Chapter 13.08
Private Utility Cost Recovery

Sections:

13.08.010 Purpose of Chapter.

13.08.020 Application.

13.08.030 Processing of Application.

13.08.040 Ownership of System.

13.08.050 Restrictions on Connection.

13.08.060 Interest on Latecomer Charge.

13.08.070 Payment of Charge.

13.08.080 Term of Agreement.

13.08.090 City Liability Limited.

13.08.100 Recording of Agreement and Releases.

13.08.010 Purpose of Chapter.

Pursuant to the authority conferred in the Municipal Water and Sewer Facilities Act, RCW chapter 35.91, this chapter is enacted to encourage the private construction of municipal water and sewer systems by providing means for the recovery of the costs of installation through a charge to later users of the systems who did not contribute to the capital costs thereof.

[Ord. C29336; Passed: 3/20/1989]

13.08.020 Application.

A.  Any property owner who uses private funds to construct domestic water and/or sewer systems in the city or within ten miles from the city limits to connect to existing public City water or sewerage systems for the purpose of serving the area in which the real property of such owner is located may apply to the City to establish a latecomer agreement in order to recover a pro rata share of the costs from subsequent users of the system.

B.  The application must be on forms prescribed by the city engineer and must be accompanied by a nonrefundable application fee determined by the city engineer.

C.  The city engineer establishes policies and procedures for processing applications and initially determining eligibility of a system for a latecomer agreement.

D.  The applicant is required to submit to the city engineer a certified statement by a State of Washington licensed professional engineer containing an itemization of the total projected cost of the system which may include the design plans.

[Ord. C29336; Passed: 3/20/1989]

13.08.030 Processing of Application.

A.  Upon receipt of the applicant’s statement of project costs, the city engineer prepares for the city council a report setting forth:

1.   the total area and frontage of property currently paying or sharing the costs of the construction,

2.   the total area and frontage of property physically and feasibly capable of being served by the system,

3.   the names and mailing addresses of the owners of the property determined to be within the possible service area,

4.   the fair pro rata share of the cost for each property which might tap into the system, determined on an acre, front footage, or other equitable basis,

5.   a determination whether the system is consistent with the facility plan of the department of engineering services,

6.   a list of other necessary services presently available or planned for the area as part of the adopted plan,

7.   evidence that the applicant agrees to an annexation covenant for the property to be presently served by the system, if located outside the city limits,

8.   a recommendation whether the application meets the criteria of this chapter and the policies and procedures of the city engineer and ought to be accepted.

B.  If the city council accepts the application, it passes a resolution declaring its intent to enter into a latecomer agreement, subject to the further requirements of this chapter.

C.  After the system is completed the applicant must present to the city engineer a final statement detailing the actual total project costs, including application fees, design, construction and inspection fees. In addition the applicant must submit “as-built” plans showing the system and the service area.

D.  If both the as-built plans and the final statement of costs are consistent with the improvement contemplated, the City enters into the latecomer agreement.

E.  If the final statement exceeds or is inconsistent with the projected cost, or if the as-built plans significantly differ from the original design, the city engineer meets with the applicant to determine the reason for the increased cost or different design.

F.  The city engineer makes a further report and recommendation to the city council. The city council may approve, reject, or modify the latecomer agreement.

[Ord. C32762; Passed: 12/11/2000]

13.08.040 Ownership of System.

A.  To be eligible a system must comply with all City ordinances, rules and regulations pertaining to the design and construction of water and/or sewer systems.

B.  Upon approval of the latecomer agreement the constructed system becomes the property of the City. The City may charge and receive fees for use according to the City’s established water and sewer rates. Maintenance and operation costs of the system are borne by the City.

[Ord. C29336; Passed: 3/20/1989]

13.08.050 Restrictions on Connection.

A.  Under the terms of the latecomer agreement the City will not allow any person to tap into the system without prior payment, or assurance of payment, to the applicant or the applicant’s successor(s) or assign(s), herein referred to collectively as “beneficiary,” of the latecomer charge, including interest and costs of administration.

B.  However, the City may authorize use of any such facility without payment of the charge when the city engineer determines a tap to be in the best interest of the public health, safety, or welfare.

C.  The latecomer agreement obligates the City to exercise its best efforts to assure compliance with this section but the City shall not incur liability for an unauthorized tap.

[Ord. C29336; Passed: 3/20/1989]

13.08.060 Interest on Latecomer Charge.

A.  The latecomer agreement will provide that the beneficiary will receive interest.

B.  If a latecomer pays the charge within thirty days from the date of execution of the agreement, no interest is payable. Otherwise, interest is payable from the date of execution of the agreement to the date of payment of the latecomer charge.

C.  The rate of interest will be the rate payable on LID warrants at the time the City signs the latecomer agreement.

D.  Interest is calculated on the basis of a three-hundred-sixty-five-day year and is not compounded.

E.  Total interest payable may not exceed the principal amount of the latecomer charge.

[Ord. C29336; Passed: 3/20/1989]

13.08.070 Payment of Charge.

A.  Payments of the latecomer charge may be made to the City or to the beneficiary in accordance with the City’s rules.

B.  Payment to the City must be by one lump sum including administrative costs. The City pays over amounts due the beneficiary within sixty days of receipt.

C.  If payment of the latecomer charge is made to someone other than the City, the City will require proof of payment in the form of a release from the beneficiary before allowing connection to the system. The City will not be involved in enforcing private payment arrangements or mediating payment disputes between parties.

D.  Throughout the term of the agreement the beneficiary must in writing certify annually in January the name(s) and address(es) of the beneficiary. The city is not responsible for locating any person who may be entitled to benefits under any agreement. Failure to receive the annual certification required under this subsection, gives the City cause to refuse to make payment under the agreement and money received may become the sole and exclusive property of the City.

[Ord. C29336; Passed: 3/20/1989]

13.08.080 Term of Agreement.

No latecomer agreement can have a term longer than fifteen years.

[Ord. C29336; Passed: 3/20/1989]

13.08.090 City Liability Limited.

A.  The agreement will provide that the developer of the facilities waives and releases the City from all claims arising from the establishment, administration and enforcement of the latecomer agreement.

B.  In no event will the City be considered a guarantor of any project or improvement by virtue of this chapter or any agreement made pursuant to this chapter.

[Ord. C29336; Passed: 3/20/1989]

13.08.100 Recording of Agreement and Releases.

A.  The city engineer records each latecomer agreement or a notice thereof, including the legal description of all properties, as determined0 under SMC 13.08.030(A)(2), subject to the latecomer charge in the records of the auditor of the county in which the properties are located.

B.  In addition to recording the city engineer mails a copy of the agreement, or a summary thereof, to each owner of record, as determined under SMC 13.08.030(A)(3), of all properties subject to the latecomer charge, indicating at least the basis of computing the latecomer charge and stating the rate of interest.

C.  When the latecomer charge for a particular lot or parcel has been paid, the city engineer furnishes proof of payment to the owner of the lot or parcel and within thirty days records with the auditor of the county in which the property is located a release, giving the legal description of the lot or parcel.

[Ord. C29336; Passed: 3/20/1989]