Chapter 13.30
UTILITY REIMBURSEMENT AGREEMENTS
Sections:
13.30.010 Statement of purpose.
13.30.030 Minimum project size.
13.30.040 Length of reimbursement provision.
13.30.050 Application for reimbursement agreement.
13.30.070 Reimbursement agreement must be recorded.
13.30.080 Construction and acceptance of improvements – Recording of final fees.
13.30.090 Collection of reimbursement fees – No liability for failure to collect.
13.30.100 Segregation of reimbursement fees.
13.30.110 Disposition of undeliverable reimbursement fees.
13.30.120 Failure to comply with this chapter.
13.30.130 Existing facilities with reimbursement agreement pending.
13.30.010 Statement of purpose.
The purpose of this chapter is to define the rules and regulations for contracts between the city and developers for private construction of municipal water, sewer, storm drainage, or street system improvements by providing means for (1) partial cost recovery through a charge to later users who did not contribute to the capital costs and (2) the establishment of benefit areas defining which properties are subject to such charges. This chapter is also intended to implement Chapters 35.72 and 35.91 RCW, and other provisions of the Revised Code of Washington, as it now reads, or is later amended. (Ord. 1514 § 1, 2020)
13.30.020 Definitions.
As used in this chapter, the terms listed below shall be defined as follows:
“Administrator” means the public works director or his/her designated representative.
“Cost of construction” means those costs (excluding interest charges or other financing costs) incurred for design, acquisition for right-of-way and/or easements, construction, materials, and installation required to create an improvement that complies with city standards.
“Direct benefit area” generally means property or properties that lie within 300 feet of the utility improvement seeking reimbursement. The administrator may modify the direct benefit area boundary if the criterion in ZMC 13.30.050(C)(2) is met.
“Indirect benefit area” generally means property or properties that lie beyond 300 feet but within 500 feet of the utility improvement seeking reimbursement.
“Latecomer fee” means a charge collected by a municipality, whether separately stated or as part of a connection fee for providing access to a municipal system, against a real property owner who connects to or uses a water or sewer facility subject to a contract created under RCW 35.91.020.
“Reimbursement agreement” means a written contract between the city and one or more parties providing both for construction of sewer or water facilities and for reimbursement to the party or parties constructing the facilities for part of the costs of the facilities by owners of property benefited by the improvements.
“Sewer or water facilities” has the meaning specified in RCW 35.91.015 as it now reads, or as hereafter amended. The word “utility” shall have identical meaning within this chapter as sewer or water facilities.
“Street system improvements” includes the acquisition of right-of-way and/or easements, design, grading, paving, installation of curbs, gutters, storm drainage, sidewalks, street lighting, traffic controls, and other similar improvements as required by the street standards of the city. A latecomer agreement shall not be approved for the improvement of a developer’s abutting rights-of-way and transitions as required by city ordinance. An exception may apply where vertical grade and alignment changes are required by the city engineer to promote traffic safety and the city engineer recommends a latecomer agreement. (Ord. 1514 § 2, 2020)
13.30.030 Minimum project size.
To be eligible for a reimbursement agreement, the estimated cost of the proposed improvement must be not less than $5,000. The estimated costs of the improvement shall be determined by the administrator, based upon a construction contract for the project, bids, engineering or architectural estimates, or other information deemed by the administrator to be a reliable basis for estimating costs. (Ord. 1514 § 2, 2020)
13.30.040 Length of reimbursement provision.
All utility latecomer agreements shall provide for reimbursement of a minimum length of 20 years from the date of final acceptance of the improvements by the city. The maximum length of a street system improvement latecomer agreement is 15 years. The city council has the sole discretion to adjust the length of time of a reimbursement agreement before the final city council decision. As such, any combined street system improvements/utility latecomer agreement must be structured to recognize those different time frames. (Ord. 1514 § 2, 2020)
13.30.050 Application for reimbursement agreement.
An application for a reimbursement agreement shall be made on a form provided by the city. An application fee of $250.00 shall be submitted to the city administrator.
A. Application Requirements. An application for reimbursement agreement shall be in writing and include the following information:
1. Preliminary utility and/or street system improvements design drawings prepared and stamped by a licensed civil engineer; and
2. An itemized estimate of construction costs prepared and signed by a licensed civil engineer or in the form of a bid submitted by a qualified contractor. If more than one bid has been obtained, all bids must be submitted to the city; and
3. A scaled vicinity drawing, stamped by a licensed civil engineer or licensed land surveyor, depicting the proposed improvements, the location, the proposed benefited area, dimensions, and county assessor’s numbers for each tax parcel, size of parcels, and evaluations where necessary for determining benefits. The applicant has the right to exclude or remove certain properties within the proposed benefit area but will not be allowed to include the additional costs of such exclusions onto other properties within the proposed benefit area; and
4. A separate legal description for each tax parcel within the benefited area; and
5. The applicant must agree to an annexation covenant for the property to be serviced by the proposed improvements if such are located outside the city limits and any such improvements must be located no further than 10 miles outside the city; and
6. Such other information as the administrator determines is necessary to properly review the application.
B. The city administrator or assignee shall review all applications and shall approve the application for completeness only if the following requirements are met:
1. All information contained above is submitted; and
2. The project satisfies the minimum size requirement in ZMC 13.30.030 and complies with city sewer or water or street system improvements standards; and
3. The proposed improvements fall within the description of water or sewer mainline facility as those terms are described in Chapter 35.91 RCW or as it may be amended and/or described in Chapter 35.72 RCW, the contracts for street system improvements, road and highway projects and city utility standards; and
4. The proposed improvements are not constructed or currently under construction; and
5. A project for which a utility reimbursement agreement is sought must be in compliance with the city’s comprehensive plan and development regulations, and the city’s ordinances must require the construction of the facilities as a prerequisite to the development of the property. Unless the city provides written notice to the owner of its intent to request a comprehensive plan approval, the owner must request a comprehensive plan amendment for a water or sewer facility and/or amendment to the transportation plans of the city, if required; and
6. The city must have the capability and capacity to service the water, sewer, storm sewer, and/or street system improvements facilities; and
7. The extension of water or sewer facilities outside of the boundaries of a city may be subject to potential review by a boundary review board under Chapter 36.93 RCW.
C. Written Determination. The administrator shall prepare a written determination for each completed reimbursement agreement application. Until the city council determines a standard calculation methodology for reimbursement agreements, the administrator shall calculate reimbursement agreement areas by one of the two following methods of calculation:
1. Using an approved calculation method approved by the city’s engineer that is in accordance with the city’s utility and/or street system improvements design standards.
2. Using a pro-rata share utility improvement method to include the following calculation considerations:
a. Direct or indirect benefit to surrounding properties, which parcels did not contribute to the original cost of the improvement, elevation, and topology of the area, logical service area, city utility design standards, and future utility plans in the surrounding area. If both direct and indirect benefits are calculated the direct benefit area shall have at least a two-to-one weight ratio in the final reimbursement cost calculation. The administrator shall have the option to define a complete property lying partially, but not wholly, within 300 feet of the utility improvement as a direct benefit area if the written findings in this section can show a justification. At no time can a property lying wholly outside 300 feet of the utility improvement be defined as a direct benefit area.
b. Determining the pro-rata share of the utility improvement cost shall include eligible reimbursement costs that are evenly distributed on a square foot, front foot, or combination of square/front foot calculation. The administrator will remove any properties that the applicant has requested in writing to be removed from consideration from the reimbursement area. If the applicant has requested specific properties to be removed from the reimbursement area the costs that would have been associated with the removed properties shall not be redistributed to other properties in the reimbursement area.
c. A copy of the administrator’s reimbursement determination shall be mailed to the applicant at the address listed on the application for review, approval, and signature.
D. Appeal. The final determination of the city administrator is an administrative decision that may be appealed by an applicant. The appeal must be filed with the city administrator within 20 calendar days of the date the final determination is mailed to the applicant. The appeal must be accompanied by a filing fee in the amount set forth by city council resolution. Any decision of the city administrator not appealed from shall be final at the time made. In reviewing a final determination, the city council (or hearing examiner) shall apply the criteria set forth above and shall uphold the administrative decision of the public works director, provided such decision is supported by substantial evidence and applicable law. (Ord. 1514 § 2, 2020)
13.30.060 Written agreement – Payment of city costs in excess of application fee – City council approval.
A. Upon the applicant’s approval by city administrator’s determination of a reimbursement agreement that includes the estimated costs of construction, the reimbursement benefit area, legal descriptions, and estimated fees to be reimbursed the applicant shall sign a reimbursement agreement in the form supplied by the city and return it to the city.
B. The signed agreement, the application, and supporting documents, together with the estimate of the cost of construction, determination of reimbursement area and estimated fees, shall be presented to the city council with a request that the city council authorizes the mayor to sign the reimbursement agreement on behalf of the city.
C. In the event costs incurred by the city for engineering or other professional consultant services required in processing the application exceeds the amount of the application fee, the city administrator shall so advise the city council and the reimbursement agreement approval may be conditioned upon receipt of payment by the applicant of an additional amount sufficient to compensate the city for its actual costs in excess of the application fee. (Ord. 1514 § 2, 2020)
13.30.070 Reimbursement agreement must be recorded.
A. In order to become effective, a reimbursement agreement must be recorded with the Yakima County auditor within 30 days of approval by the city. It shall be the sole responsibility of the applicant to record the reimbursement agreement.
B. Within 30 days after receipt of evidence that the reimbursement agreement has been recorded the administrator shall record a notice of additional tap or connection charges with the Yakima County auditor’s office as required by RCW 65.08.170, or as it may be amended. (Ord. 1514 § 2, 2020)
13.30.080 Construction and acceptance of improvements – Recording of final fees.
A. After the reimbursement agreement has been signed by both parties, and all necessary permits and approvals have been obtained, the applicant shall construct the improvements, and upon completion, request final inspection and acceptance of the improvements by the city, subject to any required obligation to repair defects. An appropriate bill of sale, easement, and any other document needed to convey the improvements to the city and to ensure right-of-access for maintenance and replacement shall be provided, along with documentation of the actual costs of the improvements and a certification by the applicant that all of such costs have been paid.
B. The applicant shall submit the final costs of the utility improvement(s) used for the reimbursement agreement. In the event that actual costs have a greater than 10 percent difference, either more than or less than the estimate, then the estimate used in calculating the reimbursement agreement fees shall be recalculated by the administrator, reducing or increasing them accordingly, and shall cause the reimbursement agreement to be rerecorded with the county auditor. If the final utility costs are within 10 percent of the estimate used to determine the reimbursement agreement fees, the estimate shall stand and no recalculation of the fees shall occur.
C. The reimbursement agreement shall be considered nonenforceable until the items mentioned in subsections (A) and (B) of this section have been submitted to the city. (Ord. 1514 § 2, 2020)
13.30.090 Collection of reimbursement fees – No liability for failure to collect.
A. After the recording of a reimbursement agreement, the city shall not permit connection of any property within the reimbursement area to any sewer or water facility constructed pursuant to the reimbursement agreement, unless the share of the costs of such facilities required by the recorded agreement is first paid to the city.
B. Upon receipt of any reimbursement fees, the city shall deduct a five percent administrative fee and remit the balance of the reimbursement fees to the party entitled to the fees pursuant to the agreement. In the event that through error, the city fails to collect a required reimbursement fee prior to the approval of connection to a sewer or water facility, the city shall make diligent efforts to collect such fee, but shall under no circumstances be obligated to make payment to the party entitled to reimbursement, or in any other way be liable to such party, unless such reimbursement fee has been paid to the city. (Ord. 1514 § 2, 2020)
13.30.100 Segregation of reimbursement fees.
The reimbursement agreement shall provide that the city is authorized to make segregation or adjustments to reimbursement fees because of subdivision or boundary line adjustment of the benefited properties. The segregation or adjustment shall generally be made in accordance with the method used to establish the original reimbursement fees to be paid. (Ord. 1514 § 2, 2020)
13.30.110 Disposition of undeliverable reimbursement fees.
In the event that, after reasonable effort, the party to which reimbursement fees are to be paid pursuant to a reimbursement agreement cannot be located, and upon the expiration of 180 days from the date fees were collected by the city, the fees shall become the property of the city and shall be revenue to the city sewer and water utility. (Ord. 1514 § 2, 2020)
13.30.120 Failure to comply with this chapter.
No reimbursement cost or fee shall be collected, nor shall any person be obligated to pay a reimbursement cost or fee with respect to any sewer or water facilities constructed after the adoption of this chapter, unless there has been full compliance with this chapter. (Ord. 1514 § 2, 2020)
13.30.130 Existing facilities with reimbursement agreement pending.
Water and sewer facilities constructed prior to the adoption of this chapter for which reimbursement costs may be pending by agreement or otherwise shall be governed by the agreement to be negotiated and not by the requirements of this chapter. (Ord. 1514 § 2, 2020)