10.1 SR 06-01-2020 - Laserfiche WebLink

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City of Qk*' River Request for Action To Item Number Mayor and City Council 10.1 Agenda Section Meeting Date Prepared by Work SessionJune 1, 2020 Justin Femrite, P.E., Public Works Director Item Description Reviewed by Clean Water Partnership Loan Conduit Cal Portner, City Administrator Reviewed by Action Requested Discussion and staff direction. Background/Discussion A number of developments outside of our Urban Service Area rely on community septic systems to process their sanitary waste. Over the past several years, citing system concerns, respective Home Owners Association representatives have contacted the city regarding connections to the public wastewater system. Although a connection to city services would provide a beneficial long-term solution, the costs tend to be prohibitive. Some have contracted with Shane Steinbrecher of Steinbrecher Companies, Inc. for options to upgrade to their existing system. An upgrade appears to be a lower cost solution however, they may not have a private financing option. Mr. Steinbrecher has proposed the city acquire a loan through the MPCA Clean Water Partnership Loan program, use the loan proceeds to make the improvements, and assess the costs of the improvements back to the benefitted property owner. All property owners would need to sign a petition and waiver agreement and the city would assess the costs back as a special assessment in accordance with city policy and the assessment agreements. Our current Petition and Waiver Policy would need to be amended to include this type of improvement. The Council also needs to consider that there are multiple developments with a similar need and a precedent could result in future loans. Financial Impact The use of the state loan is backed with a general tax obligation as we pledge our full faith and credit. Tax delinquencies may provide a payment deficit which would need to be made up with general tax funds. The city can charge an interest rate of 1.5%, which may cover staff administrative costs. The city has no existing fee structure for loan origination -like costs. It would not be a best practice to use general tax revenues to subsidize the improvement funding. Attachments ■ Petition and Waiver Policy ■ Clean Water Partnership Loan Details The Elk River Vision A welcoming community with revolutionary and spirited resourcefulness, exceptional,` 01 e service, and community engagement that encourages and inspires pi ospei ly INAMIRE1