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HomeMy WebLinkAbout1992-01-24 Support Documentation Town Council Special Session 1 J~ TOWN OF VAIL SPECIAL MEETING OF THE VAIL TOWN COUNCIL FRIDAY, JANUARY 24, 1992 8:00 A.M. IN THE VAIL COUNCIL CHAMBERS AGENDA 8:00 a.m. DISCUSSION OF ASSESSMENT FORMULAS FOR EAST VAIL UTILITY UNDERGROUNDING DISTRICT TOWN OF VAIL SPECIAL MEETING OF THE VAIL TOWN COUNCIL FRIDAY, JANUARY 24, 1992 8:00 A.M. IN THE VAIL COUNCIL CHAMBERS AGENDA 8:00 a.m. DISCUSSION OF ASSESSMENT FORMULAS FOR EAST VAIL UTILITY UNDERGROUNDING DISTRICT y, ~ ~ TOWN OF VAIL ~ 75 South Frontage Road Department of Public Works/Transportation Vail, Colorado 81657 303-479-21581FA X 303-479-2166 MEMORANDUM T0: Ron Phillips FROM: Greg Hall DATE: January 23, 1992 RE: East Vail Underground Utility Cost Sharing Proposals and Polling Process As requested, the staff has looked at various methods to distribute the costs associated with the underground utility district among the involved parcels. The district boundaries encompass four types of properties as follows: a. Vacant lots - 15 b. Existing residences where no costs are incurred by the district as the services are underground to the underground primary system - there are 14 of these residence types or services on 11 lots. c. Existing underground services connected to the overhead primary system - there are 52 residences or services on 35 lots. d. Overhead service connected to the overhead primary - there are 21 residences or services on 9 lots. It should be noted that there is an overlap of types of service on two lots and these two lots were counted twice above. In summary, there are a total of 68 lots within the district boundary, with 73 services requiring work out of a total of 102 vacant lots and residences/services. The maximum total cost of the district is estimated to be $170,893. The construction or "hard costs" are $131,484.10. The engineering, administration and bond costs, or "soft costs", are 539,408.90. The "hard costs" of the overhead type service is $55,635.40 or 42.30 of the "hard costs". The "hard costs" of the underground type service connected to the overhead primary system is $75,848.30 or 57.70 of the "hard costs". EAST VAIL UNDERGROUND UTILITY COST SHARING January 23, 1992 Page 2 There seem to be an unlimited number of options available to distribute the costs of the district to those properties within the district boundaries. These include actual costs, equal shares, and proportionate shares. These costs can then be further distributed by lot, service, or combination of lots and services. Below are a few options which detail how the costs could be distributed: Method of Assessment - Option 1 Each specific property owner would be responsible for the "hard costs" associated with the service line to their specific service. The "soft costs" would be proportioned in the same ratio the work on an individual property bears to the total amount of the "hard costs". Costs range for overhead services from $845.00 - $10,652.00. The average of all overhead services equals $3,443.13. The costs for underground services range from $211.00 - $7,916.00. The average of all of the underground services equals $1,987.27. Advantages 1. There is no common work being done. All of the work can be identified specifically with a particular property and is to the direct benefit of that property only. 2. The common costs are being paid totally by Holy Cross Electric. 3. Each property would bear the cost of individual service lines on their property. Some properties have taken care of all or part this cost in the past, some properties will need to modify existing services or construct new services as part of the district, and some properties will need to install new services in the future when they are developed. In all cases, the property owner pays only for the improvements on his property. Disadvantages 1. The assumption is that there is no common benefit received in this project. This does not take into account any aesthetic or visual benefits to all properties. 2. Some properties will have an extreme cost which may create an economic hardship. EAST VAIL UNDERGROUND UTILITY COST SHARING January 23, 1992 Page 3 Method of Assessment - Option 2 The total value of the work being accomplished would be divided equally among either a) lots, b) services, c) lots and services, or d) type of service. The costs would be as follows: a) All Lots (68) $ 2, 513.13 EA b) Actual Services with Work Required (73) $ 2,341.00 EA c) All Lots and Services (102) 1,675.42 EA d) Overhead Work by Overhead Services (21) $ 3,443.13 EA Underground Work by Underground Services(52) $ 1,987.29 EA ( ) = Number of owners involved Advantages Visual concerns and safety are the overwhelming reasons for the district. The benefits may accrue beyond the boundaries of a particular property. The concern seems to be a neighborhood concern, not just an individual property concern. Disadvantages 1. Certain properties will be subsidizing other properties with respect to service line costs. Individuals who have already undergrounded their services, or who have vacant lots, may object to subsidizing those who chose not to underground their services in the first place. It costs more to underground services than to overhead services and, therefore, a subsidy is rewarding those property owners who elected not to underground their facilities in the first place. 2. With respect to the vacant lot owners, no one is going to help them pay for their underground services when their property is developed.. 3. There are no facilities that can be identified as common facilities, only facilities related to a particular lot. Method of Assessment - Option 3 A percentage of the total district costs could be shared equally amongst all the lots and services. The remaining amount could be distributed proportionately to the service type and borne by that type of service, or could be borne equally by all the services being altered. The results are as follows: EAST VAIL UNDERGROUND UTILITY COST SHARING January 23, 1992 Page 4 Possible Shares of Total Costs* Service Tv~e "Soft Cost" 300 40% 500 or Lot Share Share Share Share Alternative A vacant Lots (15) 386.36 502.63 670.17 837.71 UG Service - No Work (14) 386.36 502.63 670.17 837.71 UG Service - Work Required (52) 1844.98 1830.01 1807.92 1785.84 Overhead Service (21) 3035.68 2912.22 2735.53 2558.85 Alternative B Vacant Lots (15) 386.36 502.63 670.17 837.71 UG Service - No Work (14) 386.36 502.63 670.17 837.71 Equal Distribution of Balance 2187.51 2141.33 2074.77 2008.71 Among Altered Services (73) ( ) = Number of Owners Involved * All categories share a portion of the total cost equally. The remaining cost is allocated to the altered services on the basis of average actual cost. Advantages 1. Recognizes that all properties derive some benefit from the undergrounding and they participate in the costs. 2. Vacant lots and those whose services are already hooked up incur costs which are substantially less than those requiring work to be completed. It is recognized these participants have or eventually will have to pay for the undergrounding of their service lines. 3. It is recognized that the overhead services costs more than the underground services, and these are proportioned respectively. Disadvantages 1. Certain properties will be subsidizing other properties relative to service line costs. 2. No facilities can be identified as common facilities, only facilities related to a particular lot. EAST VAIL UNDERGROUND UTILITY COST SHARING January 23, 1992 Page 5 Recommendation It is recommended that one of the methods of Assessment Option 3 be chosen for the following reasons: •(1) Based on the public hearing on January 7, it appeared that the neighborhood felt no one property should be overburdened with an extremely high assessment. (2) All properties within the district benefit by some amount with regards to the undergrounding of the utilities and therefore should help with the costs. (3) Those services which are currently overhead should not be overly subsidized by others who have incurred costs or will incur costs to underground their service. (4) Vacant lots and those services requiring no work should not incur the same cost as those requiring work, as they have borne and will bear the cost to underground their service. It should be noted, the "pain level" or acceptance level mentioned at the public meeting of $500.00 cannot be accomplished by any assessment method without a contribution by an outside source. Secondly, even though the estimates for the district are conservatively high, the assessment amounts stated to the property owners cannot increase once they are set. Our polling process is not the official notice of assessment, however, once a maximum assessment amount is quoted to a property owner, it is politically not practical to revise this number upward during the assessment ordinance notification process. In regards to a polling process, the following is suggested:' o Polls will be sent out by certified mail to guarantee that the Town is notified of who did and did not receive polls. All efforts will be made to deliver to the proper property owner those polls returned as undeliverable. In addition to the polls themselves, a packet will be included in the mailing. The packet will describe: 1. The history of the district 2. The need for the formation of a special district 3. The district formation process that has taken place to date 4. How the assessments were calculated 5. The assessment is the maximum assessment possible 6. How the assessments can be paid off 7. Notice of the Public Hearing of March 3 8. How the results.of the poll will be used 9. The remaining process to take place if the district is formed. o The poll shall contain only a "yes" or "no" response to the question of whether they are interested in participating in the East Vail Underground Utility District at the maximum cost determined for them as set by the assessment procedure picked by the Town Council. We want to eliminate option voting. This is because we will hear that "yes I am in favor of the district using Assessment Option 1, but not necessarily in favor if the Council later decides on Assessment Option Number 2". EAST VAIL UNDERGROUND UTILITY COST SHARING January 23, 1992 Page 6 o Polls not delivered will not be included in the totals to determine percentages. The Council will be informed of the number of polls which were undelivered. o Polls which have conditions of voting on them will not be included in the total for the same reasons as above. o It will be clearly stated, polls not postmarked by February 21, 1992 will not be considered. The polling package will be sent out by February 1, 1992. o It will be clearly stated, polls not returned will be considered a no vote. This clearly puts the pressure on those desiring the undergrounding to participate. It also eliminates criticism of possible bias in the process. o State that if a majority or set percentage of those polls returned are in favor of the district, the district will be formed by the Council. GH/slh ` ~,~3 ~ ~ . PAS ~ l,~~yr~C «~,r C~~~ f'~. XIS ~er~ S~ ~~r, `~rr~~~~,-, ~ ~.`~"~.,rra r . . In ul~~ M" ~y TOWN OF VAIL ~ 75 South Frontage Road Department of Public WorkslTransportation Vail, Colorado 81657 303-479-21S81FA X 303-479-2166 MEMORANDIIM T0: Ron Phillips FROM: Greg Hall DATE: January 23, 1992 RE: East Vail Underground Utility Cost Sharing Proposals and Polling Process As requested, the staff has looked at various methods to distribute the costs associated with the underground utility district among the involved parcels. The district boundaries encompass four types of properties as follows: a. Vacant lots - 15 b. Existing residences where no costs are incurred by the district as the services are underground to the underground primary system - there are 14 of these residence types or services on 11 lots. c. Existing underground services connected to the overhead primary system - there are 52 residences or services on 35 lots. d. Overhead service connected to the overhead primary - there are 21 residences or services on 9 lots. It should be noted t~t there is an overlap of types of service on two lots~and these two lots were counted twice above. In summary, there are a total of 68 lots within the district boundary, with 73 services requiring work out of a total of 102 vacant lots and residences/services. The maximum total cost of the district is estimated.to be $170,893. The construction or "hard costs" are $131,484.10. The engineering, administration and bond costs, or "soft costs", are $39,408.90. The "hard costs" of the overhead type service is $55,635.40,or 42.3% of the "hard costs". The "hard costs" of the underground type service connected to the overhead primary system is $75,848.30~or 57.70 of the."hard costs". EAST VAIL UNDERGROUND UTILITY COST SHARING January 23, 1992 Page 2 There seem to be an unlimited number of options available to distribute the costs of the district to those properties within the district boundaries. These include actual costs, equal shares, and proportionate shares. These costs can then be further distributed by lot, service, or combination of lots and services. Below are a few options which detail how the costs could be distributed: Method of Assessment - Obtion 1 Each specific property owner would be responsible for the "hard costs" associated with the service line to their specific service. The "soft costs" would be proportioned in the same ratio the work on an individual property bears to the total amount of the "hard costs". Costs range for overhead services from $845.00 - $10,652.00. The average of all overhead services equals $3,443.13. The costs for underground services range from $211.00 - $7,916.00. The average of all ~ ~e underground services equals $1,987.27. Advantages 1. There is no common work being done. All of the work can be identified specifically with a particular property and is to the direct benefit of that property only. 2. The common costs are being paid totally by Holy Cross Electric. 3. Each property would bear the cost of individual service lines on their property. Some properties have taken care of all or part this cost in the past, some properties will need to modify existing services or construct new services as part of the district, and some properties will need to install new services in the future when they are developed. In all cases, the property owner pays only for the improvements on his property. Disadvantages 1. The assumption is t~t there is no common benefit received in this project. This does not take into account any aesthetic or visual benefits to all properties. 2. Some properties will have an extreme cost which may create an economic hardship. EAST VAIL UNDERGROUND UTILITY COST SHARING January 23, 1992 Page 3 Method of Assessment - Option 2 The total value of the work being accomplished would be divided equally among either a) lots, b) services, c) lots and services, or d) type of service. The costs would be as follows: a) All Lots (68) $ 2,513.13 EA b) Actual Services with Work Required (73) $ 2,341.00 EA c) All Lots and Services (102) $ 1,675.42 EA ci) Overhead Work by Overhead Services (21) $ 3,443.13 EA Underground work by Underground Services(52) $ 1,987.29 EA ( ) = Number of owners involved Advantages Visual concerns and safety are the overwhelming reasons for the district. The benefits may accrue beyond the boundaries of a particular property. The concern seems to be a neighborhood concern, not just an individual property concern. Disadvantages 1. Certain properties will be.subsidizing other properties with respect to service line costs. Individuals who have already undergrounded their services, or who have vacant lots, may object to subsidizing those who chose not to underground their services .in the first place. It costs more to underground services than to overhead services and, therefore, a subsidy is rewarding those property owners who elected not to underground their facilities in the first place. 2. With respect to the vacant lot owners, no one is going to help them pay for their underground services when their property is developed. 3. There are no facilities that can be identified as common 'facilities, only facilities related to a particular lot. Method ~f A.ssessment~- Option 3 A percentage of the total district costs could be shared equally amongst all the lots and services. The remaining amount could be distributed proportionately to the service type and borne by that type of service, or could be borne equally by all the services being altered. The results are as follows: EAST VAIL UNDERGROUND UTILITY COST SHARING January 23, 1992 Page 4 Possible Shares of Total Costs* Service Tvpe "Soft Cost" 300 40% 50% or Lot Share Share. Share Share Alternative A Vacant Lots (15) 386.36 502.63 670.17 837.71 UG Service - No Work (14) 386.36 502.63 670.17 837.71 UG Service - Work Required (52) 1844.98 1830.01 1807.92 1785.84 Overhead Service (21) 3035.68 2912.22 2735.53 2558.85 Alternative B Vacant Lots (15) 386.36 502.63 670.17 837.71 UG Service - No Work (14) 386.36 502.63 670.17 837.71 Equal Distribution of Balance 2187.51 2141.33 2074.77 2008.71 Among Altered Services (73) ( ) = Number of Owners Involved * All categories share a portion of the total cost equally. The remaining cost is allocated to the altered services on the basis of average actual cost. Advantages 1. Recognizes tit all properties derive some benefit from the undergrounding and they participate in the costs. 2. Vacant lots and those whose services are already hooked up incur costs which are substantially less than those requiring work to be completed. It is recognized these participants have,or eventually will have~to pay for the undergrounding of their service lines. 3. It is recognized tY~~the overhead services costs more than the underground services, and these are proportioned respectively. Disadvantages 1. Certain properties will be subsidizing other properties relative to service line costs. 2. No facilities can be identified as common facilities, only facilities related to a particular lot. EAST VAIL UNDERGROUND UTILITY COST SHARING . January 23, 1992 Page 5 Recommendation It is recommended ~il~t one of the methods of Assessment Option 3 be chosen for the following reasons: (1) Based on the public hearing on January 7, it appeared t~t the neighborhood felt no one property should be overburdened with an extremely high assessment. (2) All properties within the district benefit by some amount with~regardg to the undergrounding of the utilities and,therefore~should help with the costs. (3) Those services which are currently overhead should not be overly subsidized by others who have incurred costs or will incur costs to underground their service. (4) Vacant lots and those services requiring no work should not incur the same cost as those requiring work, as they have borne and will bear~the cost to underground their service. It should be noted, the "pain level" or acceptance level mentioned at the public meeting of $500.00 cannot be accomplished by any assessment method without a contribution by an outside source. Secondly, even though the estimates for the district are conservatively high, the assessment amounts stated to the property owners cannot increase once they are set. Our polling process is not the official notice of assessment, however, once a maximum assessment amount is quoted to a property owner, it is politically not practical to revise this number upward during the assessment ordinance notification process. CcJi~ I~'regard,~ to a polling process, the following is suggested: o Polls will be sent out by certified mail to guarantee t~ the Town is notified of who did and did not receive polls. All efforts will be made to deliver to the proper property owner those polls returned as undeliverable. In addition to the polls themselves, a packet will be included in the mailing. The packet will describe: • 1. The history of the district 2. The need for the formation of a special district• 3. The district formation process that has taken place to date. 4.~~y How the assessments were calculated• 5. ~ aThe assessment is the maximum assessment possible. 6.~°W How the assessments can be paid off. 7. Notice of the Public Hearing of March 3• 8. How the results of the poll will be used. 9. The remaining process to take place if the district is formed. o The poll shall contain only a "yes" or "no" response to the question of whether they are interested in participating in the East Vail Underground Utility District at the maximum cost determined for them as set by the assessment procedure picked by mom; the Town Council. We want to eliminate option voting 'g because we will hear~~~t "~es I am in favor of the district using Assessment Option 1, but not necessarily in favor if the Council later decides on Assessment Option Number 2". EAST VAIL UNDERGROUND UTILITY COST SHARING January 23, 1992 Page 6 o Polls not delivered will not be included in the totals to determine percentages. The Council will be informed of the number of polls which were undelivered. o Polls which have conditions of voting on them will not be included in the total for the same reasons as above. o It will be clearly stated, polls not postmarked by February 21, 1992 will not be considered. The polling package will be sent out by February 1, 1992. o It will be clearly stated, polls not returned will be considered a no vote. This clearly puts the pressure on those desiring the undergrounding to participate. It also eliminates criticism of possible bias in the process. o State ~.la-~ if a majority or set percentage of those polls returned are in favor of the district, the district will be formed by the Council. GH/slh