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2010 Final Report - Impact Fees for the Water and Wastewater SystemsFinal Report City of KA',' Impact Fees for the Water, and Wastewater Systems August 2010 G faq I /,(-( ees August 13, 2010 Mr. James Hansz, P.E. Director of Public Works City of Kalispell 312 First Avenue East Kalispell, MT 59903 Subject: Impact Fees for the Water and Wastewater Systems Dear Mr. Hansz: HDR Engineering Inc. (d.b.a. HDR/EES) was retained by the City of Kalispell (City) to update the impact fees for the water and wastewater systems for new development based on the new facility plans adopted by the City. The City currently has impact fees that need to be reviewed and updated every two years as required under Montana Code 7-6-1601 to 7-6-1604, the legislation in Montana for imposition of impact fees. Attached is our final report detailing the findings, conclusions and recommendations of the review undertaken by HDR/EES for the determination of cost -based impact fee for the City's water and wastewater systems. The development of this report has been based upon information and data provided by the City and the impact fees developed utilize generally accepted principles. HDR/EES recommends that the City have the impact fees set forth in this report reviewed by its legal counsel to assure compliance with Montana law. We appreciate the opportunity to provide this technical report to the City. It has been a pleasure working with you on this project. We look forward to the opportunity to continue to provide assistance to the City. Sincerely yours, HDR ENGINEERING INC (D.B.A. HDR/EES). Randall P. Goff Project Principal Attachment HDR/EES 1001 SW Fifth Avenue Phone: (503) 423-3700 Suite 1800 I Fax: (503) 423-3737 Portland, OR 97204-1134 www.hdrinc.com 13P. -%� X 4- Executive Summary Introduction.............................................................................................................................1 Financial Objectives of Impact Fees....................................................................................1 ImpactFee Criteria.................................................................................................................1 TheNeed For This Study........................................................................................................2 Development and Summary of the Water Impact Fee.....................................................3 Development and Summary of the Wastewater Impact Fee..........................................5 1 Introduction and Overview of the Study 1.1 Introduction.......................................................................................................................9 1.2 Overview of the Study......................................................................................................9 1.3 Disclaimer.........................................................................................................................9 1.4 Summary........................................................................................................................10 2 Overview of Impact Fees and "Generally Accepted" Industry Practices 2.1 Introduction....................................................................................................................11 2.2 Defining Impact Fees...................................................................................................11 2.3 Historical Perspective...................................................................................................11 2.4 Impact Fees and "Generally Accepted" Practices...................................................13 2.5 Financial Objectives of Impact Fees..........................................................................15 2.6 Relationship of Impact Fees and New Construction Activity.................................16 2.7 Summary........................................................................................................................17 3 Overview of Impact Fee Methodologies 3.1 Introduction....................................................................................................................18 3.2 Impact Fee Criteria.......................................................................................................18 3.3 Growth, Risk and New Connections...........................................................................19 3.4 Overview of the Impact Fee Methodology.................................................................19 3.5 Summary.......................................................................................................................21 4 Legal Considerations in Establishing Impact Fees for the City 4.1 Introduction.................................................................................................................... 22 4.2 Requirements Under Montana Law........................................................................... 22 4.3 Summary.......................................................................................................................24 5 Determination of the City's Water Impact Fees 5.1 Introduction.................................................................................................................... 25 5.2 Overview of the City's Water System......................................................................... 25 5.3 Overview of the City's Water Facility Plan................................................................. 25 5.4 Present Water Impact Fees......................................................................................... 26 5.5 Calculation of the City's Water Impact Fees............................................................. 26 5.6 Net Allowable Water Impact Fees.............................................................................. 29 t 1AM'S Table of Contents i City of Kalispell, Montana — Development of Water and Wastewater Impact Fees 5.7 Key Assumptions........................................................................................................... 31 5.8 Implementation of the Impact Fees.......................................................................... 32 5.9 Consultant Recommendation's..................................................................................32 5.10 Summary........................................................................................................................32 6 Determination of the City's Wastewater Impact Fees 6.1 Introduction.................................................................................................................... 33 6.2 Overview of the City's Wastewater System............................................................... 33 6.3 Overview of the City's Wastewater Facility Plan ...................................................... 33 6.4 Present Wastewater Impact Fees..............................................................................34 6.5 Calculation of the City's Wastewater Impact Fees .................................................. 34 6.6 Net Allowable Wastewater Impact Fee.....................................................................37 6.7 Key Assumptions........................................................................................................... 38 6.8 Implementation of the Impact Fees.......................................................................... 39 6.9 Consultant Recommendation.....................................................................................39 6.10 Summary........................................................................................................................39 5-1 Present Water Impact Fees.........................................................................................19 5-2 Water System Planning Criteria................................................................................. 20 5-3 Water System Equivalent Residential Units............................................................. 20 5-4 Allowable Water Impact Fees($/ERU)...................................................................... 23 5-5 Allowable Water Impact Fees By Meter Size............................................................ 23 5-6 Allowable Water Impact Fees - Recoupment vs. Expansion ................................. 24 6-1 Present Wastewater Impact Fees..............................................................................27 6-2 Wastewater System Planning Criteria....................................................................... 28 6-3 Wastewater Equivalent Residential Units.................................................................28 6-4 Allowable Wastewater Impact Fees($/ERU)...........................................................30 6-5 Allowable Wastewater Impact Fees - Recoupment vs. Expansion ......................31 Figures 2-1 Overview of the Three -Interrelated Analyses to Review Rates..............................13 2.2 Overview of the "Cash -Basis" Approach to Establishing Revenue Requirements............................................................................................................14 Appendix A — Water Impact Fees A-1 Development of ERUs A-2 Source of Supply A-3 Pumping Plant A-4 Distribution Storage A-5 Transmission/Distribution Mains A-6 Breakdown of Annual Administrative Cost A-7 Debt Service Credit A-8 Summary Appendix B — Wastewater Impact Fees B-1 Development of ERUs B-2 Wastewater Treatment Plant B-3 Collection Plant B-4 Breakdown of Annual Administrative Cost B-5 Debt Service Credit - Treatment FM Table of Contents ii City of Kalispell, Montana — Development of Water and Wastewater Impact Fees B-6 Debt Service Credit - Collection B-7 Summary B-8 ERU Determination Appendix C — Montana Code — Impact Fees h-)-t ' mee5 Table of Contents iii City of Kalispell, Montana — Development of Water and Wastewater Impact Fees Introduction HDR Engineering Inc. (d.b.a. HDR/EES) was retained by the City of Kalispell (City) to update the current cost -based impact fees for the City's water and wastewater systems that comply with Montana Code 7-6-1601 to 7-6-1604 based on the new facility plan adopted by the City. This Executive Summary is intended to provide an overview of the study, along with a summary of the findings and conclusions from the study. In addition, a comparison of the cost -based fees calculated within this study has been compared to the previous water and wastewater impact fee study conducted in 2006. Impact fees are a one-time assessment against new development to pay for the cost of infrastructure required to provide service. Impact fees provide the means of balancing the cost requirements for new utility infrastructure between existing customers and new customers connecting to the City's water and wastewater systems. The portion of existing plant and future capital improvements that will provide service (capacity) to new customers is included in the impact fees. The objective of this report is to properly place in context the purpose of impact fees, and to determine cost -based impact fees for the water and wastewater systems that comply with Montana law." Financial Objectives of Impact Fees An impact fee is a regulation and not a user fee or revenue raising device. To understand this perspective, one must view new development as creating the need for new or expanded facilities. As a result, without payment of impact fees, the utility would have insufficient revenues to provide the facilities, and therefore the community is unable to accommodate new development. While on the surface it may appear as simply a means to extract revenue from new development, the reality is far more complicated. Impact fees help utilities achieve a number of different financial objectives. These objectives tend to lean more towards financial equity between customers, as opposed to simply producing revenue. An impact fee establishes equity between existing (old) customers and new customers. Impact fees create equity within the system by addressing the issue of timing and the "value" of the assets and the "value" of the capacity. Impact Fee Criteria In the determination and establishment of the impact fees, a number of different criteria are often utilized. The criteria often used by utilities to establish impact fees are as follows: Customer understanding System planning criteria Financing criteria, and State/local laws t oft Executive Summary eM City of Kalispell, Montana — Development of Water and Wastewater Impact Fees The use of system planning criteria is one of the more important aspects in the determination of impact fees. System planning criteria provides the "rational nexus" between the amount of infrastructure necessary to provide service and the charge to the customer. The rational nexus test requires that there be a connection (nexus) established between new development and the existing or expanded facilities required to accommodate new development; and appropriate apportionment of the cost to the new development in relation to benefits reasonably received. An important consideration in establishing impact fees is any legal requirements at the state or local level. The legal requirements often establish the methodology around which the impact fees must be calculated or how the funds must be used. The Montana law enabling legislation for impact fees was enacted in 2005 via Senate Bill 185. The legal basis for the enactment of impact fees is found in Title 7, Chapter 6, and Part 1601 to 1604 of the Montana Code. The Need For This Study The City last developed a comprehensive water and wastewater impact fee study in December 2006.1 Given the vintage of that particular study, the City has developed an updated water and wastewater impact fee study. While the vintage of the prior study was one consideration in undertaking this study and updating the fees, the more relevant considerations for undertaking this study are as follows: The 2006 water and wastewater impact fee study was based upon the master plan entitled, City of Kalispell Water, Sewer and Storm Drainage Facilities Plan, dated July 2002. Since completion of the 2002 report, the City has continued to experience population growth and the expansion of infrastructure; therefore, in 2006 the City chose to update their facility plan to analyze potential growth and effectively plan for growth while protecting water and environmental resources. The City updated their master plan and the water impact fees calculated within this study are based upon water facilities master plan entitled, City of Kalispell Water Facilities Plan Update, dated March 2008, and wastewater impact fees are based upon the master plan entitled, City of Kalispell Wastewater Facilities Plan Update, dated March 2008. As the City's master plans are updated and adopted it is prudent and appropriate for the City to update their impact fees to provide the linkage between the adopted master plan for each utility and the associated impact fees. The 2006 water and wastewater impact fee study was based upon the City's 2006 - 2010 Capital Improvement Plan. The fees calculated within this study are based upon the City's 2009 Capital Improvement Plan for each utility. This updated capital improvement plan reflects the current anticipated cost and timing of the future capital improvements. Among the legal requirements of the Montana legislation regarding impact fees is the requirement that the report "covers at least a 5-year period and is reviewed and updated at least every two years.112 Given the above, the City undertook an update of the water and wastewater impact fees utilizing the updated and adopted master plans and capital improvement plans. 1 City of Kalispell, Final Report, Impact Fees for the Water, Wastewater and Water Systems, December 2006, Prepared by HDR/EES. 2 MCA 2009: 7-6-1602; Calculation of Impact Fees -Documentation Required ..., Subsection 2, Part (k), (ii) Executive Summary 2 H-R /AM City of Kalispell, Montana - Development of Water and Wastewater Impact Fees Development and Summary of the Water Impact Fee The City currently services a population of approximately 18,000 customers with water services. The City has been growing and overall population growth in the study area for the master plan between 2000 and 2005 was approximately 4.2 percent per year. While growth in the last few years has slowed considerably, it is expected that high growth rates will continue in the future over the study planning horizon of the Water Facility Plan. The calculation of the water impact fee was based on the City's fixed asset records, future capital improvements as identified in the City's 2009 Capital Improvement Plan, and planning criteria and capital improvements from the master plan entitled, City of Kalispell Water Facilities Plan Update, dated March 2008 prepared by HDR Engineering (the "Water Facility Plan"). A number of key steps in the calculation of the water impact fees included the following: Use of System Planning Criteria: The Water Facility Plan provides the planning criteria for establishing an equivalent residential unit (ERU). The system planning criteria establishes the average day flow and peak day flow for an ERU. Calculation of Equivalent Residential Units: The planning horizon for the study was 2006 - 2035. The number of current and future (additional) water ERUs was determined within this step. Calculation of the Impact Fee For the Major Water System Components: Each of the major functional components of the water system (e.g. source of supply, treatment, etc.) are reviewed to consider the existing plant assets, along with planned future capital improvements. This provides the basis for the value of capacity and when divided by the appropriate ERUs produces a cost per ERU for each major system component. When the cost per ERU for each major component is added together, it produces a "gross" impact fee. Debt Service Credits: If impact fees are insufficient to pay growth -related debt service, then a debt service credit is provided against the "gross" water impact fees. The debt service credit is designed to avoid the potential "double payment" of debt service (i.e. once through the payment of the impact fee and again through rates). In determining the water impact fees, the City also considered significant future extension improvements to the transmission and distribution system. The impact fees were calculated "without future extensions" and "with future extensions." The distinction between these two categories being that "without future extensions" the impact fees are calculated in a manner consistent with the City's previous water impact fee analysis and include only the improvements within the City's 2009 Capital Improvement Plan. In contrast to this, "with future extensions" includes extensions/improvements needed to serve the vast expanded planning area as contained within the Water Facility Plan. The "with future extensions" costs were segregated within this study to highlight the potential cost associated with serving this expanded planning area. Determination of the "Net Allowable" Water Impact Fee: Based upon the steps noted above, a "net allowable" impact fee was developed. Shown below in Table ES-1 is a summary of the net allowable impact fee by major component for one (1) ERU. Z Executive Summary 3 City of Kalispell, Montana — Development of Water and Wastewater Impact Fees W/o Description Extensions Extensions Total Source of Supply $80.85 Pumping Plant 134.78 Storage 460.40 Existing Transmission 945.36 CIP Transmission 219.20 Debt Service Credit for Bonds 0.00 Subtotal Before Admin. Costs $1,840.59 Administrative Cost at 5% 92.03 Subtotal Before Extensions $1,932.61 Transmission Extensions - Administrative Cost - Extens. - Total Impact Fee $1,932.61 Recommended Water Fee $1,930.00 - $80.85 - 134.78 - 460.40 - 945.36 - 219.20 - 0.00 - $1, 840.59 - 92.03 - $1,932.61 $ 4, 755.82 38.52 $4,794.34 $4,795.00 $4,755.82 38.52 $6,726.96 $6,725.00 It should be noted that in the 2006 impact fee study, the calculated water impact fee was $2,154.72. The 2006 fee was adjusted in 2008 to reflect cost of construction to $2,213. Therefore, before extensions, the calculated fee within this study is slightly less ($280.39) than the current fee. Wat+ ee by Meter Size (Capacity)- For ease of administration, the recommended charge for one (1) ERU is $1,930 without extensions and $6,725 with extensions. The impact fees are then "weighted" by meter size to reflect capacity use of the larger sized meters. This "weighting" by meter size is based upon the safe operating capacity of the meter. Provided below in Table ES-2 is a comparison between the water impact fees by meter size as developed in the 2006 water impact fee study and the water impact fee by meter size developed within this study. 2006 Current Water Impact Fee Study Water Impact Impact Impact Fee Fee Total Fee W/o With Impact Meter Size Studyi Extensionsi Extensionsi Feel Residential $2,155 $1,930 $4,795 $6,725 1,, 5,388 4,825 11,988 16,813 1-1/2 10,775 9,650 23,975 33,625 2" 17,240 15,440 38,360 53,800 3" 34,480 30,880 76,720 107,600 4" Calculated Calculated Calculated Calculated [1] - Commercial customers with residential type usage pay the residential fee. Z Executive Summary 4 City of Kalispell, Montana - Development of Water and Wastewater Impact Fees Table ES-2 views the water impact fee from the perspective of with and without extensions. Included within the development of the water impact fees for this study are costs related to "recoupment" and "expansion". Recoupment costs are related to excess capacity in existing facilities which has been built in anticipation of the needs of new development. Montana law, 7-6-1603(3) specifically allows for the recoupment of costs of excess capacity. In contrast to this, expansion costs are the estimated costs related to system improvements reasonably anticipated to be needed to accommodate new development. This study determined that for the calculated water impact fee of $1,932.62, $1,353.29 is related to recoupment and $579.33 was related to expansion, before extensions. Extensions are clearly 100% expansion related. The City, as a matter of policy, may charge any amount up to the allowable water impact fee, but not over that amount. Charging an amount greater than the allowable impact fee would not meet the nexus test of a cost -based impact fee. Consultant's Recommendations on the water Impact I Based on our review and analysis of the City's water system, HDR/EES makes the following recommendations: The City should implement impact fees for new hookups to the water system that are no greater than the impact fees as set forth in this report. Using the current philosophy in place, the water impact fee would be $1,930.00/ERU. If the City proposes to use impact fees to fund the future extensions indentified in the City's Water Facility Plan, or to reimburse private development for making these improvements (extensions) in lieu of using individual developer extension agreements, an impact fee amount of $4,795.00 should be added to the $1,930.00/ERU impact fee, for a total water impact fee of $6,725.00/ERU. The City should update the actual calculations for the impact fees based on the methodology as approved by the resolution or ordinance setting forth the methodology for impact fees every two years as required by Montana law. This concludes the executive summary of the development of the water impact fee study. A more detailed discussion of the various steps associated with the development of this fee can be found in Section 5 of this report and the water technical appendices. Development and Summary of the Wastewater Impact Fee The City's wastewater system consists of a collection system and pumps to deliver wastewater to the City's wastewater treatment plant (WWTP). The City has a wastewater treatment plant with a recently completed design capacity of 5.4 MGD. The City's wastewater capital improvement plan calls for numerous upgrades to the interceptor and collection system. The calculation of the wastewater impact fee was based on the City's fixed asset records, future capital improvements as identified in the City's 2009 Capital Improvement Plan, and planning criteria and as noted previously, the City updated their wastewater master plan entitled, City of Kalispell Wastewater Facilities Plan Update, dated March 2008. Since completion of the 2002 report, the City has continued to experience population growth and the expansion of infrastructure. Given that, in 2006 the City chose to update their facility plan to analyze potential growth and effectively plan for growth while protecting water and Z Executive Summary 5 11-City of Kalispell, Montana - Development of Water and Wastewater Impact Fees environmental resources. The basis of planning was to determine the requirements for the next 35 years in areas that the City will have to provide wastewater service as growth continues. A number of key steps in the calculation of the wastewater impact fees included the following: Use of System Planning Criteria: The Wastewater Plan provides the planning criteria for establishing an equivalent residential unit (ERU). The system planning criteria establishes the per capita day average flow, stated in gallons. The assumed number of persons per household was then used to establish one (1) ERU of flow. Calculation of Equivalent Residential Units: The planning horizon for the study was 2009 - 2035. This is the planning horizon used in the Wastewater Facility Plan. The number of current and future (additional) wastewater ERUs was determined within this step. The number of ERUs was determined based on the flows to the treatment plant and the collection system. The number of ERUs for treatment is different, since the City provides treatment services per contract to the Flathead County Water and Sewer District #1 Evergreen. Calculation of the Impact Fee For the Mninr Wastewater System Components: Each of the major functional components of the wastewater system (e.g. treatment, collection, etc.) are reviewed to consider the existing plant assets, along with planned future capital improvements. This provides the basis for the value of capacity and when divided by the appropriate ERUs, produces a cost per ERU for each major system component. When the cost per ERU for each major component is added together, it produces a "gross" impact fee. Debt Service Credits: If impact fees are insufficient to pay growth -related debt service, then a debt service credit is provided against the "gross" water impact fees. The debt service credit is designed to avoid the potential "double payment" of debt service (i.e. once through the payment of the impact fee and again through rates). Based on the annual wastewater debt service cost and number of ERUs for each year, no debt service credit was provided for treatment or collection. In determining the wastewater fees, the City also considered significant future extension improvements to the wastewater collection system. The impact fees were calculated "without future extensions" and "with future extensions." The distinction between these two categories being that "without future extensions" the impact fees are calculated in a manner consistent with the City's previous wastewater impact fee analysis and include only the improvements within the City's 2009 Capital Improvement Plan. In contrast to this, "with future extensions" includes extensions/improvements needed to serve the vast expanded planning area as contained within the Wastewater Facility Plan. The "with future extensions" costs were segregated within this study to highlight the potential cost associated with serving this expanded planning area. Determination of the "Net Allowable" Wastewater Impact Fee Based upon the steps noted above, a "net allowable" wastewater impact fee was developed. Shown below in Table ES-3 is a summary of the net allowable wastewater impact fee by major component for one (1) ERU. ZExecutive Summary 6 MeM City of Kalispell, Montana - Development of Water and Wastewater Impact Fees Collection W/o Collection Item Treatment Extensions Extensions Total Wastewater Treatment Existing Collection CIP Collection Committed Coll. System Expansions Debt Service Credit for Bonds Subtotal Before Admin. Costs Administrative Charge at 3.60% Subtotal Before Extensions Collection System Extension Administrative Cost on Extens. Total Wastewater Impact Fee Recommended Fee ($/ERU) $3,325.05 $0.00 $3,325.05 0.00 561.38 561.38 0.00 244.30 244.30 0.00 1,029.44 1,029.44 0.00 0.00 0.00 $3,325.05 $1,835.13 $5,160.18 119.62 66.02 185.64 $3,444.67 $1,901.15 $5,345.82 $0.00 $0.00 $2,476.60 $2,476.60 0.00 0.00 0.00 0.00 $3,444.67 $1,901.15 $2,476.60 $7,822.42 $3,445.00 $1,900.00 $2,475.00 $7,820.00 The calculated capacity charge for treatment is $3,444.67 per ERU. For the collection system it is $1,901.15 per ERU without extensions and $2,476.60 with extensions. The wastewater impact fee for other business types is determined based on the type of business and the number of equivalent residential units (e.g. seats in a restaurant). Collection W/o Collection Item Treatment Extensions Extensions Total 2006 Impact Fee Study - Calculated Fees Current Impact Fee Study - Net Allowable Fee $1, 396.98 $3,444.67 $1,035.57 N/A $1,901.15 $2,476.60 $2,432.55 $7,822.42 As can be seen, since the last impact fee study in 2006, the costs associated with both treatment and collection have increased. The 2006 fee was adjusted in 2008 to reflect cost of construction to $2,499. Therefore, before extensions, the calculated fee within this study increases by $2,846.82. Table ES-3 calculates the wastewater impact fees from the perspective of treatment and collection with and without the collection system extensions. Included within the development of the wastewater impact fees are costs related to "recoupment" and "expansion". Recoupment costs are related to excess capacity in existing facilities which has been built in anticipation of the needs of new development. Montana law, 7-6-1603(3) specifically allows Z Executive Summary 7 City of Kalispell, Montana - Development of Water and Wastewater Impact Fees for the recoupment of costs of excess capacity. In contrast to this, expansion costs are the estimated costs related to system improvements reasonably anticipated to be needed to accommodate new development. Of the total fee of $5,345.82 (before extensions), only $608.54 is recoupment related and this is primarily collection related. The balance, or $4,737.28, is expansion related. The collection system extensions of $2,476.60 are clearly 100% expansion related. The City, as a matter of policy, may charge any amount up to the allowable wastewater impact fee, but not over that amount. Charging an amount greater than the allowable impact fee would not meet the nexus test of a cost -based impact fee. Consultant's Recommendations on the Wastewater Impact Fee: Based on our review and analysis of the City's wastewater system, HDR/EES makes the following recommendations: The City should implement impact fees for new hookups to the wastewater system that are no greater than the impact fees as set forth in this report. The treatment portion of the wastewater impact is $3,445.00/ERU. For the collection portion of the impact fee, using the current philosophy in place, the wastewater collection impact fee would be $1,900.00/ERU. This produces an impact fee (treatment + collection) of $5,345.00/ERU). If the City proposes to use impact fees to fund future extensions of the collection system indentified in the City's Wastewater Facility Plan, or to reimburse private development for making these collection improvements (extensions) in lieu of using individual developer extension agreements, a collection impact fee amount of $2,475.00 should be added to the $1,900.00/ERU collection impact fee, for a total collection impact fee of $4,375.00/ERU. With the inclusion of extensions, this would require an impact fee (treatment + collection) of $7,820.00/ERU. The City should update the actual calculations for the impact fees based on the methodology as approved by the resolution or ordinance setting forth the methodology for impact fees every two years as required by Montana law. This concludes the executive summary of the development of the wastewater impact fee study. A more detailed discussion of the various steps associated with the development of this fee can be found in Section 6 of this report and the wastewater technical appendices. Executive Summary 8 City of Kalispell, Montana — Development of Water and Wastewater Impact Fees i Section 1 Introduction HDR Engineering Inc. (d.b.a. HDR/EES) was retained by the City of Kalispell; Montana (City) to update the current cost -based impact fees for the City's water and wastewater systems that comply with Montana Code 7-6-1601 to 7-6-1604 based on the new facility plan adopted by the City. This report provides details of the development of cost -based impact fees for the City's water and wastewater systems. Impact fees are a one-time assessment against new development to pay for the cost of infrastructure required to provide service. Impact fees provide the means of balancing the cost requirements for new utility infrastructure between existing customers and new customers connecting to the City's water and wastewater systems. The portion of existing plant and future capital improvements that will provide service "The objective of this (capacity) to new customers is included in the impact fees. In report is to properly place contrast to this, the City has future capital improvement in context the purpose of projects that are related to renewal and replacement of impact fees, and to existing plant in service. These infrastructure costs are determine cost -based typically included within the rates charged to the City's impact fees for the water customers, and are not included within the impact fee. By and wastewater systems establishing cost -based impact fees, the City will be taking a that comply with policy action of having "growth pay for growth" and help Montana law." existing utility customers be sheltered from the financial 7 impacts of growth. Overview of the Study The development of cost -based water and wastewater impact fees requires detailed analyses of each utility. To better understand the approach and methodology used, along with the development of the City's impact fees, this report has been divided into a number of sections (chapters). This report is organized in the following manner: Section 2 - Review of "generally accepted" practices related to impact fees Section 3 - Overview of the criteria and methodologies used to establish the impact fees Section 4 - Summary of the legal requirements for enactment of impact fees under Montana law Section 5 - Review of the development of the cost -based water impact fees Section 6 - Review of the development of the cost -based wastewater impact fees Disclaimer HDR/EES, in its determination of impact fees presented in this report has relied upon data and information provided by the City. At the same time, HDR/EES has used "generally accepted" engineering, accounting and ratemaking principles in the development of these cost -based impact fees. This should not be construed as a legal opinion with respect to Montana law. 2 Introduction and Overview of the Study 9 AeM City of Kalispell, Montana — Development of Water and Wastewater Impact Fees HDR/EES would recommend that the City have its legal counsel review the methodology as discussed herein, to ensure compliance with Montana law. 1.4 Summary This section of the report has provided an overview of the water and wastewater impact fee report developed for the City. In the opinion of HDR/EES, this report provides the basis for the establishment of cost -based impact fees by the City. The next section of the report will discuss the "generally accepted" utility industry practices as they relate to impact fees. 2 Introduction and Overview of the Study 10 lAeM City of Kalispell, Montana — Development of Water and Wastewater Impact Fees ct Fees and Introduction An important starting point in discussing the City's continued implementation of water and wastewater impact fees is an understanding of the purpose and concept of impact fees and the financial objective of those fees. This section of the report will discuss the concept of impact fees and the "generally accepted" practices of the industry. 2.2 Defining Impact Fees One must first define an "impact fee" before beginning an assessment and review of the fees. Impact fees are "Impact fees are capital also often called system development charges (SDC's), recovery fees that are capacity charges, buy -in fees, facility expansion charges, generally established as one - plant investment fees, etc. Regardless of the name time charges assessed applied to the fee, the concept is still the same. Simply against developers or new stated, impact fees are capital recovery fees that are water and wastewater generally established as one-time charges assessed customers as a way to recover against developers or new water and wastewater a part or all of the cost of customers as a way to recover a part or all of the cost of system capacity constructed system capacity constructed for their use. Their for their use. application has generally occurred in areas that are experiencing extensive new residential and/or commercial development.3 The main objective of an impact fee is to assess against the benefiting party, their proportionate share of the cost of infrastructure required to provide them service. Stated another way, impact fees imply that new development creates new or additional costs on the system, and the impact fee assesses that cost in an equitable manner to those customers creating the additional cost. Historical Perspective Historically, the financing of infrastructure was typically paid for via long-term debt and "pay as you go" rates. However, over the last twenty years, the use of impact fees as a method of financing growth and infrastructure has risen sharply. To the best of our knowledge, no clear surveys or data exists to show this change, however, there are a number of examples within the literature that point out this phenomena. As an example, a survey of 67 Florida communities was undertaken in 1986 and 1989. The number of communities in 1986 using impact fees was 15. By 1989, the number of communities using impact fees had more than doubled to 32.4 As this funding mechanism gained popularity, legislatures across the U.S. were developing legislation to provide utilities with the authority to impose impact fees. Typical legislation generally provides the approach to be used to develop the fees and requires 3 George A. Raftelis, 2nd Edition, Comprehensive Guide to Water and Wastewater Finance and Pricing (Boca Raton: Lewis Publishers, 1993), p. 73. 4 James C. Nicholas, Arthur C. Nelson and Julian C. Juergensmeyer, A Practitioner's Guide to Development Impact Fees (Chicago: Planners Press, 1991) p. 3. Overview of Impact Fees and "Generally Accepted" Utility Industry Practices 11 �«M City of Kalispell, Montana — Development of Water and Wastewater Impact Fees that the fees be used only for growth -related needs and not for current 0&M requirements. At this time, the State of Montana has very specific "Historically, the financing of legislation related to impact fees. This specific infrastructure was typically legislation regarding the fees provides the City with the paid for via long-term debt and authority to establish and collect impact fees. This "pay as you go" rates. authority is provided in Montana Code Section 7-6-1601 However, over the last twenty to 7-6-1604. years, the use of impact fees as a method of financing While many utility managers viewed impact fees as an growth and infrastructure has important and alternative source of funding for new risen sharply." capital construction, these fees were also being rationalized from a number of different perspectives. Among these were the following:5 To shift the fiscal burdens from existing development to new development. To synchronize the construction of new or expanded facility capacity with the arrival of new development. To subject new development decisions to pricing discipline. To respond to locally vocal anti -growth sentiments. Each of these different perspectives is discussed in more detail below. Historically, existing development was often subsided by federal or state resources. As an example, in the early 1970's, many wastewater treatment plants in the U.S. were 90% grant funded by the Environmental Protection Agency (EPA). Today, grants are nearly extinct, often replaced instead by low -interest state revolving fund (SRF) loans. Therefore, as existing customers were being impacted by the cost of growth, local communities searched for methods to help minimize rates and the impacts of the cost of growth. Unchecked growth and sprawling expansion is very costly on a per unit basis. In response to this dilemma, many legislative bodies created urban growth boundaries. At the same time, utilities moved towards impact fee and extension policies that assist in managing system growth in an orderly and coordinated manner. As a result, improved planning and cost -based fees have helped utilities manage the costs of growth, while stabilizing rates to existing customers. Establishing the price of a commodity equal to its cost is a basic economic and market principle. In theory, consumers of a service will make "optimal" consumption decisions when the price of the commodity is set equal to its price. By establishing cost -based impact fees, developers should be in a position to make better and more rational decisions concerning new development. At the same time, proper pricing of impact fees also encourages "right sizing" of facilities to serve new development. In other words, given the proper price signal, the developer will properly size their service facilities to meet their needs (e.g. installing a 3/4-inch meter versus a 2" meter). 5 Adapted from: Arthur C. Nelson, System Development Charges for Water, Wastewater and Stormwater Facilities (Boca Raton: Lewis Publishers, 1995) p. 6-7. Overview of Impact Fees and "Generally Accepted" Utility Industry Practices v Z« City of Kalispell, Montana — Development of Water and Wastewater Impact Fees 12 Within all communities, there is a segment of the population that is anti -growth. Adoption of impact fees, even if only partially cost -based, demonstrates a concern and recognition of the anti -growth perspective. In summary, the use of impact fees has changed over time, as historical funding sources such as grants have been reduced or eliminated. In response, many communities have moved towards adoption of cost -based impact fees, particularly in areas of high growth. Impact Fees and "Generally Accepted" Practices Impact fees are one input into the rate setting process. Therefore, it is important to understand how, within the context of "generally accepted" utility industry practices, impact fees may be used. In conducting a comprehensive water or wastewater rate study, three interrelated analyses are typically conducted. They are a revenue requirement analysis, cost of service analysis and rate design analysis. Figure 2-1 provides an overview of each of these analyses. Compares the sources of funds (revenues) to Revenue Requirement Analysis the expenses of the utility to determine the overall adjustment to rates 1 Cost of Service Analysis 1 Rate Design Analysis Allocates the total revenue requirements to the various customer classes of service in a "fair and equitable" manner Consider both the level and the structure of the rate design to collect the appropriate and targeted level of revenue Impact fees are taken into account within the revenue requirement analysis. The revenue requirement analysis determines the overall funding needs of the utility, while considering prudent financial planning criteria (e.g. adequate reserves, meeting debt service coverage requirements, etc.). For most municipal utilities, the methodology used to establish their revenue requirements is referred to as the "cash basis" approach. Figure 2-2, shown below, provides an overview of the key components of the "cash basis" approach to developing revenue requirements. Overview of Impact Fees and "Generally Accepted" Utility Industry Practices 13 Z City of Kalispell, Montana — Development of Water and Wastewater Impact Fees + Operation and Maintenance Expenses + Taxes / Transfer Payments + Debt Service (Net of Applied Impact Fees) + Capital Improvements Funded From Rates = Total Revenue Requirements i + term — Miscellaneous Revenues = Total Required From Rates Total Capital Improvement Projects Less: Outside Funding Sources — Capital Reserves — Impact Fees — Grants — Long -Term Debt — Other Capital Funding Sources = Total Capital Improvements Funded From Rates As can be seen in Figure 2-2, there are two elements to establishing the "cash basis" revenue requirements. The top or blue box shows the four basic cost components that are included within the "cash basis" revenue requirements. In contrast, the bottom or yellow box illustrates the various methods used to fund capital infrastructure projects. It should be noted in Figure 2-2 that impact fees may be used (applied) in two different ways, each having a different impact upon the utility's revenue requirements and, ultimately, the utility's rates. The first possible use of impact fees is shown in the bottom or yellow box. In that particular case, the impact fees are applied directly against growth or expansion related capital projects. The effect of using the funds in this manner is that it helps to minimize long- term borrowing. For each dollar of impact fees applied in this manner, one less dollar of long- term borrowing is required. Typically, total capital improvements funded from rates is established and fixed in the financial planning process. Therefore, applying impact fees to capital projects typically will not have a significant impact upon the amount of capital improvements funded from rates. The other potential use of impact fees is to apply the fees against growth -related debt service. As shown in Figure 2-2, debt service is shown as net of any impact fees. In contrast to applying Overview of Impact Fees and "Generally Accepted" Utility Industry Practices 14 !([ee5 City of Kalispell, Montana — Development of Water and Wastewater Impact Fees impact fees directly against the capital project, in this particular case, for every dollar applied in this manner, there is a corresponding dollar decrease in revenue requirements and the resulting rates. This is a very effective method to help minimize rates, but even better at matching the cost of growth to the gradual way in which customer growth occurs over time. In other words, a utility may build or expand a facility with sufficient capacity to handle growth over the next ten to twenty years. That growth doesn't occur in the first year, but rather, trickles in over a number of years. Therefore, applying the impact fees against the debt service associated with the project creates a better matching of the cost incurrence (debt payments) to the actual customer growth. 2.5 Financial Objectives of Impact Fees An impact fee is a regulation and not a user fee or revenue "An impact fee is a raising device. To understand this perspective, one must view regulation and not a user new development as creating the need for new or expanded fee or revenue raising facilities. As a result, without payment of impact fees, the device. To understand this utility would have insufficient revenues to provide the facilities, and therefore the community is unable to perspective, one must view new development as accommodate new development. With this said, impact fees do have certain financial objectives associated with them. creating the need for new While on the surface it may appear as simply a means to or expanded facilities." extract revenue from new development, the reality is far more complicated. Impact fees help utilities achieve a number of different financial objectives. These objectives tend to lean more towards financial equity between customers, as opposed to simply producing revenue. One key financial/rate objective that is achieved from impact fees is equity. Equity is achieved in two different ways. First, an impact fee establishes equity between existing (old) customers and new customers. For example, assume that a water treatment plant is expanded by 5 million gallons per day (MGD) to accommodate growth and the facility is financed over a 20- year period. Without an impact fee, new customers connect to the system and pay for the debt service on the facility via their rates. The customer that connects to the system in year one will contribute to the cost of that facility for 20 years. In contrast, the person who connects in year 10 will only pay for debt service on the facility for ten years, even though the "value" of the capacity was the same for the person connecting in year 1 or year 10. Impact fees create equity within the system by addressing the issue of timing and the "value" of the assets and the "value" of the capacity. The second way in which impact fees help to create equity is "... an impact fee is also a after a facility is paid for. Continuing with the example form of a financial above, after the debt service is fully paid off in year 20, and reimbursement to existing assuming that capacity is still available, a new customer ratepayers who paid for connecting to the system would "in theory" receive their those facilities in advance capacity at zero cost, because the debt service is paid in full. of the new customer All the existing customers connected to the system, over the connecting to the system." past twenty years, paid for that customer's capacity. Therefore, an impact fee is also a form of a financial reimbursement to existing ratepayers who paid for those facilities in advance of the new customer connecting to the system. t Overview of Impact Fees and "Generally Accepted" Utility Industry Practices 15 City of Kalispell, Montana — Development of Water and Wastewater Impact Fees Most commonly, impact fees Based upon the above example, impact fees also have an are adopted in high growth equity perspective associated with the rate setting areas where infrastructure process. That is, impact fees are a form of "system buy - expansion has strained in." A properly established impact fee implies that a new existing financial resources. customer connecting to the system has bought into the Philosophically, many utilities system at its current cost. Therefore, from a rate setting desire to have a policy of perspective the utility does not need to have rates for "old" "growth paying for growth." and "new" customers. Again, existing customers have been equitably reimbursed for their past investments. Even with the above discussion, not all communities have impact fees. Most commonly, impact fees are adopted in high growth areas where infrastructure expansion has strained existing financial resources. Philosophically, many utilities desire to have a policy of "growth paying for growth." Impact fees comport with that philosophy, and it is achieved by applying the impact fees either directly against the capital cost of the expansion facilities or against the debt service associated with it. Relationship of Impact Fees and New Construction Activity There are a number of myths surrounding impact fees. In a very broad sense, some may argue that impact fees are bad for economic development. These arguments center around two issues. These are as follows: Development will occur on those parcels with lower or non-existent impact fees. Impact fees raise the cost of doing business and hinder development. Of the research conducted on these topics, just the opposite has been found. Provided below is a brief explanation of each. Developers look at many factors before a parcel is developed. One myth concerns the selection of parcels for development and whether impact fees are applied to the land. "The argument goes that if a developer is choosing between two parcels of land on which to build —where the first parcel is inside a city where SDC's (impact fees) are charged and the second is just outside where lower or no SDC's (impact fees) are charged —the developer will choose the second parcel. The trouble is this means that the owner of the first parcel does not make a sale. The landowner must lower the land price to offset the fee in order to make a sale. However, if the landowner does not lower the price, this indicates that the value of future development may be higher on that parcel. Thus, be wary of developers who claim they will choose the second parcel. Chances are they would not have chosen the first parcel anyway. In the meantime, the land market will be holding the first parcel available for higher value development. In effect what might look like a loss in the short term may be a much higher level of development in the long-term."6 The other argument and myth that one commonly hears about impact fees is that they are bad for economic development. The argument against this position is as follows: 6 Nelson. "System Development Charges for Water, Wastewater and Stormwater Facilities" P. 55. Overview of Impact Fees and "Generally Accepted" Utility Industry Practices 16 �«M City of Kalispell, Montana — Development of Water and Wastewater Impact Fees "The argument goes that because SDCs (impact fees) raise the price of doing business, they frustrate economic development. However, just the opposite is really true. First, remember that SDCs (impact fees) will be offset by reduced land prices and by enabling the community to more easily expand the supply of buildable land relative to demand. Now, consider what economic development really looks for: skilled labor, access to markets, and land with adequate infrastructure. Competitiveness for economic development will be stimulated by the new or expanded infrastructure paid in part by SDC's (impact fees). Besides, local governments retain the option to waive SDCs (impact fees) for specific kinds of economic development, such as development locating in enterprise zones. In the competition for certain kinds of development, it will be able to show developers the dollar value of SDCs (impact fees) waived as a solid demonstration of the local government's commitment to such development."7 As can be seen, at least in the opinion of Nelson, SDCs (impact fees) do not hinder growth, but in fact may help to spur growth. It must be remembered that an important concept associated with impact fees is that the fees are required to develop infrastructure in advance of the actual development. From the developer's perspective, absent impact fees (i.e. a moratorium on new connections) no new development can occur. Therefore, developers are generally supportive of cost -based impact fees, particularly when it provides available capacity and opportunities for development. 2.7 Summary "As can be seen, at least in the opinion of Nelson, SDCs (impact fees) do not hinder growth, but in fact may help to spur growth." This section of the report has provided an overview of the financial objectives associated with impact fees and some of the issues surrounding them. This section should have provided a basic understanding of the fees such that when the City is ready to have a policy discussion concerning the continued implementation of impact fees and the imposition of new impact fees, they can be placed in proper perspective. The next section of the report will provide an overview of methodologies for the imposition of impact fees. 7 Nelson, "System Development Charges for Water, Wastewater and Stormwater Facilities" P. 56. 2 Overview of Impact Fees and "Generally Accepted" Utility Industry Practices 17 City of Kalispell, Montana — Development of Water and Wastewater Impact Fees Section 3 Introduction An important starting point in establishing impact fees is to have a basic understanding of the purpose of these charges, along with criteria and general methodology that is used to establish cost -based impact fees. Presented in the section of the report is an overview of impact fee criteria and the "generally accepted" methodologies that are used to develop cost -based impact fees. Impact Fee Criteria In the determination and establishment of the impact fees, a number of different criteria are often utilized. The criteria often used by utilities to establish impact fees are as follows: Customer understanding System planning criteria Financing criteria, and State/local laws The component of customer understanding implies that the charge is easy to understand. This criterion has implications on the way that the fee is implemented, administered and assessed to the customer. Generally, for a water system, the fee is based on the size (capacity) of the meter. This makes it easy for the customer to understand the level of fee based on the size of a meter required to provide service. In some instances, larger meter sizes are calculated based on actual usage. While this is more complicated, it applies to very few customers and generally more sophisticated industrial customers. For wastewater systems, the charge can be based on meter size or the type of dwelling or business type being assessed. For example, a school could be assessed based on a per student basis corresponding to the sanitary sewer flow per student. The other implication of this criterion is that the methodology is clear and concise in its determination of the amount of infrastructure necessary to provide service. The use of system planning criteria is one of the more important aspects in the determination of impact fees. System planning criteria provides the "rational nexus" between the amount of infrastructure necessary to provide service and the charge to the customer. The rational nexus test requires that there be a connection (nexus) established between new development and the existing or expanded facilities required to accommodate new development; and appropriate apportionment of the cost to the new development in relation to benefits reasonably received. An example of using system -planning criteria is the determination that a single-family residential customer "The use of system planning criteria is one of the more important aspects in the determination of the impact fees. System planning criteria provides the "rational nexus" between the amount of infrastructure necessary to provide service and the charge to the customer." mess Overview of Impact Fee Methodologies City of Kalispell, Montana — Development of Water and Wastewater Impact Fees 18 requires 384 gallons of water distribution storage. The impact fee methodology then charges the customer for 384 gallons of water distribution storage at the per gallon cost of storage. One of the driving forces behind establishing cost -based impact fees is that "growth pays for growth." Therefore, impact fees are typically established as a means of having new customers pay an equitable share of the cost of their required capacity (infrastructure). The financing criteria for establishing impact fees relates to the method used to finance growth -related infrastructure of the system and assures that customers are not paying twice for growth - related infrastructure - once through impact fees and again through rates. The double payment can come in through the imposition of impact fees and then the requirement to pay debt service within a customer's rates. The financing criteria also reviews the basis under which main line and collection line extensions were provided and addresses the issue such that customers are not charged for infrastructure that was provided (contributed) by developers. Many states and local communities have enacted laws which govern the calculation and imposition of impact fees. These laws must be followed in the determination of the impact fees. Most statutes require a "reasonable relationship" between the fee charged and the cost associated with providing service (capacity) to the customer. The charges do not need to be mathematically exact, but must bear a reasonable relationship to the cost burden imposed. As discussed above, the utilization of the planning criteria and the actual costs of construction and the planned costs of construction provide the nexus for the reasonable relationship requirement. Growth, Risk and New Connections One of common phrases associated with impact fees is "growth paying for growth." While this is a simple and convenient phrase to convey the concept and purpose of impact fees, the reality of the transaction is far more complicated. As the recent downturn in the economy has demonstrated, customer growth is not assured or to be taken for granted. At the same time, it must be kept in mind that it is the existing customers that bear the risk of growth -related facilities that are built. If growth -related facilities are built in anticipation of future growth, and little or no connections occur, it will be the existing ratepayers that will bear the burden of any financial responsibility (e.g. long-term debt) associated with those growth -related facilities. Absent some form of an impact fee, existing ratepayers would likely be hesitant to fully support undertaking such risk. Overview of the Impact Fee Methodology There are "generally -accepted" methodologies that are used to establish impact fees. Within the "generally accepted" impact fee methodologies, there are a number of different steps undertaken. These steps are as follows: Determination of system planning criteria. Determination of equivalent residential units (ERUs). Calculation of system component costs. Determination of any credits. The first step in establishing impact fees is the determination of the system planning criteria. This implies calculating the amount of water required to serve a single-family residential customer and the amount of wastewater generated by a single-family residential customer. mess Overview of Impact Fee Methodologies 19 City of Kalispell, Montana — Development of Water and Wastewater Impact Fees Generally for a water system, two different criteria are determined due to differences in planning criteria. The first planning criterion is the peak day water usage per ERU and the second is a water storage requirement per ERU. These two different planning criteria are developed since a majority of the water system infrastructure is sized to meet the peak day demand, and water storage is sized to meet equalizing, emergency and fire flow requirements. For wastewater systems, average daily demand (wastewater contribution) per ERU is most often used, since this total flow represents the flow, imposed by the customer. Average inflow and infiltration$ is added to the customer's flow since this represents the total volumetric flow and hence capacity requirement at the treatment plant. Once the system planning criteria is determined, the number of ERUs can be determined. For the water system, this is determined by utilizing the peak day water system demand and dividing it by the peak day water usage per ERU. This is a very important calculation since it provides the linkage between the amounts of infrastructure necessary to provide service to a set number of customers. This implies that if the system is designed to provide service to demands up to the year 2020, then the infrastructure costs are divided by the ERUs in 2020 to determine the cost per ERU. For the wastewater sewer system, the number of ERUs is determined by dividing the average daily metered flow by the average daily flow per ERU. Once the number of ERUs has been determined, a component by component (e.g. source of supply, treatment, storage, etc.) analysis is undertaken to determine the component impact fee in $ per ERU. Individual plant components are analyzed separately for the water and sanitary sewer systems given that the planning criteria for the design of the various system components differ. The calculation of the component impact fee includes both historical assets and planned future assets. Historical assets can be valued in a number of different ways. These include original cost plus interest, replacement cost and depreciated replacement costs. The original cost plus interest method includes original cost plus fifteen (15) years worth of interest. This calculation is done to reflect the fact that existing customers have provided for excess capacity in the system and hence need to be reimbursed for not only their initial investment, but also the "carrying cost" on that investment. The reimbursement to existing customers is accomplished by the fact that without an impact fee, rates would otherwise be higher than they would be without impact fees. The replacement cost method values existing assets based on the cost to replace the assets in today's dollars. This is done by escalating the original cost by the Engineering News Record Construction Cost (ERN) index. The theory behind the use of replacement cost is that customers are indifferent since they would have to pay replacement cost if the infrastructure was built today to serve their needs. The use of depreciated replacement cost reflects the fact that the assets have been used and hence their value to the new customer is less that the replacement cost. Caution needs to be 8 EPA defines "infiltration" as the volume of ground water entering sewers and building sewer connection from the soil, through defective joints, broken or cracked pipe, improper connections, manhole walls, etc. "Inflow" covers the volume of any kinds of water discharged into sewer lines from such sources as roof leaders; cellar and yard area drains; foundation drains; commercial and industrial so-called "clean water" discharges' drains from springs and swampy areas; etc. ..a� ,� Overview of Impact Fee Methodologies 20 City of Kalispell, Montana — Development of Water and Wastewater Impact Fees exercised in the use of depreciated replacement cost, since the book or accounting lives used by many utilities are not reflective of the actual life of the asset and may result in the assets being undervalued. An example is using a useful life for a storage reservoir of 40 years, when in reality, with maintenance, the actual life may be between 60 to 80 years. Each of these three (3) methods are used in the industry and the appropriate method selected by the City should be based on the method that best reflects the cost of providing capacity in the systems. HDR/EES recommends the use of the original cost with interest method, since it will reflect the actual cost of the City's system. The City's system is developed to serve future development through existing capacity and planned future capacity additions. This has been accomplished by the City building excess capacity and using borrowing to finance this capacity and the City building future capacity. Therefore, the use of the original cost with interest method will reflect the actual costs that have been incurred or will be incurred by the City in providing capacity to new development. This is also the most commonly used method to value capacity in water and wastewater systems. This method also appears to comply with the requirements under Montana law wherein in the actual cost of infrastructure is required. Once the total cost of the capital infrastructure is determined, it is then divided by the appropriate number of equivalent residential units the infrastructure will serve to develop the cost per ERU for the specific plant component. After each plant component is analyzed and a cost per ERU is determined, the cost per ERU for each of the plant components is added together to determine the "gross impact fee." The "gross impact fee" is calculated before any credits for debt service. The last step in the calculation of the impact fee is the determination of any credits. This is generally a calculation to assure that customers are not paying twice — once through impact fees and again through debt service included within the water and/or wastewater rates. A crediting mechanism is also utilized if general obligation or tax revenue has been used to finance the infrastructure. The final cost -based impact fee is determined by taking the "gross impact fee" and subtracting any credits. This results in a "net impact fee" stated in $ per ERU. The general basis of this calculation for a water system is the assumption that an ERU is equivalent to a single family residential customer. Larger meter sizes are then imposed fees based on the number of ERUs for a given meter size based on its safe operating capacity. The number of ERUs per meter size is generally based on the safe operating capacity of the meter. For the wastewater system, an ERU can be defined and weighted in the same manner as the water system or can be defined as a single-family residential unit. In the later case, other types of dwellings or business are then assigned ERUs based on flow from design manuals or actual flows. J.5 Summary This section has provided a discussion of the criteria typically used in the determination of impact fees. In addition, an overview of the "generally accepted" methodology used in the calculation of the impact fees has been provided. Given this background, the next section of the report discusses any specific legal criteria that must be used by the City in the establishment of its impact fees. mess Overview of Impact Fee Methodologies 21 City of Kalispell, Montana — Development of Water and Wastewater Impact Fees al Considerations in Introduction An important consideration in establishing impact fees is any legal requirements at the state or local level. The legal requirements often establish the methodology around which the impact fees must be calculated or how the funds must be used. Given that, it is important for the City to understand these legal requirements. This section of the report provides an overview of the legal requirements for establishing impact fees under Montana law. The discussion within this section of the report is intended to be a summary of our understanding of the relevant Montana law as it relates to establishing impact fee. It in no way constitutes a legal interpretation of Montana law by HDR/EES. Requirements Under Montana Law In establishing impact fees, an important requirement is that implemented in conformance with local laws. In particular, many states have established specific laws regarding the establishment, calculation and implementation of capacity fees. The main objective of most state laws is to assure that these charges are established in such a manner that they are fair, equitable and cost - based. In other cases, state legislation may have been needed to provide the legislative powers to the utility to establish the charges. they be developed and "The laws for the enactment of impact fees in Montana are found in 7-6-1601 to 7-6-1604 of the Montana Code. The Montana law enabling legislation for impact fees was enacted in 2005 via Senate Bill 185. This was comprehensive legislation allowing public entities in the State of Montana to enact impact fees for various services. The legal basis for the enactment of impact fees is found in Title 7, Chapter 6, and Part 1601 to 1604 of the Montana Code. A summary of the Montana Code is provided below. A copy of the full code is provided as Appendix C A summary of the requirements under Montana law is as follows: "7-6-1601. Definitions. As used in this part, the following definitions apply:... ...5)(a) 'Impact fee" means any charge imposed upon development by a governmental entity as part of the development approval process to fund the additional service capacity required by the development from which it is collected. An impact fee may include a fee for the administration of the impact fee not to exceed 5% of the total impact fee collected. (b) The term does not include: (i) a charge or fee to pay for administration, plan review, or inspection costs associated with a permit required for development; (ii) a connection charge; (iii) any other fee authorized by law, including but not limited to user fees, FM mess Legal Considerations in Establishing Impact fees for the City 22 City of Kalispell, Montana — Development of the Water and Wastewater Impact Fees special improvement district assessments, fees authorized under Title 7 for county, municipal, and consolidated government sewer and water districts and systems, and costs of ongoing maintenance; or (iv) onsite or offsite improvements necessary for new development to meet the safety, level of service, and other minimum development standards that have been adopted by the governmental entity. 7-6-1602. Calculation of impact fees — documentation required — ordinance or resolution — requirements for impact fees. (1) For each public facility for which an impact fee is imposed, the governmental entity shall prepare and approve a service area report. (2) The service area report is a written analysis that: (a) describe existing conditions of the facility; (b) establish level -of -service standards; (c) forecast future additional needs for service for a defined period of time; (d) identify capital improvements necessary to meet future needs for service; (e) identify those capital improvements needed for continued operation and maintenance of the facility; (f) make a determination as to whether one service area or more than one service area is necessary to establish a correlation between impact fees and benefits; (g) make a determination as to whether one service area or more than one service area for transportation facilities is needed to establish a correlation between impact fees and benefits; (h) establish the methodology and time period over which the governmental entity will assign the proportionate share of capital costs for expansion of the facility to provide service to new development within each service area; (i) establish the methodology that the governmental entity will use to exclude operations and maintenance costs and correction of existing deficiencies from the impact fee; U) establish the amount of the impact fee that will be imposed for each unit of increased service demand; and (k) have a component of the budget of the governmental entity that: (i) schedules construction of public facility capital improvements to serve projected growth; (ii) projects costs of the capital improvements; (iii) allocates collected impact fees for construction of the capital improvements; and (iv) covers at least a 5-year period and is reviewed and updated at least every 2 years. (3) The service area report is a written analysis that must contain documentation of sources and methodology used for the purposes of subsection (2) and must document how each impact fee meets the requirements of subsection (7). (7) An impact fee must meet the following requirements: (a) The amount of the impact fee must be reasonably related to and reasonably attributable to the development's share of the cost of infrastructure FM 'aegis Legal Considerations in Establishing Impact fees for the City 23 City of Kalispell, Montana — Development of the Water and Wastewater Impact Fees improvements made necessary by the new development. (b) The impact fees imposed may not exceed a proportionate share of the costs incurred or to be incurred by the governmental entity in accommodating the development. The following factors must be considered in determining a proportionate share of public facilities capital improvements costs: (i) the need for public facilities capital improvements required to serve new development; and (ii) consideration of payments for system improvements reasonably anticipated to be made by or as a result of the development in the form of user fees, debt service payments, taxes, and other available sources of funding the system improvements. (c) Costs for correction of existing deficiencies in a public facility may not be included in the impact fee. (d) New development may not be held to a higher level of service than existing users unless there is a mechanism in place for the existing users to make improvements to the existing system to match the higher level of service. (e) Impact fees may not include expenses for operations and maintenance of the facility. 7 6-1603. Collection and expenditure of impact fees — refunds or credits — mechanism for appeal required... . (3) A governmental entity may recoup costs of excess capacity in existing capital facilities, when the excess capacity has been provided in anticipation of the needs of new development, by requiring impact fees for that portion of the facilities constructed for future users. The need to recoup costs for excess capacity must have been documented pursuant to 7-6-1602 in a manner that demonstrates the need for the excess capacity. This part does not prevent a governmental entity from continuing to assess an impact fee that recoups costs for excess capacity in an existing facility. The impact fees imposed to recoup the costs to provide the excess capacity must be based on the governmental entity's actual cost of acquiring, constructing, or upgrading the facility and must be no more than a proportionate share of the costs to provide the excess capacity." The use of the methodology discussed in Section 3, should meet the proportional share standard and the proposed impact fees are in compliance with Montana law. Summary This section of the report has reviewed the legal basis for establishing impact fees in Montana. HDR concludes that the City has the authority to establish cost -based impact fees and the proposed methodology to be used within this study, in the opinion of HDR, meets the requirements of Montana law. Z Legal Considerations in Establishing Impact fees for the City 24 City of Kalispell, Montana — Development of the Water and Wastewater Impact Fees Section 5 — Introduction This section of the report presents the development of the City's water impact fee. The calculation of the water impact fee presented in this section are based on the City's fixed asset records, future capital improvements as identified in the City's 2009 Capital Improvement Plan, and planning criteria and capital improvements from the master plan entitled, City of Kalispell Water Facilities Plan Update, dated March 2008 prepared by HDR Engineering (the "Water Facility Plan"). To the extent that the cost and timing of future capital improvements change, then the impact fee presented in this section should be updated to reflect the cost of these adjustments. Overview of the City's Water System The City currently services a population of approximately 18,000 people with water services. The City has been growing and overall population growth in the study area for the master plan between 2000 and 2005 was approximately 4.2 percent per year. While growth in the last few years has slowed considerably, it is expected that high growth rates will continue in the future over the study planning horizon of the Water Facility Plan. The City obtains 100% of its water supply from wells. The City currently has six wells and plans to construct one additional well. The City also has four storage reservoirs including the recently constructed Sheepherders Hill reservoir. The capital improvement plan calls for the construction of a new well, upgrades to the distribution and transmission system and new storage. 5.3 Overview of the City's Water Facility Plan The water facility plan provides an update to the water system portions of the City of Kalispell Water, Sewer, and Storm Drainage System Facility Plan, completed in July 2002. Since completion of the 2002 report, the City has continued to experience population growth and the expansion of infrastructure; therefore, in 2006 the City chose to update their facility plan to analyze potential growth and effectively plan for growth while protecting water and environmental resources. The area studied in the Water Facility Plan is bounded by the Flathead River on the east, includes the airport to the north, and is bounded by Lost Creek Drive to the north, Farm to Market Road on the west, and Buckboard Lane and Valley View Drive on the southwest. The Study Area boundary continues in the southeasterly direction until reaching Highway 82, which is the southern boundary of the study area, then proceeds north and west until reaching the Flathead River which is the eastern boundary of the study area. (See Chapter 1, Figure 1-6 - Water Facility Plan). FM I (AM'S Determination of the City's Water Impact Fees 25 City of Kalispell, Montana — Development of Water and Wastewater Impact Fees This Study Area boundary extends beyond the current Kalispell city limits, but does not represent future city limits or a future water utility service area boundary. It represents the area studied for the Water Facility Plan and the potential area that is likely to experience significant growth in the next 50 years. The basis of planning was to determine the requirements for the next 35 years in areas that the City will have to provide water service as growth continues. Given the expansion of the service area in the 2008 Water Facility Plan, the impact fees presented in this section are formatted and calculated differently than the current impact fees. While the methodology used is the same, the fees are calculated for the current planning area and the expanded area in the Water Facility Plan. The purpose for this calculation is to allow the City to determine the method used to finance infrastructure in the expanded service area. This could include developer contributions, SIDS, impact fees or a combination of these financing options. Present Water Impact Fees The City currently assesses an impact fee for connection to the water system. The current water impact fees are shown in Table 5-1. Table 5-7 Present Water Impact Fees Meter Size ERU Factor Charg2 3/4" 1.0 $2,213 1,, 2.5 5,533 1-1/2" 5.0 11,066 2" 8.0 17,705 3" 16.0 35,411 Over 3" Calculated 5.5 Calculation of the City's Water Impact Fees As was discussed in Section 3, the process of calculating impact fees is based upon a four -step process. In summary form, these steps were as follows: Determination of system planning criteria Determination of equivalent residential units (ERU) Calculation of the impact fee for system component costs Determination of any impact fee credits Each of these areas is discussed in more detail below. 5.5.1 System Planning Criteria The number of equivalent residential units (ERUs) was determined based on the planning criteria from the Water Facility Plan. The Water Facility Plan assumes 184 gallons per capita day average flow and a peaking factor of 2.67. An assumption of 2.5 persons per household or ERU was utilized to develop a peak day flow of 1,228.20 gallons per day per ERU. A summary of the ERU conversion factors is presented below in Table 5-2. iAeeS Determination of the City's Water Impact Fees 26 City of Kalispell, Montana — Development of Water and Wastewater Impact Fees Planning Criteria Gallons/Day/ERU Planning Criteria Average Day Flow 1 460.00 Gallons/Day/ERU Peak Day Flow 2 1,228.20 Gallons/Day/ERU (1) From the Water Facility Plan. (2) Based on a peaking factor of 2.67x As discussed previously, certain facilities may be planned and sized around different planning criteria. Therefore, the system planning criteria shown above will be used for different plant components to determine the cost per ERU for that specific plant component. 5.5.2 Calculation of Equivalent Residential Units The planning horizon of this study was 2006 - 2035. The number of ERUs in 2020 was utilized in the calculation of some of the impact fee components since this is the date that the City's Water Facility Plan used for that particular infrastructure development. Other impact fee components were based on the number of ERUs in 2035 or additional ERUs from 2009 to 2035 As a part of this study, a projection of the number of new/additional ERUs per year must be determined, along with the total number of ERUs at 2035. The City's total number of residential ERUs for each year was determined by dividing the peak day usage factor per ERU into total peak day demand. The number of ERUs added during each year of the study period was made based on a growth rate as set forth in the Master Plan. A summary of the ERUs for 2009 and 2035 are presented in Table 5-3. Details of the determination of ERUs are provided in Exhibit A-1 of the Technical Appendix. Table 5-3 ater System Equivalent Residentia Uni Equivalent Residential Units - 2009 12,462 Equivalent Residential - 2035 34,139 Given the development of the total water ERUs for each year of the planning period, the focus can shift to the calculation of the impact fee for each plant component. This aspect of the analysis is discussed in detail below. 5.5.3 Calculation of the Impact Fee for the Major System Components The next step of the analysis is to review each major functional component of plant in service and determine the impact fee for that component. In calculating the water impact fee for the City, both existing plant assets, along with planned future CIP were included within the calculation. The major components of the City's water system that were reviewed for purposes of calculating impact fee were as follows: iAeeS Determination of the City's Water Impact Fees 27 City of Kalispell, Montana - Development of Water and Wastewater Impact Fees Source of Supply Pumping Plant Distribution Storage Transmission and Distribution Mains Administrative Charge The City also has a number of outstanding water revenue bonds as part of its past financing strategy. Therefore a debt service credit was calculated as part of the water capacity charge. A brief discussion of the impact fee calculated for each of the functional plant components is provided below. SOURCE OF SUPPLY - The City's source of supply is provided 100% from wells. The sources of supply consist of six (6) existing wells. The City also plans to construct one (1) additional well. The cost of the existing wells was taken from the City's fixed asset records and includes up to fifteen years worth of interest. Future well costs were from the City's capital improvement plan and increased to 2009 based on changes in the Engineering New Record Construction Cost Index (ENR). The total cost was then divided by the 2035 ERU's. Based on the costs and capacity of the sources of supply for the City, the impact fee for source of supply is $80.85 per ERU. Details of the calculations for source of supply are provided in Exhibit A-2. PlIMPING PLANT - The City currently has pumping plants at all of the well sites. The cost of the existing pumping plant was obtained from the City's fixed asset records and includes up to fifteen years worth of interest. No future capital improvements were identified as part of the 2009 capital improvement plan. This total cost was subsequently divided by the 2035 ERUs to develop the cost per pumping plant per ERU. Based on the cost and capacity of the pumping plant for the City, the impact fee for water pumping plant is $134.78 per ERU. Details of the pumping plant calculation are provided in Exhibit A-3. DISTRIBUTIONSTORAGF - The City currently has four (4) storage reservoirs. The cost of the existing distribution storage plant was obtained from the City's fixed asset records and includes up to fifteen years worth of interest. The City's capital improvement plan also calls for construction of an additional three (3) reservoirs. The total cost of existing and future reservoirs was subsequently divided by the 2035 ERUs to determine the cost of storage per ERU. Based on the cost and capacity of storage for the City, the impact fee for storage is $460.40 per ERU. Details of the calculations are provided as Exhibit A-4. rRANSMISSION AND DISTRIBUTION MAINS - The City's transmission/distribution network consists of numerous lines of 8-inch, 10-inch, 12-inch, 16-inch, and 20-inch diameter mains. To determine the impact fee for transmission mains and booster pumps, an inventory of the existing system was undertaken as well as those planned improvements as identified in the capital improvement program. The historical investments of the City were adjusted for interest charges up to a maximum of fifteen years and allocated to growth based on the capacity of the assets to provide service to new development. These were subsequently divided by the number of new ERUs from 2009 to 2020 ERUs to determine the cost per ERU. Future capital improvements as set forth in the City's 2009 Capital Improvement Plan were assumed to serve new development for the planning horizon from 2009 to 2019 and were then divided by the number of new ERUs added over the planning horizon. Future transmission and distribution plant required to serve the expanded planning area were taken from the Water Facility Plan and the costs were adjusted to current dollars using the ENR. These were then divided by the iAeeS Determination of the City's Water Impact Fees 28 City of Kalispell, Montana — Development of Water and Wastewater Impact Fees number of ERUs from 2009 to 2035 to determine the cost per ERU. Based on the cost incurred by the City, the impact fee for existing and planned transmission and distribution mains is $1,164.56 per ERU. For future transmission and distribution mains extensions, the impact fee is $4,755.82 per ERU. In the calculation of the impact fee for transmission and distribution plant, a number of items were excluded. First, all existing mains that were contributed by developers, financed through improvement districts or contributed by grants were excluded from the analysis. For future transmission and distribution plant, an item -by -item analysis was done to determine the percentage cost of these facilities that would not serve new development. All mains less than six inches were also excluded from the analysis since these would not be able to provide capacity to new development. Water main replacements were also excluded since these are not growth -related and should be paid for through rates. Details of the calculation are provided in Exhibit A-5. ADMINISTRATIVE CHARGE - Under Montana statute, an impact fee may include a fee for the administration of the impact not to exceed 5% of the impact fee collected. Exhibit A-6 details what the City's actual water administrative costs are for 2009. The actual cost is $130.55 per ERU which is 7.09% of the impact fee without extensions and 1.98% with extensions. Therefore, the City has included a water administrative charge of $92.03 per ERU equal to 5% of the impact fee collected for the impact fee without extensions and $130.55 with extensions. Details of the calculation are provided on Exhibit A-6. 5.5.4 Debt Service Credits The final step in calculating the water impact fees was to determine if a credit for payment on debt service for the City's outstanding bonds. The City currently has a number of outstanding water revenue bonds. For the purpose of the impact fee calculation, it has been assumed that the City would not issue any additional debt. In the determination of the debt service credit, it was assumed that impact fee funds would be used to pay for a portion of debt service per the City's long term financial plan. The remaining debt service would be paid for through rates. This debt service was then divided by the total number of ERUs in each year to determine the debt service credit per ERU. This annual amount was then discounted to 2009 dollars to reflect the fact that a credit was being given for payments in the future. Based on the annual debt service cost and number of ERUs for each year for which debt service payments will be made, the credit for debt service payments is $0.00 per ERU. Details of the calculation of the debt service credits are shown in Exhibit A-7 of the Technical Appendices. Net Allowable Water Impact Fees Based on the sum of the component costs calculated above, the net allowable water impact fee can be determined. "Net" refers to the "gross" impact fee, net of any debt service credits. "Allowable" refers to concept that the calculated impact fee as shown in Table 5-4 is the City's cost -based impact fee. The City, as a matter of policy, may charge any amount up to the allowable impact fee, but not over that amount. Charging an amount greater than the FI-R I TAMS Determination of the City's Water Impact Fees 29 City of Kalispell, Montana — Development of Water and Wastewater Impact Fees allowable impact fee would not meet the nexus test of a cost -based impact fee. A summary of the calculated net allowable water impact fee for the City is shown in the Table 5-4. W/o Description Extensions Extensions Total Source of Supply $80.85 - $80.85 Pumping Plant 134.78 - 134.78 Storage 460.40 - 460.40 Existing Transmission 945.36 - 945.36 CIP Transmission 219.20 - 219.20 Debt Service Credit for Bonds 0.00 - 0.00 Subtotal Before Admin. Costs $1,840.59 - $1,840.59 Administrative Cost at 5% 92.03 - 92.03 Subtotal Before Extensions $1,932.61 - $1,932.61 Transmission Extensions - $4,755.82 $4,755.82 Administrative Cost - Extens. - 38.52 38.52 Total Impact Fee $1,932.61 $4,794.34 $6,726.96 Recommended Water Fee $1,930.00 $4,795.00 $6,725.00 The total impact fee as shown is $1.932.61 per ERU without extensions and $6,726.96 with extensions. The details of the net allowable impact fee are shown on Exhibit A-8 of the Technical Appendices. For ease of administration, the recommended charge for an ERU is $1,930 without extensions and $6,725 with extensions. Based on the impact fee for "1 ERU", the charges for a residential customer with at 3/4 inch meter and various sized meters results in the following impact fees as shown in Table 5-5. One (1) ERU is defined as the usage for a single family residential customer. Other meter sizes are then weighted based on their safe operating capacity. Impact Impact Fee Fee Total Weighting w/o With Impact Meter Size Factor 1 Extensions Extensions Fee Residential $1,930 $4,795 $6,725 1,, 2.5 4,825 11,988 16,813 1-1/2 5.0 9,650 23,975 33,625 2" 8.0 15,440 38,360 53,800 3" 16.0 30,880 76,720 107,600 4" Calculated Calculated Calculated [1] - Commercial customers with residential type usage pay the residential fee. ixeS Determination of the City's Water Impact Fees 30 City of Kalispell, Montana - Development of Water and Wastewater Impact Fees In Table 5-5 the impact fees for the larger meter sizes are determined by multiplying the impact fee for an ERU by the meter capacity weighting factors for up to 3 inches. The weighting factors are determined based on the American Water Works Association (AWWA) safe operating capacities for the type and size of meter. For meter sizes over 3 inches, the impact fee is calculated based on the actual usage of the customer. Table 5-4 and Table 5-5 view the water impact fee from the perspective of with and without extensions. Included within the development of the water impact fees are costs related to "recoupment" and "expansion". Recoupment costs are related to excess capacity in existing facilities which has been built in anticipation of the needs of new development. Montana law, 7-6-1603(3) specifically allows for the recoupment of costs of excess capacity. In contrast to this, expansion costs are the estimated costs related to system improvements reasonably anticipated to be needed to accommodate new development. A breakdown of the impact fees between recoupment and expansion is provided below in Table 5-6. Description Recoupment Expansion Total Source of Supply $59.37 $21.48 $80.85 Pumping Plant 134.78 0.00 134.78 Storage 149.34 311.06 460.40 Existing Transmission 945.36 0.00 945.36 CIP Transmission 0.00 219.20 219.20 Debt Service Credit for Bonds 0.00 0.00 0.00 Subtotal Before Admin. Costs $1,288.85 $551.74 $1,840.59 Administrative Cost at 5% 64.44 27.59 92.03 Subtotal Before Extensions $1,353.29 $579.33 $1,932.62 Transmission Extensions - $4,755.82 $4,755.82 Administrative Cost - Extens. - 38.52 38.52 Total Impact Fee $1,353.29 $5,373.67 $6,726.96 In viewing Table 5-6, it should be noted that "recoupment" impact fees are not "directly reimbursed" to ratepayers. Rather, the recoupment funds are used to minimize future water rates by either using the funds to pay for growth -related debt service, refund (i.e. pay off early) an existing growth -related debt obligation, or minimize future long-term borrowing for growth - related facilities by paying for the improvements directly from the fees previously received. This approach for the use of these funds is consistent with the discussion in Section 2 (Figure 2-2) and Montana law. Key Assumptions In the development of the impact fees for the City's water system, a number of key assumptions were utilized. These are as follows: The City's asset records were used to determine the existing plant assets. The interest rate used for calculating interest on existing investments was 6.0%. Up to fifteen (15) years worth of interest were included in the cost of existing plant. aaeS Determination of the City's Water Impact Fees 31 City of Kalispell, Montana - Development of Water and Wastewater Impact Fees R Implementation of the Impact Fees The methodology used to calculate the impact fees takes into account the cost of money or interest charges and inflation. Therefore, HDR/EES would recommend that the City adjust the impact fees each year by an escalation factor to reflect the cost of interest and inflation. The most frequently used source to escalate impact fees is the ENR index which tracks changes in construction costs for municipal utility projects. This method of escalating the City's impact fee should be used for no more than a two-year period. After this time period, as required by Montana law, the City should update the charges based on the actual cost of infrastructure and any new planned facilities that would be contained in an updated master plan or capital improvement plan. Consultant Recommendations Based on our review and analysis of the City's water system, HDR/EES makes the following recommendations: The City should implement impact fees for new hookups to the water system that are no greater than the impact fees as set forth in this report. The City should update the actual calculations for the impact fees based on the methodology as approved by the resolution or ordinance setting forth the methodology for impact fees every two years as required by Montana law. 5.10 Summary The water impact fees developed and presented in this section of the report are based on the engineering design criteria of the City's water system, the value of the existing assets, future capital improvements and "generally accepted" ratemaking principles. Adoption of the proposed impact fees will provide multiple benefits to the City and create equitable and cost - based charges for new customers connecting to the City's water system. ixem Determination of the City's Water Impact Fees 32 City of Kalispell, Montana — Development of Water and Wastewater Impact Fees ILI Introduction i Section 6 — Determination This section of the report presents the development of the wastewater impact fee. The calculation of the wastewater impact fee presented in this section are based on the City's fixed asset records, future capital improvements as identified in the City's 2009 Capital Improvement Plan, and planning criteria and capital improvements from the master plan entitled, City of Kalispell Wastewater Facilities Plan Update, dated March 2008 prepared by HDR Engineering (the "Wastewater Facility Plan"). To the extent that the cost and timing of future capital improvements change, then the impact fee presented in this section should be updated to reflect the cost of these adjustments. Overview of the City's Wastewater System The City's wastewater system consists of a collection system and pumps to deliver wastewater to the City's wastewater treatment plant (WWTP). The City has a wastewater treatment plant with a recently completed design capacity of 5.4 MGD. The City's capital improvement plan calls for numerous upgrades to the interceptor and collection system. 6.3 Overview of the City's Wastewater Facility Plan The wastewater facility plan provides an update to the wastewater system portions of the City of Kalispell Water, Sewer, and Storm Drainage System Facility Plan, completed in July 2002. Since completion of the 2002 report, the City has continued to experience population growth and the expansion of infrastructure. Given that, in 2006 the City chose to update their facility plan to analyze potential growth and effectively plan for growth while protecting water and environmental resources. The area studied in the Wastewater Facility Plan is bounded by the Flathead River on the east, includes the airport to the north, and is bounded by Lost Creek Drive to the north, Farm to Market Road on the west, and Buckboard Lane and Valley View Drive on the southwest. The Study Area boundary continues in the southeasterly direction until reaching Highway 82, which is the southern boundary of the study area, then proceeds north and west until reaching the Flathead River which is the eastern boundary of the study area. This Study Area boundary extends beyond the current Kalispell city limits, but does not represent future city limits or a future water utility service area boundary. It represents the area studied for the Wastewater Facility Plan and the potential area that is likely to experience significant growth in the next 50 years. The basis of planning was to determine the requirements for the next 35 years in areas that the City will have to provide wastewater service as growth continues. Given the expansion of the service area in the 2008 Wastewater Facility Plan, the wastewater impact fees presented in this section are formatted and calculated differently than the current mess Determination of the City's Wastewater Impact Fees 33 City of Kalispell, Montana — Development of Water and Wastewater Impact Fees impact fees. While the methodology used is the same, the fees are calculated for the current planning area and the expanded area in the Wastewater Facility Plan. The purpose for this calculation is to allow the City to determine the method used to finance infrastructure in the expanded service area. This could include developer contributions, SIDS, impact fees or a combination of these financing options. Present Wastewater Impact Fees The City currently assesses an impact fee for connection to the wastewater system. The current wastewater impact fees are shown in Table 6-1. Plant Component Impact Fee Wastewater Treatment $1,435/ERU Wastewater Collection 1.064/ERU Total Fee - Treatment and Collection $2,499/ERU Impact fees for other types of business are based on wastewater flow volumes and type of business from the City's rate schedule. Calculation of the City's Wastewater Impact Fees As was discussed in Section 3, the process of calculating impact fees is based upon a four -step process. In summary form, these steps were as follows: Determination of system planning criteria Determination of equivalent residential units (ERUs) Calculation of the impact fee for system component costs Determination of any impact fee credits Each of these areas is discussed in more detail below. 1 Qvstem Planning Criteria The number of wastewater equivalent residential units (ERUs) was determined based on the planning criteria from the Wastewater Plan. The Wastewater Plan assumes 106 gallons per capita day average flow. To develop an average day flow of 265 gallons per day per ERU an assumption of 2.5 persons per household or ERU was utilized. This was subsequently divided by the average day demand to determine the total number of ERUs. Table 6-2 provides a summary of the system planning criteria used within this study. ti— Z Determination of the City's Wastewater Impact Fees 34 City of Kalispell, Montana - Development of Water and Wastewater Impact Fees Criteria Average Day Flow '- Persons per Residence 1 Average Daily Flow per ERU 2 (1) See Page 1-16 of the Wastewater Facility Plan (2) Based on 106 gpcp and 2.5 persons per household Planning Criteria 106 gpcd 2.5 persons/ERU 265.0 gallons per day/ERU 6.5.2 Calculation of Equivalent Residential Units The planning horizon of this study was 2009 - 2035. This is the planning horizon used in the Wastewater Facility Plan for which the City's wastewater system and future improvement will provide service. As a part of this study, a projection of the number of new/additional ERUs per year must be determined, along with the total number of ERUs at 2035. The City's total number of ERUs for each year was determined by dividing the average day usage factor per ERU into the City's total metered average flow. The number of ERUs added during each year of the study period was made based on a growth rate as set forth in the Wastewater Facility Plan. The number of ERUs was determined based on the flows to the treatment plant and the collection system. The number of ERUs for treatment is different, since the City provides treatment services per contract to the Flathead County Water and Sewer District #1 Evergreen. A summary of the ERUs for 2009 and 2035 are presented in Table 6-3. Details of the determination of ERUs are provided in Exhibit B-1 of the Technical Appendix. Component and Year ERUs Equivalent Residential Units - 2009 - Treatment 15,933 Equivalent Residential Units - 2035 - Treatment 37,359 Equivalent Residential Units - 2009 - Collection 12,550 Equivalent Residential Units - 2035 - Collection 33,294 Given the development of the total wastewater ERUs for each year of the planning period, the focus can shift to the calculation of the impact fee for each plant component. This aspect of the analysis is discussed in detail below. 6.5.3 Calculation of the Impact Fee for the Major System Components The next step of the analysis is to review each major functional component of plant in service and determine the impact fee for that component. In calculating the impact fee for the City, both existing plant assets, along with planned future improvements were included within the FI-R I 1AM5 Determination of the City's Wastewater Impact Fees 35 City of Kalispell, Montana - Development of Water and Wastewater Impact Fees calculation. The major components of the City's wastewater system that were reviewed for purposes of calculating the wastewater impact fees are as follows: Wastewater Treatment Plant Collection Plant Administrative Charge A brief discussion of the impact fee calculated for each system component below. WASTEWATF TREATMENT PLANT - The City currently operates a 5.4 million gallon average day wastewater treatment plant, providing both primary and secondary treatment to the wastewater flows. The City just recently completed construction on the additional facilities needed to serve growth and meet regulatory requirements. The City's treatment plant was near its capacity limitation and new discharge requirements have been imposed associated with the City's permit from the Montana Department of Environmental Quality. Given there was minimal excess capacity in the City's wastewater treatment plant, the impact fee for treatment was calculated based on the cost of the capital improvements for the new treatment plant and existing assets that will provide service to new growth. The amount of capital required was obtained from the City's capital improvement plan and was allocated to new development based on the amount that will provide service to new development per the Wastewater Facility Plan. This was subsequently divided by the number of new ERUs from 2009 to 2025, which was the planning horizon for the treatment plant. Based on the costs and capacity of treatment plant for the City, the impact fee for treatment is $3,325.05 per ERU. Details of the calculations are provided in Exhibit B-2. COLLECTION PI ANT - The City's collection network consists of numerous lines. To determine the impact fee for the wastewater collection system, an inventory of the existing system was undertaken, as well as those planned improvements as identified in the capital improvement program. The historical investments of the City were adjusted for interest charges up to a maximum of fifteen years and allocated to growth based on capacity they will provide. These were subsequently divided by the number of new ERUS added from 2009 to 2020 to determine the cost per ERU. Future capital improvements as set forth in the City's 2009 Capital Improvement Plan were assumed to serve new development for the planning horizon from 2009 to 2019 and were then divided by the number of new ERUs added over the planning horizon. Future collection plant required to serve the expanded planning were taken from the Wastewater Facility Plan and the costs were adjusted to current dollars using the ENR. These were then divided by the number of ERUs from 2009 to 2035 to determine the cost per ERU. Based on the cost incurred by the City, the impact fee for existing and planned collection plant is $1,835.13 per ERU. For future collection plant, the impact fee is $2,476.60 per ERU. In the calculation of the impact fee for collection plant a number of items were excluded. First, all existing collection plant that was contributed by developers, financed through improvement districts or contributed by grants were excluded from the analysis. Additionally, for future collection plant, an item by item review was undertaken for future capital improvements to determine the percentage that would serve new development. Replacements were also excluded since these are not growth -related and should be paid for through rates. Details of the calculation are provided in Exhibit B-3. ADMINISTRATIVE CHARGE - Under Montana statute, an impact fee may include a fee for the administration of the impact not to exceed 5% of the impact fee collected. Exhibit B-4 details the City's actual wastewater administrative costs for 2009. The actual cost was $185.64 per ERU which is 3.60% of the impact fee without extensions. Therefore, the City has included a Determination of the City's Wastewater Impact Fees 36 City of Kalispell, Montana — Development of Water and Wastewater Impact Fees wastewater administrative charge of $185.64 per ERU. 6.5.4 Debt Service Credits The final step in calculating the wastewater impact fee was to determine if a credit for payment on debt service for the City's outstanding bonds. The City currently has a number of outstanding wastewater revenue bonds and does not plan to add any additional revenue bonds to finance the wastewater treatment plant expansion and collection system improvements. In the determination of the debt service credit, it was assumed that impact fee funds would be used to pay for a portion of debt service. The remaining debt service would be paid for through rates. This debt service was then divided by the total number of ERUs in each year to determine the debt service credit per ERU. This annual amount was then discounted to 2009 dollars to reflect the fact that a credit was being given for payments in the future. Based on the annual debt service cost and number of ERUs for each year for which debt service payments will be made, the credit for debt service payments is $0.00 per ERU for treatment and $0.00 per ERU for collection. Details of the calculation of the debt service credits are shown in Exhibit B-5 and B-6 of the Technical Appendices Net Allowable Wastewater Impact Fees Based on the sum of the component costs calculated above, the net allowable wastewater impact fee can be determined. "Net" refers to the "gross" impact fee, net of any debt service credits. "Allowable" refers to concept that the calculated impact fee shown in the following tables is the City's cost -based wastewater impact fee. The City, as a matter of policy, may charge any amount up to the allowable impact fee, but not over that amount. Charging an amount greater than the allowable impact fee would not meet the nexus test of a cost -based impact fee. A summary of the calculated net allowable wastewater impact fees for the City is shown in the Table 6-4. Collection W/o Collection Item Treatment Extensions Extensions Total Wastewater Treatment $3,325.05 $0.00 $3,325.05 Existing Collection 0.00 561.38 561.38 CIP Collection 0.00 244.30 244.30 Committed Coll. System Expansions 0.00 1,029.44 1,029.44 Debt Service Credit for Bonds 0.00 0.00 0.00 Subtotal Before Admin. Costs $3,325.05 $1,835.13 $5,160.18 Administrative Charge at 3.60% 119.62 66.02 185.64 Subtotal Before Extensions $3,444.67 $1,901.15 $5,345.82 Collection System Extension $0.00 $0.00 $2,476.60 $2,476.60 Administrative Cost on Extens. 0.00 0.00 0.00 0.00 Total Wastewater Impact Fee $3,444.67 $1,901.15 $2,476.60 $7,822.42 Recommended Fee ($/ERU) $3,445.00 $1,900.00 $2,475.00 $7,820.00 2 ineS Determination of the City's Wastewater Impact Fees 37 City of Kalispell, Montana — Development of Water and Wastewater Impact Fees The calculated capacity charge for treatment is $3,444.67 per ERU and for collection is $1,901.15 per ERU without extensions and $2,476.60 with extensions. Details of the net allowable capacity charge for the City are shown in Exhibit B-7 of the Technical Appendices. Wastewater impact fee for other business types are determined based on the type of business and the number of equivalent residential units (e.g. seats in a restaurant). Exhibit B-8 of the Technical Appendices provides the detail of this ERU determination. Table 6-4 calculates the impact fees from the perspective of treatment and collection with and without the collection system extensions. Included within the development of the wastewater impact fees are costs related to "recoupment" and "expansion". Recoupment costs are related to excess capacity in existing facilities which has been built in anticipation of the needs of new development. Montana law, 7-6-1603(3) specifically allows for the recoupment of costs of excess capacity. In contrast to this, expansion costs are the estimated costs related to system improvements reasonably anticipated to be needed to accommodate new development. A summary breakdown of the impact fees between recoupment and expansion is provided below in Table 6-5. Description Recoupment Expansion Total Wastewater Treatment $26.03 $3,299.03 $3,325.05 Existing Collection 561.38 0.00 561.38 CIP Collection 0.00 244.30 244.30 Committed Collection System Expansions 0.00 1,029.44 1,029.44 Debt Service Credit for Bonds 0.00 0.00 0.00 Subtotal Before Admin. Costs $587.41 $4,572.77 $5,160.18 Administrative Charge at 3.60% 21.13 164.51 185.64 Subtotal Before Extensions $608.54 $4,737.28 $5,345.82 Collection System Extensions $0.00 $2,476.60 $2,476.60 Administrative Cost 0.00 0.00 0.00 Total Wastewater Impact Fee $608.54 $7,213.88 $7,822.42 In viewing Table 6-5, it should be noted that "recoupment" impact fees are not "directly reimbursed" to ratepayers. Rather, the recoupment funds are used to minimize future water rates by either using the funds to pay for growth -related debt service, refund (i.e. pay off early) an existing growth -related debt obligation, or minimize future long-term borrowing for growth - related facilities by paying for the improvements directly from the fees previously received. This approach is consistent with the discussion in Section 2 (Figure 2-2) and Montana law. 6.7 Key Assumptions In the development of the impact fees for the City's wastewater system a number of key assumptions were utilized. These are as follows: The City's asset records were used to determine the existing plant assets. The interest rate used for calculating interest on existing investments was 6.0% Up to fifteen (15) years worth of interest were included in the cost of existing plant. 11-R I JAMS Determination of the City's Wastewater Impact Fees 38 City of Kalispell, Montana — Development of Water and Wastewater Impact Fees A R Implementation of the Impact Fees The methodology used to calculate the impact fees takes into account the cost of money or interest charges and inflation. Therefore, HDR/EES would recommend that the City adjust the impact fees each year by an escalation factor to reflect the cost of interest and inflation. The most frequently used source to escalate impact fees is the ENR index which tracks changes in construction costs for municipal utility projects. This method of escalating the City's impact fee should be used for no more than a two-year period. After this time period, as required by Montana law, the City should update the charges based on the actual cost of infrastructure and any new planned facilities that would be contained in an updated master plan, capital improvement plan or rate study. Consultant Recommendations Based on our review and analysis of the City wastewater impact fees, HDR/EES makes the following recommendations: The City should implement impact fees for new hookups to the wastewater system that are no greater than the impact fees as set forth in this report. The City should update the actual calculations for the impact fees based on the methodology as approved by the resolution or ordinance setting forth the methodology for impact fees every two years as required by Montana law. 6.10 Summary The wastewater impact fees determined and presented in this section of the report are based on the engineering design criteria of the City's wastewater system, the value of the existing assets, future capital improvements and "generally accepted" ratemaking principles. Adoption of the proposed impact fees will provide multiple benefits to the City and create equitable and cost -based charges for new customers connecting to the City's wastewater system. ti— Z Determination of the City's Wastewater Impact Fees 39 City of Kalispell, Montana — Development of Water and Wastewater Impact Fees Technical Appendix Exhibit A-1 City of Kalispell Water System Impact Fees Development of ERUs 1 Peak Day Flow 2 Average Day Flow 3 Pagel of 2 1,228.20 gallons per day/ERU 460.00 gallons per day/ERU 1 - From the 2008 Water Facility Plan Update 2 - Based on a peaking factor of 2.67. 3 - Based on a per capita usage of 184 gallons and a household size of 2.5. Exhibit A-1 City of Kalispell Water System Impact Fees Development of ERUs 1 Peak Day Total Additional Year (MGD) s ERUs s ERUs 2005 9.04 7,361 2006 10.31 8,396 1,036 2007 11.76 9,578 1,181 2008 13.42 10,925 1,347 2009 15.31 12,462 1,537 2010 17.46 14,216 1,753 2011 18.11 14,744 529 2012 18.78 15,292 548 2013 19.48 15,861 569 2014 20.21 16,451 590 2015 20.96 17,063 612 2016 21.74 17,697 634 2017 22.54 18,355 658 2018 23.38 19,038 683 2019 24.25 19,746 708 2020 25.15 20,480 734 2021 26.85 21,861 1,381 2022 28.66 23,334 1,474 2023 30.59 24,908 1,573 2024 32.65 26,587 1,679 2025 34.86 28,379 1,792 2026 34.98 28,482 103 2027 35.11 28,586 104 2028 35.24 28,690 104 2029 35.37 28,794 104 2030 35.49 28,899 105 2031 36.70 29,879 979 2032 37.94 30,891 1,013 2033 39.23 31,938 1,047 2034 40.56 33,020 1,082 2035 41.93 34,139 1,119 Page 2 of 2 1 - From the 2008 Water Facility Plan Update 2 - Population per Table 1-13 of the 2008 Water Facility Plan times 184 gallons per capita day and a 2.67 peaking factor. 3 - Peak day usage divided by peak day flow per ERU - see page 1 . Exhibit A-2 City of Kalispell Water System Impact Fees Source of Supply Page 1 of 1 Original Cost Year Equipment List Cost $2009 2002 Source Water Delineation Study $ 94,868 $ 142,646 2002 Noffsinger Springs Chlorine Room 10,398 15,635 Total Existing Source $ 105,266 $ 158,281 Existing Wells 1913 Lawrence Park Well 1956 Depot Park Well 1966 Armory Well 1979 Buffalo Hill Well 1982 Buffalo Hill Well to Res 1956 Northridge Well Site 1997 Northside (Grandview) Water Wells 2007 Old School Station Well 2009 West View Water Project Total Existing Wells Future Wells 2009-2013 Total Future Wells Total Wells 2035 ERUs Well Impact Fee per ERU Grosswieller Water Supply $ 9,835 $ 23,570 38,306 91,803 34,251 82,085 94,577 226,659 11,042 26,463 10 24 306,028 615,788 95,318 107,099 853,355 853,355 $ 1,442,722 $ 2,026,846 $ 575,000 $ 575,000 $ 575,000 $ 575,000 $ 2,760,127 34,139 $ 80.85 Exhibit A-3 City of Kalispell Water System Impact Fees Pumping Plant Page 1 of 1 Original Cost Year Equipment List Cost $2009 Existing Pumping Plant 1913 Lawrence Park Pump & Springhouse 1966 Lawrence Park Pump # 1 & Motor 1964 Lawrence Park Pump # 2 & Motor 1959 Lawrence Park Pump # 3 & Motor 1971 Lawrence Park Chlorine Injector 1965 Lawrence Park Furnace 1987 L. Park-2 Cylinder Chlorine Scale 1951 Depot Park Pump house 1951 Depot Park Pump house Elec. & meter 2000 Chlorine Room Addition 1951 Depot Pump # 1 1959 Buffalo Hill Booster Station 1956 Buffalo Hill Booster Motor 1965 Armory Well Pump house 2000 Chlorine Room Addition 1965 Armory Pump/ Motor 1965 Armory Well Flow Meter 1975 Armory Well Muesco Valve 1967 Telemetry System 1974 Buffalo Hill Booster Station 1999 Buffalo Hill Fuel Tank 1986 B.H. Pressure Transducer System 1979 B.H. Well Turbine Pump 1985 Buffalo Hill Flow meter 1990 Remodel Lawrence Park Pump house 1991 Buffalo Hill Flow meter 1992 Buffalo Hill Telemetry System 1999 Telemetry System Upgrade 1998 Northside Pump house and Telemetry 2001 Noffsinger/Chlorine Room 2001 2002 Noffsinger Upgrade 2002 Standby Power Upgrade 2004 Phase II -Standby Power -Install Generators/Switchgears 2005 Meridian Rd to 3 Mile Drive 2005 Highway 93 South Improvements - Ashley Creek to Kalispell 2005 Telemetry System Upgrade & Phase II 2005 Wtr Supply Electrical Safety Syst Upgrade Total Existing Pumping Plant Total ERUs 2035 $ 112,024 $ 268,472 4,025 9,646 3,302 7,913 7,785 18,657 1,073 2,572 2,129 5,102 3,820 9,155 3,000 7,190 6,780 16,249 7,550 12,756 4,644 11,130 2,150 5,153 4,870 11,671 2,744 6,576 7,839 13,244 7,293 17,478 1,972 4,726 4,995 11,971 30,140 72,232 22,678 54,349 8,117 14,536 5,330 12,774 107,930 258,661 1,979 4,743 37,130 88,984 2,467 5,912 60,276 144,455 3,945 7,065 501,757 952,485 6,249 9,960 4,148 6,611 249,924 375,793 133,249 178,317 158,707 200,364 1,192,190 1,505,112 80,000 100,998 133,249 168,224 2,927,460 $ 4,601,235 34,139 Pumping Plant Impact Fee per ERU $ 134.78 Exhibit A-4 City of Kalispell Water System Development Charge Distribution Storage Page 1 of 1 Original Cost Year Equipment List Cost $2009 Existing Storage Plant 1958 Buffalo Hill Standpipe $ 48,117 $ 115,315 1914 Reservoir # 1 24,031 57,592 1952 Reservoir # 2 73,691 176,605 1957 Reservoir Covers 97,577 233,849 1982 Buffalo Hill to Reservoir pipe 11,042 26,463 2001 Water Reservoir Roof 420,128 669,620 1914 Reservoir#1 Land 715 1,714 1935 Noffsinger Land 1,500 3,595 1939 Monteath Land 650 1,558 1952 Reservoir # 2 Land 1 2 2009 Sheepherder's Hill 3,812,072 3,812,072 Total Existing Storage Plant $ 4,489,524 $ 5,098,384 Future Storage Plant 2009-2035 North Kalispell Reservoir' $ 3,374,100 $ 3,608,600 2009-2035 West Kalispell Reservoir 2 3,277,500 3,505,286 2009-2035 South Kalispell Reservoir 3 3,277,500 3,505,286 Total Future Storage Plant $ 9,929,100 $ 10,619,173 Total Storage Plant $ 15,717,557 Total ERUs 2035 34,139 Distribution Storage Plant Impact Fee per ERU $ 460.40 1 - See Table 5-16 City of Kalispell Water Facility Plan Update - 2008 2 - See Table 5-18 City of Kalispell Water Facility Plan Update - 2008 3 - See Table 5-20 City of Kalispell Water Facility Plan Update - 2008 Pagel of 3 Exhibit A-5 City of Kalispell Water System Development Charge Transmission/Distribution Mains Percent Impact Original Cost IF Fee Year Equipment List Cost $2009 Related Eligible Existing Transmisslon/Distribution Plant 1967 2200 8 inch $ 13,455 $ 32,246 0.0% $ - 1911 318020 inch 10,838 25,974 39.1% 10,169 1911 101 12 inch 251 602 39.1% 235 1924 420418 inch 30,224 72,434 39.1% 28,357 1924 1776 16 inch 11,349 27,199 39.1% 10,648 1924 195998 inch 50,136 120,154 39.1% 47,039 1925 2046 12 inch 11,016 26,400 39.1% 10,336 1925 11693 6 inch 21,874 52,422 39.1% 20,523 1928 29412 inch 1,278 3,063 39.1% 1,199 1930 131696 inch 21,428 51,353 39.1% 20,104 1932 1311 12 inch 5,158 12,361 39.1% 4,839 1935 10853 6 inch 18,462 44,245 39.1% 17,322 1938 1988 8 inch 12,786 30,642 39.1% 11,996 1938 15678 6 inch 31,309 75,034 39.1% 29,375 1948 110196 inch 3,667 8,788 39.1% 3,440 1948 3145 6 inch 11,624 27,858 39.1% 10,906 1949 3290 8 inch 15,573 37,322 39.1% 14,611 1950 14526 inch 5,447 13,054 39.1% 5,111 1952 630 20 inch 10,109 24,227 39.1% 9,485 1952 96918 inch 14,578 34,937 39.1% 13,678 1955 62746 inch 29,235 70,063 39.1% 27,429 1956 12668 inch 7,983 19,132 39.1% 7,490 1958 18846 inch 10,102 24,210 39.1% 9,478 1959 5245 8 inch 36,994 88,658 39.1% 34,709 1960 21226 inch 12,006 28,773 39.1% 11,264 1961 109812 inch 17,964 43,052 39.1% 16,854 1961 1575 12 inch 26,910 64,491 39.1% 25,248 1962 4720 8 inch 35,749 85,675 39.1% 33,541 1962 58716 inch 34,739 83,254 39.1% 32,593 1965 322512 inch 55,101 132,053 39.1% 51,697 1965 24516 inch 14,956 35,843 39.1% 14,032 1966 544 8 inch 249,924 598,957 39.1% 234,486 1967 106012 inch 133,249 319,339 0.0% - 1967 590 8 inch 158,707 380,351 39.1% 148,904 1968 115712 inch 1,192,190 2,857,153 39.1% 1,118,549 1968 2795 8 inch 80,000 191,725 39.1% 75,058 1968 10596 inch 133,249 319,339 39.1% 125,018 1969 18306 inch 18,588 44,547 0.0% - 1969 37248 inch 24,327 58,301 39.1% 22,824 1969 70216 inch 45,023 107,900 39.1% 42,242 1970 10708 inch 18,245 43,725 0.0% - 1970 1635 8 inch 13,517 32,394 39.1% 12,682 1970 37286 inch 24,079 57,707 39.1% 22,592 1971 1866 6 inch 13,266 31,793 39.1% 12,447 1972 Airport flinch 40,418 96,864 39.1% 37,921 1972 858 10 inch 10,385 24,888 39.1% 9,744 1972 1070 8 inch 9,419 22,573 39.1% 8,837 1972 2122 6 inch 15,212 36,456 39.1% 14,272 1973 567416 inch 129,932 311,390 39.1% 121,906 1973 2318 14 inch 49,763 119,260 39.1% 46,689 1973 176912 inch 36,636 87,800 39.1% 34,373 1973 1592 12 inch 31,899 76,448 39.1% 29,929 1973 316 10 inch 3,979 9,536 39.1% 3,733 1973 217 8 inch 2,064 4,946 39.1% 1,937 1973 5930 8 inch 54,317 130,174 39.1% 50,962 1973 50 8 inch 457 1,095 39.1% 429 1973 25896 inch 18,527 44,401 39.1% 17,383 1973 743 6 inch 5,523 13,236 39.1% 5,182 1973 178 6 inch 1,273 3,051 39.1% 1,194 1974 309712 inch 78,563 188,281 0.0% - 1975 43346 inch 48,188 115,485 39.1% 45,211 1976 309712 inch 103,559 248,185 39.1% 97,162 1976 414 12 inch 410 983 39.1% 385 1976 2196 12 inch 10,882 26,079 39.1% 10,210 1976 3682 8 inch 55,845 133,836 39.1% 52,395 1976 845 6 inch 10,012 23,994 39.1% 9,394 1977 922 6 inch 12,400 29,717 39.1% 11,634 Page 2 of 3 Exhibit A-5 City of Kalispell Water System Development Charge Transmission/Distribution Mains Percent Impact Original Cost IF Fee Year Equipment List Cost $2009 Related Eligible 1981 Idaho Street Main 79,872 191,418 39.1% 74,938 1982 SID 328 24,646 59,066 0.0% - 1983 Main Street 150,540 360,778 39.1% 141,241 1983 6th Avenue Water Main 4,216 10,104 39.1% 3,956 1983 SID 326 4,511 10,811 0.0% - 1983 370 8 inch 11,101 26,604 39.1% 10,415 1983 230 8 inch 6,873 16,472 39.1% 6,448 1983 12512 inch 1,475 3,535 39.1% 1,384 1984 SID 326 Kenway Addition 3,781 9,061 0.0% - 1984 8596 inch 19,566 46,891 0.0% - 1984 722 8 inch 32,507 77,905 0.0% - 1984 13756 inch 14,722 35,282 19.6% 6,906 1984 220 12 inch 1,980 4,745 39.1% 1,858 1984 235012 inch 43,968 105,372 0.0% - 1984 65012 inch 6,455 15,470 0.0% - 1984 240 12 inch 8,094 19,398 39.1% 7,594 1984 360 6 inch 5,520 13,229 39.1% 5,179 1984 25206 inch 17,317 41,501 0.0% - 1984 John Deer 510B Backhoe 43,350 103,891 39.1% 40,672 1985 30506 inch 37,708 90,369 0.0% - 1985 1080 8 inch 32,400 77,648 39.1% 30,399 1985 385 8 inch 11,550 27,680 39.1% 10,837 1985 400 8 inch 12,000 28,759 39.1% 11,259 1985 1250 8 inch 37,500 89,871 39.1% 35,184 1985 320 8 inch 9,600 23,007 39.1% 9,007 1985 360 flinch 10,800 25,883 39.1% 10,133 1986 22708 inch 99,300 237,978 9.4% 22,360 1986 610 8 inch 15,300 36,667 39.1% 14,355 1987 519712 inch 302,513 724,990 25.1 % 182,217 1987 157 8 inch 9,486 22,734 39.1% 8,900 1987 211 6 inch 15,121 36,238 39.1% 14,187 1987 400 8 inch 17,158 41,120 39.1% 16,098 1987 300 8 inch 9,008 21,588 39.1% 8,452 1987 4578 inch 15,084 36,150 3.5% 1,274 1987 272 8 inch 9,881 23,680 19.6% 4,635 1987 600 8 inch 18,079 43,327 39.1% 16,962 1987 1540 12 inch 70,434 168,799 39.1% 66,083 1987 145412 inch 51,759 124,043 39.1% 48,562 1987 396 12 inch 17,679 42,369 39.1% 16,587 1988 5998 inch 18,145 43,486 39.1% 17,024 1988 165712 inch 68,322 163,738 39.1% 64,102 1989 SW Kai Project 257,827 617,897 27.4% 169,331 1989 660 12 inch 24,318 58,280 39.1% 22,816 1989 300 8 inch 8,516 20,409 39.1% 7,990 1990 2701 12 inch 162,689 389,894 39.1% 152,640 1991 261912 inch 197,416 473,119 39.1% 185,222 1991 400 6 inch 16,000 38,345 39.1% 15,012 1991 430 8 inch 18,700 44,816 39.1% 17,545 1991 700 8 inch 30,120 72,184 39.1% 28,259 1991 366 8 inch 35,605 85,329 29.8% 25,388 1992 Tav-L-Vac 80 12,317 29,519 39.1% 11,556 1992 713 8 inch 21,648 51,881 39.1% 20,311 1992 6th St W 66,480 159,323 39.1% 62,374 1992 14th St and 5th Ave 65,709 157,475 39.1% 61,650 1993 Cat 426B Backhoe 46,932 112,475 39.1% 44,033 1993 Windward Upsize 15,000 35,948 39.1% 14,073 1994 LN-8000 Tandem 58,108 139,259 39.1% 54,519 1994 Greenbrier Upsize 15,903 38,112 39.1% 14,921 1994 Kelly Road Upsize 14,023 33,607 39.1% 13,157 1994 8th Ave and Cal St 34,605 82,933 39.1% 32,467 1995 Lawrence Park 36,525 82,580 39.1% 32,329 1995 Utah Street 19,521 44,135 39.1% 17,278 1995 Ave of Arts/2nd Ave 24,923 56,349 39.1% 22,060 1996 EArizona 15,750 33,594 39.1% 13,152 1997 Tapping Machine 12,320 24,790 39.1% 9,705 1997 Woodland 169,225 340,514 39.1% 133,308 1997 Liberty/Two Mile 314,628 633,093 39.1% 247,850 1997 14th St 28,798 57,947 39.1% 22,686 1997 West Wyoming 88,130 177,335 39.1% 69,425 1998 Buffalo Com 145,201 275,635 39.1% 107,908 1999 5th Ave NW Water 91,657 164,144 39.1% 64,261 2001 Cat 430D Backhoe 58,361 93,019 39.1% 36,416 2001 MN St/Cntr-Sunst 612,454 976,159 39.1% 382,157 2001 Willow Glen and Woodland 17,525 27,932 39.1% 10,935 2002 Meter Test Bench 12,737 19,152 39.1% 7,498 2002 Meridian Rd to 3 Mile Drive 158,707 238,637 7.8% 18,685 2002 Facility Plan 93,000 139,838 0.0% - 2004 Northern Lights Blvd -Water Main installation 281,859 377,191 39.1% 147,667 2004 Washington St. btwn 7th & 8th 26,585 35,577 39.1% 13,928 2005 Meters - New Services 205,703 259,695 0.0% - 2005 US Highway 93 South Utilities 1,904,905 2,404,899 35.6% 855,872 2006 West View Upsize 12,407 14,777 39.1% 5,785 2007 Meridian Road Reconstruction 203,561 228,721 39.1% 89,542 2007 Westwood Upsize 28,923 32,498 39.1% 12,723 2007 Lone Pine Meadows Upsize 58,275 65,478 39.1% 25,634 2008 Spnng Prairie Upsize 18,187 19,278 39.1% 7,547 2008 Holiday Inn Upsize 6,072 6,436 39.1% 2,520 2008 Gardner Extension Upsize 32,631 34,589 39.1% 13,541 2008 Reserve Loop Extension 15,592 16,528 39.1% 6,470 2008 Hutton Ranch Phase 1 Upsize 12,500 13,250 39.1% 5,187 2008 Buffalo Hills Water Main Replacement Project 100,275 106,292 39.1% 41,612 2009 Upper Zone Production 853,355 853,355 39.1% 334,081 Total Existing Transmission and Distribution Plant $ 11,547,858 $ 21,963,307 $ 7,579,626 New ERUs 2009 to 2020 8,018 Existing Transmission/Distribution Plant Impact Fee per ERU $ 945.36 Page 3 of 3 Exhibit A-5 City of Kalispell Water System Development Charge Transmission/Distribution Mains Percent Impact Original Cost IF Fee Year Equipment List Cost $2009 Related Eligible Future TransmissioniDistribution Plant - CIP Projects z W-EX-6 Conway Drive and Highway 93 Loop $ 191,558 $ 191,558 100.0% $ 191,558 W-EX-119 Misc Contract Main Upsize 455,000 455,000 100.0% 455,000 W-EX-123 Meters -New Services 950,000 950,000 100.0% 950,000 Total Future Transmission/Distribution Plant -CIP Projects $ 1,596,558 $ 1,596,558 $ 1,596,558 New ERUs 2009 to 2019 3 7,283 Future Transmission/Distribution Plant CIP Projects Impact Fee per ERU $ 219.20 Future TransmissioniDistribution Plant - Extension Projects ° 2009-2035 East Whitefish River Extensions 13,544,300 14,485,629 100.0% 14,485,629 2009-2035 North Kalispell Extensions 23,367,000 24,991,007 100.0% 24,991,007 2009-2035 West Stillwater River Extensions 11,519,800 12,320,426 100.0% 12,320,426 2009-2035 West Kalispell Extensions 40,114,200 42,902,138 100.0% 42,902,138 2009-2035 East Kalispell Extensions 1,392,000 1,488,744 100.0% 1,488,744 2009-2035 South Kalispell Extensions 6,455, 100 6,903,730 100.0% 6,903,730 Total Future Transmission/Distribution Plant Extension Projects $ 96,392,400 $ 103,091,673 $ 103,091,673 New ERUs2009 to 2035 21,677 Future Transmission/Distribution Plant Impact Fee per ERU $ 4,755.82 Total Trensmission/Distribution Plant Impact Fee per ERU $ 5,920.39 1- Allocation for existing projects based on new ERUs, from 2009 to 2020 divided by total ERUs in 2020. Some plant is excluded or reduced based on the amount from developer contributions and or the amount which was for replacement. 2 - See City of Kalispell Water Capital Improvement Plan and Exhibit A-9 for project details 3- Assumes that CIP covers a period of 10 years. 4 - See Chapter 5 of the Water Facility Plan Update - 2008 and Exhibit A-9 for project details. Projects are adjusted to 2009 dollars from the 2007 plan values based on changes in the ENR Construction Cost Index. Exhibit A-6 City of Kalispell Water System Impact Fees Breakdown of Annual Administrative Costs Page 1 of 1 Percent of Portion Of Time Spent Portion of Salary on Growth Salary Attributed to Related Attributed to Water Issues Growth Public Works Director $ 34,358 20.0% $ 6,872 Public Works Superintendent 20,265 3.0% 608 Water Superintendent 84,181 3.0% 2,525 Deputy Public Works Director 17,893 30.0% 5,368 Budget Resource Manager 16,511 30.0% 4,953 Surveyor 30,279 3.0% 908 Secretary 8,983 3.0% 269 Asst. City Engineer 23,211 50.0% 11,606 Project Manager 12,533 50.0% 6,267 Billing Clerk 48,248 3.0% 1,447 Admin Coordinator 12,399 3.0% 372 Water Resource Manager 17,355 3.0% 521 Construction Manager 18,614 75.0% 13,961 Construction Manager 19,596 75.0% 14,697 Engineering Tech 9,620 3.0% 289 Finance Director 15,787 3.0% 474 Asst. Finance Director 22,279 3.0% 668 Water Operator 59,250 3.0% 1,778 Water Operator 55,608 3.0% 1,668 Meter Operator 58,972 3.0% 1,769 Water Foreman 57,320 3.0% 1,720 Water Operator 59,812 3.0% 1,794 Meter Operator 61,910 3.0% 1,857 Water Operator 59,228 3.0% 1,777 Water Operator 58,717 3.0% 1,762 Water Operator 57,159 3.0% 1,715 Water Operator 53,402 3.0% 1,602 Subtotal $ 993,490 9.0% $ 89,246 Admin Transfer $ 96,329 9.0% $ 8,653 Water Impact Fee Review $ 9,000 100.0% 9,000 Data Processing ' 43,794 9.0% 3,934 Office Space ' 15,676 9.0% 1,408 Total 2009 Administrative Costs Attributed to Growth $ 112,241 Average New Connections 2009-2035 2 860 2009 Water Administrative Cost per ERU $ 130.55 2009 Water Admin. Cost as percentage of Impact Fee w/o Extensions 7.09% 2009 Water Admin. Cost as percentage of Impact Fee with Extensions 1.98% 1 - Allocated based on labor costs 2 - See Exhibit A-1. Exhibit A-7 City of Kalispell Water System Impact Fees Debt Service Credit Page 1 of 1 Existing Additional Total Impact Fee Net Debt/ Debt/ERU Year Debt Service Debt Service' Debt Service Revenue 2 Debt Service ERUs ERU ($2009) 2009 $ 515,085 $ 515,085 $ 2,966,558 $ 12,462 $ - 2010 510,496 510,496 3,485,445 14,216 0.00 2011 510,911 510,911 1,082, 360 14,744 0.00 2012 414,905 414,905 1,156,286 15,292 0.00 2013 450,759 450,759 1,235,262 15,861 0.00 2014 460,107 460,107 1,319,632 16,451 0.00 2015 458,513 458,513 1,409,764 17,063 0.00 2016 275,166 275,166 1,506,053 17,697 0.00 2017 272,486 272,486 1,608,918 18,355 0.00 2018 274,600 274,600 1,718,809 19,038 0.00 2019 272,245 272,245 1,836,205 19,746 0.00 2020 273,679 273,679 1,961,620 20,480 0.00 2021 240,414 240,414 3,799,288 21,861 0.00 2022 212,635 212,635 4,177,086 23,334 0.00 2023 214,100 214,100 4,592,453 24,908 0.00 2024 215,171 215,171 5,049,123 26,587 0.00 2025 121,794 121,794 5,551,205 28,379 0.00 2026 120,631 120,631 329,354 28,482 0.00 2027 121,319 121,319 340,469 28,586 0.00 2028 - - 351,959 28,690 0.00 2029 363,837 28,794 0.00 2030 376,115 28,899 0.00 Total Debt Service Credit ( $ per ERU) $ 1 - No new debt service assumed. 2 - Excludes Extensions Exhibit A-8 City of Kalispell Water System Impact Fees Summary Pagel of 2 Description w/o Extensions Extensions Total Source of Supply $ 80.85 $ 80.85 Pumping Plant 134.78 134.78 Storage 460.40 460.40 Existing Transmission 945.36 945.36 CIP Transmission 219.20 219.20 Debt Service Credit for Bonds Subtotal $ 1,840.59 $ 1,840.59 Administrative Cost at 5% 92.03 92.03 Transmission Extensions $ 4,755.82 4,755.82 Administrative Cost 38.52 38.52 Total Impact Fee $ 1,932.61 $ 4,794.34 $ 6,726.96 Recommended Fee $ 1,930.00 $ 4,795.00 $ 6,725.00 Meter Size Weighting Factor 2 Impact Fee w/o Extensions Impact Fee With Extensions Total Impact Fee Residential 3 $ 1,930 $ 4,795 $ 6,725 1 2.5 4,825 11,988 16,813 1 1/2 5.0 9,650 23,975 33,625 2 8.0 15,440 38,360 53,800 3 16.0 30,880 76,720 107,600 4 Calculated Calculated Calculated 1- Additional administrative cost see Exhibit A-6. 2 - AWWA safe operating capacities. 3 - Commercial customers with residential type usage pay the residential fee Exhibit A-8 City of Kalispell Water System Impact Fees Summary Page 2 of 2 Description Recoupment Expansion Total Source of Supply $ 59.37 $ 21.48 $ 80.85 Pumping Plant 134.78 - 134.78 Storage 149.34 311.06 460.40 Existing Transmission 945.36 - 945.36 CIP Transmission - 219.20 219.20 Debt Service Credit for Bonds - - - Subtotal $ 1,288.85 $ 551.74 $ 1,840.59 Administrative Cost at 5% 64.44 27.59 92.03 Transmission Extensions $ - $ 4,755.82 $ 4,755.82 Administrative Cost - 38.52 38.52 Total Impact Fee $ 1,353.29 $ 5,373.67 $ 6,726.96 Exhibit A-9 City of Kalispell Water Impact Fees Supporting Documentation U O m 0 ds� ��M a - - E LL w o U d c E LL w o o666 U a 5 E LL w o U M A } E LL w o Un 5 } E LL w m .. o U a A} E LL w v v 0 U o A E } LL W _ o m a oo dLL m a E o U W � m - m - - m o LL c6 w U Q lo t o t o - m 3 m - o a w w 0 7 m .. 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O U j N> >� W C `�m� O O O m> O C> Q o O N O Z C�N�NNNNNm �(n O Q (o (n - E �N o .O o Q Q o f d(5 Q Q N r O o Si �a Q 0 0 �� 0 w U u N N N N N N N Q Q 'o S� O Q OM Q T T O F U N a U' m8U t 0 fD fD U' D� t 4 0 o = y C)U)E O i, '- Ffq�YZ O - �j»��U�� O U' __�i2C,DDC,> - (n (n O f c O 'c O1 mmmm c � �O E oE w w w w w w w w w w w w w w w w X X ww X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X IIIIJ a -6 m > O E 11 R II II II O C m _ C, U 0 C c LL U N O LD a N Q O U T C N N II 2 Y Y M Chapter 1: Basis of Planning Population predictions are detailed in Section 1.4, and a summary of these projections is presented in Table 1-13. It should be noted that these predictions include population in the Evergreen Water District; however, these people are served by the Evergreen Water District. In 2005, there were about 8,200 people served by the Evergreen Water District. For analysis purposes, the water district is assumed to grow to 10,000 people, and these 10,000 people were removed from analysis of the Kalispell Water System. Table 1-13 also provides predicted future daily water demand, if everyone connected to the water system. However, this is not an entirely realistic portrait of the water demand because the entire population (particularly current population) will not connect immediately, but will connect over time as their current systems fail or as services become available in their area. Figure 1-5 provides a graph of current population, current water users, and a likely scenario of population connecting to the system. Table 1-13. Future Water Demand YEAR Study Area Population Study Area Population (excluding the Evergreen Water District of 10,000 people) Daily Water Demand (MGD)' 2010 45,539 35,539 6.54 2020 61,200 51,200 9.42 2025 70,948 70,948 13.05 2030 82,248 72,248 13.29 2035 95,348 85,348 15.70 2040 110,534 100,534 18.50 2050 148,549 138,549 25.49 Daily water demand is determined by multiplying the predicted future population by 184 gallons per capita per day. April 15, 2008 City of Kalispell Water Facility Plan Update 1-23 Chapter 5: Water System Analysis Chapter 5: Water System Analysis 5.1 Introduction Chapter 1 developed estimates of existing and projected populations for the Study Area and established per capita demand characteristics for the City of Kalispell. Chapter 3 summarized the capacity of the existing water system and outlined near -term plans for its expansion. The City's hydraulic model was updated and expanded for system analysis. This section utilizes this information to analyze existing and future water demand and the water utility's ability to deliver an adequate quantity of high quality drinking water at the required pressure to meet this demand. 5.2 Demand Forecast In 2005, there were 39,282 people living in the study area, including approximately 18,400 connected to the water system, approximately 14,500 in the lower pressure zone, and 3,900 in the upper pressure zone. It was estimated in Chapter 1 that 138,5491 people will be living in the Study Area by 2050. It is difficult to predict when the population served by the water system will coincide with the predicted population for the study area; however, for infrastructure sizing and planning purposes, it is assumed the entire population, including people currently living in the Study Area not connected to the City's water system, will be served by the future water system by 2050. Figure 5-1 depicts projected population growth, along with a predicted population connected to the water system. There is a predicted population of 148,549 in the entire study area by 2050. However, for the water system analysis the 10,000 people connected to the Evergreen Water District were removed from analysis. April 15, 2008 City of Kalispell Water Facility Plan Update 5-1 Chapter 5: Water System Analysis Water Service Area 160,000 140,000 120,000 c 100,000 3 80,000 CL a 60,000 40,000 20,000 0 2005 2010 2020 2030 2040 2050 Year Figure 5-1. Water Service Area Population Table 5-1 shows the predicted population, along with the associated average and maximum daily water demand for the Kalispell water system. Table 5-1. Population and Water Demand Year 2005 2010 2025 2035 2050 Population Connected to Water System' 18,400 22,698 47,000 72,000 138,549 Average Daily Demand (MGD) 3.39 4.18 8.65 13.25 25.49 Peak Hour in Gallons Per Minute 6,277 7,744 16,035 24,564 47,268 (calculated using a peaking factor of 2.67) 'Estimated using the population served curve from Figure 5-1 above To adequately evaluate the upper and lower pressure zones, it is important to know how many people will be connected to each. Water service area population estimates were made for each pressure zone. Figure 5-2 below depicts projected population growth, along with a predicted population connected to the lower pressure zone. 5-2 City of Kalispell Water Facility Plan Update April 15, 2008 Chapter 5: Water System Analysis Lower Zone 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 200 2020 2APopulati!onin Year NL�7 Connected Population TotRStudya Figure 5-2. Lower Pressure Zone Population Table 5-2 shows the predicted population, along with the associated average and maximum daily water demand for the lower pressure zone. Table 5-2. Lower Pressure Zone Population and Water Demand Year 2005 2010 2025 2035 2050 Population Connected to Water System' 14,500 16,319 28,000 38,000 60,064 Average Daily Demand (MGD) 2.67 3.00 5.15 7.00 11.05 Peak Hour in Gallons Per Minute 4,947 5,567 9,553 12,964 20,492 (calculated using a peaking factor of 2.67). 'Estimated using the population served curve from the Lower Zone graph above Figure 5-3 below depicts projected population growth, along with a predicted population connected to the upper pressure zone. April 15, 2008 City of Kalispell Water Facility Plan Update 5-3 Chapter 5: Water System Analysis Upper Zone 90,000 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 2000 2010 2020 203 2040 Year +Connected Population Total Population in Study Area Figure 5-3. Upper Pressure Zone Population Table 5-3 shows the predicted population, along with the associated average and maximum daily water demand for the upper pressure zone. Table 5-3. Upper Pressure Zone Population and Water Demand Year 2005 2010 2025 2035 2050 Population Connected to Water System' 3,900 6,379 19,000 34,000 78,485 Average Daily Demand (MGD) 0.72 1.17 3.50 6.26 14.44 Peak Hour in Gallons Per Minute 1,331 2,176 6,482 11,600 26,776 (calculated using a peaking factor of 2.67). 'Estimated using the population served curve from the Lower Zone graph above 5.3 Water Supply Analysis 5.3.1 Existing Water Supply Analysis The current City of Kalispell water system has a total capacity, with Grandview Well No. 2 unavailable due to iron bacteria and sand, of 8,400 gallons per minute or 12,096,000 gallons per day. When the West View, Old School Station No. 1 and Old School Station No. 2 wells become available in 2007, the total supply capacity will be 10,600 gallons per minute or 15,264,000 gallons per day. The current firm capacity of the system with the largest producing unit, Buffalo Hill, out of service and Grandview Well No. 2 not used due to iron bacteria and sand, is 6,150 gallons per minute or 8,856,000 gallons per day. When the new 5-4 City of Kalispell Water Facility Plan Update April 15, 2008 Chapter 5: Water System Analysis wells become available, the firm capacity of the system will be 8,350 gallons per minutes or 12,024,000 gallons per day. The total current system average day and peak day demand is 3,387,624 gallons per day and 9,038,880 gallons per day respectively. The overall City of Kalispell water system meets the requirements of MDEQ Circular DEQ 1, which states that system capacity must equal or exceed the design maximum day demand and equal or exceed the design average day demand with the largest producing well out of service. Table 5-4 summarizes current overall water supply and capacity. Table 5-4. Exist Water System Supply Capacity and Demand Existing Supply Existing Peak Day Existing Firm Supply Existing Average Day Capacity (MGD) Demand (MGD) Capacity (MGD) Demand (MGD) 12.10 9.04 8.35 3.39 To adequately evaluate the Kalispell water system, the capacity and demand of the upper and lower pressure zones must be evaluated individually. 5.3.1.1 Existing Lower Pressure Zone Supply Analysis The total current supply capacity in the lower pressure zone is 7,300 gallons per minute or 10,512,000 gpd. When Old School Station Wells No. 1 and 2 come on line, the total supply capacity of the lower pressure zone will be 8,300 gpm, or 11,952,000 gpd if run continuously. The current firm capacity of the lower pressure zone with the largest supply (Buffalo Hill) out of service is 5,050 gpm or 7,272,000 gpd. When the Old School Station wells come on line, the firm capacity of the lower pressure zone will be 6,050 gpm or 8,712,000 gpd. The total current lower pressure zone average day and peak day demand is 2,670,000 gallons per day and 7,128,900 gallons per day respectively. The lower pressure zone meets the requirements of MDEQ Circular DEQ 1, which states that system capacity must equal or exceed the design maximum day demand and equal or exceed the design average day demand with the largest producing well out of service. Table 5-5 summarizes current lower pressure zone supply and capacity. Table 5-5. Exist Lower Pressure Zone Supply Capacity and Demand Existing Supply Existing Peak Day Existing Firm Supply Existing Average Day Capacity (MGD) Demand (MGD) Capacity (MGD) Demand (MGD) 10.51 7.12 7.27 2.67 April 15, 2008 City of Kalispell Water Facility Plan Update 5-5 Chapter 5: Water System Analysis The lower pressure zone system also provides water to the upper pressure zone. There is 4.6 mgd (3,200 gpm) in excess capacity in the lower pressure zone that is available for supplementing the upper pressure zone. 5.3.1.2 Existing Upper Pressure Zone Supply Analysis The total current supply capacity in the upper pressure zone is 1900 gpm; however, Grandview Well No. 2 is not used due to iron bacteria and sand. This results in an actual current useable supply capacity in the upper pressure zone of 1100 gpm or 1,584,000 gpd if run continuously. When the West View well comes on line, the total capacity of the upper zone will be 2300 gpm or 3,312,000 gpd (not including Grandview Well No. 2). The firm capacity of the upper pressure zone with the largest well out of service will be 1,100 gpm or 1,584,000 gpd when the West View Well comes on line in 2007. The lower pressure zone supplements the upper pressure zone by utilizing the Buffalo Hill booster pumps. The Buffalo Hill booster pumps have a total capacity of 3,900 gallons per minute and a firm capacity of 2,700 gallons per minute. The current total capacity of the upper pressure zone is 5,000 gallons per minute or 7.2 million gallons per day and the firm capacity of the upper pressure zone is 3,800 gallons per minute or 5.47 million gallons per day. The total current upper pressure zone average day and peak day demand is 720,000 gallons per day and 1,920,000 gallons per day, respectively. The upper pressure zone meets the requirements of MDEQ Circular DEQ 1. Table 5-6 summarizes current upper pressure zone supply and capacity. Table 5-6. Exist Upper Pressure Zone Supply Capacity and Demand Existing Supply Existing Peak Day Existing Firm Supply Existing Average Day Capacity (MGD) Demand (MGD) Capacity (MGD) Demand (MGD) 7.2 1.92 5.47 0.72 5.3.2 Future Water Supply Analysis It is anticipated that at the end of 2007 the West View, Old School Station No. 1 and Old School Station No. 2 wells will be available. As stated above, when these wells become available the total supply capacity will be 10,600 gallons per minute or 15,264,000 gallons per day. When the new wells become available the firm capacity of the system will be 8,350 gallons per minutes or 12,024,000 gallons per day. 5-6 City of Kalispell Water Facility Plan Update April 15, 2008 Chapter 5: Water System Analysis When the supply capacity of the system is compared to the average and max day demand reported in Table 5-1, the analysis shows that the system reaches capacity by approximately year 2015. To adequately evaluate the impact of growth on the Kalispell water system, the capacity and demand of the upper and lower pressure zones must be evaluated individually. 5.3.2.1 Future Lower Pressure Zone Supply Analysis When Old School Station Wells No. I and 2 come on line, the total supply capacity of the lower pressure zone will be 9,400 gpm or 13,536,000 gpd. The firm capacity will be 7,150 gpm or 10,296,000 gpd. When the supply capacity of the system is compared to the average and max day demand reported in Table 5-2, the analysis shows that the system reaches capacity by approximately year 2024. It must also be taken into consideration that the lower pressure zone supplements the upper pressure zone. 5.3.2.2 Future Upper Pressure Zone Supply Analysis When the West View Well comes on line, the total capacity of the upper zone will be 5,000 gpm or 7,200,000 gpd with 2,700 gpm of supplemental water from the lower pressure zone. The firm capacity of the upper pressure zone, not including supplemental water from the lower pressure zone, will be 1,100 gpm or 1,584,000 gpd. The firm capacity of the upper pressure zone is 3,800 gpm or 5,472,000 gpd when supplemental water from the lower pressure zone is included. The lower pressure zone has adequate capacity to provide 2,700 gpm to the upper pressure zone until approximately 2017. When the supply capacity of the system is compared to the average and max day demand reported in Table 5-3, the analysis shows that the upper pressure zone system, including the supplemental water from the lower pressure zone, reaches capacity by approximately year 2020. Since the lower pressure zone will no longer have the ability to provide the necessary 2,700 gpm, capacity improvements will be needed in either the upper or lower zone by 2017. 5.4 Storage Analysis Finished water storage facilities are an essential element, serving several functions in a water system such as the City of Kalispell. Its main function is to provide an adequate supply of water during peak day and emergency water demand conditions. Using storage to meet peak demands throughout the day April 15, 2008 City of Kalispell Water Facility Plan Update 5-7 Chapter 5: Water System Analysis PUMP OFF 191kkFllsli: reduces the required sizes and design capacities of other water system elements, such as sources of supply, treatment plants, pump stations, and transmission mains. Storage also helps to maintain uniform pressures throughout the service area. Finally, storage provides a reserve supply that can be drawn on during emergencies, such as power outages, fires, and equipment failures. Storage volume requirements for these functions are typically classified as operating, equalizing, fire and/or emergency, and dead storage volumes. Figure 5-4 depicts graphically the typical storage components. OPERATIONAL STORAGE EQUALIZING STORAGE EMERGENCY ANDIOR FIRE STORAGE DEAD STORAGE Figure 5-4 — Storage Components The typical storage elements are defined as follows: Operating Storage. The volume of water stored in the system between the "pump on" and "pump off' levels. This storage is normally used when the sources of supply pumps to the storage tank are off. The pumps supplying the tank will typically be started when the tank has drained to the "pump on" level sensor. Equalizing Storage. This storage component is used when the source pump capacity is less than the peak system demands. The storage is needed so that water production facilities can operate at a relatively constant rate. The volume is determined by comparing the daily peak rates of water demand to the average daily demand and source capacity. A typical recommended volume for equalizing storage is 25% of the total storage volume. Fire Storage. Fire storage is the volume of water stored within the water system for fighting fires. The volume of storage required varies with the size of city and with the size, type, and classification of construction within the area served by the storage facility. Emergency Storage. This storage is used to provide water to the system during other unusual or emergency conditions. A typical example would be a prolonged 5-8 City of Kalispell Water Facility Plan Update April 15, 2008 Chapter 5: Water System Analysis source of supply failure. The volume needed depends upon the likelihood of an interruption in the source of supply and the time required for making repairs or mobilizing an alternative source. Dead Storage. This is storage in tanks or reservoirs that cannot be drawn out or used beneficially because of piping levels or low pressures. This volume is typically most significant in tall standpipe -type tanks where the bottom volume of storage is not usable due to low system pressures. To adequately analyze the capacity of the storage reservoirs, it is essential to identify the demands on each. It is assumed, for the purposes of this analysis, that Reservoir No. 1 and Reservoir No. 2 serve the lower pressure zone and supplement water to the upper pressure zone. It is also assumed that the elevated reservoir serves only the upper pressure zone and water is not fed back to the lower pressure zone. 5.4.1 Lower Pressure Zone Storage Analysis The lower pressure zone reservoirs, Reservoirs No. 1 and No. 2, must have capacity to serve the entire system demand in the lower pressure zone and supplement water to the upper pressure zone. These reservoirs have a combined total volume of 4.4 million gallons. It is essential to identify the demands on the lower pressure zone in order to evaluate the capacity of Reservoir No. 1 and No. 2. The largest demand on the water system would be to service a fire during peak day demand conditions. For the purposes of this evaluation, a 4,000 gpm four hour fire has been used. The max day demand condition on the lower pressure zone would also include 2,700 gallons per minute pumped to the upper pressure zone since standby power is available at the Buffalo Hill Booster Stations. Table 5-7 summarizes the maximum demand on the lower pressure zone reservoirs. Table 5-7. Maximum System Demand Summary Year Fire Demand (GPM) Peak Demand' (GPM) Total Demand (GPM) Total Demand (Gallons) 2005 4,000 7,647 11,647 2,795,280 2010 4,000 8,267 12,267 2,944,080 2025 4,000 9,553 13,553 3,252,720 2035 4,000 12,964 16,964 4,071,360 2050 4,000 20,492 24,492 5,878,080 Includes 2,700 gallons per minute pumped to the upper pressure zone 2 Based on four hour fire flow during peak system demand conditions. April 15, 2008 City of Kalispell Water Facility Plan Update 5-9 Chapter 5: Water System Analysis Standby power is available for the Buffalo Hill Well, the Armory Well, Noffsinger Spring and Old School Station Wells No. 1 and No. 2, offsetting the demand on Reservoirs No. 1 and No. 2. Table 5-8 summarizes the net demand on lower pressure zone Reservoirs No. 1 and No.2 during peak day demand and rated supply conditions. Table 5-8. Net Maximum System Demand Summary Fire Demand Peak Demand' Total Demand Total Demand Year (GPM) (GPM) (GPM) (Gallons) 20053 4,000 1,597 5,597 1,343,280 2010 4,000 1,217 5,217 1,252,080 2025 4,000 2,503 6,503 1,560,720 2035 4,000 5,914 9,914 2,379,360 2050 4,000 13,442 17,442 4,186,080 'Includes 2,700 gallons per minute pumped to the upper pressure zone 2Based on four hour fire flow during peak system demand conditions. 3Year 2005 net peak demand does not include supply from the Old School Station wells since they are not available until 2007. Table 5-9 summarizes the storage capacity of the lower pressure zone, Reservoirs No. 1 and No.2, under 2005, 2010, 2025, 2035, and 2050 peak demand conditions. Table 5-9. Reservoir No. 1 and No.2 Volume Summary 2005 2010 2025 2035 2050 Total Volume (Gallons) 4,400.000 4,400,000 4,400,000 4,400,000 4,400,000 Total Demand (Gallons)' 1,343,280 1,252,080 1,560,720 2,379,360 4,186,080 Remaining Volume (Gallons )2 3,056,720 3,147,920 2,839,280 2,020,640 213,920 'Total reservoir demand from Table 5-8. Equal to equalizing and emergency/fire storage required. 2Volume available for operational and dead storage. Provided that the distribution system is adequate for delivery of fire flow under peak demand conditions, the reservoirs can supply year 2005, 2010, 2025, 2035 and 2050 maximum system demand with a remaining volume of 3.06 million gallons (MG), 3.15 MG, 2.84 MG, 2.02 MG and 0.21 MG gallons, respectively. This equates to approximately 8.75 feet, 9.0 feet, 9.1 feet, 5.8 feet, and 0.60 feet of dead and operation storage under 2005, 2010, 2025, 2035 and 2050 conditions, respectively. If the capacity of the upper pressure zone is increased, reducing the amount of supplemental water required from the lower pressure zone, the dead and 5-10 City of Kalispell Water Facility Plan Update April 15, 2008 Chapter 5: Water System Analysis operational storage available will improve. This analysis assumes that improvements are made to the lower pressure zone supply to provide 2,700 gpm of supplemental water to the upper pressure zone beyond 2017. 5.4.2 Upper Pressure Zone Storage Analysis The upper pressure zone elevated reservoir must have capacity to serve the upper pressure zone demand. This reservoir has a total volume of 100,000 gallons. The 2.0 million gallon West Valley Reservoir is expected to be in service by the summer of 2008. For the purpose of this evaluation, the West Valley Reservoir will be considered operational after 2008. It is essential to identify the demands on the upper pressure zone in order to evaluate the capacity of the elevated reservoir and the West Valley Reservoir. The largest demand on the water system would be to service a fire during peak day demand conditions. For the purposes of this evaluation, a 4,000 gpm four hour fire has been used. Table 5-10 summarizes the maximum demand on the upper pressure zone reservoirs. Table 5-10. Maximum System Demand Summary Year Fire Demand (GPM) Peak Demand (GPM) Total Demand (GPM) Total Demand' (Gallons) 2005 4,000 1,331 5,331 1,279,440 2010 4,000 2,176 6,176 1,482,240 2025 4,000 6,482 10,482 2,515,680 2035 4,000 11,600 15,600 3,744,000 2050 4,000 26,776 30,776 7,386,240 'Based on four hour fire flow during peak system demand conditions. Standby power is available for Grandview Well No. 1, the Buffalo Hill Booster Stations, and the West View Well (expected to be on line in 2007), offsetting the demand on the Elevated Reservoir and the West Valley Reservoir. Table 5-11 summarizes the net demand on the upper pressure zone's Elevated Reservoir and the West Valley Reservoir during peak day demand and rated supply conditions. April 15, 2008 City of Kalispell Water Facility Plan Update 5-11 Chapter 5: Water System Analysis Table 5-11. Net Maximum System Demand Summary Fire Demand Peak Demand Total Demand Total Demand' Year (GPM) (GPM) (GPM) (Gallons) 20052 4,000 (3,669) 331 79,440 2010 4,000 (2,824) 1,176 282,240 2025 4,000 1,482 5,482 1,315,680 2035 4,000 6,600 10,600 2,544,000 2050 4,000 21,776 25,776 6,186,240 ' Based on four hour fire flow during peak system demand conditions. 2 Year 2005 net peak demand does not include supply from the West View well since it is not available until 2007. Table 5-12 summarizes the storage capacity of the upper pressure zone, the Elevated Reservoir, and the West Valley Reservoir under 2005, 2010, 2025, 2035, and 2050 peak demand conditions. Table 5-12. Elevated Reservoir and West Valley Reservoir Volume Summary 2005 2010 2025 2035 2050 Total Volume (Gallons) 100.000 2,100,000 2,100,000 2,100,000 2,100,000 Total Demand (Gallons)' 79,440 282,240 1,315,680 2,544,000 6,186,240 Remaining Volume (Gallons )2 20,560 1,817,760 784,320 (444,000) (4,086,240) ' Total reservoir demand from Table 5-11. Equal to equalizing and emergency/fire storage required. 2 Volume available for operational and dead storage. Provided that the distribution system is adequate for delivery of fire flow under peak demand conditions after the West Valley Reservoir is constructed, the upper pressure zone reservoirs can supply year 2005, 2010 and 2025 maximum system demand with a remaining volume of 0.02 MG, 1.82 MG and 0.78 MG respectively. This equates to approximately 0.20 feet, 17.4 feet and 7.5 feet of dead and operation storage under 2005, 2010 and 2025 conditions, respectively. Additional storage will be required in the upper pressure zone before 2031 if operational and dead storage is going to be provided. 5-12 City of Kalispell Water Facility Plan Update April 15, 2008 Chapter 5: Water System Analysis 5.5 Distribution System Analysis The City of Kalispell maintains a computer generated hydraulic model of the water system utilizing EPANet. The existing model was updated and converted into WaterCADYm by Bentley (formerly Haestad Methods) for analysis. The hydraulic model was used to evaluate the existing system and to identify future improvements needed to correct deficiencies and serve future growth. Significant expansion of the existing distribution system will be required if the entire study area is served. The majority of this expansion will be constructed and paid for by development. It is recommended that proposals for expanding the water system be analyzed in detail utilizing the hydraulic model. 5.5.1 Water System Model Development The water system model was originally developed as part of the 2002 City of Kalispell Water, Sewer and Storm Drainage Systems Facility Plan using EPANet, a public -domain software package available from the U.S. Environmental Protection Agency. The EPANet model was updated using the latest available water system mapping and converted to WaterCADTm for use in this study. For this analysis, the Hazen -Williams formula was utilized in WaterCADTM to calculate head loss. The Hazen -Williams pipe roughness coefficient is affected by a pipe's material, size, and age and by the physical and chemical characteristics of the water passing through the pipe. The City of Kalispell water system contains predominantly ductile iron and PVC (plastic) with some cast iron, steel, and asbestos cement. The roughness coefficients shown in Table 5-13 were used in the initial model setup. Table 5-13. Hazen -Williams Pipe Roughness Coefficients Pipe Material Hazen -Williams Pipe Roughness Coefficient Ductile Iron 120 PVC 140 Asbestos Cement 120 Cast Iron 130 Steel 120 For evaluation of the water system and sizing new infrastructure, a conservative average roughness coefficient of 130 was used in this study. April 15, 2008 City of Kalispell Water Facility Plan Update 5-13 Chapter 5: Water System Analysis 5.5.2 Model Cali bration/Verification The hydraulic model of the City of Kalispell water system was calibrated as part of the 2002 City of Kalispell Water, Sewer and Storm Drainage Systems Facility Plan. To verify that the model was calculating conditions close to reality, four fire flow test were performed. At four locations, the City opened a fire hydrant and measured the available fire flow, as well as the residual pressure at two nearby hydrants. The model was then run to simulate the four tests and verify that the calculated pressures were close to the pressures observe in the field. The pressures calculated by the model were generally within 3 to 4 psi of the observed values. Additional calibration was not performed as a part of this study. 5.5.3 Distribution System Evaluation Criteria The 75-6-101, et seq., MCA Montana Department of Environmental Quality, Circular DEQ1, Standards for Water Works, indicates that distribution system pressures meet the following criteria: All water mains, including those not designed to provide fire protection, must be sized after a hydraulic analysis based on flow demands and pressure requirements. The system must be designed to maintain a normal operating pressure of 35 psi. Maximum normal working pressure should be approximately 60 psi. Minimum pressure under all conditions of flow (e.g. fire flows) must be 20 psi. A detailed evaluation of the Kalispell water system was completed utilizing the WaterCADTM hydraulic model developed as a part of this facility plan. The evaluation included analysis of fire flow under max day demand conditions for years 2005 and 2035 predicted population. Analysis of 2035 conditions assumed extension of the water system to areas of predicted growth within the Study Area. 5.5.4 Existing System Analysis and Proposed Improvements 5.5.4.1 Fire Flow/Pressure Analysis A simulation of fire flow availability and system pressure under the current maximum day water demand with year 2005 population conditions was run. In the simulation, the water level in the upper and lower pressure zone tanks and the status of the existing wells and booster pumps were manipulated to simulate actual system operating parameters and MDEQ Circular DEQ 1 standards. Three scenarios were simulated. In the first scenario, system pressure and flow was simulated with all tanks at their normal full operating level and all wells and pumps off. Figure 5-5 5-14 City of Kalispell Water Facility Plan Update April 15, 2008 Chapter 5: Water System Analysis graphically depicts the results of the simulation. White nodes indicate locations where the available fire flow was below 1,500 gallons per minute. In the second scenario, system pressure and flow was simulated with tank levels at the elevation in which pumps would first be called to start and all pumps and wells on except the largest in each of the pressure zones, the Grandview Well and Buffalo Hill. Figure 5-6 graphically depicts the results of the simulation. White nodes indicate locations where available fire flow was below 1,500 gallons per minute. There is a slight increase in the number of nodes with flow below 1,500 gallons per minute under these conditions. In the third scenario, system pressure and flow was simulated with tank levels at 1 foot above floor elevation and all pumps and wells on except the largest in each pressure zone, the Grandview Well and Buffalo Hill. Figure 5-7 graphically depicts the results of the simulation. As is expected there is an additional increase in the number of nodes with flow below 1,500 gallons per minute when compared to scenario 2. 5.5.4.2 Alternatives Development and Evaluation Areas experiencing fire flow below 1,500 gallons per minute are typically comprised of undersized piping, 6-inch or smaller, and/or dead ends. Improvements including looping and replacing small pipe with larger diameter pipe were simulated in the model to improve fire flow. Table 5-14 summarizes the pipe improvements simulated in the model and Figure 5-8 shows their location. Table 5-14. Pipe Improvement Summary Improvement Improvement Description No. 1 Replace 6-inch pipe on S. Woodland Dr. and Lehi Ln. with 8-inch 2 Connect existing 6-inch piping on 6th Ave. East and 7th Ave. East with an 8-inch pipe on 10th St. East 3 Connect existing 6-inch piping on 7th Ave. EN and 8th Ave. EN with an 8-inch pipe on E Washington St. 4 Replace 6-inch pipe on E Oregon St. between 7th Ave. EN and 8th Ave. EN with an 8-inch pipe 5 Replace 6-inch pipe on 9th Ave. EN between E California St and E Oregon St. with an 8-inch pipe 6 Replace 2-inch and 4-inch pipe in E Arizona St and 1st Ave. EN with 6-inch and 8-inch pipe 7 Replace 6-inch pipe in 4th Ave. WN from W California St. to W Wyoming St with 8-inch pipe 8 Replace 6-inch pipe in 5th Ave. WN and W Colorado St. with 8-inch pipe April 15, 2008 City of Kalispell Water Facility Plan Update 5-15 Chapter 5: Water System Analysis Improvement Improvement Description No. 9 Replace 6-inch pipe in W Arizona St. with 8-inch pipe 10 Replace 6-inch pipe in Glacier St between Hawthorne Ave. and Iris Court with 8-inch pipe 11 Replace 8-inch pipe in Highway 2 from Meridian Rd to the entrance to the Hampton Inn with 10-inch pipe 12 Replace 8-inch pipe to commercial area adjacent to Corporate Drive with 10-inch The same three operational scenarios as described above were analyzed with the hydraulic model. Figure 5-9, Figure 5-10, and Figure 5-11 graphically depict the results of these three simulations. These figures demonstrate there is a significant improvement in fire flow with the only instances of flow below 1,500 gallons per minute occurring in close proximity to the storage tanks. The West View well is scheduled to be available for service in 2007. The new West Valley 2.0 MG storage tank located on Sheepherder's Hill is under construction and expected to be available for service in 2008. The existing system was analyzed using the hydraulic model with these facilities in service. The pipe improvements summarized in Table 5-14 were not included, so it could be determined if adding the new storage reservoir and the West View well would alleviate fire flow deficiencies without having to construct the piping improvements previously evaluated. The same three operational scenarios were run as described above with one exception. In the second and third scenarios, the largest producing well in the upper pressure zone not in service was the West View well instead of the Grandview Well. The evaluation shows, as can be seen in Figure 5-12, Figure 5-13, and Figure 5-14, that utilization of the new storage tank and West View well alleviates a few fire flow deficiencies previously present in the upper pressure zone, however; none of the fire flow deficiencies associated with previously evaluated piping improvements changed. There is currently not a connection that allows water to be transferred from the upper pressure zone to the lower pressure zone. Construction of the new 2.0 MG upper zone tank may make it beneficial to have such a connection. The existing system was analyzed using the hydraulic model with the West View well, new 2.0 MG tank, and a PRV located at Meridian Road and Three Mile Drive in service. The pipe improvements summarized in Table 5-14 were not included so that it could be determined if adding the PRV would alleviate fire flow deficiencies without having to construct the piping improvements previously evaluated. The same three operational scenarios were run with the West View 5-16 City of Kalispell Water Facility Plan Update April 15, 2008 Chapter 5: Water System Analysis Well out of service in Scenarios 2 and 3. The evaluation shows, as depicted in Figure 5-15, Figure 5-16, and Figure 5-17, that two of the piping improvements listed in Table 5-14 would not be required, including numbers 1 and 10, if the PRV is installed. 5.5.5 Water Main Extension Evaluation As shown in Figure 1-3 of Chapter 1, the Study Area was segregated into six analysis areas: East Whitefish River, North Kalispell, West Stillwater River, West Kalispell, South Kalispell, and East Kalispell. Predicted population density for the 2035 design year was established and a hydraulic model developed to size and locate water distribution and storage infrastructure to serve the design year population. Similar to the existing system evaluation, a simulation of fire flow availability and system pressure under the maximum day water demand with year 2035 population conditions was run to confirm adequate sizing of the future system. In the simulation the water level in the upper and lower pressure zone tanks and the status of the existing wells and booster pumps were manipulated to simulate actual system operating parameters and MDEQ Circular DEQ 1 standards. Three scenarios were simulated. In the first scenario, system pressure and flow was simulated with all tanks at their normal full operating level and all wells and pumps were off. Figure 5-18 graphically depicts the results of the simulation. In the second scenario, system pressure and flow was simulated with tank levels at the elevation in which pumps would first be called to start, and all pumps and wells on except the largest in each of the pressure zones, the West View Well and Noffsinger Spring. Figure 5-19 graphically depicts the results of the simulation. In the third scenario, system pressure and flow was simulated with tank levels at I foot above floor elevation and all pumps and wells on except the largest in each pressure zone, the West View Well and Noffsinger Spring. Figure 5-20 graphically depicts the results of the simulation. The following discussion describes in detail each of the analysis areas, the infrastructure required to serve the design year population, and the estimated cost of that infrastructure. East Whitefish River This East Whitefish River analysis area is located north of the Evergreen Sewer District, bounded on the west by the Flathead River, on the east by the Whitefish River, and north by the Study Area boundary. The projected population is April 15, 2008 City of Kalispell Water Facility Plan Update 5-17 Chapter 5: Water System Analysis generally less dense than other areas, at about 1 to 3 units per acre. The 2035 design year population is estimated to be 8,224 people. Alternatives Development and Evaluation The proposed East Whitefish River water system consists of a grid of 18-inch and 12-inch piping generally following the existing road system with north/south mains in Trumble Creek Road and Helena Flats Road and cast/west mains in Birch Grove Road, Rose Crossing, and East Reserve Drive. Figure 5-21 graphically depicts the proposed system. The East Whitefish River system would be connected to storage tanks and supply wells in the North Kalispell area via pressure reducing valves located on Rose Crossing and Birch Grove Road. Estimates of probable construction cost were developed for the main infrastructure required to serve this area. Table 5-15 summarizes these costs. Detailed cost estimates are included in Appendix A. Table 5-15. East Whitefish River Cost Summary Description Total ($) Surface Restoration $3,300,800 Water Transmission Main $9,579,000 Fire Hydrants $463,700 Valves and Fittings $200,800 East Whitefish River Total Estimated Probable Construction Cost $13,544,300 5.5.5.1 North Kalispell The North Kalispell analysis area is bounded on the east by the Whitefish River, on the west by the Stillwater River, on the south by the City of Kalispell, and on the north by the study area boundary. This area is currently experiencing development pressure, and growth is expected to be around 2 to 4 units per acre. The 2035 design year population is estimated to be 16,907 people. Alternatives Development and Evaluation The proposed North Kalispell water system consists of a grid of piping ranging in size from 18-inch to 28-inch generally following the existing road system. North/south mains are located in Highway 93 and Whitefish Stage Road and cast/west mains are located in West Reserve Drive and Tronstad Road. A 1.5 MG water tank would be required to maintain adequate fire flow and pressure in the system. For modeling purposes, the tank was located north of the Study Area along Highway 93. Two supply wells currently under development as part of the Silverbrook Subdivision were included. Figure 5-22 graphically depicts the proposed system. As described above, the North Kalispell system would be 5-18 City of Kalispell Water Facility Plan Update April 15, 2008 Chapter 5: Water System Analysis connected to the East Whitefish River area by pressure reducing valves located on Birch Grove Road and Rose Crossing. Estimates of probable construction cost were developed for the main infrastructure required to serve this area. Table 5-16 summarizes these costs. Detailed cost estimates are included in Appendix A. Table 5-16. North Kalispell Cost Summary Description Total ($) Surface Restoration $3,016,600 Water Transmission Main $16,414,500 Fire Hydrants $423,100 Valves and Fittings $476,100 Water Reservoirs $3,374,100 North Kalispell Total Estimated Probable Construction Cost $23,704,400 5.5.5.2 West Stillwater River The West Stillwater River analysis area is bounded on the east by the Stillwater River, on the south by the City of Kalispell, and on the north by the Study Area boundary. Growth is expected to occur at a density of 2 to 4 units per acre. The 2035 design year population is estimated to be 10,084 people. Alternatives Development and Evaluation The proposed West Stillwater River water system consists of a grid of 12-inch to 24-inch piping as shown by Figure 5-23. Piping generally follows the existing road grid with mains located on Stillwater Road, West Springcreek Road, and Church Drive. The West View Well is located in the West Stillwater River area. Estimates of probable construction cost were developed for the main infrastructure required to serve this area. Table 5-17 summarizes these costs. Detailed cost estimates are included in Appendix A. Table 5-17. West Stillwater River Cost Summary Description Surface Restoration Water Transmission Main Fire Hydrants Total ($) $2,068,900 $8,906,100 $289,800 Valves and Fittings $255,000 West Stillwater River Total Estimated Probable Construction Cost $11,519,800 April 15, 2008 City of Kalispell Water Facility Plan Update 5-19 Chapter 5: Water System Analysis 5.5.5.3 West Kalispell The West Kalispell analysis area is located along the western side of the study area and is bounded by Farm to Market Road on the west, Foys Lake Road on the south and the City of Kalispell on the east. Growth is expected to occur at a density of 2 to 3 units per acre. The 2035 design year population is estimated to be 19,938 people. Alternatives Development and Evaluation The proposed West Kalispell water system consists of a grid of 12-inch to 28- inch piping as shown by Figure 5-24. Piping generally follows the existing road grid with mains located on Stillwater Road, West Springcreek Road, West Valley Drive, Farm to Market Road, Foys Lake Road, Three Mile Drive, Four Mile Drive, West Reserve Drive, Clark Drive and Church Drive. A 1.5 MG water tank would be required to maintain adequate fire flow and pressure in the system. For modeling purposes the tank was located northwest of the Study Area 0.75 miles west and 0.15 miles north of the Lost Creek Drive and Hwy 424 intersection. Estimates of probable construction cost were developed for the main infrastructure required to serve this area. Table 5-18 summarizes these costs. Detailed cost estimates are included in Appendix A. Table 5-18. West Kalispell Cost Summary Description Total ($) Surface Restoration $6,208,800 Water Transmission Main $31,725,800 Fire Hydrants $1,014,300 Valves and Fittings $1,165,300 Water Reservoirs $3,277,500 West Kalispell Total Estimated Probable Construction Cost $43,391,700 5.5.5.4 East Kalispell The East Kalispell analysis area is bounded by the City of Kalispell on the west, the Stillwater River on the east, and the Evergreen County Water and Sewer District on the north. Growth is expected to occur at a density of 2 to 4 units per acre. The 2035 design year population is estimated to be 4,107 people. Alternatives Development and Evaluation The proposed East Kalispell water system consists of a 12-inch water main on Willow Glen Drive connecting to the existing system at Woodland Avenue, 5-20 City of Kalispell Water Facility Plan Update April 15, 2008 Chapter 5: Water System Analysis Conrad Drive and Concord Lane. Figure 5-25 graphically depicts the proposed infrastructure. Estimates of probable construction cost were developed for the main infrastructure required to serve this area. Table 5-19 summarizes these costs. Detailed cost estimates are included in Appendix A. Table 5-19. East Kalispell Cost Summary Description Surface Restoration Water Transmission Main Fire Hydrants Total ($) $347,300 $972,600 $52,200 Valves and Fittings $19,900 East Kalispell Total Estimated Probable Construction Cost $1,392,000 5.5.5.5 South Kalispell The South Kalispell area is located south of the City limits and is bounded on the east by the Flathead River and on the west and south by the Study Area boundary. Growth is expected to occur at a density of 1 to 3 units per acre. The 2035 design year population is estimated to be 6,474 people. Alternatives Development and Evaluation The proposed South Kalispell water system consists of a grid of 12-inch to 14- inch pipe and a 1.5 MG storage tank. The piping grid generally follows the existing road grid with water mains on Airport Road, Highway 93 and Rocky Cliff Drive. For the purposes of modeling, the water tank was located on Rocky Cliff Drive. The Old School Station wells are located in this area. Figure 5-26 graphically depicts the proposed water system to serve the South Kalispell Area. Estimates of probable construction cost were developed for the main infrastructure required to serve this area. Table 5-20 summarizes these costs. Detailed cost estimates are included in Appendix A. Table 5-20. South Kalispell Cost Summary Description Total ($) Surface Restoration $1,377,200 Water Transmission Main $4,753,800 Fire Hydrants $197,100 Valves and Fittings $127,000 Water Reservoirs $3,277,500 South Kalispell Total Estimated Probable Construction Cost $9,732,600 April 15, 2008 City of Kalispell Water Facility Plan Update 5-21 Appendix Exhibit B-1 City of Kalispell Wastewater Impact Fees Development of ERUs Waste Water Flow ' Persons per Household' Waste Water Flow 2 1 - See page 1-16 of the Wastewater Facility Plan Update. 2 - Based on 129 gpcd and 2.5 persons per household. 106.00 gpcd 2.50 persons/ERU 265.00 gallons per day/ERU Page 1 of 2 Exhibit B-1 City of Kalispell Wastewater Impact Fees Development of ERUs Year Average Day Flow (MGD) 2 Wastewater Plant (1) Total Additional ERUs3 ERUs Page 2 of 2 Collection Average Day Flow Total Additional (MGD) 2 ERUs 3 ERUs 2005 2.83 10,663 - 1.95 7,374 - 2006 3.12 11,789 1,126 2.25 8,477 1,103 2007 3.45 13,034 1,245 2.57 9,699 1,222 2008 3.82 14,411 1,377 2.93 11,052 1,353 2009 4.22 15,933 1,522 3.33 12,550 1,498 2010 4.67 17,615 1,683 3.77 14,208 1,659 2011 4.82 18,184 569 3.91 14,753 545 2012 4.97 18,772 587 4.06 15,316 563 2013 5.14 19,378 606 4.21 15,898 582 2014 5.30 20,004 626 4.37 16,500 601 2015 5.47 20,650 646 4.54 17,121 621 2016 5.65 21,317 667 4.71 17,763 642 2017 5.83 22,006 689 4.88 18,426 663 2018 6.02 22,717 711 5.06 19,112 685 2019 6.21 23,451 734 5.25 19,820 708 2020 6.42 24,208 758 5.45 20,552 732 2021 6.62 24,990 782 5.65 21,308 756 2022 6.84 25,798 807 5.85 22,089 781 2023 7.06 26,631 833 6.07 22,896 807 2024 7.29 27,491 860 6.29 23,730 834 2025 7.52 28,379 888 6.52 24,591 861 2026 7.73 29,170 791 6.72 25,355 764 2027 7.95 29,983 813 6.93 26,141 786 2028 8.17 30,819 836 7.14 26,950 808 2029 8.39 31,678 859 7.36 27,781 832 2030 8.63 32,561 883 7.59 28,637 855 2031 8.87 33,469 908 7.82 29,516 880 2032 9.12 34,402 933 8.06 30,421 905 2033 9.37 35,360 959 8.31 31,352 931 2034 9.63 36,346 986 8.56 32,309 957 2035 9.90 37,359 1,013 8.82 33,294 984 1 - Includes Flathead County Water and Sewer District #1 Evergreen 2 - See page 1-14 of Wastewater Facility Plan Update - Population times 129 gpcd. 3 - Average day flow divided by usage per ERU - see page 1. Exhibit B-2 City of Kalispell Wastewater Impact Fees Wastewater Treatment Plant Page 1 of 1 Percent Impact Original Cost IF Fee Year Equipment List Cost $2009 Related Eligible Completed Projects 1982 9500 Sludge Injector $ 26,996 $ 64,697 44% $ 28,375 1993 Sludge Truck 80,797 193,635 44% 85,199 2000 Sludge Truck 102,723 173,548 44% 76,116 2003 Sludge truck 105,892 150,210 44% 65,880 2004 Wastewater Plant Expansion -Prelim Eng. Report 116,483 155,881 44% 68,367 Total Existing Completed Plant $ 432,891 $ 737,971 $ 323,937 Future Treatment Plant',z WWFP-1702 Phase I & II WWT Expansion - Design, Constr. & Constr. Mngmnt (78% Growth) $ 21,612,528 $ 21,612,528 78% $ 16,857,772 WWFP-1703 AWWTP Phase 2 Expansion (73% Growth) 7,882,215 7,882,215 73% 5,754,017 WWFP-1704 AWWTP Phase 3 Expansion (74% Growth) 14,844,660 14,844,660 74% 10,985,049 WWFP-1705 AWWTP Phase 4 Expansion (100% Growth) 7,465,110 7,465,110 100% 7,465,110 WWFP-1706 AWWTP Odor Control Upgrade 2,064,135 2,064,135 0% - WWTP-1707 AWWTP Effluent Quality Upgrade (2015) 3,743,250 3,743,250 0% - WWTP-1708 AWWTP Effluent Quality Upgrade (2025) 2,566,800 2,566,800 0% - WWTP-1709 Belt Filter Press Replacement 300,000 300,000 0% - WWTP-1710 Primary Digester Lid Replacement 1,000,000 1,000,000 0% - WWTP-1711 Secondary Digester Lids Replacement 600,000 600,000 0% Total Future Treatment Plant $ 62,078,699 $ 41,061,948 Total Existing and Future Treatment Planl $ 62,816,670 $ 41,385,884 New ERUs 2009 to 2025 12,447 Treatment Impact Fee per ERU 1 - See City of Kalispell Capital Improvement Plan Exhibit 8-9. 2 - Allocations from Table 7-5 of the Wastewater Facility Plan Update. $ 3,325.05 Exhibit B-3 City of Kalispell Pagel of 2 Wastewater Impact Fees Collection Plant Percent Impact Original Cost IF Fee Year Equipment List Cost $2009 RelatedEliqible Existing Collection Plani 1940 140027inch $ 3,415 $ 8,184 0.0% $ - 1952 20,1606 inch 72,576 173,933 0.0% - 1952 1210308inch 522,850 1,253,040 0.0% - 1952 2035010inch 98,901 237,022 0.0% - 1962 1597012inch 97,864 234,537 0.0% - 1962 1187015inch 84,105 201,563 0.0% - 1967 2024018inch 186,528 447,025 0.0% - 1974 680 Cke Backhoe 17,525 42,000 38.9% 16,353 1978 SID 326 17,427 41,765 0.0% - 1979 Sewer Line Additions 7,390 17,711 38.9% 6,896 1979 Sewer Line Grout 9,563 22,918 38.9% 8,923 1979 Sewer Line Grout 195,214 467,842 38.9% 182,159 1981 Sid 328 60,360 144,656 0.0% - 1982 Anodes and Cable for Lift Station 949 2,274 38.9% 886 1982 Grouting 11,283 27,040 38.9% 10,528 1983 5-1900 Vactor E-350 Camera 85,000 203,707 38.9% 79,315 1984 N Main Extensions 26,261 62,936 38.9% 24,505 1984 SID 333 32,507 77,905 0.0% - 1984 Kinshella Street 635 1,522 38.9% 593 1984 Monk Project - City 22,524 53,980 38.9% 21,018 1984 Joe Radiator 2,684 6,432 38.9% 2,505 1984 Lift Station Meters 1,333 3,195 38.9% 1,244 1985 Fence - Lift Station No4 1,530 3,667 38.9% 1,428 1985 6 inch Sludge Line 6,149 14,736 38.9% 5,738 1986 Meadows 97,770 234,311 1.9% 4,562 1986 160824 inch 225,371 540,115 38.9% 210,299 1986 South Meadows 17,721 42,469 38.9% 16,536 1987 Woodland Park 110,770 265,467 9.7% 25,840 1987 38624 inch RCP CL III 27,171 65,117 38.9% 25,354 1987 554 30 inch RCP CL III 44,807 107,383 38.9% 41,810 1987 966 30 inch RCP CL IV 86,823 208,076 38.9% 81,016 1987 12 30 inch Duct Iron 531 1,273 38.9% 495 1987 1601 36 inch RCP Cl III 158,278 379,322 38.9% 147,693 1987 2701 36 inch RCP Cl IV 303,436 727,202 38.9% 283,143 1987 1254 inch 4,119 9,871 38.9% 3,844 1987 1226 inch 3,659 8,769 38.9% 3,414 1987 3368 inch 14,887 35,678 38.9% 13,891 1987 7430 inch 8,921 21,380 38.9% 8,324 1987 (1)- Includes Evergreen Sewer District 3,197 7,662 38.9% 2,983 1987 1766 30 RCP Cl III 187,646 449,705 38.9% 175,097 1987 3364 24 inch RCP Cl III 296,837 711,387 19.5% 138,493 1987 5018 inch RCP Cl III 4,162 9,974 38.9% 3,884 1987 SID 337 216,740 519,430 0.0% - 1988 Scoreboard 16,866 40,420 38.9% 15,738 1989 (1)- Includes Flathead County Waterand Sewer District#1 Evergreen 2,159 5,174 38.9% 2,015 1991 Purdy/Remick 73,396 175,898 38.9% 68,487 1991 E350 Camera Trk 99,998 239,651 38.9% 93,310 1992 Greenacres 54,872 131,504 38.9% 51,202 1992 Generator Lift N o 2 and 3 49,197 117,903 38.9% 45,907 1993 Lift Station 1 bypass 47,055 112,770 38.9% 43,908 1993 2nd St East 17,796 42,649 38.9% 16,606 1993 18th St E and 5th Ave 74,992 179,723 7.8% 13,995 1994 Evergreen Truck - City 43,090 103,268 38.9% 40,208 1994 18th St 6,125 14,679 38.9% 5,715 1994 Heritage Park 5,600 13,421 38.9% 5,225 1995 Courtyard Apts 7,890 17,839 38.9% 6,946 1995 Slipline Project 98,645 223,027 38.9% 86,838 1995 5th Ave SID 341 129,848 293,574 0.0% - 1997 Elks Lift Station No. 2 293,395 590,368 38.9% 229,865 1997 Manhole 2nd St E between 4th and 5th 12,575 25,303 38.9% 9,852 1997 Greenacres Sewer Engineering 7,353 14,796 38.9% 5,761 1997 6th Alley NW 89,059 179,204 38.9% 69,775 1997 20kw fuel Generator 34,995 70,417 38.9% 27,418 1998 Hilltop Ave/Salish Court 35,000 66,440 38.9% 25,869 1999 City Wide Sewer Improvements 374,765 671,147 2.1% 13,850 1999 146C Backhoe 55,014 98,522 38.9% 38,361 2000 Woodland Park 17,685 29,878 38.9% 11,633 2000 2nd Alley E Sewer 122,926 207,681 38.9% 80,862 2001 Multi Angle Camera 15,149 24,146 38.9% 9,401 2001 (2) Hydraulic By-pass pumps and power plants 14,580 23,238 38.9% 9,048 2002 Lift Station #4 Replacement 120,849 181,712 38.9% 70,751 2002 Main St. MH Corrosion Repair 8,390 12,615 38.9% 4,912 2002 Building Addition 72,000 108,261 38.9% 42,153 2002 Building Remodel 7,000 10,525 38.9% 4,098 2003 Inspection Camera & Transporter 13,500 19,150 38.9% 7,456 2003 Manhole Rehabilitation 22,710 32,215 0.0% - 2004 Highway 93 South Improvements -Ashley Creekto kalispell 1,409,970 1,886,858 35.0% 661,199 2005 Golf Course Bridge Force Main 22,500 28,406 38.9% 11,060 2005 US Highway 93 South Utilities 1,371,758 1,731,813 38.9% 674,298 2005 Liberty Street Lift Station 128,849 162,669 0.0% - 2006 Buffalo Golf Course Bridge Footing 22,309 26,570 38.9% 10,345 2006 Bowser Creek Lift Station Upsize 132,852 158,229 38.9% 61,608 2007 Slip Line Manhole Covers 38,133 42,846 0.0% - 2007 Grandview Lift Station Force Main 200,554 225,342 38.9% 87,739 2007 Fairway Boulevard Lift Station Nurnberg 392,603 441,129 38.9% 171,758 2007 Wyoming Street 150,874 169,522 38.9% 66,005 2008 New Generator Lift Station 16 43,731 46,355 38.9% 18,049 2008 Spring Prairie Upsize 49,168 52,118 38.9% 20,293 2008 Reserve Loop Extension 9,525 10,097 38.9% 3,931 Total Existing Collection Plan $ 4,492,218 New ERUs 2009 to 2020 8,002 Existing Collection Plant Impact Fee $ 561.38 Exhibit B-3 City of Kalispell Page 2 of 2 Wastewater Impact Fees Collection Plant Percent Impact Original Cost IF Fee Year Equipment Lisl Cost $2009 Related Eligible Future CIP Collection Plant SEW 24 Nevada between 1st Ave. E 8 Main to Washington (56 % Growth) $ 244,306 $ 244,306 56.0% $ 136,811 SEW 31 SE 1/4 Section 36 Lift Station (100%Growth) 324,251 324,251 100.0% 324,251 SEW 43 Grandview Pu mping Station U pgrade 115,098 115,098 100.0% 115,098 SEW 44 Northridge Drive/Prkway Dr. 387,669 387,669 100.0% 387,669 SEW 45 Whitefish Stage Road Pipe Upsize (44%growth) 35,715 35,715 44.0% 15,715 SEW 46 Fairway Pumping Station Upgrade (48%Growth) 172,155 172,155 48.0% 82,635 SEW 47 1st Alley East North Pipe Upsize (66% Growth) 285,019 285,019 66.0% 188,113 SEW 52 Misc Sewer contract main upsize and Facility Enlargements (lift stations) 525,832 525,832 100.0% 525,832 Total Future CIP Collection Plam $ 2,090,045 $ 2,090,045 $ 1,776,122 New ERUs 2009 to 20193 7,270 Future Collection CIP Plant Impact Fee per ERU $ 244.30 Committed Future Extension Plant' SEW 48 Stillwater Road Interceptor $ 5,218,404 $ 5,218,404 100.0% $ 5,218,404 SEW 55 Three Mile Drive Intemeptor(100%Growth) 3,845,134 3,845,134 100.0% 3,845,134 SEW 56 Spring Creek Interceptor (100% Growth) 9,516,146 9,516,146 100.0% 9,516,146 SEW 57 Foys Lake Road Intemeptor(100%Growth) 2,774,953 2,774,953 100.0% 2,774,953 Total Commiled Future Extension Collection Plan $ 21,354,636 New ERUs 2009 to 2035 20,744 Future Committed Extension Collection Plant Impact Fee per ERt $ 1,029.44 Future Extenstion Collection Plant4 2009-2035 East Whitefish River $ 21,308,000 $ 22,788,906 100.0% $ 22,788,906 2009-2035 North Kalispells 8,302,000 8,878,989 0.0% - 2009-2035 West Stillwater River 9,788,000 10,468,266 100.0% 10,468,266 2009-2035 West Kalispell 17,418,000 18,628,551 13.38% 2,492,319 2009-2035 East Kalispell 2,083,000 2,227,769 100.0% 2,227,769 2009-2035 South Kalispell 6,284,000 6,720,738 100.0% 6,720,738 SEW 49 Whitefish Stage Road to Rose Crossing Extension 3,933,266 3,933,266 100.0% 3,933,266 SEW 51 Whitefish Stage Road Interceptor (North of Rose Crossing) (100% Growth) 2,742,859 2,742,859 100.0% 2,742,859 Total Future Extension Collection Plan $ 51,374,123 New ERUs 2009 to 2035 20,744 Future Extension Collection Plant Impact Fee per ERt $ 2,476.60 Total Collection Plant Impact Fee per ERU $ 4,311.73 1- Allocation for existing projects based on new ERUs from 2009 to 2020 divided by total ERUs in 2020. Some plant is excluded or reduced based on the amount from developer contributions and or the amount which was for replacement. 2 - See City of Kalispell Wastewater Capital Improvement Plan and Exhibit 8-9 for project details 3- Assumes that CIP covers the period of 2009 to 2019 4 - See Chapter 5 of the Wastewater Facility Plan Update - 2008 and Exhibit 85 forproject details. Non CIP projects are adjusted to 2009 dollars from the 2007 plan values based on changes in the ENR Construction Cost Index. 5 - Allocation to impact fees is reduced by specific projects contained in the City Wastewater Capital Improvement Plan and the amout paid by development. Exhibit B-4 City of Kalispell Wastewater Impact Fees Breakdown of Annual Administrative Costs Page 1 of 1 Nercent of Time Spent on Portion of Portion Of Growth Salary Salary Attributed to Related Attributed to Wastewater Issues Growth Public Works Director $ 40,103 20.0% $ 8,021 WWTP Manager 81,065 3.0% 2,432 Sewer Foreman 58,392 3.0% 1,752 Water Resource Manager 52,090 3.0% 1,563 Asst. City Engineer 46,443 50.0% 23,222 Admin Coord/Assessments 20,396 30.0% 6,119 Deputy Public Works Director 35,802 30.0% 10,741 Eng Tech 10,139 30.0% 3,042 Admin Coordinator 18,648 3.0% 559 Secretary 9,165 3.0% 275 Budget Resource Manager 33,036 30.0% 9,911 Project Manager 13,024 50.0% 6,512 Finance Director 15,794 3.0% 474 Asst. Finance Director 22,381 3.0% 671 Construction Manager 18,614 75.0% 13,961 Construction Manager 19,596 75.0% 14,697 Billing Clerk/Meter Reader 49,975 3.0% 1,499 Sewer Operator 55,200 3.0% 1,656 Sewer Operator 59,480 3.0% 1,784 Sewer Operator 28,362 3.0% 851 Sewer Operator 27,749 3.0% 832 Sewer Operator 25,474 3.0% 764 WWT Operator 69,671 3.0% 2,090 WWT Operator 73,173 3.0% 2,195 WWT Operator 70,820 3.0% 2,125 WWT Operator 67,178 3.0% 2,015 Chemist 67,781 3.0% 2,033 Chemist 66,732 3.0% 2,002 Subtotal $ 1,156,283 10.71% $ 123,797 Wastewater Impact Fee Review $ 9,500 100.00% $ 9,500 Admin Transfer 1 156,883 10.71% 16,797 Data Processing 57,726 10.71% 6,180 Office Space 1 14,113 10.71% 1,511 Total 2009 Administrative Costs Attributed to Growth $ 157,786 Average New Connections 2009-2035 2 850 2009 Wastewater Administrative Cost per ERU $ 185.64 2009 Wastewater Admin. Cost as percentage of Impact Fee w/o Extensions 3.60% 2009 Wastewater Admin. Cost as percentage of Impact Fee with Extensions 2.43% 1 - Allocated based on labor costs. 2 - See Exhibit 8-1. Exhibit B-5 City of Kalispell Wastewater Impact Fees Debt Service Credit - Treatment Page 1 of 1 Existing Additional Total Impact Fee Net Debt/ Debt/ERU Year Debt Service Debt Service' Debt Service Revenue Debt Service ERUs ERU ($2009) 2009 $ 1,249,930 $ 1,249,930 $ 5,243,110 $ 15,933 $ - 2010 1,251,850 1,251,850 5,941,774 17,615 0.00 2011 1,251,549 1,251,549 2,059,574 18,184 0.00 2012 1,246,735 1,246,735 2,179,259 18,772 0.00 2013 1,097,338 1,097,338 2,305,899 19,378 0.00 2014 1,184,288 1,184,288 2,439,897 20,004 0.00 2015 1,226,538 1,226,538 2,581,683 20,650 0.00 2016 1,216,725 1,216,725 2,731,708 21,317 0.00 2017 1,206,163 1,206,163 2,890,452 22,006 0.00 2018 1,194,850 1,194,850 3,058,420 22,717 0.00 2019 1,182,788 1,182,788 3,236,148 23,451 0.00 2020 1,169,975 1,169,975 3,424,205 24,208 0.00 2021 1,156,413 1,156,413 3,623,190 24,990 0.00 2022 1,142,100 1,142,100 3,833,739 25,798 0.00 2023 1,127,038 1,127,038 4,056,523 26,631 0.00 2024 1,111,225 1,111,225 4,292,253 27,491 0.00 2025 1,104,475 1,104,475 4,541,681 28,379 0.00 2026 1,094,725 1,094,725 4,146,572 29,170 0.00 2027 1,046,631 1,046,631 4,368,707 29,983 0.00 Total Debt Service Credit ( $ per ERU) $ 1 - No New Debt Assumed to be issued. Exhibit B-6 City of Kalispell Wastewater Impact Fees Debt Service Credit - Collection Page 1 of 1 Total Existing Impact Fee Net Debt/ Debt1ERU Year Debt Service Revenue Debt Service ERUs ERU ($2009) 2009 $ 105,700 $ 2,846,408 $ 12,550 $ 2010 105,375 3,230,276 14,208 0.00 2011 105,075 1,087,641 14,753 0.00 2012 105,694 1,152, 092 15,316 0.00 2013 106,200 1,220,329 15,898 0.00 2014 105,594 1,292,573 16,500 0.00 2015 105,931 1,369,057 17,121 0.00 2016 106,156 1,450,031 17,763 0.00 2017 105,269 1,535,756 18,426 0.00 2018 105,269 1,626,510 19,112 0.00 2019 105,175 1,722,586 19,820 0.00 2020 105,950 1,824,295 20,552 0.00 2021 105,575 1,931,967 21,308 0.00 2022 103,125 2,045,950 22,089 0.00 2023 105,581 2,166,611 22,896 0.00 Total Debt Service Credit ($ per ERU ) $ N O N a Q Q LL r.+ CL CL U1 L O E X = 7 w0cn Ln w O O M M M Ln N O M EA co o co co LO N O Ln O Ln N M M EA co O Ln co a0 ME CO N O coco a0 Ln N O (O Ln 0') N CO M EA N O ' N co (o (O N I-- N co � co Ln N I -- EA EA EA 0 0 N N Ln Ln O O M M C O C (o Q X w o ( "a 0 c i �+ O M O y ) L c N 0 21 L w E U E O LL (o O a) L U a) U a H aai O U U a) ? N ? LL d .. L m o U 0co cn a cu Q d 'E 'E E a) c U E U o o v N V) E- E °' E cu (o� U D U) ( UW w N N U- V f� Q Ld E ch L o w E x = ch M = W U 3: co LO w O a0 q-t N O O M M (O a0 (o 6 4i 1 - - M LO N O M q-t M L L N 61} (A (f} (f} co O a0 O O co q-t I-- LO N (o O i � i O N � I� 1 O O N 1-- (O co I-- N N O LO — r- q-t M Ni Ni N co a0 CO Nt O co LO O i i i i i N (o CO N O LO LO O (f} I (f} I (f} (f} N C O C co Q X W o N O co N O M y+ ) L co N C O 21 L E co O o ... a coU U O O U U > L _ O O 0 U a) � co o U = � co 0 .� N n E 0 0 E W U U D U) Q 0 0 U) c O C W� E O a) U U) y-+ c co U C a� U Q N N N O 31. Eii O O M N Eii Eii N d U- CL E m H Exhibit B -8 ERU Determination TYPE OF BUILDING AND SEWER USE ERU'S 1. Single Family Residence/Duplex 1 each per unit 2. Multiple Family Residence 0.8 per dwelling unit 3. Mobile Home Space in Mobile Home Park (Common building at additional commercial rate and laundry areas at laundry 0.65 per space rate.) 4. Recreational Vehicle Waste Dumping Station 0.65 per station 5. Schools 0.030 per student capacity 6. Churches (School uses at additional per student capacity rate.) 0.64 per 100 seats 7. Hospitals — general 1 per bed 8. Convalescent Hospitals 0.5 per bed 9. Residential Care/Boarding Facilities 0.25 per bed 10. Hotels and Motels (Additional charges for restaurant or tavern at restaurant or tavern rate, laundry areas at laundry rates, and meeting room areas with fixtures at commercial rate.) 0.25 per room or motel unit 11. Food Preparation and/or Serving Areas 0.15 per 100 square feet 12. Vehicle Wash Self -Service Vehicle Wash 1.17 per bay Full -Service Vehicle Wash 15.66 per bay All Other Vehicle Washes See Wet Industrial 13. Laundries & Laundromats 0.3 per 100 square feet Industrial Laundries See Wet Industrial 1 14. Commercial, Office and Dry Industrial Charge for each plumbing fixture to be installed. Bath tub w/or w/o shower 0.13 Dental unit or cuspidor 0.1 Dishwasher 0.1 Disposal 0.1 Drinking Fountain 0.05 Floor Drain 0.013 Fountain/Backwash 0.1 Kitchen Sink 0.08 Laundry Tray 0.08 Lavatory 0.05 Service Sink 0.08 Shower (each head) 0.13 Swimming Pool/Backwash 0.1 Urinal 0.17 Urinal Trough (for each 2 foot section) 0.17 Wash Sink (for each set of faucets) 0.08 Washing Machine 0.07 Water Closet 0.33 In case of a remodel in types 5-13 which results in no increase in the units on which the charge for a new building is calculated, the ERU for the remodel will be calculated on the basis of the fixtures added using the amounts in Item 14. 15. Wet Industrial To be determined on an individual basis by the City 16. Undefined Building and Sewer Use To be determined on an individual basis by the City 17. Additional Loading or Change of Use Determined on basis of new use for entire facility less credit for former use. No refunds if new use is less than former use. 2 The following are the definitions of the classifications used in establishing the ERUs. 1. A single family residence shall be defined as a building containing one kitchen, designed and/or used to house not more than one family, including all necessary employees of such family, such building having a single sewer service connection. Mobile homes occupying a separate lot and providing permanent housing with a separate sewer connected shall be classified as a single-family residence. Duplexes shall be classified as two (2) single family residences. 2. A multiple family residence shall be defined as a building or a group of buildings housing three or more families, living independently of each other, a family being defined as one or more persons living as a single housekeeping unit or household with sewer service being provided through not more than one sewer connection. Common buildings in an apartment house complex requiring sewer service shall be charged as commercial buildings and that portion of buildings housing common laundry facilities shall be charged as laundries and Laundromats. 3. A mobile Home Park, including travel trailer parks, is defined as any area or tract of land having a sewer connection, and where sewerage collection pipes are extended to two or more spaces occupied by, or intended to be occupied by a mobile home, travel trailer or motor home which are defined as a vehicle with or without motive power which is designed, used or intended for use as a place of human habitation, or as eating, sleeping or living quarters or any combination thereof. A mobile home space is defined as the individual location having a sewer hookup for each such vehicle. For purposes of determining the GFCs for mobile home parks' common buildings such as recreation halls, etc., shall be charged as commercial buildings. Buildings housing laundry facilities shall be charged as laundries and Laundromats and food or drink service buildings shall be charged as food preparation and/or serving. 4. Recreation Vehicle Waste Dumping Stations are defined as buildings or structures used for the dumping of sanitary sewer wastes from recreational vehicle holding tanks. Includes gray water from sinks and showers. (This excludes an individual collector installed by a homeowner for his/her own use.) 5. Schools are defined as any building or group of buildings used for school purposes more than 12 hours per week, involving assemblage for instruction, education or recreation. Schools may be public or private. 3 6. Churches shall be defined as a building or structure whose principal use is for worship and in which the incidental use for school or recreational purposes is less than 12 hours per week. Church buildings used for school purposes in excess of 12 hours per week shall be charged the GFC per student capacity in addition to the charge per 100 seats as a church. 7. General hospitals shall be defined as a building or structure used for the temporary housing of ill or injured persons and containing facilities for medical and surgical treatment of such persons. No additional charge shall be made for laundry and food and drink preparation and serving facilities included in hospitals. 8. Convalescent hospitals or rest homes are defined as a building or structure used for housing of persons convalescing from illness or injury or persons requiring close personal care. No additional charge shall be made for laundry or food and drink preparation and serving facilities included in the convalescent hospitals. 9. Residential Care/Boarding Facilities is defined as a residential building or structure used for housing of persons requiring either long-term supervision and general care, or any type of dependency recovery. No additional charge shall be made for laundry or food and drink preparation and serving facilities included in the Residential Care/Boarding Facilities. 10. Hotels and motels are defined as a building or group of buildings used for temporary housing of persons containing rooms or units intended for the use of transient persons. Those areas within hotels and motels to be used for commercial preparation of and serving of food and drink shall be charged at the rate for food preparation and/or serving. Commercial areas within hotels and motels, including convention facilities and other such common areas other than lobby areas, shall be charged at the rate for commercial and dry industrial areas. Areas used for laundry facilities in hotels and motels shall be charged at the rate for laundries and Laundromats. Such additional charges for food and drink, commercial areas and laundry shall be in addition to the charge per room or motel unit. 11. Food preparation and serving, including restaurants, taverns, delicatessens and wholesale and retail bakeries, but does not include canneries, dairies, cheese factories, packing houses and similar facilities, which shall be classified as "Wet Industrial' under Item 15 of definitions. 12. Vehicle washes are defined as commercial buildings or structures used for washing vehicles. Self-service vehicle washes are coin -operated facilities serving the general public that require the customer to wash the vehicle. Full -service vehicle washes are facilities serving the general public, wherein the vehicle is washed for the customer, either automatically or by attendants. M All other vehicle and parts washing or steam cleaning facilities that discharge to the sanitary sewer will be reviewed on a case -by -case basis. 13. Laundries and Laundromats are defined as commercial buildings and structures, or parts of commercial buildings and structures used for housing and operating laundry equipment by the general public to wash clothes and linens for personal use. Industrial laundries are defined as buildings or structures or parts of buildings and structures used for housing and operating laundry equipment for the large scale washing of uniforms, towels, linens, etc. The anticipated volume and strength of the sewage to be generated from an industrial laundry would be considerably more that that from a commercial laundry or Laundromat. Industrial laundries shall be classified as "Wet Industrial' under Item 15. 14. Commercial buildings are defined as all buildings used for conducting of wholesale or retail trade. Dry industrial buildings or structures are those buildings or structures housing light industrial activities where use of water and subsequent discharge of sewer does not occur in connection with the industrial process. Warehouses and other storage buildings with sewer connections are classified as dry industrial buildings. 15. Wet industrial buildings are defined as those buildings and structures housing industrial activities where the use of water and subsequent discharge to the sewer occurs in connection with an industrial process. Facilities with a discharge of 15,000 gallons per day or greater are considered wet industrial. Other facilities that discharge less than 15,000 gallons per day, and whose anticipated strength of the sewage to be generated from the facility is greater than domestic sewage strengths may also be considered wet industrial. Those facilities will be reviewed on a case -by -case basis. The anticipated volume and strength of sewage from an average single-family residence shall be considered when calculating GFC. 5 The GFC for wet industrial shall be determined on an individual basis using the formula listed below: day. General Facility Charge) GFC = G.P.D. x SFR x F 192 G.P.D.= Anticipated volume of discharge to sewer in gallons per SFR = Current System Development Charge for single F = Extra strength factor, whole number multiplier derived for every 300 mg/I of biochemical oxygen demand or suspended solids, or fraction thereof, in excess of the first 300 mg/I of biochemical oxygen demand or suspended solids. Example: Factor Range 1 0-300 2 301-600 3 601-900 (continues per 300 increment) 16. Undefined buildings and sewer use are those not defined above. 17. Additional loading or change of use is defined as an increased demand for wastewater treatment from an existing wet industrial building or structure. The additional loading may be the result of replacement or addition to an existing structure or facility, a change in use, or a fifteen percent (15%) or greater increase above the permitted volume or character of the wastewater constituents being discharged. ERUs shall be determined on the basis of the number of single-family residence equivalent units with the additional loading or the new use with credit being given for the number of single-family residence equivalent units of the original facility. No refund will be given if the change of use results in a decreased sewer loading. Any addition to an existing single-family residence which does not result in an additional dwelling will be exempt from additional charge. 0 Exhibit B-9 Wastewater Impact Fee Supporting Documentation O O M V N M V O I� 0 Ln O . 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LL E O U rn U) f» N O J O � O � 6 o N E E O N Y O N N N °° 3 U m 10 ° 0 0 N 10 W 0 o 0 0 0 U u o N o N 61 U O W s� cO Z N fY o \ \ 6I ` LL p 1 3k O p p O (n O O (D O N Ir '(6 O O O N N p` U (6 N05 J o Ur o p 0 tk _T .� E� N o W' Q Z N Q N �.N N Q'N (n O o O .� 7 E u `—° a W O (n O N oQ 7 7 O oY�x3 p N J O 0 O d nano U 71 > Iry� ULI .� .� Q �_ o N !n T d ° a o n d n_ a .� s 3 .� > o `o U o m U Ul o J Ir 0 (n J J y� N m O O. E fY N f1 VC J J ._ (n 0 y6 M— Q O UI 6I O- O Ir for W N �aL�._(n u Hinz' N a�O L W E.> o�.QZa E .fr ��ou p� _L .>_— m-o 0In In w W p (n LL1 LL1�s� oxsao �� T� d WJf1 °y'� �y� N N D O O N N N O N (n N 0 '> a N >, _ d@6 UI UI 0 0 N U Ip O (n O (n V N ul Q N Q Q Q ( $ u) N .. p O (6 N o.` J O ° Q M M rn A a .� E E Ern LL JN 0- Z(h (n��U' > Z>fi �(n»�fY > > fYlH Ufi (n f177 H O %C C �-' �-' �-' �-' �-' �-' it a. a. _ LL' LL' — — (Z' (Z' (Z' (Z' (Z' (Z' :a T C N — � U! LL 0 V N N W O N V N MWWWWWWWWWWWWWWWWWWWWWWWWWWWWW LWO—E n n n n n n n n n n n n n n n n n n n rn n n n n n n n n n A- N (6 LL_ F 0 (n N N 0 i Chapter 1: Basis of Planning • Depending upon the analysis method, 2050 population estimates ranged from 70,246 (growth at 1.3% per year) to 229,453 (growth at 4% per year). • According to City staff knowledge regarding future development projects, zoning, land use, and probable population densities, theoretical build out population is estimated at 194,164 (or approximately 3.5% growth per year).6 • The project team chose to use a growth rate of 3% per year. This corresponds closely with the City staff estimates for theoretical build out, is lower than the aggressive 4.2% seen over the past 5 years, and is higher than historic growth rates of 1.3% per year (which are considered unrealistically low for future conditions). In addition, analysis shows that higher growth rates will likely be seen for the next 15-20 years (until about 2025 to 2030), then may slow down according to demographic trends. • Therefore, for the purpose of this facility plan, there will be an estimated 70,948, 95,348, and 148,549 people living within the study In 2050 there will be an estimated area by 2025, 2035, and 148,549 people living within the 2050, respectively. These defined study area boundary. This estimates will be used in corresponds to a growth rate of 3% per utility system analysis and year. capital improvements planning. 1.5 Historical and Projected Wastewater Flow and Loading In order to appropriately evaluate treatment plant and collection system capacity and the impact of growth, wastewater flow and loading and population data must be analyzed to determine per capita wastewater flow and loading values. These values can then be used in conjunction with future population projections to predict future flow and loading rates and determine wastewater system requirements. A detailed analysis of wastewater flow and loading was performed in 2005 in association with the Advanced Wastewater Treatment Plant Phase 1 6 The theoretical build out would occur if all available land was built upon according to likely densities. This theoretical build out does not consider political or ownership limitations that may exist or be placed on properties in the subject area; therefore, estimated future population should not exceed the theoretical build out. 1-14 City of Kalispell Wastewater Facility Plan Update April 16, 2008 Chapter 1: Basis of Planning 4.00 3.69 3.50 3.00 2.86 2.97 2.89 2.57 2.64 2.50 0 2.00 1.50 1.00 0.50 0.00 Figure 1-3. Daily Average Flow Data Per Month The average daily plant flow during 2005 (2.83 mgd) was divided by the 2005 population including the number of residents in the Evergreen sewer district served by the Kalispell system (26,657 people), and an average daily flow per capita was computed as 106.3 gallons per capita per day. This flow rate includes In 2005 the average per residential, commercial, visiting/employment capita wastewater flow was population and inflow and infiltration (1/1). 106.3 gallons per day. The 2005 Advanced Wastewater Treatment Plant — Basis of Design Report provided detailed analysis of wastewater flow and loading. The 2005 report estimated a per capita flow value of 129 gallons per capita per day for year 2025. This higher per capita flow rate resulted from the prediction that employment population was going to increase at a rate of 4% per year and residential population was going to increase at a rate of 2% per year. The predicted 2025 flow was modeled using both employment and residential flow contribution, but per capita flow was calculated using residential population only, thus resulting in an elevated per capita flow value. This study predicts that employment and residential population are currently growing and will continue to grow at the same rate (or proportionately to each other) resulting in a lower per capita flow value than that predicted in the Basis of Design Report. Current and historical data supports the use of the lower per capita flow value. A per capita flow value of 106 gallons per capita per day will be used in this study. The Basis of Design Report provided normal per capita influent loading values and per capita loading values corrected for the unbalanced residential/employment population growth. Table 1-5 summarizes per capita loading values from the Basis of Design Report. 1-16 City of Kalispell Wastewater Facility Plan Update April 16, 2008 Chapter 5: Sewer Collection and Conveyance System Analysis Chapter 5: Sewer Collection and Conveyance System Analysis 5.1 Introduction A computer -generated hydraulic model was developed for the City's sewer collection system using SewerGEMS software that works in conjunction with a GIS environment. This model was used to evaluate the existing collection system and to identify improvements that may be needed to serve existing customers and future population growth. The primary data source for building the sanitary sewer model was an AutoCAD drawing of the existing sewer system maintained by the City of Kalispell. This drawing shows the pipe network and the location of the pump stations and the treatment plant. The collection and conveyance system outside the City limits was delineated into six analysis areas, as shown in Figure 1-3 of Chapter 1. 5.2 Sewer Flow Analysis The sewer system model includes the existing City system and potential future system expansions. These future expansion locations were determined preliminarily in meetings between the consultants and the public works department. The locations were further developed by examining topography, roadway locations (potential pipe right-of-way), groundwater, and other physical limitations. Preliminary sewer conveyance system modeling of the Kalispell area was performed using the ultimate build -out population of 194,164. Pipes and pumping stations were placed according to locations identified by the City and other logical locations identified during the modeling process. This model resulted in pipe sizes ranging from 8 inch to 60 inch in size. The theoretical build -out scenario assumes that every available parcel of land is built upon according to likely densities developed with public works and planning staff during the basis of planning phase of this project. The potential for current growth rates to be sustained over the long term is uncertain. It is expected that population growth will slow once the "baby boomer" generation has passed. For the purposes of sizing future infrastructure, the project team determined it would be overly conservative and costly to design for the theoretical build -out population scenario. A design year population of 2035 was selected for sizing utility extensions. Utility routes and easements should be planned with additional right-of-way set aside for future utilities beyond the 2035 design year. May 7, 2008 City of Kalispell Wastewater Facility Plan Update 5-1 Chapter 5: Sewer Collection and Conveyance System Analysis 5.3 Collection and Conveyance System Analysis 5.3.1 Existing System Analysis and Proposed Improvements The existing sewer collection system was modeled using SewerGEMS. SewerGEMS is a Bentley software product that offers interoperability with AutoCad, ArcView, and Microstation. The existing system model was calibrated against existing wastewater treatment plant flow and known flow depths and patterns in the existing collection system. Average daily flow within the model includes a diurnal peaking factor of 1.56. A peak hour factor of 3.05 was used for sizing new collection piping. This peaking factor is the actual peak hour flow experienced by the Kalispell system, as described in Chapter 1. There are four main gravity interceptor sewers that collect sewage from the Kalispell service area and convey it to the wastewater treatment plant. Figure 5-1 is a map of the existing collection system highlighting these main interceptors. As described in Chapter 3, there are 34 sewage pumping stations. Two of these pumping stations, Grandview pumping station (Pumping Station No. 3) and Fairway pumping station (Pumping Station No. 9), were evaluated in detail because they serve regional areas with significant growth pressure and are vital to the City's ability to provide service to these areas. The forcemains for both of these pumping stations were up -sized in 2007 utilizing pipe bursting technology to increase capacity. Each of these forcemains and the main gravity interceptors were evaluated with regard to capacity to serve future growth. Line A serves the west side of Kalispell and the Highway 93 corridor north of the Meridian Road and Highway 93 intersection via the Grandview pumping station. A significant amount of growth is being planned for the area west and north of Kalispell. Line A and the Grandview pumping station were evaluated to determine how much excess capacity, if any, exists for serving growth in these areas, and if improvements could be made to increase capacity, if necessary, to serve this growth. The Grandview pumping station currently has a pumping capacity of 460 gallons per minute (gpm). It currently sees a peak inflow of 251 gpm leaving an excess capacity of 209 gpm. The Grandview pumping station could serve approximately 372 additional single family units. The gravity sewer main downstream of the forcemain discharge is at capacity with the Grandview pumping station pumping 460 gpm. The maximum capacity of the Grandview pumping station, if upgraded, was determined to be 860 gallons per minute. Line A, on its upper end, is already capacity limited and cannot convey the potential maximum capacity of the Grandview pumping station and serve customers currently connected to these lines. The system was modeled with part of the flow directed down Parkway Drive and part of the flow directed down Northern Lights 5-2 City of Kalispell Wastewater Facility Plan Update May 7, 2008 Chapter 5: Sewer Collection and Conveyance System Analysis and Liberty Streets. The Northern Lights and Liberty Street route can handle 460 gallons per minute of the Grandview pumping station flow. If a split structure is constructed, where the Grandview forcemain discharges into the gravity system at Northridge Drive and a second, parallel pipe is installed adjacent to the first four sections of sewer in Parkway Drive, this route could handle 400 gallons per minute from the Grandview pumping station. If new pumps are installed in the Grandview pumping station, allowing its full 860 gallon per minute capacity to be achieved, and a split structure and parallel sewer are constructed as described above, it is estimated that an additional 1,089 homes could be served by Line A. Line A is also limited at the manhole in the intersection of Liberty Street and Meridian Road. Line A could serve additional homes west of Kalispell if the forcemain from the Aspen Creek pumping station is routed to Line A at the intersection of Two Mile Drive and Meridian Road. The hydraulic model showed that Line A could handle an additional 0.60 mgd from Two Mile Drive to the south or approximately 742 single family residences. The model also showed Line A has excess capacity where it increases in size from 18-inch to 30-inch at the intersection of 9"' Street West and 5"' Avenue West and again where it increases from 30-inch to 36-inch near I' Avenue West and 18"' Street West. Each of these locations can handle an additional 2.0 mgd, which equates to approximately 2,474 single family residences at each location. Line B serves the southeast side of Kalispell in a built -out area. Line B has an excess capacity of 0.20 mgd. This equates to an additional 247 single family residences. Line B is not expected to see growth in excess of its current capacity. Line C serves the east side of Kalispell and is also in a built -out area. Line C has an excess capacity of 0.90 mgd, which equates to an additional 1,113 single family residences. Growth in the East Kalispell area could be served by Line C. Line D serves the northeast area of Kalispell along Whitefish Stage Road, collecting and routing flow to the Fairway pumping station. Line D has excess capacity of 0.35 mgd, which equates to 433 single family residences. Line D is limited by a section of 12-inch pipe at Whitefish Stage Road and West Evergreen Drive. If this pipe is upsized to 15-inch, Line D would have excess capacity of 0.70 mgd or the equivalent of 866 single family residences. The Fairway pumping station forcemain was recently upsized to 10-inch to achieve greater capacity. If the capacity of the Fairway pumping station is expanded the system could handle the additional 0.70 mgd. The forcemain from the Fairway pumping station discharges to Line E. Line E was also evaluated with regard to its capacity to handle the additional flow. Line E serves the central part of Kalispell, which is mostly built out. Line E also accepts flow from the Fairway pumping station. Line E has no remaining May 7, 2008 City of Kalispell Wastewater Facility Plan Update 5-3 Chapter 5: Sewer Collection and Conveyance System Analysis capacity under current conditions due to three sections of 8-inch sewer main in 1st Alley East North between East Wyoming and East Oregon Streets. If these sections of pipe are upsized to 12-inch, Line E can handle the additional 0.70 mgd from the Fairway pumping station. The Evergreen County Water and Sewer District pumping station and forcemain were evaluated to determine if excess capacity exists in the event a wastewater transport partnership for outside -District flows is developed to serve future growth. Recent development proposals directly north of the Evergreen District prompted this evaluation. The Evergreen pumping station contains three non -clog centrifugal pumps in a wet well/dry well configuration. It was originally designed for a peak flow, with two pumps running, of 2.6 mgd (1,800 gpm). Actual pump performance data shows that with two pumps running the output of the pumping station is 2.95 mgd (2,050 gpm). Flow data from the pumping station shows that the system currently pumps an average of 0.48 mgd. Evergreen is currently limited by interlocal agreement with Kalispell to a maximum average daily flow of 0.682 mgd. It is estimated that Evergreen's corresponding peak hour flow would be 2.01 MGD. The pumping station currently has excess capacity of 2.47 mgd over current average daily flows and 0.94 mgd over the peak hour flow corresponding to the maximum flow permitted by interlocal agreement. The excess capacity over the maximum allowed by interlocal agreement equates to 1,163 single family residences using City of Kalispell per capita flow and peaking factors. The existing pumps are equipped with 12 3/4-inch impellers that could be replaced with a maximum impeller size of 14 inches. If the impellers are replaced, it is estimated that the pumping station could achieve an output of 3.38 mgd (2,350 gpm) with two pumps running. If this improvement was made, the excess capacity beyond the peak hour flow corresponding to the maximum flow permitted by interlocal agreement would be 1.37 mgd (951 gpm), which equates to 1,695 single family residences. The Evergreen forcemain is a 14-inch pipe with an estimated maximum capacity of 3.5 mgd (2,430 gpm). The City of Kalispell, by the interlocal agreement, paid for 0.288 mgd (200 gpm) of forcemain capacity within the Evergreen forcemain. If the Evergreen pumping station pumps are fitted with larger impellers and Kalispell utilizes its allotment of 200 gpm, the forcemain will be at capacity. The forcemain's allowable excess capacity would be approximately the same as the Evergreen pumping station, 1.37 mgd (951 gpm) or approximately 1,695 single family residences. Figure 5-2 shows the location of the recommended improvements described above and summarizes the capacity of each of the main interceptors in additional flow and single family residences that could be served if the recommended improvements are made. It also shows the excess capacity of the Grandview, Fairway, and Evergreen forcemains. It should be noted that the evaluation of 5-4 City of Kalispell Wastewater Facility Plan Update May 7, 2008 Chapter 5: Sewer Collection and Conveyance System Analysis excess capacity assumes that the system will be adequately maintained and excess infiltration and inflow will not be allowed to occur. 5.3.2 Collection and Conveyance System Extension Evaluation As shown in Figure 1-3 of Chapter 1, the study area was segregated into six analysis areas: East Whitefish River, North Kalispell, West Stillwater River, West Kalispell, South Kalispell, and East Kalispell. Predicted population density for the 2035 design year was established and a hydraulic model developed to size and locate collection and conveyance infrastructure to serve the design year population. The existing system analysis, described above, indicates that the existing sewer system is limited and will only be able to serve a portion of the predicted 2035 design year population. The following discussion describes each of the analysis areas, the infrastructure required to serve the design year population, and the estimated cost of that infrastructure. East Whitefish River The East Whitefish River analysis area is located north of the Evergreen Sewer District, bounded on the west by the Flathead River, on the east by the Whitefish River, and north by the study area boundary. The projected population is generally less dense than other areas, at about 1 to 3 units per acre. The 2035 design year population is estimated to be 8,224 people. Alternatives Development and Evaluation The proposed East Whitefish River sewer collection and conveyance system consists of two main interceptor sewers generally running north to south on Trumble Creek Road and Helena Flats Road. The projected planned sewer system mainlines include pipes sized from 8- to 21-inch. Ten pumping stations would be required, including a main pumping station located adjacent to the existing Evergreen County Water and Sewer District pumping station, to convey sewer from the area via a 14-inch forcemain to the existing City of Kalispell Advanced Wastewater Treatment Plant (AWWTP), as shown in Figure 5-3. The design team examined the utilization of the Evergreen sewer system for serving this area and found the system to have a nominal amount of excess capacity. The system could serve approximately 1,163 additional single family residences in its current condition. If improvements are made to the existing Evergreen Pumping Station, approximately 1,695 additional single family residences could be served, or approximately 565 acres, under predicted development densities. The approximate equivalent area surrounding the Evergreen Sewer District is shown on Figure 5-4. May 7, 2008 City of Kalispell Wastewater Facility Plan Update 5-5 Chapter 5: Sewer Collection and Conveyance System Analysis Estimates of probable construction cost were developed for the infrastructure required to serve this area. Table 5-1 summarizes these costs. Detailed cost estimates are included in Appendix D. Table 5-1. East Whitefish River Cost Summary Description Total ($) South Helena Flats Pumping Station $252,000 Forcemain $573,000 Interceptor $504,000 South Helena Flats Subtotal $1,329,000 South Helena Flats 2 Pumping Station $243,000 Forcemain $350,000 Interceptor $572,000 Laterals $704,000 South Helena Flats 2 Subtotal $1,869,000 Helena Flats Pumping Station $1,247,000 Forcemain $1,577,000 Interceptor $1,650,000 Laterals $869,000 Helena Flats Subtotal $5,343,000 North Helena Flats Pumping Station $262,000 Forcemain $87,000 Interceptor $1,494,000 Laterals $619,000 North Helena Flats Subtotal $2,462,000 North Helena Flats 1 Pumping Station $243,000 Forcemain $29,000 Interceptor $439,000 North Helena Flats 1 Subtotal $711,000 North Helena Flats 2 Pumping Station $245,000 Forcemain $30,000 Interceptor $560, 000 5-6 City of Kalispell Wastewater Facility Plan Update May 7, 2008 Chapter 5: Sewer Collection and Conveyance System Analysis Description Total ($) North Helena Flats 2 Subtotal $835,000 Trumble Creek Pumping Station $308,000 Forcemain $80,000 Interceptor $2,283,000 Laterals $412,000 Trumble Creek Subtotal $3,083,000 Birch Grove 1 Pumping Station $237,000 Forcemain $46,000 Interceptor $325,000 Birch Grove 1 Subtotal $608,000 Birch Grove 2 Pumping Station $236,000 Forcemain $35,000 Interceptor $527, 000 Birch Grove 2 Subtotal $798,000 Evergreen Pumping Station $1,546,000 Forcemain $2,724,000 Evergreen Subtotal $4,270,000 East Whitefish River Service Area Total Estimated Probable $21,308,000 Construction Cost North Kalispell The North Kalispell analysis area is bounded on the east by the Whitefish River, on the west by the Stillwater River, on the south by the City of Kalispell, and on the north by the study area boundary. This area is currently experiencing development pressure, and growth is expected to be approximately two to four units per acre. The 2035 design year population is estimated to be 16,907 people. Alternatives Development and Evaluation The proposed North Kalispell sewer collection and conveyance system consists of two main interceptor sewers running north to south on Whitefish Stage Road and Highway 93. The projected, planned sewer system mainlines include pipes sized from 8- to 18-inch. Two pumping stations would be required to convey sewer from the Highway 93 corridor to the existing City of Kalispell system. As May 7, 2008 City of Kalispell Wastewater Facility Plan Update 5-7 Chapter 5: Sewer Collection and Conveyance System Analysis the area grows and population increases, most of the flow from Highway 93 and Whitefish Stage Road will need to be pumped west to the system along Stillwater Road. A single pumping station is required to convey sewer form Whitefish Stage Road to the existing City of Kalispell system. See Figure 5-5. Estimates of probable construction cost were developed for the infrastructure required to serve this area. Table 5-2 summarizes these costs. Detailed cost estimates are included in Appendix D. Table 5-2. North Kalispell Cost Summary Description Total($) Whitefish Stage Road Pumping Station $354,000 Forcemain 1 $58,000 Forcemain 2 $335,000 Interceptor 1 $2,067,000 Interceptor 2 $624,000 Whitefish Stage Road Subtotal $3,438,000 Highway 93 North Pumping Station $347,000 Forcemain $55,000 Interceptor $1,713,000 Highway 93 North Subtotal $2,115,000 Highway 93 North 2 Pumping Station $460,000 Forcemain $406,000 Interceptor $1,883,000 Highway 93 North 2 Subtotal $2,749,000 North Kalispell Service Area Total Estimated Probable Construction $8,302,000 Cost West Stillwater River The West Stillwater River analysis area is bounded on the east by the Stillwater River, on the south by the City of Kalispell, and on the north by the study area boundary. Growth is expected to occur at a density of two to four units per acre. The 2035 design year population is estimated to be 10,084 people. 5-8 City of Kalispell Wastewater Facility Plan Update May 7, 2008 Chapter 5: Sewer Collection and Conveyance System Analysis Alternatives Development and Evaluation The proposed West Stillwater River sewer collection and conveyance system consists of two main interceptor sewers ranging in size from 10- to 27-inch, flowing generally north to south along Church Drive and Stillwater Road, and includes two pumping stations. See Figure 5-6. Estimates of probable construction cost were developed for the infrastructure required to serve this area. Table 5-3 summarizes these costs. Detailed cost estimates are included in Appendix D. Table 5-3. West Stillwater River Cost Summary Description Total($) Church Drive Pumping Station Forcemain Interceptor Church Drive Subtotal Stillwater Road Pumping Station Forcemain Interceptor Stillwater Road Interceptor $438,000 $813,000 $1,761,000 $3,012,000 $512,000 $528,000 $1,170,000 $4,566,000 Stillwater Road Subtotal $6,776,000 West Stillwater River Service Area Total Estimated Probable $9,788,000 Construction Cost West Kalispell The West Kalispell analysis area is located along the western side of the study area and is bounded by Farm to Market Road on the west, Foys Lake Road on the south and the City of Kalispell on the east. Growth is expected to occur at a density of two to three units per acre. The 2035 design year population is estimated to be 19,938 people. May 7, 2008 City of Kalispell Wastewater Facility Plan Update 5-9 Chapter 5: Sewer Collection and Conveyance System Analysis Alternatives Development and Evaluation The proposed West Kalispell sewer collection and conveyance system consists of three main interceptors and multiple pumping stations. The east half of the area is served by an interceptor that generally follows Stillwater Road and the future route of the Highway 93 bypass to Three Mile Drive. Sewer flow from the West Stillwater River area enters this area at the intersection of West Reserve Drive and Stillwater Road. A second interceptor conveys flow from the west side of this area down West Valley Drive to Three Mile Drive and then to the intersection of Three Mile Drive and Spring Creek, where it joins with the Stillwater Road interceptor. The combined sewer from each side of this area is then conveyed in a single interceptor to a main pumping station located at the intersection of South Meridian Road and Ashley Creek. Sewer is then conveyed via a forcemain to the AWWTP. A third interceptor serves the area between Ashley Creek to the north and the southern boundary of the study area conveying sewer down Foys Lake Road to a second pumping station located at the intersection of Foys Lake Road and the future Highway 93 bypass. Sewer from this pumping station is conveyed by a second forcemain to the AWWTP. The pipe sizes range from 10- to 42-inch, with the large 42-inch pipe located at the south end of the West Kalispell area. This 42-inch pipe flows to the South Meridian pumping station. See Figure 5-7. The South Meridian pumping station would need to have a capacity of 22.0 mgd in order to serve the predicted 2035 population. It is not reasonable to think the 42-inch interceptor and 22.0 mgd South Meridian pumping station would be constructed until the capacity of the existing system is no longer adequate. Estimates of probable construction cost were developed for the infrastructure required to serve this area. Table 5-4 summarizes these costs. Detailed cost estimates are included in Appendix D. Table 5-4. West Kalispell Cost Summary Description Total ($) West Valley Drive Interceptor $2,400,000 West Valley Drive Subtotal $2,400,000 Three Mile Drive Interceptor $3,600,000 Three Mile Drive Subtotal $3,600,000 Spring Creek South Meridian Pumping Station $1,776,000 5-10 City of Kalispell Wastewater Facility Plan Update May 7, 2008 Chapter 5: Sewer Collection and Conveyance System Analysis Description Total ($) South Meridian Forcemain $2,056,000 Spring Creek Interceptor $5,066,000 Spring Creek Subtotal $8,898,000 Foys Lake Road Pumping Station $343,000 Forcemain $656,000 Interceptor $1, 584, 000 Foys Lake Road Subtotal $2,583,000 West Kalispell Service Area Total Estimated Probable Construction $17,481,000 Cost East Kalispell The East Kalispell analysis area is bounded by the City of Kalispell on the west, the Stillwater River on the east, and the Evergreen County Water and Sewer District on the north. Growth is expected to occur at a density of two to four units per acre. The 2035 design year population is estimated to be 4,107 people. Alternatives Development and Evaluation The proposed East Kalispell sewer collection and conveyance system consist of a gravity interceptor in Willow Glen Drive with pipe sized from 8- to 12-inch in size. Sewer is collected at a single main pumping station and a 10-inch forcemain conveys sewer to the existing system. See Figure 5-8. Estimates of probable construction cost were developed for the infrastructure required to serve this area. Table 5-5 summarizes these costs. Detailed cost estimates are included in Appendix D. Table 5-5. East Kalispell Cost Summary Description Total ($) East Kalispell Pumping Station $318,000 Forcemain $487,000 Interceptor $1,278,000 East Kalispell Subtotal $2,083,000 East Kalispell Service Area Total Estimated Probable Construction $2,083,000 Cost May 7, 2008 City of Kalispell Wastewater Facility Plan Update 5-11 Chapter 5: Sewer Collection and Conveyance System Analysis South Kalispell The South Kalispell area is located south of the City limits, and is bounded on the east by the Flathead River and on the west and south by the study area boundary. Growth is expected to occur at a density of one to three units per acre. The 2035 design year population is estimated to be 6,474 people. Alternatives Development and Evaluation The proposed South Kalispell sewer collection and conveyance system consists of a series of gravity interceptors, pumping stations, and forcemains that convey sewer from the south end of the area, north to the AWWTP. Pipe sizes range from 8- to 15-inch, and run along Highway 93, Airport Road, and Rocky Cliff Drive with four pumping stations. See Figure 5-9. Estimates of probable construction cost were developed for the infrastructure required to serve this area. Table 5-6 summarizes these costs. Detailed cost estimates are included in Appendix D. Table 5-6. South Kalispell Cost Summary Description Total ($) Highway 93 South Pumping Station $238,000 Forcemain $52,000 Interceptor $120,000 Highway 93 South Subtotal $410,000 Highway 93 South 2 Pumping Station $243,000 Forcemain $66,000 Interceptor $442, 000 Highway 93 South 2 Subtotal $751,000 Rocky Cliff Pumping Station $248,000 Forcemain $183,000 Interceptor $1,472,000 Rock Cliff Subtotal $1,903,000 Airport Road Pumping Station $341,000 Forcemain $355,000 Interceptor $2, 524, 000 Airport Road Subtotal $3,220,000 5-12 City of Kalispell Wastewater Facility Plan Update May 7, 2008 Chapter 5: Sewer Collection and Conveyance System Analysis Description Total ($) South Kalispell Service Area Total Estimated Probable Construction $6,284,000 Cost Collection and Conveyance System Extension Cost Summary The cost to serve the predicted 2035 population to the extent of the study area boundary is summarized in Table 5-7 below. Table 5-7. Sewer Collection and Conveyance System Cost Summary Description Total ($) East Whitefish River $21,308,000 North Kalispell $8,302,000 West Stillwater River $9,788,000 West Kalispell $17,481,000 East Kalispell $2,083,000 South Kalispell $6,284,000 Total Service Area Estimated Probable Construction Cost $65,246,000 May 7, 2008 City of Kalispell Wastewater Facility Plan Update 5-13 Chapter 7: Recommendations and Capital Improvement Plan Table 7-5. Growth Related Project Summary Project Description Percent of Project Cost Related to Growth 1 Grandview Pumping Station Upgrade 50% 2 Northridge Drive split structure and 100% Parkway Drive parallel sewer 3 Whitefish Stage Road pipe upsize 44% 4 Fairway Pumping Station Upgrade 48% 5 15t Alley East North pipe Upsize 66% 6 Stillwater Road Interceptor 100% 7 Whitefish Stage Road improvements 100% 8 Highway 93 North improvements 100% 9 Whitefish Stage Road Interceptor 100% 10 AWWTP Phase 2 Expansion 73% 11 AWWTP Phase 3 Expansion 74% 12 AWWTP Phase 4 Expansion 100% 13 AWWTP Odor Control Upgrade 0% 14 AWWTP Effluent Quality Upgrade 0% (2015) 15 AWWTP Effluent Quality Upgrade 0% (2025) 7-10 City of Kalispell Wastewater Facility Plan Update November 19, 2008 Appendix 7-6-1601. Definitions. Page 1 of 1 Montana Code Annotated 2009 Previous Section MCA Contents Part Contents Search Help Next Section 7-6-1601. Definitions. As used in this part, the following definitions apply: (1) (a) "Capital improvements" means improvements, land, and equipment with a useful life of 10 years or more that increase or improve the service capacity of a public facility. (b) The term does not include consumable supplies. (2) "Connection charge" means the actual cost of connecting a property to a public utility system and is limited to the labor, materials, and overhead involved in making connections and installing meters. (3) "Development" means construction, renovation, or installation of a building or structure, a change in use of a building or structure, or a change in the use of land when the construction, installation, or other action creates additional demand for public facilities. (4) "Governmental entity" means a county, city, town, or consolidated government. (5) (a) "Impact fee" means any charge imposed upon development by a governmental entity as part of the development approval process to fund the additional service capacity required by the development from which it is collected. An impact fee may include a fee for the administration of the impact fee not to exceed 5% of the total impact fee collected. (b) The term does not include: (i) a charge or fee to pay for administration, plan review, or inspection costs associated with a permit required for development; (ii) a connection charge; (iii) any other fee authorized by law, including but not limited to user fees, special improvement district assessments, fees authorized under Title 7 for county, municipal, and consolidated government sewer and water districts and systems, and costs of ongoing maintenance; or (iv) onsite or offsite improvements necessary for new development to meet the safety, level of service, and other minimum development standards that have been adopted by the governmental entity. (6) "Proportionate share" means that portion of the cost of capital system improvements that reasonably relates to the service demands and needs of the project. A proportionate share must take into account the limitations provided in 7-_6_-1602. (7) "Public facilities" means: (a) a water supply production, treatment, storage, or distribution facility; (b) a wastewater collection, treatment, or disposal facility; (c) a transportation facility, including roads, streets, bridges, rights -of -way, traffic signals, and landscaping; (d) a storm water collection, retention, detention, treatment, or disposal facility or a flood control facility; (e) a police, emergency medical rescue, or fire protection facility; and (f) other facilities for which documentation is prepared as provided in 7-6-_1.602 that have been approved as part of an impact fee ordinance or resolution by: (i) a two-thirds majority of the governing body of an incorporated city, town, or consolidated local government; or (ii) a unanimous vote of the board of county commissioners of a county government. History: En. Sec, 1, Ch. 299, L. 2005. Provided by Montana Legislative Services http://data.opi.mt.gov/bills/mca/7/6/7-6-1601.htm 4/9/2010 7-6-1602. Calculation of impact fees -- documentation required -- ordinance or resolution -- requirement... Page 1 of 1 Montana Code Annotated 2009 Premous Section Mr -A Contents Part Contents Search Help Next Section 7-6-1602. Calculation of impact fees — documentation required — ordinance or resolution — requirements for impact fees. (1) For each public facility for which an impact fee is imposed, the governmental entity shall prepare and approve a service area report. (2) The service area report is a written analysis that must: (a) describe existing conditions of the facility; (b) establish level -of -service standards; (c) forecast future additional needs for service for a defined period of time; (d) identify capital improvements necessary to meet future needs for service; (e) identify those capital improvements needed for continued operation and maintenance of the facility; (f) make a determination as to whether one service area or more than one service area is necessary to establish a correlation between impact fees and benefits; (g) make a determination as to whether one service area or more than one service area for transportation facilities is needed to establish a correlation between impact fees and benefits; (h) establish the methodology and time period over which the governmental entity will assign the proportionate share of capital costs for expansion of the facility to provide service to new development within each service area; (i) establish the methodology that the governmental entity will use to exclude operations and maintenance costs and correction of existing deficiencies from the impact fee; 0) establish the amount of the impact fee that will be imposed for each unit of increased service demand; and (k) have a component of the budget of the governmental entity that: (i) schedules construction of public facility capital improvements to serve projected growth; (ii) projects costs of the capital improvements; (iii) allocates collected impact fees for construction of the capital improvements; and (iv) covers at least a 5-year period and is reviewed and updated at least every 2 years. (3) The service area report is a written analysis that must contain documentation of sources and methodology used for purposes of subsection (2) and must document how each impact fee meets the requirements of subsection (7). (4) The service area report that supports adoption and calculation of an impact fee must be available to the public upon request. (5) The amount of each impact fee imposed must be based upon the actual cost of public facility expansion or improvements or reasonable estimates of the cost to be incurred by the governmental entity as a result of new development. The calculation of each impact fee must be in accordance with generally accepted accounting principles. (6) The ordinance or resolution adopting the impact fee must include a time schedule for periodically updating the documentation required under subsection (2). (7) An impact fee must meet the following requirements: (a) The amount of the impact fee must be reasonably related to and reasonably attributable to the development's share of the cost of infrastructure improvements made necessary by the new development. (b) The impact fees imposed may not exceed a proportionate share of the costs incurred or to be incurred by the governmental entity in accommodating the development. The following factors must be considered in determining a proportionate share of public facilities capital improvements costs: (i) the need for public facilities capital improvements required to serve new development; and (ii) consideration of payments for system improvements reasonably anticipated to be made by or as a result of the development in the form of user fees, debt service payments, taxes, and other available sources of funding the system improvements. (c) Costs for correction of existing deficiencies in a public facility may not be included in the impact fee. (d) New development may not be held to a higher level of service than existing users unless there is a mechanism in place for the existing users to make improvements to the existing system to match the higher level of service. (e) Impact fees may not include expenses for operations and maintenance of the facility. History: En. Sec. 2, Ch. 299, L. 2005; amd. Sec. 1, Ch. 358, L. 2009. Provided by Montana Legisiative Services http://data.opi.mt.gov/bills/mca/7/6/7-6-1602.htm 4/9/2010 7-6-1603. Collection and expenditure of impact fees -- refunds or credits -- mechanism for appeal requir... Page 1 of 1 Montana Code Annotated 2009 Prevous Section MCA Contents Part Contents Search Help Next Section 7-6-1603. Collection and expenditure of impact fees -- refunds or credits -- mechanism for appeal required. (1) The collection and expenditure of impact fees must comply with this part. The collection and expenditure of impact fees must be reasonably related to the benefits accruing to the development paying the impact fees. The ordinance or resolution adopted by the governmental entity must include the following requirements: (a) Upon collection, impact fees must be deposited in a special proprietary fund, which must be invested with all interest accruing to the fund. (b) A governmental entity may impose impact fees on behalf of local districts. (c) If the impact fees are not collected or spent in accordance with the impact fee ordinance or resolution or in accordance with 7-6-1602, any impact fees that were collected must be refunded to the person who owned the property at the time that the refund was due. (2) All impact fees imposed pursuant to the authority granted in this part must be paid no earlier than the date of issuance of a building permit if a building permit is required for the development or no earlier than the time of wastewater or water service connection or well or septic permitting. (3) A governmental entity may recoup costs of excess capacity in existing capital facilities, when the excess capacity has been provided in anticipation of the needs of new development, by requiring impact fees for that portion of the facilities constructed for future users. The need to recoup costs for excess capacity must have been documented pursuant to 7-6-1.602 in a manner that demonstrates the need for the excess capacity. This part does not prevent a governmental entity from continuing to assess an impact fee that recoups costs for excess capacity in an existing facility. The impact fees imposed to recoup the costs to provide the excess capacity must be based on the governmental entity's actual cost of acquiring, constructing, or upgrading the facility and must be no more than a proportionate share of the costs to provide the excess capacity. (4) Governmental entities may accept the dedication of land or the construction of public facilities in lieu of payment of impact fees if - (a) the need for the dedication or construction is clearly documented pursuant to 7-6-1602; (b) the land proposed for dedication for the public facilities to be constructed is determined to be appropriate for the proposed use by the governmental entity; (c) formulas or procedures for determining the worth of proposed dedications or constructions are established as part of the impact fee ordinance or resolution; and (d) a means to establish credits against future impact fee revenue has been created as part of the adopting ordinance or resolution if the dedication of land or construction of public facilities is of worth in excess of the impact fee due from an individual development. (5) Impact fees may not be imposed for remodeling, rehabilitation, or other improvements to an existing structure or for rebuilding a damaged structure unless there is an increase in units that increase service demand as described in 7-6-1602(2) 0). If impact fees are imposed for remodeling, rehabilitation, or other improvements to an existing structure or use, only the net increase between the old and new demand may be imposed. (6) This part does not prevent a governmental entity from granting refunds or credits: (a) that it considers appropriate and that are consistent with the provisions of 7-6-1602 and this chapter; or (b) in accordance with a voluntary agreement, consistent with the provisions of 7-6-1602 and this chapter, between the governmental entity and the individual or entity being assessed the impact fees. (7) An impact fee represents a fee for service payable by all users creating additional demand on the facility. (8) An impact fee ordinance or resolution must include a mechanism whereby a person charged an impact fee may appeal the charge if the person believes an error has been made. History: En. Sec. 3, Ch. 299, L. 2005; amd. Sec. 2, Ch. 358, L. 2009. Provided by Montana Legislative Services http://data.opi.mt.gov/bills/mca/7/6/7-6-1603.htm 4/9/2010 7-6-1604. Impact fee advisory committee. Page 1 of 1 Montana Code Annotated 2009 Preuous Section MCA Contents Part Contents Search Help Next Section 7-6-1604. Impact fee advisory committee. (1) A governmental entity that intends to propose an impact fee ordinance or resolution shall establish an impact fee advisory committee. (2) An impact fee advisory committee must include at least one representative of the development community and one certified public accountant. The committee shall review and monitor the process of calculating, assessing, and spending impact fees. (3) The impact fee advisory committee shall serve in an advisory capacity to the governing body of the governmental entity. History: En. Sec. 4, Ch. 299, L. 2005. Provided ,by Montana Legislative Services http://data.opi.mt.gov/bills/mca/7/6/7-6-1604.htm 4/9/2010