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Home My WebLink AboutCouncil Presentation 11/01/2022 - Marana Utility Impact Fees WaterPublic HearingWater and Water Reclamation Impact Fees Jing Luo, PhD, PE –Water Director November 1, 2022 Agenda 1.Water Impact Fee Process Overview 2.Water Infrastructure Impact Fees 3.Water Reclamation Impact Fees 4.Water Resources Impact Fees 5.Summary of Proposed Fees 2 3 Impact Fee Process Overview Impact Fee Process 1.Recovers infrastructure and resources costs to serve new customers from 2023 -2032 2.Growth and Cost projections per Town Land Use Assumptions (LUA) and Infrastructure Improvement Plans (IIP) 3.Growth related costs only at existing service levels 4.Fee types: Water Infrastructure, Water Resources, Water Reclamation 5.Fee is a unit cost calculation -Growth related costs ($) / equivalent dwelling units (EDUs) 4 Impact Fee Calculation Methods 1.Incremental Method a.New development supported by new infrastructure only b.Projected costs / projected EDUs c.Used for Water Infrastructure Fee 2.Hybrid Method a.New development supported by both existing and new infrastructure b.(Costs for existing + new infrastructure)/ total benefiting EDUs (existing and future) c.Acknowledges costs already incurred to serve new development and recovers new development’s proportionate share d.Used for Water Resources and Water Reclamation Fees 5 6 Water Infrastructure Impact Fees Water Infrastructure Impact Fees Calc. 1.Incremental Method –New projects / new EDUs 2.Benefit Areas: North Marana, Twin Peaks, Saguaro Bloom, Palo Verde, and IGA 3.EDUs added –North Marana (8,821), Twin Peaks (1,988), Saguaro Bloom (850), and IGA (546) -Total (12,205) 4.New Infrastructure Projects Identified in North Marana and Twin Peaks Only 5.Infrastructure Costs a.Projects which benefit two areas -Allocated proportionate to EDUs b.Projects which are specific to a benefit area –Directly allocated 6.Other Eligible Costs –Water Master Plan, Impact Fee Study, Hartman Vistas Debt 7.Credit provided for existing fund balance 8.Fee calculated per EDU, scaled by AWWA meter capacity ratios 7 Water Infrastructure Benefit Areas 8 Water Infrastructure Impact Fee Unit Cost9 Description System-Wide North Marana Twin Peaks Impact Fee Costs 50% Airport Connection to NRWWDS Pipeline $ 2,025,081 $ 1,652,627 [1]$ 372,455 [1] 50% Partnered NRWWDS Project 3,735,894 3,048,785 [1]687,109 [1] 50% Marana Booster at NRWWDS 2,107,775 1,720,111 [1]387,664 [1] 50% Blending Plan 60,000 48,965 [1]11,035 [1] B-Zone Booster and Transmission Line 4,413,278 3,601,584 [1]811,694 [1] B-Zone Reservoir 617,700 504,092 [1]113,608 [1] C-Zone Booster 1,819,375 -1,819,375 Tangerine 16" with Break Tanks 5,307,960 5,307,960 - Tangerine 16" at I-10 2,634,128 2,634,128 - Marana Park Well 991,302 991,302 - 78% Marana Park Reservoir 3,566,723 3,566,723 - Sanders Road 24” Pipeline 4,878,502 4,878,502 - Twin Peaks Interconnect 2,901,250 -2,901,250 Picture Rocks Interconnect 1,554,163 -1,554,163 Honea East Well 216,550 216,550 - Heritage Park Water Plant 5,328,123 5,328,123 - Master Plan 150,000 122,412 [1]27,588 [1] Impact Fee Study 60,000 48,965 [1]11,035 [1] Hartman Debt Service Reimbursements 1,573,010 -1,573,010 Total Impact Fee Costs $ 43,940,814 $ 33,670,829 $ 10,269,985 Divided by: New EDUs 10,809 8,821 1,988 Equals: Infrastructure Cost per EDU $ 3,817 $ 5,166 Less: Balance on 8/23/2022 $ 4,993,825 $ 4,075,357 [1]$ 918,468 [1] Divided by: New EDUs 10,809 8,821 1,988 Equals: Credit for Balance per EDU $ 462 $ 462 Water Infrastructure Fee per EDU (Infrastructure Cost -Balance)$ 3,356 $ 4,704 Source(s): Impact Fee Costs (Table 4), Balance on 8/23/2022 (per Town), EDUs (Table 3) [1] Split proportionate to EDUs 10 Water Reclamation Impact Fees Water Reclamation Impact Fee Calc. 1.Hybrid Method –Water Reclamation Facilities (WRF) + Recharge 2.Single benefit area for Town Designated Management Area (DMA) 3.Benefiting EDUs -Water Reclamation Facility (WRF) and Recharge Basin a.Current 1.5mgd capacity will have capacity until 2027 b.New 1.5mgd expansion will provide capacity beyond 2032 c.Total capacity recognizes all customers who will use WRF d.3mgd / 139.6gpd per EDU = 21,490 EDUs 4.Incremental Method –Collection System (New 9,267 EDUs) 5.Other Eligible Costs –Sewer Master Plan, Impact Fee Study 6.Credit provided for existing fund balance 7.Fee calculated per EDU, scaled by AWWA meter capacity ratios 11 Town Sewer Service Area (DMA) 12 Water Reclamation Unit Cost13 Description System-Wide % Impact Fee Funded Water Rec Share WRF Costs WRF 2013 Principal and Interest $ 34,527,164 50%$ 17,263,582 WRF 2017A Principal and Interest 32,096,067 50%16,048,033 WRF 2017C Principal and Interest 4,702,544 50%2,351,272 WRF Loaned from Transportation Fund 2,400,000 50%1,200,000 WRF Loaned from Water Fund 367,388 50%183,694 WRF Loaned from Wastewater Fund 3,169,279 50%1,584,640 WRF Expansion Principal and Interest 62,847,780 50%31,423,890 Recharge Expansion Principal and Interest 6,427,056 50%3,213,528 Subtotal: Water Reclamation Facility (WRF)$ 146,537,278 $ 73,268,639 Divided by: Total EDUs 21,490 Equals: WRF Cost per EDU $ 3,409 Subtotal: Collection System $ 27,584,477 75%$ 20,627,411 Divided by: New EDUs 9,267 Equals: Collection System Cost per EDU $ 2,226 Sewer Master Plan $ 150,000 100%$ 150,000 Impact Fee Study $ 60,000 100%$ 60,000 Divided by: New EDUs 9,267 Equals: Impact Fee Study and Master Plan Cost per EDU $ 23 Less: Balance on 8/23/2022 $ 6,144,392 100%$ 6,144,392 Divided by: New EDUs 9,267 Equals: Credit for Balance per EDU $ 663 Water Reclamation Fee per EDU (WRF + Collection + IF Study - Balance)$ 4,995 Source(s): Impact Fee Costs (Table 14), Balance on 8/23/2022 (per Town), EDUs (Table 13) 14 Water Resources Impact Fees Water Resources Impact Fees Calc. 1.Hybrid Method –for Water Resources from Effluence and Other Sources 2.Single benefit area -entire water service area 3.Benefiting EDUs a.WRF Effluent –3mgd / 270gpd per EDU = 11,111 EDUs b.Additional Resources Acquisitions – i.NIA/CAP –242 AFY (216,044 gpd) / 270 gpd per EDU = 800 EDUs ii.Additional Acquisitions –773 AFY (690,090 gpd) / 270 gpd per EDU = 2,556 EDUs c.Total 14,467 EDUs 4.Other Eligible Costs –Integrated Water Resources Master Plan, Impact Fee Study 5.Credit provided for existing fund balance 6.Fee calculated per EDU, scaled by AWWA meter capacity ratios 15 Water Resources Unit Cost16 Description System-Wide % of Impact Fee Funded Water Resources Impact Fee Costs WRF 2013 Principal and Interest $ 34,527,164 50%$ 17,263,582 WRF 2017A Principal and Interest 32,096,067 50%16,048,033 WRF 2017C Principal and Interest 4,702,544 50%2,351,272 WRF Loaned from Transportation Fund 2,400,000 50%1,200,000 WRF Loaned from Water Fund 367,388 50%183,694 WRF Loaned from Wastewater Fund 3,169,279 50%1,584,640 WRF Expansion Principal and Interest 62,847,780 50%31,423,890 Recharge Expansion Principal and Interest 6,427,056 50%3,213,528 NIA/CAP 1,072,743 50%1,072,743 Additional Water Resources 8,889,500 50%8,889,500 Integrated Water Resources Plan 435,000 50%435,000 Impact Fee Study Expenses 60,000 50%60,000 Total Impact Fee Costs $ 156,994,521 $ 83,725,882 Divided by: Total EDUs 14,467 Equals: Resources Cost per EDU $ 5,787 Less: Balance on 8/23/2022 $ 5,248,244 100%$ 5,248,244 Divided by: New EDUs 12,205 Equals: Credit for Balance per EDU $ 430 Water Resources Fee per EDU (Resources Cost -Balance)$ 5,357 Source(s): Impact Fee Costs (Table 9), Balance on 8/23/2022 (per Town), EDUs (Table 8) 17 Proposed Water Impact Fees Summary Summary of Water, Water Resources and Water Reclamation Impact Fees 18 Description Water Infrastructure Water Resources Water ReclamationNorth Marana Twin Peaks Saguaro Bloom Existing 5/8"$ 2,331 $ 2,740 $ 838 $ 3,050 $ 3,930 3/4"3,497 4,110 1,257 4,575 5,895 1"5,828 6,850 2,095 7,626 9,824 1 1/2"11,656 13,700 4,189 15,251 19,648 2"18,650 21,920 6,703 24,402 31,437 Calculated Fee 5/8"$ 3,356 $ 4,704 $ 838 $ 5,357 $ 4,995 3/4"5,033 7,056 1,257 8,036 7,493 1"8,388 11,760 2,095 13,394 12,488 1 1/2"16,776 23,520 4,189 26,787 24,975 2"26,841 37,632 6,703 42,859 39,960 Primary Drivers of Water Related Fees 1.Rapid growth from a small community to a mid-sized community requires infrastructure 2.Town Council’s direction: developments should pay for the cost of growth 3.Inflation –project construction costs drastically increased 4.Regional water supplies –water resources cost increased 5.Town has decided to contribute: a.~$8MM general fund to the NWRRDS projects b.~$3MM general fund to the phase I of WRF c.~$7MM for sewer collection augmentation projects 6.WIFA contributed ~$500K forgivable principal for Marana Parks Reservoir Project 19 Marana Home Value Marana Home Value: •2017 –$255K •2022 -$441K •Increased by: $186K (73%) Water Related Impact Fees: •Existing (2017): $9,772 –$12,150 •4.3%of the home value •Proposed (2022): $13,988 -$18,820 •3.7%of the home value 20 Questions/Discussion 21 Thank You ! 22