Memorandum 15-136 Water Main Extension Shellfish Avenue, South Slope Drive, and Kachemak Drive Phase III

Memorandum ID: 
15-136
Memorandum Status: 
Backup

Details

Memorandum 15-136

TO:                       Mayor Wythe and Homer City Council

FROM:                 Katie Koester, City Manager

DATE:                  August 5, 2015

SUBJECT:         Memo on Resolution 15-066(S)

The purpose of this memo is to explain the changes made in substitute Resolution 15-066(S). The City of Homer received a grant to pay for 70% of water storage distribution projects. These projects include completing the water main extension on Kachemak Drive Phase III and Shellfish Avenue / South Slope Drive. Resolution 15-066 established conditions by which property owners along those routes could hook up to water. The substitute before you makes the following changes to Resolution 15-066:

 

Original specified that property owners could not hook up to water until they had access to City sewer. However, no mechanism was provided to construct City sewer.

Substitute requires property owners to enter into a special assessment district (SAD) for water and sewer at the same time. The property owners still benefit from the grant paying for a large portion (70%) of the water main extension project. Property owners have already initiated a SAD for sewer. Resolution 15-066(S) will give the City Clerk direction for the terms and conditions of the SAD.

 

Original made the entire amount a property owner owes for the water main extension due at hook up.

Substitute incorporates the amount a property owner owes for the water main extension into an SAD. This ensures that all properties pay for the improvement and offers City financing to the property owners.

 

Original establishes the same conditions for Kachemak Drive Phase III and Shellfish Avenue / South Slope Drive property owners to hook up to the water main extension.

Substitute only addresses the conditions for Kachemak Drive Phase III. The reality is they are two different projects. Shellfish Avenue / South Slope Drive property owners do not have the same soil and drainage issues associated with septic systems. Furthermore, this neighborhood does not have sewer immediately adjacent. Installing a sewer main extension in the Shellfish / South Slope neighborhood would require the development of an additional subdivision that is not feasible at this time. Conditions for Shellfish / South Slope properties to connect to the main extension will be brought forward at a later time once Public Works Director Meyer has had an opportunity to hold a neighborhood meeting with affected property owners.

 

How to Treat Lots Owned by State of Alaska

At the July 27th meeting Councilmember Roberts asked about lots owned by the State of Alaska and how they would be treated in the SAD. There is nothing in Alaska Statutes or Homer City Code that exempts State land from paying an assessment.[i] Nevertheless there are no State properties in Phase III. There are 32 parcels within the district. Two parcels are owned by the City. Five parcels are owned by Kachemak Moose Habitat. The 5 Moose Habitat parcels are all exempted from real property tax because they are used for community purposes. They may file an exemption for the water sewer assessments (as they did with their property in Phase II). Council can exempt certain lands that will not be developed due to conservation easements or owned by organizations that conserve land for public purposes and or habitat protection. With this in mind the City should recover 25 assessments for Phase III.

 

 

[i] Sec. 29.46.010. Assessment and proposal.    

(a) A municipality may assess against the property of a state or federal governmental unit and private real property to be benefited by an improvement all or a portion of the cost of acquiring, installing, or constructing capital improvements. The state shall pay an assessment levied, except as otherwise provided by law and subject to its right of protest under AS 29.46.020(b). If a governmental unit other than the state benefited by an improvement refuses to pay the assessment, it shall be denied the benefit of the improvement. An improvement proposal may be initiated by
        (1) petition to the governing body of the owners of one-half in value of the property to be benefited; or

        (2)the governing  body.

(b) Notwithstanding (a) of this section, a party to a contract approved by the legislature as a result of submission of a proposed contract developed under AS 43.82 or as a result of acts by the legislature in implementing the purposes of AS 43.82, is exempt, as specified in the contract, from assessment under this chapter against real property associated with the approved qualified project that is subject to the contract. This subsection applies to home rule municipalities.

(AS 43.82 is the Alaska Stranded Gas Development Act)

[1] Sec. 29.46.010. Assessment and proposal.    

(a) A municipality may assess against the property of a state or federal governmental unit and private real property to be benefited by an improvement all or a portion of the cost of acquiring, installing, or constructing capital improvements. The state shall pay an assessment levied, except as otherwise provided by law and subject to its right of protest under AS 29.46.020(b). If a governmental unit other than the state benefited by an improvement refuses to pay the assessment, it shall be denied the benefit of the improvement. An improvement proposal may be initiated by
        (1) petition to the governing body of the owners of one-half in value of the property to be benefited; or

        (2)the governing  body.

(b) Notwithstanding (a) of this section, a party to a contract approved by the legislature as a result of submission of a proposed contract developed under AS 43.82 or as a result of acts by the legislature in implementing the purposes of AS 43.82, is exempt, as specified in the contract, from assessment under this chapter against real property associated with the approved qualified project that is subject to the contract. This subsection applies to home rule municipalities.

(AS 43.82 is the Alaska Stranded Gas Development Act)