HomeMy WebLinkAbout11-Discussion and Possible Action Regarding Reconnect FeesAgenda
TUC EEDIVE
Public Utility District
ACTION
To:
Board of Directors
From:
Robert Mescher
Date:
April 18, 2012
Subject: Discussion and Possible Action Regarding Reconnect Fees
1. WHY THIS MATTER IS BEFORE THE BOARD
The Board requested this workshop regarding fees to reconnect abandoned services.
2. HISTORY
Facilities Fees
The District must expand its electric and water facilities to accommodate increased
customer demand and protect the public health, safety and welfare. The imposition of
facilities fees is the preferred method of ensuring that customers with new service
connections bear the cost of electric and water facilities necessary to accommodate
such growth.
The Electric and Water System Master Plans are prepared every five years. They set
a reasonable method to determine the impact of new development and the need for
additional facilities. The established fees do not exceed the costs of providing
additional water and electric facilities necessitated by the service connection to the
District's systems.
Reconnection of Abandoned Service
Sections 5.12.050.5 and 5.12.055.4 of District Code specifically state that if service is
re-established after five years from the date of disconnection, the customer shall make
normal application for service and shall be responsible for payment of current
connection and facilities fees. No credit will be given for the previous service fees.
The Electric and Water Master Plans are prepared every five years using consumption
data of current customers. Services that have been abandoned for more than five
years, do not register consumption, and are therefore excluded in the most recent
master plans. Reconnection of an abandoned service is considered the same as a
connection of a new service because there is additional burden on the existing system
which should not be charged to the existing rate payers.
These sections of District Code assist in the implementation of the District Master
Plans and ensure that customers with reconnected abandoned services bear a
proportionate share of the cost of capital expenditures necessary to provide electric
and water facilities within the District service area.
3. NEW INFORMATION
Periodically, customers voluntarily or involuntarily terminate their service.
This year, the District was contacted by several potential buyers who were considering
the purchase of residences that had been disconnected from the District's services.
They specifically requested information regarding the costs to reconnect.
Last month, after purchasing a property located at 10433 Somerset, Mr. Craig Lighty
contacted the District to apply for a new account. He was informed that the water
service had been discontinued at that residence since 2002, and he was surprised by
the required fees. Per District Code, the applicable facilities fees are $3,911 and
connection fees are $1,185, totaling $5,096.
In consideration of the fact that an existing meter box was located at the residence,
District staff agreed to reduce the connection fee by $885. The adjusted amount due
was $4,211. Mr. Mark Lighty came to the April 4th Board Meeting to request that the
District consider reducing the fees.
After hearing Mr. Lighty's comments, the Board requested staff to present a workshop
today regarding fees to reconnect abandoned services.
The Board also requested staff to report what other districts impose for similar
situations. Exhibit A is a table of the District's fees and other agency fees.
The District has approximately 40 abandoned services that have been inactive for
more than five years. One third of those are abandoned water -only services.
4. FISCAL IMPACT
Waiving reconnection fees transfers the costs back to the District's other existing rate
payers. For a typical 2,000 sq. ft. single-family residence, the total costs to reconnect
abandoned services are $2,500 for electric -only service and $4,500 for water -only
service, for a combined utility cost of $7,000.
5. RECOMMENDATION
Receive this report, consider possible action for the reconnection fees of 10433
Somerset, and provide direction to staff.
Robert Mescher
Administrative Services Manager
Michael D. Holley
General Manager