Memorandum 16-120 Shellfish Avenue/South Slope Drive Water Main Connection

Memorandum 16-120

TO:                        Mary K. Koester – City Manager

FROM:                  Carey Meyer – Public Works Director

DATE:                  July 15, 2016

SUBJECT:          Policy Regarding Conditions for Property Owner Connection

                                                Shellfish Avenue/South Slope Drive Water Main Extension Project

Background: The Water/Sewer Master Plan for the City of Homer calls for improvements to the City’s water system that would improve the reliability of the water service to the community and provide piped drinking water to those that are not currently served.  The extension of a water main along Shellfish Avenue/South Slope Drive (see attached map) is one of those improvements. Public Works has completed the design of the improvement and has obtained a grant to help pay for the design and construction.  Normally, these types of improvements are constructed through the formation of a neighborhood initiated Special Assessment District (SAD) where benefitted property owners are assessed for their fair share.  Water and sewer SAD assessments have normally been distributed equally to all benefitted lots.

This project was initiated by the City. 55% of the cost of design and 70% of the cost of construction will be covered by grants obtained by the City. The remaining costs shall be divided equally between the benefitted property owners fronting the main.

Attached is a table showing the estimated “fair share” of the costs anticipated for each benefitted fronting property. The City Council will review and approve the actual costs once actual costs are known.

Condition for connection to the water main:

Property owner shall pay their “share” in full or execute an agreement between the City and the property owner(s) that permits connection, promises to pay their “share” in equal annual payments over a 10-20 year period (interest charges at 1.5% over the term of the agreement), and authorizes the City to record a lien against the property. Interest will accrue from the date that the City Council establishes final project cost.

Recommendation: The City Council approve this Memorandum which establishes the conditions under which benefitted property owners can connect to the Shellfish Avenue/South Slope water