Council mulls sharing cost of services
February 15, 2008
Steamboat Springs — Developers who bear the cost of extending essential services like water and streets to new subdivisions soon could receive reimbursement from developers who follow after them, according to a proposed city law.
Steamboat Springs City Council is considering passage of an ordinance that would give it the authority to assess a charge against each subsequent developer whose property is benefited by the public improvements originally paid for by another developer. The funds would be used to reimburse the original developer who absorbed the cost of extending sewer lines, storm drains and street improvements – including traffic signals, sidewalks and street lighting – to areas of the city that weren’t previously served.
“In these cases, the original developers put all this money up front and as others develop around them, their cost of development would be less,” City Council President Loui Antonucci said. “That’s not equitable. We probably should have done this 20 years ago.”
The ordinance would not apply to individual homeowners in existing subdivisions.
The collection of funds would be based upon a reimbursement agreement entered into by the city – at its option – and the original developer during the city planning process.
City Council tentatively passed the ordinance on first reading at its Feb. 5 meeting and could finalize it at a second reading Feb. 26.
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According to the tentative ordinance drafted by Staff Attorney Dan Foote, the reimbursement plan is based on the city’s philosophy of making development pay its own way, but also on a recognition that making the initial developer pay full freight could result in a windfall to nearby property owners.
“The city’s current practice is to require the construction of all public infrastructure necessary to serve a project or to mitigate the impacts by the owner of the development,” Foote wrote in a memo to City Council. “This approach in some circumstances results in the owner of the initial development constructing roads, drainage facilities or water/sanitary sewer mains that provide benefits to other properties. These benefits amount to a windfall to the other property owners at the expense of the initial developer.”
Councilwoman Cari Hermacinski said the need for the ordinance came to the council’s attention during the permitting process for a new development, The Aviator, across Routt County Road 129 from Steamboat Springs Airport.
“The Aviator is extending public infrastructure all the way out there, and the city will tie into it,” Hermacinski. As a result, she said, the city has agreed to share the cost.
If there is a downside to the ordinance in City Council’s view, it could be disputes that result from the assessment of charges.
“This is really commonplace in other jurisdictions,” Hermacinski said. The ordinance will provide for dispute resolution.
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