OPENING Mayor Hellar called the special workshop of the city council to order on Tuesday, June 24, 2008 at 6:00 p.m. in the council chambers at City Hall, 1123 Lake.
ROLL CALL Council members Logan and Reuter were present. Council members Boge, Newton, Hawkins, and Snedden were absent.
STAFF PRESENT: Public Works Director Kody Van Dyk, Planning Director Jeremy Grimm, City Attorney Will Herrington and City Clerk Maree Peck
CITY OF PONDERAY: Mayor Kunzeman, Council members Daugharty, Geiger, Moreland, City Engineer Mike Fitzgerald, and City Clerk Nancy Piatt
CITY OF KOOTENAI: Mayor Mjelde, Council member Brubaker, and City Clerk Mary Luzmoor
DISCUSSION OF JURISDICTIONAL, FUNDING AND SERVICE CHALLENGES ASSOCIATED WITH THE CITY OF SANDPOINT WATER SYSTEM
Sandpoint Mayor Hellar announced that at the last meeting, there was a task to review and discuss problems with the possibility of adding other criteria. Ponderay Councilman Geiger noted that is would be impossible to meet the criteria if the business is outside the boundary and that the criteria is designed for large subdivisions in the outlying areas. Sandpoint Planning Director Jeremy Grimm explained the intent for the criteria is primarily for subdivision development and not geared to the individual property owner. He noted that it provides more points for development that is not homogenous. He said there’s a safety value in the code that allows the city council to waive any criteria. He said the cost to individual seeking water pays for the city’s costs for staff time, an analysis on the hydraulic model and a geographical fee analysis. Sandpoint Public Works Director Kody Van Dyk stated it’s been at least 15 years since an individual has requested an expansion of boundaries. Councilman Geiger commented that boundaries are only extended based on a project and whoever can afford to buy water. He stated the NUFF fees should be incorporated and based on the layout of Ponderay but that this plan wouldn’t pertain to a very large percentage. Jeremy Grimm stated the biggest challenge is the incremental effect from an infrastructure planning capacity standpoint because the system needs to know the demand. He said a hydraulic model is needed to better predict the future. He suggested that the City of Ponderay run the model based on their plan and would provide the Sandpoint Public Works Director the analysis needed to plan for infrastructure accordingly.
Ponderay Councilman Daugherty stressed that he didn’t approve of the criteria because the City of Sandpoint has control. He questioned how long it would take to make the process work and how long it would take to acquire a permit. He stressed that the City of Sandpoint is putting requirements on individual land owners which they don’t need or want. He suggested that hook ups require compliance to ordinances. He felt the criteria requirements are preventing affordable housing. Jeremy Grimm explained the criteria doesn’t require that, that there were a number of ways to achieve points.
Ponderay Mayor Kunzeman raised concern that water extensions are passed by a majority vote of Sandpoint city council. She said it would be difficult for other city councils to determine what happens in their city. She said it requires individuals or developers from the City of Ponderay to go to Sandpoint for water and to the Kootenai/Ponderay Sewer District for sewer. She said the criteria doesn’t apply to Ponderay because the majority of Ponderay is commercial. She tried to look at this matter in a positive way and noted it didn’t fit well. She said she would love to tell applicants they could hook up to water.
Kody Van Dyk explained that applicants could come to the public works department with a building permit from the City of Ponderay, then they would hook up to the city’s water if it’s within the water district. He explained that if the property were outside the boundaries, no one would be eligible for a hookup and would have to go through the Sandpoint city council for approval. He noted the criteria is only binding if it is outside the boundaries. Mayor Kunzeman pointed out most potential development is outside the boundary with only one-half of the city available for water hookups. She said the Kootenai/Ponderay Sewer District currently has the potential to hookup the entire City of Ponderay. She pointed out the boundary goes to Bronx Rd on the Sandpoint side but yet the City of Ponderay can’t supply water for what they need in that area. She felt the boundary should go to Bronx Rd on the Ponderay side.
Jeremy Grimm explained the criteria essentially looks at a number of aspects of development such as location of tract, whether it has sewer service, road capacity, land use plan, and mixed housing development. He said the intent was not to provide a developer with water if it was harmful to the neighborhood. He said the criteria was based on planning principles, cost analysis and planned for infrastructure as well. He said other city ordinances were not considered. He noted there are other elements when considering the impact to the rest of the community. He explained that a large subdivision would impact intersections and would impact more trips.
Sandpoint Councilman Reuter said the City of Sandpoint has interest in growth from other areas as it impacts Sandpoint. Councilman Daugherty noted the City of Ponderay’s ordinances require developments to install infrastructure. He suggested combining the planning efforts for the two cities’ water needs so there’s no competition for the same grants. Councilman Geiger suggested extending the boundary so that all cities could work together.
Jeremy Grimm suggested that the City of Ponderay conduct a cost benefit analysis in order to determine the potential pressures on their services, costs, and to have a better understanding of the impact of development. He noted that sometimes development doesn’t pay for itself.
Councilman Reuter noted that the growth of the City of Ponderay is affecting the community and both cities are making decisions that are not keeping each other’s impact in mind. Mayor Kunzeman said the only way for Ponderay to grow is north of town. Kody Van Dyk stressed that north of town is the most expensive part of the system to maintain and is the least dense. He explained this boundary was extended to Bronx Road because it’s next to the treatment plan and several years ago the city council granted extension for development. He doubted this would happen today. He said it wouldn’t be possible to loop into Bronx Road because it’s an entire different pressure zone.
Mayor Mjelde noted that a street in Kootenai has one side with water and the other side without. She noted there are properties divided in half within the water district and requested this be cleaned up. She said the big developers pay for the cost of extension so that individuals could afford to hook up to the water. She said Kootenai would like to see the property annexed into the cities first before they hook up to water as well as complying with zoning ordinances. She opposed mixed housing and said there should be no limits for a developer as not all development would be low-income housing. She said it should be up to the Cities of Ponderay and Kootenai as to what happens in each development. Kootenai Councilman Brubaker mentioned that the water policy is helpful in gaining leverage in development that could happen in Bonner County. He suggested that the policy provide a veto if there’s going to be long-term detriment to Kootenai. He said the impact for long-term maintenance is the most important issue to the agreement. He said situations that don’t affect the long-term costs and maintenance for the water system, don’t fit into the criteria such as affordability. He said the boundary should be smoothed out and should have a point system in case there is a failure in the water system.
Sandpoint City Attorney Will Herrington pointed out the point system applies to all areas of city impact in order to meet the same standards. He stressed the primary concern should be the cost effectiveness of expansions. He said the cost of providing service should also consider density. He noted there are liability concerns when Sandpoint extends its district when it’s unable to provide extra fire flow. He said the cost of providing service and liability are important items and suggested that the cities consider intergovernmental agreements. Kody Van Dyk said there are ordinances that govern the system within Sandpoint but don’t outside of Sandpoint. He said there was a recent incident where a developer on Kootenai Cut off Road attached a hose to one of the city’s fire hydrants and also hooked up to the Kootenai/Ponderay sewer system. He said it was determined no contaminating backflow had occurred but Sandpoint was not able to control the situation because it occurred outside the city limits of Sandpoint. He said an intergovernmental agreement could have given Sandpoint the ability to make the developer responsible.
Sandpoint Councilwoman Logan suggested considering defining the goals of these agreements and what is to be accomplished. She asked how to determine the dollar value. Councilwoman Logan asked how the funds would be determined that would pay for the entire system or apply the funds to the piping to the property. Jeremy Grimm said the collection of impact fees would be an element because Sandpoint can’t collect fees outside the boundaries. Mayor Kunzeman said it would be helpful to know what the funds would be used for. She noted Area 4, which lies generally north and east of the thread of Sand Creek, was very cost prohibitive. She asked if developers develop in Area 4, whether the funds would apply to those deficiencies in that area. She asked how the City of Ponderay would know where grant funding was applied. Will Herrington stated the city did an independent study on the water system deficiencies with criteria of where the deficiencies are located. He said this would provide guidance for the City as to where to apply funds based on what deficiencies were the worse. He said isolating funds for a specific area could be entered into the intergovernmental agreements. Kody Van Dyk noted the developers for Providence Park would pay for the improvements but that the city won’t receive any extra revenue. He said the NUFF fees would go to the water fund, not the general fund. He explained to Councilman Daugherty that the city has borrowed funds from the water fund and paid it back as reflected in the budget.
Councilman Reuter raised concern that the current water users pay for maintenance on improvements and felt requiring more density was important. He said if the water boundary is extended to Bronx Road, it will encourage more development but will impose the cost on Sandpoint. Councilwoman Logan said it comes back to intergovernmental agreements. Mayor Hellar said the criteria encourages cost effective and efficient use of taxpayer dollars in order to provide services. She asked if the cities would be willing to accept greater charges for water if their cities had less density.
Jeremy Grimm pointed out the system is currently deficient and in order to provide water for growth it would cost several million dollars which doesn’t include the cost for the new treatment plant in order to provide more water. He said in order to provide for growth, a developer could pay for their share, but it would be impossible to charge the rates that would cover the costs. He said the intergovernmental agreements could have an element for land and funding source.
Ponderay City Attorney Louis Marshall said Ponderay’s future land use map will soon be revised and will probably be adopted by city council. He said the new numbers would be similar with much less rural property.
City Attorney Will Herrington suggested preparing an outline of an intergovernmental agreement and a public safety ordinance. He said a priority would be to update the NUFF fees into impact fees and an agreement that allows the City of Sandpoint to collect those fees. He said the intergovernmental agreement should include language that allows other cities to come forward to ask for expansion of water boundary lines. He said using the same criteria to evaluate this allows discussion as to what the real costs are for expansion and what developers would need to do in order to comply with each city in order to expand in their area. He said the reason the city is getting a large contribution of infrastructure from developers is because they’re not in the service area. He said if they were in the service area, then the city would have to provide the service and watch the water pressure go down because of the added users on an under capacity system. He raised concern with safety and liability as well as cost.
Louis Marshall said the City of Ponderay just addressed impact fees but didn’t address sewer and water because they have no control. He said they could address this because a study was in place and could review water impact fees.
Ponderay City Engineer Mike Fitzgerald noted Sandpoint’s report on the water system would be the basis for their capital improvement. He said impact fees are just a basis to get more funds. Mayor Mjelde said it there’s a request for annexation, it would require compliance to their building standards and codes. She said there needed to be control of drainage and infrastructure based on their own standards. She said their policy would require annexation first before allowing water expansion.
Mayor Hellar suggested that Bonner County be an involved party. Councilwoman Logan reviewed the issues to be included in the intergovernmental agreement such as health and safety, more input on criteria for water boundaries, collection on impact fees, where money is going, deferential rates, and funding sources. She felt the most important issue is the collection of impact fees and differential rates. Mayor Mjelde felt safety was an important element. Will Herrington suggested that city staff provide a skeletal outline to the city attorneys for review, then to provide it to the sub-committee for review. He suggested inviting one representative from Bonner County. Councilman Reuter suggested more Sandpoint city council members be on the sub-committee. Councilman Geiger suggested establishing stepping-stones as to how to expand the boundaries. Mayor Hellar suggested having a separate meeting with Sandpoint city council to talk about the issues. She also suggested coming up with compilations as to how to handle the existing water boundaries, expansion of outside boundaries, and where to get the funding for improvements. Kody Van Dyk noted most existing deficiencies are based on fire flow issues. He noted that a tank on Bronx Road would help on fire flow immensely.
Don Hutter stated the deficiencies are fire flow. He noted the majority of the City of Ponderay is industrial and commercial with the need to look at the engineering aspect and shouldn’t do it by piecemeal. He said there needs to be a way to collect funds from everyone in the area and design progressively outward. He didn’t think it necessary to depend on developers. He said there needs to be consideration in collecting funds and the need to loop the systems. Councilman Geiger said it would be helpful to provide a loop system. Louis Marshall said the issue would be to reintroduce impact fees with a reason to go forward before final agreements are signed. Jeremy Grimm said he hoped to have a study in another two weeks for differential rates, and geographic specific NUFF fees. Louis Marshall stressed there are concerns with funds and that a safety ordinance can be passed without an intergovernmental agreement.
Mayor Kunzeman said the City of Ponderay is looking at hiring a professional planner who will be on staff. Will Herrington explained the City of Sandpoint NUFF fees will become impact fees because court ruling states that NUFF fees can’t be used for future capital improvement and a capital improvement ordinance would need to be adopted. He stressed there would be concern that if Sandpoint chooses to have water impact fees, the other cities would have to match those impact fees. He suggested discussing this matter before entering into an intergovernmental agreement as to what the burden is going to be for impact fees. He asked if differential rates are based on zones, how would the impact fees be determined for each zone or are the fees going to be the same for the entire area. He said that surrounding cities would have to adopt their own impact fees through the intergovernmental agreement.
Mr. Fitzgerald noted that the 2006 water master plan explains the deficiencies with the water system and how the impact fees are assessed and calculated. Kody Van Dyk said the results from the company doing the research on water impact fees would be ready in less than two weeks. Will Herrington explained that the city attorneys would be producing a general outline of what needs to be done and will send to other cities for review. He said they would also draft a model safety ordinance. He said the attorneys would have drafts within the next two to three weeks and would be available for mayors’ and city council review. Louis Marshall stated there’s an issue as to how to expand the boundaries and what figures to use for impact fees. Jeremy Grimm explained that in terms of costs, the question would be whether the water system would pay for hiring consultants to conduct an analysis. Mayor Hellar asked whether conservation measure rates could be in the intergovernmental agreement. Kody Van Dyk explained as long as you have a rate study that justifies the rates, you could charge this within the system.
The next sub-committee meeting was scheduled on August 25, 2008 at 6:00 p.m. at Kootenai City Hall with the suggestion to invite Bonner County.
ADJOURNMENT The special meeting adjourned at 8:00 p.m.
Gretchen A. Hellar, Mayor
ATTEST:
Maree Peck, City Clerk
