ASHLAND SYSTEM DEVELOPMENT CHARGE REVIEW COMMITTEE
April 15, 2014
CALL TO ORDER
: Carlos Reichenshammer called the meeting to order at 1:09 p.m. in the Siskiyou Room, 51 Winburn Way.
Committee Members Present:
Russ Silbiger, Carlos Reichenshammer, Allen Douma and Troy Brown Jr.
Committee Members Absent:
Dan Jovick, and Jac Nickels
Bill Molnar, Mike Faught, and Tami De Mille-Campos
Ray Bartlett (Financial Analyst)
Council Liaison Absent:
Mike mentioned that at some point the committee will need to select a Chair/Vice Chair but the Committee would come back to that after introductions. He stated that Ray Bartlett who is the Financial Analyst that did all the work on the SDC recommendations is here to present the information. All of the SDCís that are being presented have been recommended, with the exception of a couple of projects that have been added, out of the Water, Sewer and Transportation master plans so these are all recommendations based on those adopted documents.
The Committee did a round table introduction.
Minutes approval Ė March 18th
. Unanimous consent
Ray stated the SDC statutes in Oregon have two portions of the SDC; reimbursement fee & improvement fee. The reimbursement fee is based on the value of excess capacity that is currently in the system, drought notwithstanding. The City in the past has used original cost depreciated for the length of time itís been in use to calculate the cost basis for the reimbursement fee. There are two other commonly used methods in practice; replacement cost or replacement cost depreciated for the length of time itís been in use; both of which produce a much higher SDC than what the City of Ashland has chosen to use. Ray pointed out that you are allowed to include projects that are financed or under construction. One of the issues that will be looked at is whether or not to take the TAP line & add that to the reimbursement fee.
The improvement fee is the value of capacity that hasnít yet been built; they are projects to be built in the future which in the planning process have been identified as necessary to meet population & employment growth thatís expected. Although the future canít be precisely forecasted, the master plan is based on a reasonable forecast of population & employment. The current water master plan is designed to go out to the year 2030. The TAP waterline is likely to meet demand to 2060.
Ray pointed out that they are simply updating the figures in the 2012 master plan to 2013 dollars, which is the last year in which there are audited financials for capital values and using the same measurements that they had for capacity for the existing system and the growth.
One of the issues that came up at the previous committee meeting was how the SDC is applied to new development. What the City has been using for sewer & water for residences is to calculate what the SDC would be for a 2,000 square foot house. The City then applies that SDC to the actual square footage of the house that is being built. The theory is the larger the house, the higher the demand for water and is a pretty commonly applied method.
For non-residential uses, the water SDC is applied based on the size of the water meter that is installed. The sewer system is based on the number of fixture units that are installed.
The TAP project was originally left entirely out of the SDC calculation because it was considered to be satisfying only emergency demands of the current population & would only be used on a temporary basis. Based on climate change it is estimated that it would be used every 4 years or during an emergency (flood, fire etc). A discussion was had between Ray and Mike regarding whether or not the TAP project meets the SDC requirements. Mike stated if Council approves the TAP project as proposed then the original SDC proposal is what they would continue to recommend, if it does change they would recalculate it and bring it back to the committee.
The sewer SDC hasnít changed since the previous meeting, except for addressing a few of the issues that came up at the last meeting. One of those issues was whether or not sewer projects that are being paid for with food and beverage tax have been included. Those are not being included and they have removed those facilities that are financed and being repaid out of the food and beverage tax. The net is the facilities paid for with user fees and SDCís. There have been major improvements to the wastewater treatment plant since the last master plan was updated and the capital improvements list has had additions made to it related to regulatory requirements.
The engineers evaluate what percentages are due to growth. It is required as part of the master planning process and all of the projects have different growth projections.
Mike pointed out the master plans calculate the estimated population growth, and they then figure out what that impact is to the system. After reviewing the master plans/transportation system plan, the goal for the SDC committee is to make a recommendation which will be forwarded to Council for approval. Once the committee has made their recommendation a required 90-day notice would be sent out to the homebuilders association and after that it would be presented to Council along with a public hearing.
The committee agreed to skip the April 29th
meeting in order to have time to go through all of the material. The next meeting will be held on May 13, 2014.
Meeting adjourned at 2:15 pm
Tami De Mille-Campos, Administrative Assistant