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HomeMy WebLinkAboutOrdinance No. 2013-35 (Title: An ordinance updating impact fees and creating new Article III "Impact Fees" to Chapter 74 "Taxation" of the City Code of Ordinances for regulation of subject.) ORDINANCE NO. 2013-35 AN ORDINANCE AM�NDING THE CODE OF THE CITY OF FRIENDSWOOD, TEXAS, CHAPTER 74 "TAXATION" TO CREATE A NEW ARTICLE III, "IMPACT FEES", rOR PURPOSES OF AMENDING AND UPDATINC� LAND USE ASSUMPTIONS AND CAPITAL IMPROVEMENTS PLAN FOR IMl'ACT FEES (IMPACT FEES), PURSUANT TO THE TEXAS LOCAL GOVERNMENT CODE ANNOTATED, § 395.001 ET. SEQ., PROVIDING PROVISIONS FOR ADEQUATE PUBLIC FACILTTIES TO SERVE NEW � DEV�LOPMENT BY REQUIRING EACH SUCH DEVELOPMENT TO PAY ITS PRO RATA SHARE OF THE COSTS, FEE ASSESSMENT, CALCULATION AND COLL�CTION; THE USE OF PROCEEDS; PROVISIONS FOR APPEALS, REFUNDS AND RELATED MATTERS; PROVIDING A PENALTY IN AN AMOUNT NOT TO EXCEED $500 FOR VIOLATION OF ANY PROVISIONS HEREOF BY INCLUSION IN THE CODE OF ORDINANCES; REPEALING ALL ORDINANCES OR PARTS OF ORDINANCES INCONSISTENT OR IN CONFLICT HEREWITH; PROVIDING FOR SEVERABILITY; AND PROVIDING FOR NOTICE AND EFFECTIVE DATE. X X X X Y X X X �X X iF WHEREAS, by virtue of Vernon's Texas Codes Annotated, Local Government Code, Chapter 395 ("State Law"), the City Council has found it necessaiy and appropriate to revise the City's capital improvements plan and update impact fees to comply with the provisions of said State Law; and WHEREAS, the City Council has employed qualified professionals to revise the capital improvements plan and calculate updated impact fees, and has held a public hearing, as required by State Law, at which hearing all persons desiring to be heard were heard; and WHEREAS, the City of Priendswood first adopted Impact Pees for New Construction in 1990 in accordance with applicable law; and WHEREAS, Section 395.052 of the Texas Local Goveinment Code requires that the land use assumptions and capital improvement plan for which an impact fee is imposed shall be reviewed, evaluated, and updated at least every five years; and WHEREAS, the City of Friendswood last reviewed, evaluated and updated the land use assmnptions and capital improvement plan for impact fees (collectively sometiines referred herea8er as "Impact Fees"), by the passage of Resolution 2008-87 adopted on November 17, 2008; and WHEREAS, in accordance with the provisions of Chapter 395 of the Texas Local Government Code, "Financing Capital Improvements Required by New Development in Municipalities, Counties, and Certain other Local Governments — Subchapter C. Procedures far Adoption of Impact Fee," Sections 395.052 and 395.058, the City Council of the City of Friendswood appointed the Planning and Zoning Commission to act as the Capital Improvements Advisory Committee, (Committee), for the purpose of updating the land use assumptions, capital improvements, and impact fees Ord 2013-35 2 and determined that the appointment of such Conunittee complied in all respects to the provisions of law; and WHEREAS, the Committee has filed its written comments on the proposed amendments to the land use assumptions, capital improvements plan, and impact fees as required by law, before the fifth business day before the date of the public heai7ng, for which notice was properly provided by the Friendswood City Council within 60 days after the date it received the update of the land use assumptions and capital improvements plan, in accordance with sections 395.053 and 395.056 of the Texas Local Government Code; and WHEREAS, the City Council has compleYed an Impact Fee Analysis on which to base the recommended amendment of fees and has caused to be prepared a new Capital Improvements Plan and Land Use Assumptions; and WHEREAS, the City of Friendswood has met all of the legal requirements and prerequisites for iinpleinentation of impact fees in accordance with Chapter 395 of the Texas Local Government Code; and WHEREAS, the City Council of the City of Friendswood finds and determines its legislative intent to enable the provisions of Chapter 395 of the Texas Local Government Code and has determined to approve the amendments to the Impact Fees within 30 days after the date of the public hearings on the subject amendments in compliauce with section 395.057; Ord 2013-35 3 NOW, THEREFORE, BE IT ORDAINED BY TH� CITY COUNCIL OF THE CITY OF FRIENDSWOOD, STATE OF TEXAS: SECTION 1. That the City Council of the City of Friendswood adopts the preceding preamble paragraphs as if repeated verbatim herein and find them to be true and coirect facts. SECTION 2. The capital improvements plan, included in a study by James E. Thompson, P.E., entitled "2013 Update Study for Land Use Assumptions Capital Improveinents Plan and Impact Pees Water Supply / Distribution and Wastewater Treatment / Collection Systems" is incoiporated by reference and attached hereto as E�ibit"A". S�CTION 3. AM�NDM�NT TO TH� COD� The Friendswood City Code, Chapter 74 "Taxation", is hereby amended by creating a new Ai�ticle III to be entitled"Impact Fees,"as follows: "Sec. 74-50. Authority. The city is authorized to enact this Articie by Chapter 395 of the Texas Local Government Code, which authorizes home-rule cities, among others,to enact or impose impact fees on land within their coiporate boundaries and in their extraterritorial jurisdictions, and on persons with whom they have a water or sewer service contract, as charges or assessments imposed against new development in order to generate revemie for fimding or recouping the costs of capital improvements or facility expansions necessitated by and attributable to such new development; and by the Friendswood City Charter. The provisions of this article shall not be construed to limit the power of the city to adopt such article pursuant to any other source of local authority,nor to utilize any other methods or powers otherwise available for accomplishing the purposes set forth herein, either in substitution of or in conjunction with this article. Guidelines may be developed by resolution or otherwise to implement and administer this article. Sec. 74-51. Definitious. The following words, teims and phrases, when used in this article, shall have the meanings ascribed to them in this section, except where the context clevly indicates a different meaning: Assessment means the deteiniination of the amount of impact fee per service unit that may be imposed on new development pursuant to this article, which determination occurs at the time specified in Secrion 395.016 of V.T.C.A. Local Government Code. Ord 2013-35 4 Capital improve�ne�ts plcm means the water and wastewater capital improvements plan adopted by the city council, as inay be amended from rime to time, that identifies capital improvements or facility expansions for which impact fees may be assessed. Impact fee has the meaning ascribed to it in Section 395.001 of V.T.C.A. Local Goveinment Code and shall mean a charge or assessment to be imposed by the city upon new development to generate revenue for funding or recouping the costs of capital improveinents ar facility expansions necessitated by and attributable to new development. The term includes amortized charges, lump-sum charges, impact fees, contributions in aid of construction, and any other fee that functions as described by this definition. Impact fees do not include dedication of rights-of-way or easements, or constrLiction or dedication of site-related water distribution or wastewater collection facilities, or streets, sidewallss, or curbs if the dedication ar construction is required by other valid ordinances of the City Code and is necessitated by and ath•ibutable to the new development; lot or acreage fees placed in trust funds for the purpose of reimbursing developers for oversizing or constructing water or sewer mains or lines; or other pro rata fees for reimbursement of water or sewer mains or lines extended by the city.. Neia� developi�xend means the subdivision of land; the construction, reconstruction, redevelopment, conversion, structural alteration, relocation or enlargement of any structure or any use or extension of the use of land; any of which increases the number of sexvice timits. Plat mans the plan or map for the subdivision to be filed for record with the county clerk in the county in which the property is located. Plat includes replat. Properry omner means the owner in fee of a tract or parcel of land upon which new development is to be located or his authorized representative. Service area means the area within the corporate boundaries and exhaterritorial jurisdiction to be served by the capital iinprovements or facilities expansions specified in the capital improveinents plan. Service units means a standardized measure of consumption of water and wastewater systems capacity whicb is eqiial to the average flow rate for a single family dwelling unit in the city. Sec. 74-52. Impact fees for new construction. (a) Cr�eafed There is hereby created an impact fee as provided by Chapter 395 of the Texas Local Government Code. (b) New development to be charged. P'ees may be charged against new development in the city, including the subdivision of land; the construction, reconstruction, redevelopment, conversion, sh�uctural alteration, relocation or enlargement of any shucture; or any use or extension of the use of land; any of which increases the demand for additional services. Ord 2013-35 5 (c) Use offi�nds. The funds collected by the city froin such fees shall be used only to pay the costs of conshucting capital improvements or facility expansions, including and limited to the construction contract price, suiveying and engineering fees, land acquisition costs (including land purchases, court awards and costs, attorney's fees and expert witness' fees) and the fees actually paid ox contracted to be paid to an independent qualified engineer or financial consultant, not an employee of the city, preparing or updating the capital improvement plan on which fees are based. Funds may also be used for the payment of principal and interest on bonds, notes or other obligations issued by or on behalf of the city to fnance the cost of such improvements. The funds may not be used for construction of any improvements not identified in the plan; to repair, operate or maintain existing or new capital improvements; to upgrade, update, expand or replace capital improvements seiving existing development in order to meet stricter safety, efficiency, environmental or regulatory standards or to better seive existing developments; to pay administrative and operating cosYs of the city; or to pay fox the cost of preparing the land use assumptions or the capital improvements plan if performed by municipal employees. (d) Fees. The fees to be charged are as follows: ($2,928 per Seivice Unit- Single Family Connection) Meter size and Tvve Service Units 1" simple 1 1 'h" simple 2 1 %2" turbine 2 2" simple 3 2" compotmd 3 2" tarbine 4 3" compound 6 3" turbine 10 4" compound 10 4" turbine 17 6" compound 20 8" compound 32 6" turbine 37 10" compound 46 8" turbine 64 10" turbine 100 12" turbine 132 [I" meter is the smallest acceptable meter. In any situation where a meter smaller than 1"is installed,the 1"fee will be charged]. Ord 2013-35 6 (e) Assessnaent and paynzent of i�pact fees. The iinpact fee imposed by this section shall be assessed and collected in full at the time of issuance of the building permit for the seivice timits or at the time the water meter is installed, whichever occurs first, if the lot or tract was platted prior to June 20, 1987. For land platted after June 20, 1987, the impact fees shall be assessed at the time of recordation of the final plat and collected in full at the time of issuance of the building permit for the service units or at the time the water meter is installed, whichever occros first. Once the fee is assessed and collected, additional impact fees or increases in fees may not be assessed and collected against the lot or tract unless the number of service units to be developed on the lot or tract increases. In such event, the city may increase the assessment and collection of fees to fund new capital improvement in the amount attributable to the additional service units. (fl Exe»aptions. Impact fees may be assessed but shall not be collected in areas where services are not cun�ently available unless: (1) The city and the developer enter into a contract for the constr•uction or financing of necessaiy facilities, which agreeinent eontains provision for crediting such contributions against impact fees or for reimbursement fiom fees paid by other new developments using the facilities. (2) The city elects to collect fees and commence conshuction of necessary facilities within two years and provide services within five years. (3) The owner voluntarily requests the city to reserve capacity to serve futLUe development and the city and the owner enter into a written agreement regarding the reserve capacity. (g) Deposit of fees. All funds collected under this section shall be deposited in interest-bearing accounts clearly identifying the category of capital improvements or facility expansions wiYhin the service area for which the fee was adopted. All interest earned in the accounts shall be considered fimds of the account. (h) Refimds. Impact fees must be refunded to the recard owner of the property with statutory interest under the following circumstances: (1) On request of the owner of property on which an impact fee was paid, if services are available and the city denies seroice, or if the city fails to commence construction of new facilities to serve the development or fails to complete such facilities within five years of the time the fee is collected. Ord 2013-35 7 (2) If the funds collected are not spent for earmarked facilities within ten years from the date of collection. (3) Upon completion of the capital improvements for wbich the fee was collected, the city must xecalculaYe the impact fee based on actual project costs and if the fee collected exceeds the amount paid for the improvements by more than ten percent, the difference must be refunded to the property owner. (i) Administraiive remedies. If the city does not perform a duty imposed by the Texas Local Government Code, Ch. 395, any person who has paid an impact fee or an owner of land upon which an impact fee has been paid shall present a written reqiiest to the city council stating the nature of any unperformed duty on the part of the city and request that it be performed within 60 days of the request. If the city council deteimines that the duty is requ�ed pursuant to this artiele and is late in being performed, it shall cause the duty to commence within 60 days of the date of the request and to continue until completion. This subsection shall not apply to matters subject to appeal. (j) Ap�eals. Appeals may be made as follows: (1) The propei�ty owner or applicant for new development may appeal the following decisions to the city council: a. The applicability of an impact fee to the development; b. The amount of the impact fee due; c. The availability or the amount of an offset ar credit; d. The application of an offset or credit against an impact fee due; and e. The amount of the refund due, if any. (2) The burden of proof shall be on the appellant to demonstrate that the amount of the fee or the amount of the offset or credit was not calculated according to the applicable fee schedule or the guidelines established for determining offsets and credits. (3) The appellant must file a notice of appeal with the city secretary within 30 days following the decision for which the appeal is made. If the notice of appeal is accompanied by a bond or other sufficient surety satisfactory to the city attorney in an amount equal to the original determination of the impact fee due, the development application or tap purchase may be processed while the appeal is pending. No person shall have any right to appeal for relief to any court in regard to any matter covered by this article Ord 2013-35 8 until after such person has exhausted the appeal procedure provided for in this section. (k) Updates to plan and revision of fees. The city shall review the land use assumptions and capital improvements plan far water and sewer facilities at least eveiy five yeais the first five year period which shall commence from the date of adoption of the capital improvements plan referenced in this section herein as required by law. The city council shall accordingly then make a deteimination of whether changes to the land use assumptions, capital improvements plan or impact fees are needed and shall, in accordance with the procedures set forth in the Texas Local Government Code ch. 395 ar any successor stahrte, either update the fees or inake a determination that no update is necessary. (1) b��pact fees. Impact fees established by this section are additional and supplemental to, and not in substitution of, any other requirements iinposed by the city on the development of land or the issuance of building permits or the sale of water or wastewater taps or the issuance of certificates of occupancy. Such fees are intended to be consistent with and to further the policies of city's comprehensive plan, capital improvements plan, zoning ordinance, subdivision regulations and other city policies, ordinances and resolutions by which the city seeks to ensure the provision of adequate public facilities in conjunction with the development of land. (m} Waiver• offees. The city council may waive all or a portion of impact fees from proposed new commercial development due, upon written request by a developer or owner of commercial property subject to the ordinance, following a public heat�ng, upon finding that such waiver substantially furthers the city's goals of promoting economic development, as may be set forth in the city's goals, policies and regulations. In granting such waiver, the city council shali make findings relating to such puiposes and shall take into eonsideration the extent to which other incentives and waivers have been granted the development pursuant to then existing laws and regulations." SECTION 4. ADOPTION OF TH� LAND USE ASSUMPTIONS MAP The "2013 Update Study for Land Use Assumptions Capital Improvements Plan and Iinpact Fees Water Supply / Dish•ibution and Wastewater Treatment / Collection Systems" by James E. Thompson, P.E., as shown on the attached Exhibit "A" which was prepared as part of the Impact Fee Study is hereby adopted and made a part of this Ordinance and the Impact Fees set forth therein are hereby levied against new development on lands located within the coiporate boundaries of the City of Friendswood consistent with this Ordinance. Ord 2013-35 9 SECTION 5. PENALTY CLAUSE; INCLUSION INTO THE CODE This Ordinance is hereby incoiporated into and made a part of the Friendswood City Code. Any person who shall violate any provision of this Ordinance shall be deemed guilty of a misdemeanor and, upon conviction, shall be fined in an amount not more than Five Hundred Dollars ($500.00) per offense, or the maximum amount provided by law. Each day of violation shall constitute a separate offense. SECTION 6. REPEAL OF CONFLICTING ORDINANCES All ordinances or parts of ordinances or resolutions inconsistent or in conflict herewith are, to the extent of such inconsistency ar conflict, hereby repealed but only to the extent of such conflict. SECTION 7. SEVERABILITY In the event any clause, plu•ase, provision, sentence, or any part of this Ordinance or the application of the same to any person or circumstances shall for any reason be adjudged invalid or held unconstitutional by a court of competent jurisdiction, it shall not affect, impair, or invalidate this Ordinance as a whole or any part or provision hereof other than the part declared to be invalid or unconstitutional; and the City Council of the City of Friendswood, Texas, declares that it would have passed each and every part of the same notwithstanding the omission of any such part thus declared to be invalid or Luiconstitutional, whether thexe be one or more parts. SECTION 8. CODIFICATION It is the intent of the City Council of the City of Friendswood, Texas, that the provisions of this Ordinance shall be codified in the City's official Code of Ordinances as provided hereinabove. SECTION 9. SAVINGS All rights and remedies which have accrued in favor of the City under this Chapter and amendments thereto shall be and are preserved for the benefit of the City. Ord 2013-35 10 SECTION 10. NOTICE BY PUBLICATION The City Secretary shall give notice of the enactment of this Ordinance by promptly publishing it or its descriptive caption and penalty after final passage in the official newspaper of the City; the Ordinance to take effect upon publication. The Ordinance shall then become effective ten (10) days after its publication, or the publication of its caption and penalty, in the official City newspaper. SECTION 11. EFFECTIVE DATE This ordinance shall become effective immediately upon passage. PASS�D AND APPROVED on first and final reading pursuant to Section 3.11(b) of the City Charter on this 7th day of October,2013. � Kevin . Holland Mayor ATTEST: ^�j\� `4'�t'"`a""_�l Q��:'�A:,s����° N ` . Melinda Welsh, TRMC �'�F�`•`•�' �S�L�•. City Secretaty :o: •;O�o •1— : oU: r� = ..�: ..�e .o.�T�TE 0���+Qe o,. ,< Ord 2013-35 11 Exhibit"A" 2013 Update Shidy for Land Use Assumptions Capital Impirovements Plan and Impact Fees Water Supply/Distribution and Wastewater Treatment/ Collection Systems Ord 2013-35 12 I CITY OF FRIENDSWOOD 2013 UPDATE STUDY FOR LAND USE ASSUMPTIONS CAPITAL IMPROVEMENTS PLAN AND 1MPACT FEES WATER SUPPLY/DISTRIBUTION AND WASTEWATER TREATMENT/COLLECTION SYSTEMS June,2013 Mayor I�evin Holland City Council Position 1—Steve Rockey Position 2—Billy J.Enochs(Mayor Pro Tem) Position 3 —7im Hill Position 4—Patrick J,McGinnis,MD Position 5—John H.Scott Position 6—Carl Gustafson City Manager Roger Roecker City SecreYary Melinda Welsh,l'RMC City Attorney Ainold Polanco Assistant City Manager Morad Kabiri, P.E.,AICP This doczrment is released for revieron under the azrthority of James E. Thw�zpson, P.E., TBPE Reg. #55568, 8/21/2013 FIRM#14865 CITY OF FRIENDSWOOD 2013 UPDATE STUDY FOR LAND USE ASSUMPTIONS CAPITAL IMPROVLMENTS PLAN AND IMPACT FEES WATER SUPPLY/DISTRIBUTION AND WASTEGVATER TREATMENT/COLLECTION SYSTEMS Impact Fee Advisory Committee Chairinan: Mark McLean Vice Chairman: Ma�•k Tibbitts Members: David O'Farrell Jim Gibson Chris Brown Jim Nye Arthur Triplette, 7r. Page 2 of 18 TABL� OF CONTENTS ITEM I. Executive Summary......................................................................................................................4 II. Introduction and Background.......................................................................................................7 IIL Review of Land Use Assumptions—City Growth Rates.............................................................9 IV. Development of City-Wide Water Supply&Distribution Impact Fee.......................................12 l. Water Supply, Storage, Transmission, Pwnping, and Distribution Projects 2. Service Unit Basis 3. Projected Service Units 4. Calculation of Updated City-Wide Water Supply&Dish�ibution Impact Fee V. Development of City-Wide Wastewater Collection&Treatment Impact Fee........................16 1. Wastewater Collection and TreaUnent Projects 2. Seivice Unit Basis 3. Projected Service Units 4. Calculation of Updated City-Wide Wastewater Collection &Treatment Impact Fee VI. Recommendations&Conchisions..........................................................................................18 Appendices A. Chapter 395 Local Government Code B. Summary of Service Unit Equivalents C. Water Supply&Dish�ibution Projeets and Costs D. Wastewater Collection&Treatment Projects and Costs �. Review of Historical Impact Fee Charges (Per Service Unit) Page 3 of 20 I. �X�CUTIV� SUMMARY This study is the 2013 Update of the original study which the City of Friendswood(City) performed in 1990 to establish impact fees for water supply and distribution and wastewater collection and treatment facilities. Fees were established in accordance with the original state Impact Pee Legislation (VTCA Local Government Code Section 395.001 et seq.) and have previottsly been updated in 1993, 1997, 2000, 2003 and 2008. The law provides for municipalities and certain other political subdivisions to assess and collect impact fees for the infrastructure required to serve new development. Fees collected are used to fund new infrastructure and expansions to existing infrastructure that are reqL�ired to serve the needs of Yhe new development and cannot be used to serve existing development. The legislation includes guidelines for use when determining if a particular project is eligible for impact fees and the method of calculating the maximum allowable impact fee that can be established. The City's fees have previously been adopted and subsequenfly updated for city-wide water sL�pply capacity, specific area water distribution sysYems, city-wide wastewater treatment capacity, and specific area wastewater collection systems. In 2008, HDR/Claunch & Miller, Ina (I-IDR) prepared an update that inchided a review of current water demand and wastewater flow data, population projections, land use assumptions and area growth trends. The update also included as-built costs for recently constructed systems improvements and other updated cost data that were utilized to determine the maximum allowable impact fees to be assessed and collected. Future water and wastewater capital projects that were identified in the most cuirent Capital Improvement Plan (CIP) were also included in the calculation of the impact fee. The state law originally required that impact fees be reviewed and updated at least every three yeais from the adoption date; however, the legislation was amended to revise the maximum period to five years between required updates. Assessing Impact Fees based on Water Meter Size: Many municipalities choose to assess impact fee amounts for water and sewer capital improvements based on the size of the water meter purchased to serve the development. A water meter of a particular size will allow a definite water flow that will provide adequate service to the user. The larger the water meter, the larger the flow rate for which the meter is rated. The American Water Works Association, one of the leaders in technical research in the water and wastewater utility indush�ies, has published tables identifying the rated water flow rates through meters of vvious sizes. When an engineer sizes a water meter for a particular development, he detennines the number of water closets, water fountains, sinks, and other types of fixture units and uses the mimber of fixture units and associated average demands to select the proper water meter size. Essentially those "industry standard" flow rates are compared to the flow rates for the meter serving a single fatnily home ( in Friendswood — 1 inch ) to determine Yhe Page 4 of 20 equivalent number of service units for which the impact fee is ultimately charged. For example, if a 1"meter is rated for 25 gpm and a 2" simple meter is rated for 75 gpm, then the purchase of a 2" meter to serve a development would result in the assessment of an impact fee for 3 service units(75 gpm/2S gpm=3). Assessing Impact Fees based on geneYal consam7ption/wasteivater flow tables: Agencies such as Texas Commission ofEnviromnental Quality (TCEQ), City ofHouston (COH) and others have developed tables identifying water use and wastewater flows for various types of commercial, institutional, and industrial development based on available research data ( water meter records and wastewater flow tests) that they have on various types of development. Depending on the size of a proposed development of a specific type, water demands and wastewater flows can be developed fi•om the tables and compared to those generated by the single family residence. The ratio of the proposed water demands and wastewater demands to those for the typical single family residence become the multiplying factor for the impact fee charged for residential development to determine the impact fee to be assessed a particular development. Dzscarssdon of the arse of these��ethods to develop ivater and setiver utility impact fees: Communities use these types of inethods as well as otheis to calculate the maximum allowable impact fee to be assessed to a particular development. The use of either of the above described methods are based on using industiy standards to compare different types of development and their associated water demands and wastewater flows. Using either assessment method does not assure that the consumpYion and flow generation of a particular development will not vary significantly from the values that form the averages that are used to calculate fees. Even if average values are determined for a specific city using historical data for that particular city, the water demands and wastewater flows for a particular development typically vary significantly from the city averages. For the selection of a water meter, there u�e other factors than impact fees that determine the meter size that an owner may want for their development (i.e. keep pressures at desired levels). While it is probable that actual water and wastewater records will result in numbers that vary signifcantly from those developed by area agencies, as they are more general and use many samples to develop their numbers - those samples may have significantly different characteristics such as size, location, amount of water use in the area, fire protection, irrigation patterns, and others. Using either approach, a review of several months records of an individual development may result in different numbers than the industry averages used to calculate the impact fees. Since both methods are successfully used in the vicinity, and either approach would produce a more equitable fee in most cases (than would the cun•ent approach) for small commercial developments on larger tracts, the City adopted the water meter approach in the 2003 Update for ease of administration and uniformity. The City staff has indicated a Page 5 of 20 preference far the water meter approach because of the ease of administration, and developers would also benefit from the simplicity in that approach. The city-wide fees determined per Seivice Unit(SU) for the 2008 update were: 1. Water Supply and Distribution $ 1,849 2. WastewaYer Collection and TreaYment 1 290 Total City-Wide Impact Fees $ 3,139 The proposed fees determined in this 2013 update are: 1. Water S�ipply and Dish•iburion $2,088 2. Wastewater Collection and Treatment $ 840 Total City-Wide Impact Fees $2,928 The approach to assessing the impact fee is dependent on the size of the water meter serving the proposed development which will be more equitable than the eurrent system in allocating capital improvement costs to serve commercial development on relatively large tracts of land. (See Appendix B) Adminishation Items: 1. The impact fee will be assessed at the time that a plat is filed (where applicable) and collected during Yhe building permit process as identified in the impact fee ]egislation. 2. Parks, and construction trailers will not be assessed any impact fees. 3. Hoiises and businesses obtaining additional meter(s) for fire line or lawn irrigation purposes only, will not pay the impact fee associated with water or wastewater unless a new tap to the City main is required. 4. The Architect ar Engineer for the Owner will size the water meter for the development based on industry standards. 5. Governmental buildings and churches will pay the water and sewer impact fees based on the proposed assessment method. 6. When an existing water meter is changed out, additional impact fees will be assessed if the meter size is increased. The fee will be based on the ineremental increase in the Service Units calculated per Appendix B. 7. When meters are changed out for the same size meter or a smaller meter, no fee will be assessed. Page 6 of 20 II. INTRODUCTION AND BACKGROUND State law allows municipalities to establish impact fees to fund the cost of capital improvements necessitated by new development. Current Chapter 395 of the Local Government Code (VTCA Local Government Code, Chapter 395) contains the requirements and procedures for the establishment of impact fees. (Appendix A) The City of Friendswood has established impact fees to recover the costs of water supply and distribution and wastewater treatment and collection. These impact fees were first adopted on June 4, 1990 by Resolution No. 90-22, in accordance with the provisions of the,then current State law. Impact fees were originally established for the following items: City-wide Water Supply Facilities City-wide Wastewater Treatment Facilities City-wide Impact Fee/CIP Study Seivice Area Water Distribution: Melody Lane Water System Bay Area Boulevard Water System Cenh•al Service Area Water System Seivice Area Wastewater Collection: Melody Lane Wastewater System Central Service Area Wastewater System (Segments A-E) On Janua�y 7, 1991, an amendment(R91-4)to the Impact Fee Resolution was adopted by the City to create the Mills, Muiphy, and Briarmeadow Avenue Wastewater Collection System service area and establish an impact fee therefor. In 1993, the 1990 Impact Fees were reviewed, as required by State law. The Updated Study for Land Use Assumptions, Capital Improvements Plan and Impact Fees, dated March 10, 1993 reviewed the previously established impact fees with regard to water demand, wastewater flow and revisions and extensions to the seivice areas. Adjushnents to the various components of the impact fees were recommended and adopted by the City based on the 1993 Update Study,under Resolution No.R1993-24. Significant modifications were made to the Central Service Area during the 1993 Update Study. This area, renamed the South Friendswood Service Area, was greatly expanded and the proposed collection system was redesigned. Costs for various other impact fee components and areas were recalculated and updated in the 1993 study to reflect current conditions as well. Page 7 of 20 The second Update Study was prepared by CMI in 1996— 1997 with the result being that two service areas were deleted fi�om the program and the fee calculation for the South Friendswood Service Area was simplified for administration. The 2000 Update Study added one specific water distribution se�roice area and one specific wastewater collection service area. The 2003 and 2008 Update Studies were produced to recognize new Capital Improvement Projects that have system-wide benefits and to meet the needs of new development that occLU•s anywhere within the ciTy. The 2003 study also simplified the overall assessment and collection process for the City staff Uy grouping all water and wastewater impact fees into city-wide fees for either water supply and distribution or wastewater collection and treatment. The assessment method was changed to correlate Seivice Units with water meter size. This inethod allows for the fees assessed to more closely reflect water demand and wastewater flows than the previous method of assessing the fees on an acreage basis for particular development types (which allows for a relatively high assessment for a commercial establishment on a site of several acres). The 2013 Update Study is being prepared to meet the requirements of the legislature to update the Study at least eveiy five years. The 2013 Update Study will recognize new Capital Improvement Projects that will have system-wide benefits and to meet the needs of new development that occurs anywhere within the city. The study will also update the cost for capital projects that have been completed in the last five years and update land use assumptions and population projections. The Texas Impact Fee Legislation provides for assessing the impact fee before or at the time of recordation of the final plat. In cases where new development occurs without platting, the impact fee may be assessed at any time during the development and building process. Per the legislation, collection of the impact fees can occur: 1. When the final plat is recorded, if the development is platted, or 2. When connections are made to the City's water and wastewater system, or 3. At the time Yhe City issues either a biiilding permit or certiflcate of occupancy. After assessment of impact fees atfributable to a specific project or the execution of an agreement for payment of impact fees, no additional impact fees may be assessed to the particular property for that project unless the number of Service Units (SU) is inereased (a largec meter is installed to replace the existing meter), in which case the additional fees to be imposed shall apply only to the additional seivice units. If a property owner pays an impact fee and the construction of the capital improvement, fm• which the fee was paid, is neither under consh•uction within two (2) years after payment nor complete for service within five (5) years after payment, the property owner may request a refund of the fee, Page 8 of 20 III. R�VI�W OF LAND USE ASSUMPTIONS—CITY GROWTH RATES Land use assumptions adopted in the previous impact fee studies, prior to 2003, fell into two (2) categories. For the city-wide impact fees (surface water supply and wastewater treatment), growth rates for the city were projected for the 10-year planning period. For the individual service area based impact fees, specific assumptions about land use types and connection counts were made to reflect the planned or anticipated development in each area. The 2003 and 2008 Update Studies grouped ail proposed impact fees into two (2) city- wide components and thus an evaluation of the city-wide growth rates was the focus and the previously identified specific service areas were no longer analyzed. Previous Studies: The a•iginal 1990 Impact Fee Study assumed a 5%annual growth rate throughoi�t the 10-year planning period. The 1990 population of the City was estimated to be 22,500 people with 7,662 equivalent connections. At the end of the planning period (January 2000), the population was projected to be 36,650 people with 12,481 equivalent connections. The 1993 Updated Study adopted population projeetions developed in two (2) repoi�ts prepared by City staff and Wayne Smith & Associates. Those reports Lrtilized Houston-Galveston Area Council of Governments (HGAC) population projections and the City Zoning Map to produce land use and population projections for the entire City. Based on this data, the 1993 Update Study utilized population projections of 30,850 for 1995, 38,900 for 2000 and 43,724 for 2003. In 1996, Claunch & Miller, Inc. analyzed data from tlu•ee (3) additional sources for the Second Update Study. Data was again obtained from HGAC, a study prepared by J.T. Duncan and Associates, and data provided by the City records for dwelling units constructed. It was determined that a growth rate of 3.6% derived from City records was possibly the most accurate and reasonable figure available, as it was based on the 1990 Census count plus detailed records of new residential electrical connections made since then, whereas all of the other figures were based on projections of historical trends or assumed growth rates. The 3.6% annual growth rate produced a 7aniiary 1996 popufation pirojection of 27,835 and a 2006 population projection of 40,175. Page 9 of 20 The 2000 Update Study revisited HGAC, Texas Water Development Board (TWDB), and City records on dwelling construction. The dwelling construction data from 1997 through 1999 utilized with daYa previously gathered for the period from 1990-1996 indicated an average annual population growth rate of approximately 3.3%. Based on the City supplied connection numbers by development type and the recommended annual growth rate of 33%, the projected Service Unit totals at the end of the 10-year planning period (2010) were 14,164 water service units and 13,709 wastewater seivice units. For the 2003 Update Shidy projections fi•oin the various entities as well as City records were again revisited. Census data was also available from the 2000 and previous decades as follows: Zable 1 Year PopLdation %increase anmial % increase 1970 5,675 - 1980 10,719 889% 8.9% 1990 22,814 112.8°/a 11.3% 2000 29,037 27.3% 2.7% Based on the current trends in 2003 it was agreed that the same 33% annual growth rate would be utilized. Population and water / sewer connections projected for the ]0 year planning period were determined as follows: Table2 Year Population PPC Connections 2013 45,460 2.8 16,236 For the 2008 update, a conservative growth rate of 1.9% was adopted which was consistent with currenttrends and HGAC projections. Based on this ].9% growth rate the projected population for 2018 (end ofthe 10 year planning period) was 43,805 with 15,998 connections. Current Studv: Based on the City supplied connection numbers far residential units and population data,the popLilation for the last five(5) years was as follows: Table 3 Year Connections Population Persons/Connection 2008 ll,974 35,922 3.00 2009 12,088 36,299 3.00 2010 12,289 36,966 3.01 Page ]0 of 20 2011 12,511 37,441 2.99 2012 12,731 37,995 2.98 Based on these records, the actual growth rate for the past five(5) years averaged approximately 11%. Other soitrces for population projections were also investigated for the 10 year shtdy period. The Aouston Galveston Area Council predicts an average growth rate of 1.48%for the community for the period from 2013 to 2023. The Texas Water Development Board provides predictions of population for planning purposes for 10 year periods. The TWDB growth rate projection for the period from 2010 to 2020 is 0.9%. The 2008 study reported that the City of Friendswood Planning Department provided projections through 2020 when the city population is predicted to reach approximately 45,486. The growth rate for the City supplied projections equates to a future growth rate of approximately 1.2%. Recent trends show an increase in home building activity. The City's Water Billing records show an increase in connections fi•om March 2012 to March 2013 of 233 connections or an increase of nearly 1.9%. It is recommended that a conservative growth rate of 1.5%be utilized for this 2013 Update Study which is more consistent with cun•ent h•ends for the City and the HGAC projections. Using the 1.5% growth rate resLdts in the following projected connections for the 10-year planning period: Table 4 Year Connections Population(3.0%onnection� 2013 12,922 38,766 2014 13,115 39,344 2015 13,312 39,935 2016 13,512 40,535 2017 13,715 41,144 2018 13,920 41,762 2019 14,129 42,386 2020 14,347 43,023 2021 14,556 43,668 2022 14,774 44,323 2023 14,996 44,987 Page 1 I of 20 IV. DEVELOPMENT OF CITYWIDE WATER SUPPLY AND DISTRIBUTION IMPACT FEE 1. Water Supply, Storage,Transmission, Pumping, and Distribution Projects This City-wide water supply and distribLrtion impact fee is composed of the following components: 1. Surface Water Capacity 2. Surface Water Transmission, Pumping and Storage Facilities 3. Water Distribtttion System Lnprovements Surface Water Capacitv Under the Harris-Galveston Coastal Subsidence Dish•ict's requirements, the City's future water supply must be converted from a majority of ground water use to a majority of surface water use. The City of Friendswood initially purchased 3.0 mgd of treatment capacity in the City of Houston's Southeast Water Purification Plant. Additional pLirchases have inchided 1.0 mgd fi•om the La Poite Water ALrthority, 0.5 mgd fi•om MUD 55, 1.5 mgd and more recently 6.0 mgd from the Southeast Water Purification Plant (SEWPP). The 2002 Groundwater Reduction Plan (GRP) developed to meet the needs of the Harris / Galveston Coastal Subsidence District requirements indicated the ultimate maximum day conditions for the City would be approximately 17.0 mgd and that to ineet�roitnd waYer reduction goals,the appropriate mix should be 12.0 mgd surface water and 5.0 mgd groundwater. The recent pLircbase of 6 MGD will provide the total of 12.0 mgd surface water for tiiltimate development of the City. Total available to the iilrimate 57,400 population of the City would be the 12.0 mgd surface water along with 5.0 mgd groundwater. The cost for the 6.0 MGD purchased in the SEWPP was inchtded in the 2008 report and will be also included in this impact fee study update. Surface Water Transmission, Pumpin¢and Storage Facilities The sm�face water transmission, pumping and storage projects that have been completed to date along with those anticipated in the near future based on the current Capital Improveinent Program (CIP) are estimated to be su�cient for the city's requirements through the i�ltimate bi�ild out level, or approximately 20,500 Service Units. A summary of all surface water supply, storage, transmission, and pumping projects included in the impact fee calculation are included as Appendix C. Page ]2 of20 Water Distribution System Improvements Appendix C includes water distribution facilities included in the water supply and distcibLition system impact fee component. Several of the projects were previously identified as projects for specific seivice areas in studies prior to the 2003 Update Study. These projects have now been combined with all other projects for simplicity of administration so that a city-wide water supp]y and distribution fee could be developed. 2. Service Unit Basis The 1990 Impact Fee St��dy and the 1993 Update Study calculated the surface water supply capacity in terms of Service Units based on historical water usage and connection counts. Table 5 below shows the data used to compute these figures, along with 1996, 2000—2002, 2007 and 2012 data. Table S Surface Water Capacity Consumptiou Study Water Service Surface Water Year Consum tn ion Units Per S.U. Unit Capacity 1990 2.8 mgd 7,662 365 gpd 10,261 1993 2.89 mgd 8,621 335 gpd 11,196 1996 2.97 mgd 9,337 318 gpd 11,789 2000 3.73 mgd 10,238 365 gpd 20,548 2001 3.42 mgd ]0,955 312 gpd " 2002 3.49 mgd ]1,278 312 gpd " 2007 3.56 mgd I 1,758 303 gpd " 2012 5.17 mgd 12,731 406 gpd " (initial 3.0 mgd sw•face water capacity increased to 6.0 mgd capacity in 2000 by purchases) In 1996, CMI standardized the sw�face water supply impact fee calculations by defining a previoitsly fluctuating surface water supply service unit (based on yearly water consumption fluctuations) at 365 gpd consumption, which was the value used in the original Impact Fee Study. This value is a reasonable consumption rate for a typical single family residence and is somewhat conservative based on analysis of water usage figures supplied by the City for the period FY 1993 thiro�igh FY 2002. Over the two years preceding this 2013 update the City experienced a near record drought causing water consumption citywide to be much higher than noimaL It is recommended Page 13 of 20 that these years be recognized as exh•eme and that previously used plauning factors be utilized for purposes ofthis update. The 2002 GRP indicated that the average demand per Service Unit should be 136 gpd X 2.8 ppc, or 381 gpd. Use of a value of 381 gpd per Seivice Unit means that the previous 6A mgd capacity owned in the two (2) surface water treatment facilities equated to 19,685 SU (veisus the 20,500 ultimate anticipated Service Units) when the 80% surface water/20%groundwater mix is factored in. The additional groundwater recently purchased will more than cover the additiona1815 connections that will ultimately need to be seived. The Groundwater Reduction Plan used a peak daily demand rather than an average daily deinand to deteimine the amount of future surface water purchases to meet the needs of existing and future development. The recommended 381 gpd per Service Unit is lower than the previously defined 450 gpd defined for the Service Unit, however, there are valid reasons for a more conservative figure to be used for distribution system design. In addition, the 1990 Impact Fee Study acknowledged that the 450 gpd utilization rate was higher than other commonly recognized rates. For planning puiposes, it is helpful to equate various types and densities of development in terms of their water and sewer capacity requirements. The Texas Impact Fee legislation requires that a standardized measure of consumption, use, generation or discharge attributable to an individual unit of development be used in the computation of impact fees. Previously, the water consumption for different land use types were compared to that of the single family residential connection(Service Unit)to develop equivalent service units for areas of development. To simplify administration of the impact fee program, required water meter sizes are now proposed to determine the equivalent number of Service Units for a particular development. An equivalent Service Unit table for various water tneter sizes is included as Appendix «B�, 3. Projected Service Units The existing surface water transmission, pumping, and storage components above are each adequate to serve the 12,731 existing SU (5.17 mgd average 2012 daily demand / 381 gpd per Service Unit). The existing and proposed surface water h�ansmission, pumping, and storage components will provide adequate transmission, storage, and pumping capacity for the City's needs beyond the end of the 10-year planning period in Page 14 of 20 2023. Table 6 Total Capacit,�� Remainin�SU Surface Water Pacility Capacity 20,500 7,769 Based on the 1.5% annual growth rate projection and the existing 12.0 mgd of total available surface water capacity, the City's available Surface Water Capacity will more than serve the needs of the development projected through the year 2018. 4. CalcLilation of Updated City-Wide Water Supply&Distribution Impact Fee Using the updated total costs for previous projects along with the costs for the anticipated projects to be completed within the next ten (10) years (per the current CIP provided by the City) for the various components ofthe Sw•face Water Supply&Distribution System, the Water Supply&Distribution Impact Fee is as follows: Table 7 Water Supply and Distribution Maximnm Impact Fee Calculation Impact Item Cost** Capacity Fee 1. Sm-face Water Capacity (12.0 mgd) $33,993,938 20,500 SU $1658 2. Transmission, Pumping& Storage Facilities $22,905,150 20,500 SU $l ll7 3. System Wide Components $12,213,830 20,500 SU $ 596 4. Water Distr•ibtiition $16,165,613 2Q500 SU $ 789 5. Impaet Fee Studies (through 2023) $ 120,000 7,334 SU* $ 16 Total: $4176 * (14,996(2023 Sin—7662 (1990 SU)) ** - See Appendix C for further details in individual cost Page 15 of 20 8. DEV�LOPMENT OF CITY-WIDE WASTEWAT�R COLLECTION AND TREATMENT IMPACT FE� 1. Wastewater Treatment and Collection Projects The City of Friendswood has purchased 4.875 MGD of capacity in the Blackhawk Regional Wastewater TreaUnent Plant. Of the City's total capacity, 2.5 MGD was purchased in the Phase I construction to serve existing development. An additiona12375 MGD was purchased in the Phase II expansion project to serve new development, and has previously been subject to the impact fee. A 2.0 MGD expansion is anticipated to be required to serve new development within the 10-yev planning period and has been included in the impact fee calculation. A wastewater h•eatment p1anY rehabilitation project is antieipated di�ring the next 10 year planning period and has also been included in the impact fee caleulation. The following new additional projects and cost adjustments have been added as system wide wastewater system costs and will be incorporated into the impact fee calculation: (See Appendix D for a complete project list.) Table 8 Deepwood Foree Main $1,153,727 Deepwood Lift Station Expansion $490,821 Beamer Road Sanitary Sewer(Phase I) $1,017,518 FM 528 Trunk Sewer(Lundy Land—Tower Estates) $322,379 Lift Station#3 Replacement $735,000 Lift Station#6 Replacement $458,500 Lift Station#18 Replacement $458,500 FM 528-Falcon Ridge to Windsong Sanitary Sewer $706.000 Windsong Lift Station and Force Main $2,152,000 Impact Fee Studies (50%X$240,000—through 2023) $120,000 2. ServiceUnitBasis I�i 1991 and 1992, a detailed analysis of the existing wastewater flows was undertaken as a part of the planning effort for the South Friendswood Service Area. This study found that the average daily dry weather flow was 82 gpd per capita ar 246 gpd per Service Unit for wastewater treatment capacity. The peak 2-how•flow was found to be 4.2 times the average daily flow or 1,033 gpd per service unit, which was rounded up to 1,050 gpd for planning purposes for the wastewater col lection system. It is recommended that the previously defined wastewater treatment capacity Service Unit of 246 gpd, from a typical single family residence, and wastewater collection system Service Unit of 1,050 gpd be maintained for use in this study for consistency. These figures are based on the previous flow study data and bear a reasonable relationship to the consumption rate used to define the Service Unit. Page 16 of 20 For planning purposes, it is helpfii( to equate various Yypes and densities of development in terms of their water and sewer capaciry requirements. The Texas Impact Fee legislation requires that a standvdized measure of consumption, use, generation ar discharge attributable to au individual unit of development be used in the computation of impact fees. Previously, the wastewater generation for different land use types were compared to that of the single family residenYial connection (Service Unit) to develop equivalent Service Units for areas of development. To simplify administration of the impact fee program, required water meter sizes are now proposed to determine the equivalent number of Service Units for a particular development. 3. Projected Service Units Based on the Service Unit definition provided above, the 2375 MGD of wastewater treatment capaciYy in the Blackhawk Regional Plant eqL�ates to 9,654 Service Units. In the previous impact fee sYudies wastewater treatment costs and costs for additional trunk sewers and lift stations were distributed over these 9,654 Service Units Yo develop a city- wide wastewater impact fee. The rationale was that these cost were adequate to serve only these projected Service Units. With the planned 2.0 MGD plant expansion and other system wide improvements proposed in the current CIP the City will have adequate capacity to serve the 20,500 Service Units anticipated at complete build-out. Therefore, the projected costs will be distributed over the ultimate 2Q500 Service Units. 4. Calculation of updated city-wide Wastewater Collection and Treatment Fee The updated Wastewater Collections/Treahnent Impact Fee is as follows: Tnble 9 Impact Items Cost Capaeity Fee 1. Wastewater Treatment Capacity $13,500,000 20,500 $ 659 (With Future 2.0 MGD and Rehab) 2. Additional System Wide Projects $20,573,300 20,500 $1004 3. Hupact Fee Study CosYs $ 120,000 7,334 $ 16 Maxim��m Total Wastewater Colleetion/Treat�nent $1,679 Page 17 of 20 9.0 RECOMMENDATIONS & CONCLUSIONS The City simplified the impact fee assessment process in 2003 by incorporating water and wastewater impact fees for existing service areas within the city into a city-wide impact fee that included the costs of all Capital Improvements that will serve future development. The City changed the approach of assessing impact fees to recognizing the water meter size of a proposed development as the way to determine the number of Service Units for which the development will be assessed the fee. (See Appendix B) These assessment methods have proven to be successful over this 5-year update period and it is recommended that the City continue in this manner. Research indicates that the City should recognize approximately 20,500 Service Units at ultimate development of the City and that the projected number of service units at the end of the 10-year planning period in 2023 should be 14,996. Chapter 395 of the Local Governn�ent Code was amended in 2001 to include that the CiTy mList provide a credit for the following: Section 395.014 Paragraph a(7) (A) a credit for the poition of ad valorem tax and utility service revenues generated by new service units duriug the program period that is used for the payment of improvements, including the payment of debt, that are included in the Capital Improvements Plan; or (B) in the alternative, a credit equal to 50 percent of the total projected cost of implementin�the capital improvemenYs plan. The City of Friendswood has elected to provide the credit equal to 50 percent of the CIP resulting in the following recommended Impact Fees: Capital Improvement Cosfs for new development dish•ibuYed over the new development to be served indicates that the maximum allowable water and wastewater impact fee to be assessed future development would be$5,855/2=$2,928. The two components of the total fee to be assessed are: 1. Water Supply and Dish•ibution- $2,088 2. Wastewater Collection and Treatment- $ 840 Total: $2,928 Page ]8 of 20 APPENDIX"B" SUMMARY OF SERVICE UNIT EQUIVAL�NTS CTI'Y OF FRIENDSWOOD WATER AND WASTEWATER IMPACT FEES Meter size and Twe Service Units 1" simple 1 1 '/2" simple 2 1 %z" turbine 2 2" simple 3 2" compound 3 2" turbine 4 3" compound 6 3" hirbine 10 4" compound 10 4" turbine 17 6" compound 20 8" compound 32 6" turbine 37 10" compound 46 8" turbine 64 10" turbine 100 12" hirbine 132 P meter is the smallest acceptable meter. In any situation where a meter smaller than 1"is installed,the 1"fee will be charged. Page 19 of 20