City Council
259 N. Wilma Avenue
Ripon, CA 95366
MEMO
To: Honorable City Council
From: Ken Zuidervaart, Planning Director
Date: 05/09/2023
Subject: Annexation Policy for Connection Fees
RECOMMENDED ACTION:
Adopt the resolution rescinding Resolution 99-24 and re-establishing an updated policy for the annexation of developed residential parcels to the City of Ripon regarding connection to municipal services.
BACKGROUND:
In 1999 the City Council of the City of Ripon adopted Resolution 99-24 (see Exhibit A) which put forth policies for the annexation of developed residential parcels to the City of Ripon. The resolution set forth the requirements and policies of when newly annexed developed residential properties were required to hook up to City services, and what improvements and fees are due at the time of connection.
Additionally, the resolution defines a loan program offered by the City of Ripon whereas the City would loan money for the extension of city services to the property, the installation of necessary required frontage improvements (curb, gutter, sidewalk) and payment of hookup/development fees for water, sewer and storm. The loan was offered at 5% fixed interest over a 15-year period, in annual installments. In the alternative, the City and property owner may enter into a loan agreement whereby no annual payment is made, and the loan amount, plus interest, is repaid at the time the property is developed, sold, or ownership is otherwise transferred.
DISCUSSION/ANALYSIS:
Due to recent changes in California prevailing wage laws, modifications to our policy were necessary. Essentially any project receiving funds from the City of Ripon must be prevailing wage. This essentially nullifies our ability to loan money to private residents for the extension of City services to their property or the installation of curb, gutter and sidewalk across the frontage of their property.
The proposed changes to the resolution would eliminate the option for the City to loan money to private residents for the above mentioned frontage improvements or improvements needed to connect to City utilities, however does maintain an option to allow residents to enter into a loan agreement to pay their utility development/hookup fees to the City of Ripon over a period of 15 years.
The new proposal would allow a resident to enter into a loan agreement with the City of Ripon to cover the development/hookup fees for City water, sewer and storm. Any loan made pursuant to this new policy shall be fixed at the time of borrowing and shall bear an interest rate of the current federal funds rate plus 1% per annum, with no prepayment penalty. Repayments of the loan shall be made over a 15-year period, in monthly installments.
FISCAL IMPACT:
N/A
Attachments:
1. Resolution No 99-24
RESOLUTION NO. 23-18
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
RIPON RESCINDING RESOLUTION 99-24 AND REESTABLISHING AN UPDATED POLICY FOR THE
ANNEXATION OF DEVELOPED RESIDENTIAL PARCELS
TO THE CITY OF RIPON
WHEREAS, on March 16, 1999, the City Council adopted Resolution 99-24 which set forth policies for the annexation of developed residential parcels to the City of Ripon.
WHEREAS, resolution 99-24 recognized that such properties are, in most cases, not served with traditional municipal services, such as municipal water, sewer, storm drainage, curbs, gutters and sidewalks. Rather, said properties are served by domestic wells, septic tanks, and onsite drainage; and
WHEREAS, the Ripon General Plan and Municipal Code require that all residential properties must be connected to municipal services; and WHEREAS, the City Council recognizes that requiring property owners to connect to municipal services upon annexation can create a financial hardship to some property owners, and desires to set forth an alternative method of connecting to municipal services, and making payment for such connection; and
WHEREAS, the City Council is now desirous of amending those policies in light of new State Law regulations regarding the expenditure of any City revenues pertaining to public works projects.
NOW, THEREFORE, BE IT RESOLVED THAT THE FOLLOWING POLICY FOR ANNEXATION OF DEVELOPED RESIDENTIAL PARCELS IS HEREBY ADOPTED:
1. This policy shall apply only to parcels which are developed with one or more residential units at the time of annexation. This policy does not apply to annexations of undeveloped land.
2. Owners of residential units in newly annexed areas are encouraged, but not required, to connect to city water, sewer and storm drainage facilities at the time their properties are annexed to the City. Property owners with residential units may connect to city water, sewer and storm drainage facilities at any time after annexation, provided the property owner pays for any necessary extension of such utilities to their property. A property owner connecting to city services shall connect to all such services at the same time.
3. In addition to the requirement to connect to city water, sewer and storm drainage facilities, owners of developed residential properties shall install curb, gutter and sidewalk along the frontage of their properties, consistent with City standards. The City Council may in their discretion, at the time the property owner connects to City water, sewer and storm drainage facilities, waive, modify or defer the requirement to install curb, gutter and sidewalk improvements, in whole or in part, based upon the following factors: financial hardship to property owners, potential future projects which may cover those improvements or lack of surrounding sidewalk improvements at the time of connection.
4. In calculating the connection fees for City water, sewer and storm drainage facilities, the City shall impose those fees set forth in the City of Ripon’s Public Facilities Financing Plan, as indexed and/or revised from time to time, for the following facilities:
a. Water Facilities for single family units
b. Wastewater Facilities for single family units
c. Storm Drainage Facilities for single family units
In the event a property owner is already connected to any of the aforementioned facilities at the time of annexation, such fee(s) shall not be applicable.
5. Notwithstanding any other provision of this Resolution, at any time after annexation, if the property owner’s domestic well or septic system fails, as determined by the San Joaquin County Department of Environmental Health or other agency of competent jurisdiction, and a permit for repair or replacement would otherwise be required, the property owner shall, at its expense, connect to all available city services, including water, sewer and storm drainage facilities.
6. The City Council recognizes that in some cases, the property owner may not be able to afford to incur the costs associated with connection to city services. In such cases, the City shall make a loan to the property owner in the amount sufficient to pay the connection fees set forth in Section 4 above. Any loan made pursuant to this policy shall be fixed at the time of borrowing and shall bear an interest rate of the current federal funds rate plus 1% per annum, and shall contain no prepayment penalty. Repayment of the loan shall be made over a 15 year period, in monthly installments. The City may secure repayment through an annual property lien or other appropriate security, as determined by the City Administrator.
PASSED AND ADOPTED at a regular meeting of the City Council of the City of Ripon this 9th day of May, 2023, by the following vote:
RESULT: ADOPTED BY CONSENT VOTE [UNANIMOUS]
MOVER: Leo Zuber, Vice Mayor
SECONDER:Gary Barton, Council Member
AYES: Michael Restuccia, Leo Zuber, Gary Barton
ABSENT: Daniel de Graaf, Dean Uecker
THE CITY OF RIPON,
A Municipal Corporation
By ________________________________
MICHAEL RESTUCCIA, Mayor
ATTEST:
By: ___________________________
LISA ROOS, City Clerk