project,in addition to the petition for annexation, the owners of the Riverside Properties must submit a petition for the creation of a SID to fund the Project. The petition must be pursuant to §7-12-4102(3), MCA and must detail the costs to be covered by the SID assessments which such costs must include costs of design, construction, costs associated with the sale of bonds, and administrative costs including those applicable to the City's SID revolving fund. If not all owners of the Riverside Properties sign such a petition for creation of a SID the petition for annexation must at a minimum include a waiver of right to protest creation of such a SID from every property owner signing the annexation petition. Waivers of right to protest such a SID must be provided in sufficient number to exceed the protest thresholds provided in §7- 12-4113, MCA. If the residents find alternative financing so as to not seek the City's assistance in financing the Project the petition for annexation or the interlocal agreement with the District must indicate the method of financing and indicate such financing has been secured and will be made available to the City to pay for the City's costs associated with the Project. The owners of the Riverside Properties recognize that for the City to create a SID to finance the Project the Riverside Properties must be annexed into the City prior to the City commencing the process to create the SID. Page 7 of 14 Resolution 4972, Riverside Annexation Conditions 7. Waivers of Rights to Protest for Infrastructure. Consistent with other annexation, the City seeks waivers of rights to protest for the financing of important public infrastructure. The petition for annexation must also include waivers of right to protest creation of(i) a special district for park and trail maintenance to be created pursuant to §7-11-1001 et seq., MCA; (ii) waivers of right to protest the creation of a SID for construction of all local streets to the City's local street standard including all City requirements such as lighting, curb, gutter, sidewalks, etc.; and (iii) given the location of the Riverside Properties, waivers of right to protest the creation of a SID for future improvements to Springhill Road, the intersection of Springhill Road and Frontage Road and the intersection of Springhill Road and N. 19"Avenue. 8. Interlocal Agreement between the District and the City. The City and the District,prior to or concurrent with annexation, must enter into an interlocal agreement. The interlocal agreement must address: a. Conveying Infrastructure. The manner in which the City will acquire the District's wastewater collection facilities following completion of the Project and which of its facilities the District will convey to the City. The District will retain possession of and maintain responsibility for its treatment system and all infrastructure connected to that system after the completion of the Project and the commencement of treatment of wastewater by the City. b. Indemnification. That the District release,hold the City harmless and indemnify the City from any claims or damages resulting from, arising out of, or in any way related to pollution and water quality compliance issues stemming from the District's operation of its wastewater facilities for both past action and for any future issues related to the District's facilities that City does not obtain. The indemnity obligation must also hold the City harmless from any delay in the District meeting DEQ's required compliance schedule. The District must also release and hold the City harmless from any suit from any resident of the Riverside Properties regarding the formation of a SID to fund the Project and Page 8 of 14 Resolution 4972,Riverside Annexation Conditions agree to take all steps necessary to secure financing for the Project should the City not be able to form such a SID. The District must secure and maintain adequate insurance to support its indemnity obligations. c. Financing. How design, financing, and construction of the Project will occur. The agreement must address: i. If the District and the Riverside Properties seek the City's participation in financing the Project through a SID, the District's financial and logistical participation as the City completes the design for the Project, secures financing, and bids, awards, and oversees a contract for the construction of the Project. ii. How, at its own cost, the District will be solely responsible for obtaining all necessary permits and easements for the Project provided that the same meet the standards and requirements of the MDEQ and the City. iii. That any easements or other right of way necessary for the City to provide wastewater service will be transferred to the City upon annexation. d. Water for Firefighting. Because the City will, upon annexation, rely on the District to ensure adequate water supply for fire suppression purposes, the District must agree to operate and maintain its water distribution, storage, and supply system to maximize available water flow for fire suppression from the system and to make all necessary repairs. The District must indemnify and hold the City harmless from any claims or damages resulting from, arising out of, or in any way related to inadequate water supply or flow related to a fire suppression effort. Page 9 of 14 Resolution 4972,Riverside Annexation Conditions e. City Not Subject to DEQ Enforcement. That should the City finance the Project through the creation of a SID, the District will be solely responsible for ensuring compliance with any water quality violations and the act of the City to assist the District and the Riverside Properties in designing, constructing, and financing the Project will not subject the City to enforcement action by MDEQ for the District's ongoing water quality violations. £ City Assumption of Wastewater Treatment. That at the time of completion and approval by the City of the construction of the Project and notice to the District the City is ready to assume wastewater services for the Riverside Properties,the District shall convey to the City its functioning wastewater collection facilities, including but not limited to the existing pipes,manholes,lift stations, and other wastewater infrastructure used to collect and deliver wastewater within the District's boundaries to the WRF. After the City agrees to begin treating the District's and Riverside Properties' wastewater, the City shall be solely responsible for all collection,treatment and disposal of wastewater coming from the Riverside Properties. g. District to Maintain Responsibility for Its Wastewater Treatment Works. That the District will retain possession of and maintain responsibility for its existing wastewater treatment system and all infrastructure connected to that system after the completion of the Project and the commencement of treatment of wastewater by the City. h. District's Water System. The City will not require transfer of the District's water supply and distribution system or the District's water rights to the City at the time of annexation and, as such, the District is retaining its water rights, water supply and distribution system. The District's water supply and distribution system may be considered to demonstrate compliance with the City's water adequacy requirements. Page 10 of 14 Resolution 4972,Riverside Annexation Conditions i. If,however,the District's water system is altered or modified, or no longer functioning, or the City determines demand for water in Riverside Properties is increased or not otherwise being met, the Riverside Properties must comply with the City's water adequacy requirements in place at that time by either paying cash-in-lieu of water rights, or transfer ownership of water rights, or a combination thereof. ii. The interlocal agreement must address how the District would transfer ownership to the City of the District's personal and real property necessary for the provision of water service to the Riverside Properties should the District request the City take over the water treatment and distribution system or should the District no longer be able to provide water service to the District. i. Nutrient Credits. The District must acknowledge any future nitrogen and/or phosphorus nutrient credits that result from removing the District's wastewater treatment system from operation and which are provided by MDEQ will belong to the City to offset nutrient discharge limits at the WRF. j. District's Ongoing Responsibilities. The interlocal agreement must also address how the District will continue to operate as it relates to providing water to the Riverside Properties, though it will cease to operate any sewer collection or treatment operations and how the District will exist for wastewater purposes solely to address any outstanding reclamation and indemnity obligations. k. No Expansion of Water Service Area. The District must agree that it will not expand its area of water service. Page 11 of 14 Resolution 4972, Riverside Annexation Conditions 9. No Action on Financing until Annexation. That the City shall take no action regarding the Project including financing the Project (if requested) until all properties proposed to be served by the City have been annexed into the City. 10. Impact Fees. Consistent with annexing other properties into the City, the Riverside Properties will be assessed impact fees for fire and wastewater. At the time of annexation, all the owners of the Riverside Properties must provide fire impact fees and wastewater impact fees.The City shall provide a listing of the cost of impact fees by individual property. The City will collect all fire impact fees and distribute such to the fire impact fee capital fund at the time of annexation. For wastewater impact fees, the City will place wastewater impact fees in a fund to be held by the City until the completion of the connection between the WRF and the Riverside Properties.At the time the City commences treating wastewater effluent from the Riverside Properties the City will transfer all wastewater impact fee to the wastewater impact fee capital fund. 11. Zoning. The petition for annexation must address the requested zoning designation of the Riverside Properties. The determination of zoning is a legislative act of the Commission and will be conducted pursuant to the requirements of Montana law and the City's development regulations. The City Commission retains sole authority over the zoning designation. 12. Sump Pumps. At the time of submission of the Riverside Properties or the District must provide a plan to be approved by the City that requires property owners or the District to disconnect every sump pump within all structures disposing of such water into the District's wastewater collection system and dispose of such water outside of the wastewater collection system in a manner that complies with all local, state, and federal requirements. The disconnection must occur prior to the City accepting wastewater for treatment. Section 2 That upon receipt of a petition for annexation, the City, in cooperation with the District Page 12 of 14 Resolution 4972,Riverside Annexation Conditions and the owners of the Riverside Properties, will prepare an extension of services plan specifically tailored to Riverside Properties, for extending each municipal service based on the present circumstances concerning existing services, systems, and facilities. Section 3 The conditions of this Resolution are non-binding as conditions may change from the date of this Resolution to the date a petition is submitted. The Commission adopts this Resolution in a good faith effort to communicate the Commissibn a po4y,regarding the City assisting the Riverside Properties and the District in addressing their Wastewaterneeds as established pursuant to MDEQ's AOC and, as such, the Commission mtenc- ,fo "the $ta�ements in this resolution to provide guidance as the District and Riverside Properties determine-whether to move forward with a petition for annexation seeking the City's assistance:~ Page 13 of 14 Resolution 4972,Riverside Annexation Conditions PASSED, ADOPTED, AND APPROVED by the City Commission of the City of Bozeman, Montana, at a regular session thereof held on the 28"' day of J -y 2019. THIA L. A RU May ATTEST: B O2> � O � rJ • C n ?ca •.,2, ROBIN CROUGH - U L -� City Clerk L9TrN co• APPROVED AS TO FORM: GRE ULLIVAN City Attorney Page 14 of 14