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HomeMy WebLinkAbout09-28-06 Impact Fee Advisory Committee Minutes.doc** MINUTES ** THE CITY OF BOZEMAN IMPACT FEE ADVISORY COMMITTEE THURSDAY, SEPTEMBER 28, 2006 7:00 P.M. ITEM 1. CALL TO ORDER AND ATTENDANCE Chairman Tim Dean called the meeting to order at 7:03 PM and directed the secretary to record the attendance. He noted he would like the correspondence to be sent via e-mail and regular mail. He would also like packets earlier. MEMBERS PRESENT: Tim Dean, Chairman Ron Kaiser Debra Becker Ken Eiden Anna Rosenberry Nicholas Lieb Randy Carpenter MEMBERS ABSENT: Rick Hixson Sean Becker, Commission Liaison STAFF PRESENT: Chris Saunders, Assistant Director of Planning Kimberly Kenney-Lyden, Recording Secretary GUESTS PRESENT: Randy Goff, HDR Inc. ITEM 2. MINUTES OF AUGUST 24TH AND SEPTEMBER 14TH, 2006. Chris Saunders noted the more detailed the minutes are, the longer they take to transcribe. He further added he is sensitive to the time concerns as the city serves 13 advisory boards. Ron Kaiser noted he would prefer the minutes be capsulated. Ms. Becker stated she was unsure what we need as a committee, but if the commission is requesting them at this level of detail, then they must continue in this format. She further added that she would be in favor of less detailed, shortened version of minutes. Mr. Saunders noted the City Commission has adopted a shorter, bullet pointed version with a new software program. Chair Dean moved to recommend using the same format of minute taking as the City Commission. Mr. Kaiser seconded the motion. All in favor. Motion passed unanimously. Mr. Dean asked that the April 27th minutes read clearly under Item #2 so it plainly states that when the vote was taken, the three items were not impact fee eligible. He further added that the minutes from August 24th and September 14th be approved as read. ITEM 3. PUBLIC COMMENT {Limited to any public matter within the jurisdiction of the Impact Fee Advisory Committee and not scheduled on this agenda. Three-minute time limit per speaker.} Seeing there we no members of the public present, Mr. Dean closed this portion of the meeting. ITEM 4. CITY COMMISSION LIASON { A standing item to be used as needed} Mr. Dean noted Mr. Sean Becker was not present for this meeting, therefore he closed this portion of the meeting. ITEM 5. HDR Engineering – WATER AND SEWER IMPACT FEE UPDATE Initial meeting and discussion with the consultants selected to update the water and sewer impact fees. Discussion on methodology and the update process. 5.1 INTRODUCTIONS Mr. Randy Goff with HDR Inc. noted his firm was selected to do the water and waste water impact fees update study. They are located in Portland, Oregon. Mr. Saunders added this firm will also be doing a rate study for the City of Bozeman simultaneously. He noted these funds must run like ‘utilities’, it is a little different than the general tax revenues. IMPACT FEE OVERVIEW PRESENTATION Mr. Goff stated he called his presentation “Impact Fee 101” on the water and waster water impact fees. He added they will discuss key methodology in determining the fees and utilize to determine the calculation. Mr. Goff noted there are generally three types of fees that are imposed to serve development; the impact fee, the line extension policy, and lastly the hook-up fee. His firm will make sure they keep these fees separate to ensure there is not any double counting that will occur. He added an impact fee is a one time capital recovery charges imposed on new development in order to collect all or a portion of infrastructure costs to provide service to that development. 5.3 BASIC ORDINANCE REQUIREMENTS Randy Goff stated that state and local laws, planning and finance criteria, in conjunction with customer acceptance are the methods used to determine impact fees. He further added that the system planning criteria is the most important criteria because it establishes a rational nexus which allows the customer to only pay for what they need. Mr. Goff noted that when general obligation bonds are issued, the public ends up paying for this through their property taxes. He noted there are legal considerations from Senate Bill No. 185 that set definitions for impact fees. In this statute, the standard that a capital project must have is an asset life of greater than 10 years to be included in the impact fee calculation. Mr. Goff added it cannot be used for renewal/ replacements or maintenance/operation issues and there is a laundry list of criteria that needs to be met. IMPACT FEE METHODOLOGY Mr. Goff noted there are a few different approaches in calculating the impact fees; The buy in method: You only take what the existing assets are and the number of units that will be served and that is how you get the calculation. No existing capacity exists: You would use an incremental method which would only look at future capital improvements less any deficiencies. Hybrid Method for utilities: There is always a need to have excess capacity in the system and by law, when you get to 80% of your treatment plant capacity, you have to start planning a new one. Capacity divided by availability and multiplied by demand. Mr. Saunders noted that Tindale-Oliver discussed the idea of indexing, establishing an annual adjustment on a defined basis that assists the city since no one can see perfectly into the future and the annual adjustment keeps it at present value. Mr. Goff added that his recommendation is to increase the fees every year by the construction cost index and added that the homebuilders in other areas were requesting indexing. He noted that our statutes only require impact fees to be updated every two years, but Mr. Goff stated he would recommend indexing every year. Debra Becker added this may not be accurate ten years down the line, but Mr. Goff responded this will be about equal with inflation. Mr. Kaiser asked when the last time was when these fees were adjusted and Mr. Saunders noted the City has indexed every year in January and based it off the consumer price index. Mr. Goff noted that HDR uses the Hybrid approach to determine sewer impact fees. Mr. Saunders noted that with water, it’s a simple calculation however, with waste water, it’s more difficult to determine exact usage at times. We can charge the sewer impact fees correlated to the size of water meter and Ms. Rosenberry noted the city currently has no debt on the waste water facility. Mr. Saunders noted there is a larger usage of our waste water treatment plan right now and will need to start thinking about our new facilities plan to accommodate this growth. Mr. Goff stated the City of Bozeman will need to issue debt in order to get the financing for the new waste water treatment plant. Mr. Carpenter asked if there is a limit to the number of gallons per unit that can use the treatment plant. Mr. Saunders responded that the city can discharge as many gallons as can fit through the pipeline, but the question arises about the quality of the water that is being sent into the river. Mr. Carpenter then asked if there was a limit to toxicity or pollution. Mr. Goff stated there is a limit to the toxicity, but there is not a limit to amount of gallons that are discharged. Mr. Lieb asked if the impact fees are going to be used for a new waste water treatment plant. Mr. Goff noted his firm will decide what percent of these improvements are growth related, but overall the treatment plant issue is very complicated. Mr. Saunders noted there is discussion about ways to reclaim or otherwise reduce discharges, but there are many factors involved. Mr. Saunders stated that impact fees pay for the large scale projects like the main 24 inch water line down 19th by the Stockman Bank. Mr. Goff stated there is an administrative charge as part of the impact fees. Mr. Dean noted he thought the state statute did not allow for administrative costs. Mr. Goff responded that the statute states you can charge this fee, but it cannot be more than 5% of the total impact fee collected. He added this administrative charge would be for the accounting time, finance director’s time, and even planning department’s time. Mr. Tim Dean asked Mr. Goff that if he and his firm were being paid from the impact fees collected to which Mr. Goff confirmed he and his firm were being paid from those funds. Mr. Saunders noted the City has collected a 2% administration charge historically and that is the funding source for the update. Ms. Becker then asked if ordinance requires us to update every two years, is the city required to hire a consultant. Mr. Saunders noted it would depend on how much things have changed and right now, the city ordinance says we have to go through the update every three years, but if the city is hitting it’s projections, there is no need to hire a consultant. 5.5 REVIEW OF SCOPE OF SERVICES AND SCHEDULE Mr. Goff noted that tonight was just the basic overview. Mr. Saunders added the location for meetings will be at the Commission Meeting room at City Hall once the affordable housing board has completed their proceedings. Mr. Goff detailed the Water/Sewer Impact fee schedule: Octoboer 19, 2006: The overview of the master plans, but this committee might meet based on drafts and discussions between city staff. October 26, 2006: Draft of this impact fee study for the city to review and give them a couple of weeks to review it. November 16, 2006: Meeting for IFAC members to review the draft reports. December 14, 2006: Tentative meeting for IFAC members, this will be to make our formal recommendations to the City Commissions. This meeting date may be pushed due to the holiday season. Mr. Goff noted this schedule may change a little once they start the fire impact study, but will update members of times and dates. He added Amanda McGuinness from the Missoula office who is the project manager on the waste water treatment plan will be joining him for the meeting that covers the waste water issue. Ms. Becker asked Mr. Goff if the schedule he passed out tonight was accurate or if it was just a guideline. Mr. Goff responded that October 19th is only a deliverable date. He added along with Mr. Saunders noted that the next meeting dates will be on October 26th and November 16th, 2006. The rest of the dates were more ‘deliverable dates’. The December 14th date will most likely be postponed to beginning of the new year due to the Holidays. Mr. Saunders noted that Tindale-Oliver will be doing the data collection portion of the traffic study during the first two weeks of October. 5.6 OTHER COMMENTS AND ISSUES Randy Goff noted that the current waste water fees are low due to treatment costs of late. He added it will take two or three years to phase in the new fee increases to help balance new development against existing homes. Anna Rosenberry stated she had received a request from CAHAB to find a mechanism to waive the impact fee. Mr. Goff noted the city can do that, but the Supreme Court states you cannot impose that onto the next person paying impact fees. Overall, he stated the financing source has to come to from somewhere else. Mr. Saunders responded that in his opinion, it’s easier to charge the same rate for everyone and then say the city will pay for the building fee. Randy Goff added that if you are going to waive a fee, you have to do it for a ‘well defined’ class. ITEM 6. OLD BUSINESS Regarding the street plan update, Mr. Saunders noted that Tindale-Oliver has picked three types of sites from which to do their study; three office sites, three condominium sites, and three single family residential sites, and two condominium-residential sites. He added the city will be possibly reviewing the data collected from this study by the end of the year, just in time to analyze the water issue. Chris Saunders commented that the transportation study is the most difficult to define the user. ITEM 8. NEW BUSINESS Mr. Randy Carpenter noted he will not be present if there ends up being a meeting on October 19th. ITEM 9. ADJOURNMENT Chairman Tim Dean adjourned the meeting at 8:35 PM. _______________________________________ ____________________________________ Tim Dean, Chairperson Chris Saunders, Assistant Planning Director City Of Bozeman Impact Fee Advisory Committee Planning and Community Development and Staff Liaison to IFAC *City of Impact Fee Advisory Committee meetings are open to all members of the public. If you have a special need or disability, please contact our ADA Coordinator, Ron Brey, at 582-2306 (voice) or 582-2301 (TDD).