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City Council Minutes <br />January 10, 2023 <br />Page 3 <br />Mr. Puga presented findings on the sewer service portion of the study, noting <br />challenges for the northeast area include its distance from facilities and limited <br />available capacity to connect to the existing system. This necessitates at least three lift <br />stations and a regional lift station to pump directly to the treatment plant. <br />Mr. Puga went on to explain that, with one exception, a lift station would not <br />immediately be required in the northwest area like it is in the northeast area. Service <br />to the far northwest corner would require a lift station as the existing gravity pipe is <br />not deep enough to connect. He added that a regional lift station would be needed if <br />and when the mining areas are developed, and that the lift station would support <br />future development to the north. <br />Mr. Puga presented an opinion of probable cost for providing sewer service with the <br />northeast area totaling $13,143,00 and the northwest totaling $15,335,000. <br />Ms. Cook presented the Financial Analysis Methodology which provides options for <br />funding the projected expenses. <br />Ms. Cook reported that for water and sewer service the cost per single family unit in <br />the northeast area is $22,144 per single family unit in development fees/assessment <br />while the total for the northwest area is $19,724 per single family unit. <br />Ms. Cook provided a comparison chart for seven other communities with <br />development fees for water and sewer services which showed each of Elk River's <br />proposed projects as the highest examples. <br />In presenting options for recovering costs, Ms. Cook noted that sizable investments <br />in the Northwest area need to be incurred in the first five years which is a risk for the <br />party funding the project. She then presented the options. <br />The first option presented was developer payment through an agreed cost sharing <br />approach. <br />Ms. Cook explained that the second option would be to use special assessments <br />which follow the land and are paid whether development occurs or not. Mr. Femrite <br />contributed that the city had done special assessments before. <br />The third option is area trunk charges which are paid when land is platted. <br />Ms. Cook noted that as these options progress there is a greater gap in time between <br />installation of infrastructure and collecting revenue which contributes to a greater <br />risk factor for the city/utility. <br />Option four would be utilizing sewer and water availability charges which are paid by <br />builders through permitting. <br />p 0 0 1 R C 1 I T <br />NATURE <br />