ELWOOD TOWN
SEWER SYSTEM
CAPITAL FACILITIES PLAN SUMMARY
AND IMPACT FEE ANALYSIS
March 2012
Wasatch Civil Consulting Engineering
5320 South 1950 West
Roy City, Utah 84067
(801) 775-9191
TABLE OF CONTENTS
TABLE OF CONTENTS i
IMPACT FEE SUMMARY ii
CERTIFICATION OF COMPLIANCE iii
SECTION 1 - CAPITAL FACILITIES PLAN SUMMARY
BACKGROUND 1-1
CURRENT PROJECT 1-2
CURRENT SYSTEM CAPACITY 1-4
FUTURE DEMAND AND CAPITAL IMPROVEMENTS 1-5
FINANCING FUTURE CAPITAL IMPROVEMENTS 1-5
SECTION 2. IMPACT FEE ANALYSIS
GENERAL 2-1
SERVICE AREA 2-1
PROPORTIONATE SHARE ANALYSIS 2-1
CALCULATIONS 2-2
REFERENCES
APPENDIX A - FIGURES
APPENDIX B - CONSTRUCTION COST ESTIMATES
SUMMARY OF IMPACT FEE ANALYSIS
The Capital Facilities Plan describes the current sewer project and projects future capital improvements that will be required due to development and growth. These future capital improvements include: planning studies; sewer pipelines; pump stations; and treatment facility expansion. Developers will be expected to fund and to construct local sewers as necessary to serve individual developments. Elwood Town will construct regional pump stations and sewers, and pay developers for the cost of up-sizing (larger diameter) sewers where the upgrades are necessary to meet future regional needs.
Elwood Town will fund growth related capital improvements and reimburse developers for growth related up-size costs using impact fees. Impact fees will be collected from each development when applications for building permits are submitted. Impact fees were calculated using the following steps:
$ Project future needs and identify the capital facilities necessary to meet those needs
$ Estimate future capital facilities costs and allocate those costs fairly to future development.
Demand associated with system capacity and impacts from development are described in equivalent residential connections (ERCs). An ERC is the estimated wastewater flow from a typical residential connection. Future growth is expected to add 784 ERCs to the Elwood sewer system during the 50-year planning period. The estimated cost of new capital facilities that will be required to serve this increase in demand is $3,165,000. Additional details regarding the demand projections and cost estimates are given in Sections 1 and 2 of this document. The calculation for the maximum impact fee amount is given below.
Impact Fee per ERC = $3,165,000 / 784 = $4,037
The calculated impact fee of $4,037 per ERC represents the maximum amount that can charged. Each residential connection should be charged for one ERC. Calculated ERCs for non-residential connections should be based upon indoor water use for the development. Formulas for determining the impact fee for non-residential connections are given below.
ERCs = (Estimated Indoor Water Use)/(350 gallons per day)
Impact Fee = (Fee per ERC) * (ERCs)
CERTIFICATION OF COMPLIANCE
The Capital Facilities Plan and the Impact Fees Calculation are intended to comply with Utah Code 11 36a (Impact Fee Act), with exceptions as permitted for a community with population of less than 5,000 people. We make the following certifications regarding that the attached impact fee analysis.
1. The impact fee includes only the costs of public facilities that are allowed under the Impact Fees Act.
2. The impact fee does not include: costs of operation and maintenance of public facilities; the costs for qualifying public facilities that will raise the level of service for the facilities, through impact fees, above the level of service that is supported by existing residents; or an expense for overhead.
3. Impact fee funds are projected to be incurred or encumbered within six years after the day on which each impact fee is paid.
4. The impact fee does not include facilities expected to be funded with grants or other alternate sources of payment.
Signature
Date
SECTION 1
CAPITAL FACILITIES PLAN SUMMARY
BACKGROUND
Capital facilities planning for the Elwood Town began about a decade ago when a limited study was undertaken to identify potential sewer layouts and sites for treatment facilities. In 2007 Elwood Town obtained funding from the Utah Water Quality Board for more extensive planning study to determine the most cost effective and environmentally sound approach for disposing of the area=s municipal wastewater. The study considered all of the area within the Elwood Town boundaries plus areas where future annexation into the Town was likely. The study results were presented in the Elwood Town Wastewater Facilities Plan (Wasatch Civil, 2011). The study determined that a wastewater collection and treatment system for the community would be beneficial for solving existing septic system problems and meeting the long term needs of the community. However, the study has also indicated that the per household cost of the wastewater collection system is relatively high due to the Town's large geographic area and widely scattered homes. Some of the relevant findings and conclusions of the study are summarized below:
$ Soils with very low permeability severely limit the use of individual septic systems for wastewater disposal in a large portion of Elwood Town. Areas with soils unsuitable for individual septic systems include the center of the Town and zones designated in the Elwood Town General Plan for commercial and industrial development.
$ Existing septic systems appear to be having a negative impact on water quality in the Bear River. The Utah Department of Environmental Quality has tested water discharging from land drains into the Bear River and found indicators of wastewater contamination. A wastewater collection and treatment system is the most environmentally sound approach to disposing of the area=s municipal wastewater.
$ Although the topography is quite flat, a gravity sewer system with pump stations is the favored alternative for wastewater collection.
$ The favored alternative for wastewater treatment is aerated lagoons that will be owned and operated by Elwood Town.
$ A community wide wastewater collection system is not currently financially feasible due to the large area of the Town combined with a relatively small existing population.
$ The study identified a phase 1 sewer system construction project with a funding plan that will provide wastewater collection system in the northeast section of Elwood and an aerated lagoon wastewater treatment plant. Phase 1 construction will initially serve about 130 existing homes and several businesses.
$ Future expansions of the sewer system will be necessary due to anticipated growth. Sewer system expansion will be accomplished by a combination of facilities that will be constructed by developers and by Elwood Town.
The Elwood Town Wastewater Facilities Plan (Wastewater Facilities Plan) was adopted by the Elwood Town Council and approved by the Utah Department of Water Quality. The Utah Water Quality Board authorized funding for the Phase 1 Sewer Project and construction is currently (2012) on-going. The sewer system that is currently under construction is consistent with Waste Water Facilities Plan recommendations.
The Wastewater Facilities Plan will provide a basis for impact fee analysis and calculations in accordance with the Impact Fees Act found in Title 11, Chapter 36 of the Utah Code. The Impact Fees Act allows the Town to collect sewer impact fees that are proportionate to the improvement costs reasonably related to new development.
CURRENT PROJECT
The wastewater collection system and aerated lagoon treatment facility that is currently under construction will initially serve approximately 130 existing households. The project area is the northeast section of Elwood Town and the treatment facility is located near the Bear River at southeast corner of the Town. The project is shown in Figure 1. The estimated project costs are summarized in Table 1-1.
TABLE 1-1
ESTIMATED PROJECT COSTS
Description
Total Cost
Wastewater Treatment Plant Construction
$2,900,000
Wastewater Collection System Construction
$4,300,000
Legal, Bond Costs & Loan Fee
$41,000
Property for Sewer Facilities
$155,000
Project Design & Environmental Compliance
$567,000
Planning & Environmental Studies
$103,000
Engineering Services During Construction
$400,000
Contingency
$106,000
Total Estimated Project Costs
$8,572,000
Elwood Town has secured funding through the Utah Division of Water Quality (DWQ) Board and the Corps of Engineer=s (COE) Section 595 funding. Section 595 authority allows federal participation to directly assist in design and/or construction and reimbursement up to a maximum of $5 million. Non-federal participation will be funding provided through a loan and a grant by the Division of Water Quality Board. Project cost allocation is given in Table 1-2.
TABLE 1-2
PROJECT FUNDING
Description
Total Cost
Corps of Engineers Section 595 Grant*
$4,880,000
Water Quality Board Loan
$1,560,000
Water Quality Board Grant
$2,132,000
Total Estimated Project Funding
$8,572,000
* Reduced $120,000 from $5,000,000 for Corps of Engineers administrative costs
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CURRENT SYSTEM CAPACITY
Capacities of sewer system facilities are calculated in equivalent residential connections (ERCs). An ERC is the estimated wastewater flow from a typical residential connection. An ERC for Elwood Town was estimated to be an average flow of 350 gallons per day. With 3.5 people per household, this value is consistent with a design flow of 100 gallons per capita day as recommended by Utah Division of Water Quality Design Standards.
Future connections were estimated using an average annual growth rate of 2.5% and the assumption that the sewer will be gradually expanded from initially serving 45% of the Elwood Town population to eventually serving 75% of the Town population over 50 years.
Capacities and an estimated service life are given for key sewer facility components in Table 1-3.
TABLE 1-3
CAPACITIES OF SEWER FACILITIES
Facility
Capacity
in ERCs
Estimated
Service Life
Wastewater Treatment Plant
320
20 years
Winter Storage Pond1
210 - 260
10 - 15 years
Pump Station No. 1
430
30 years
Pump Station No. 2
150
30 years
15" Dia. Sewer
1,200
Buildout2
10" Dia. Sewer
500
Buildout2
8" Dia. Sewer
320
Buildout2
1) The capacity depends upon infiltration rates and whether or not a discharge permit is obtained in the future.
2) Additional by-pass sewers are assumed as growth occurs and development occurs.
FUTURE DEMAND AND CAPITAL IMPROVEMENTS
New development will continue to expand the sewer system by constructing additional sewers. As new ERCs are added, sewer flows will increase and use existing excess capacity. It is anticipated that the sewer system will serve over 1,100 ERCs by the end of the 50-year planning period. Additional treatment capacity, pump stations, and by-pass sewers will need to be needed to serve the increased system demand. Figure 1-2 shows the key components of a future sewer system necessary to meet anticipated demands. Estimated construction costs are given in the Appendix.
Development is expected construct the additional local sewer lines needed to serve that development. Elwood Town will construct regional facilities that will include portions of major sewers and regional pump stations. In addition, Elwood Town will pay for upsizing costs associated with sewers that larger than minimum (8-inch) diameter if the upsizing is due to regional needs.
FINANCING FUTURE CAPITAL IMPROVEMENTS
Potential funding sources available to Elwood Town include sewer user fees and impact fees. Sewer user fee rates have been established by Elwood Town and approved by the Division of Water Quality to provide sufficient funding to pay the Division of Water Quality loan and meet operation and maintenance needs. Monthly user fees are at the maximum recommended by the Utah Division of Water Quality based upon the average income of Elwood Town residents. With current loan repayment conditions, user fees are not expected to be a significant source of funds for future capital improvements. Therefore, impact fees will be necessary fund capital improvements that are required due to growth.
SECTION 2
IMPACT FEE ANALYSIS
GENERAL
Impact fees are governed by the Impact Fees Act found in Title 11, Chapter 36, of the Utah Code. Impact fees are intended to fund capital improvements that are reasonably related to growth and development and the permissible impact fee amount must be calculated by a proportionate share analysis that considers past and future funding.
SERVICE AREA
The service area that will be used to calculate impact fees is all property within the incorporated Elwood Town boundaries. It should be noted that some newly developed properties within the Town boundaries may not have sewer service immediately available when they develop. Development of property beyond the area served by the sewer system will depend upon the Town=s zoning and land use policies and it is not the intent of this study to define those policies. Extension of the sewer system will depend upon the availability of funds and the relative cost of extending the collection system. In most cases, impact fees should still apply to new development even when sewer service is not immediately available. This is justified because all development represents a potential demand on the sewer system, and sewer facilities have been planned and will eventually be constructed to meet these potential demands. Exceptions to impact fee charges may be justified if it seems impractical to extend the sewer system to the new development within the planning period or other reasonable time frames as established by the Town Council.
PROPORTIONATE SHARE ANALYSIS
The Elwood Town sewer system is a new public utility. As presented in Section 1, funding for the new sewer consists of grants and a loan. The loan will be paid through user fees that will be paid by all current and future sewer connections until the loan is paid. At the current time, there appears to be no justification for a buy-in component of the impact fee or credits for past or future contributions. It is assumed that capital facilities constructed with the loan and funding grants benefit both existing residents and future development. Likewise, the cost of existing facilities will be shared by existing residents and future development through repayment of the loan amount. The impact fee analysis will consider only future improvements that are planned to accommodate growth.
The proportionate share analysis is based upon the following parameters and assumptions:
$ The planning period is 50 years.
$ The average rate of growth for the planning period is estimated at 2.5%.
$ Developers will fund and construct the local sewers necessary to serve their individual developments.
$ Elwood Town will construct regional sewer facilities and fund the cost of up-sizing sewers to meet future needs. Construction of these facilities will be funded through impact fees.
CALCULATIONS
The calculation for an impact fee amount is presented below. Detailed construction cost estimates are given in the Appendix. All construction cost estimates are in current (2012) dollars.
Equivalent Residential Connections:
Current Residents & Businesses = 322 ERCs
Future Residents and Businesses = 1106 ERCs
Growth ERCs = 1106 322 = 784 ERCs
Capital Projects to be Funded by Impact Fees
Additional Treatment Plant Capacity (200,000 gallons per day) = $1,700,000
Future East Side Trunk Sewer Construction = $233,000
East Side Capacity Upgrades* = $176,000
7800 South Pump Station = $350,000
West Side Force Main to Treatment Plant = $510,000
West side capacity upgrades* = $176,000
Future Planning Studies = $20,000
Total = $3,165,000
* Sewers that will be built by developers, but will be upsized to handle future demands. It is assumed that the Town will pay for only the upsize costs and the developer will pay all other construction costs.
Impact Fee Amount
Impact Fee per ERC = $3,165,000 / 784 = $4,037
The calculated impact fee of $4,037 per ERC represents the maximum amount that can charged. A lesser amount can selected by the Town Council for a sewer impact fee. Each residential connection should be charged for one ERC. Calculate ERCs for non-residential connections by estimating the indoor water use for the development (use Utah Division of Drinking Water Design Standards) and dividing by the indoor water use for a typical residential connection (350 gallons per day).
ERCs = (Estimated Indoor Water Use)/(350 gallons per day)
Impact Fee = (Fee per ERC) * (ERCs)
REFERENCES
State of Utah, 1995 (Updated 2010). Impact Fee Act. Utah Code Ann. Title 11, Chapter 36a.
Wasatch Civil Consulting Engineering, 2011. Elwood Town Wastewater Facilities Plan (Final Document)
APPENDIX A
FIGURES
APPENDIX B
CONSTRUCTION COST ESTIMATES