COST REIMBURSEMENT AND RECOUPMENT FEES
A developer or property owner that agrees to construct a water or wastewater line or an associated facility that on acceptance will become part of New Braunfels Utilities water and wastewater system and which supplies capacity to other existing or new developments, may apply to New Braunfels Utilities to establish recoupment fees to be paid by other users of the facilities and to reimburse the developer or property owner a proportional amount of the costs of constructing such improvements. The developer or property owner also may apply for cost participation by New Braunfels Utilities for the costs of oversizing water or wastewater lines in excess of one size larger than the NBU Standard Size required to serve the development.
Section 2.02 STUDY DETERMINING AMOUNT OF COST REIMBURSEMENT
The amount of the cost reimbursement for an improvement, if any, shall be based on engineering cost estimates agreed upon in writing by the Chief Executive Officer and the applicant, and verified in a study provided by the applicant. The study shall aggregate the costs of associated improvements where feasible. New Braunfels Utilities may establish guidelines for eligible costs to administer the policy in this section. The study shall contain the following minimum elements:
(1) identification of the area and all properties to be served by the water or wastewater lines or associated facilities to be installed;
(2) identification of the costs of the facilities to be installed;
(3) apportionment of the costs of the facilities to be installed among lots, tracts or parcels to be served by the improvements, based upon capacity to be utilized by such properties, using accepted engineering standards and practices;
(4) calculation of the maximum amount of the costs which are to be reimbursed to the developer or property owner, net of costs attributable to the developer’s or property owner’s utilization of capacity of the lines or associated facilities; and
(5) calculation of a recoupment fee to be charged per unit of land that is to be connected to the water or wastewater lines or associated facilities.
Section 2.03 AMOUNT OF COST PARTICIPATION
NBU in its sole discretion shall determine the amount of any cost participation based on engineering estimates of the costs attributable to the increase in the size of lines exceeding one size larger than the NBU Standard Size, taking into consideration the degree to which the need for such oversizing is created by the development for which service extension is being requested.
Section 2.04 SERVICE EXTENSION CONTRACT REQUIRED
(A) The applicant for approval of a service extension must request the establishment of recoupment fees or cost participation in writing at the time the applicant applies to the Chief Executive Officer of New Braunfels Utilities for approval of the service extension. If the applicant for approval of a service extension requests establishment of recoupment fees or cost participation, a written service extension contract is required.
(B) The service extension contract shall include at a minimum the recoupment fee and cost participation, if any, approved by NBU, the duration of the right to collect recoupment fees, and provisions for forfeiture of such fees to NBU in the event they are not collected by the contracting party, his successor-in-interest, or assignee.
(C) An executed service extension contract may be assigned by the party requesting service extension with the written consent of New Braunfels Utilities, which shall not be unreasonably withheld.
(A) The Chief Executive Officer of New Braunfels Utilities shall review each request for cost reimbursement from recoupment fees or cost participation for oversizing lines.
(B) The Chief Executive Officer of New Braunfels Utilities may approve the study for cost reimbursement from recoupment fees or cost participation for oversizing lines, with or without modifications, only if the Chief Executive Officer of New Braunfels Utilities, or the Board of Trustees on review of the Chief Executive Officer decision, determines that:
(1) the line(s) to be extended has not been included on the impact fee capital improvements plan for that category of capital improvement;
(2) the size of each proposed line or facility complies with the generally accepted engineering practices and other planning criteria of the New Braunfels Utilities and final design and routing will comply with the Water/Sewer Connection Policy Manual;
(3) the study proposing recoupment fees fairly apportions the extension costs among prospective users of the facilities to be installed;
(4) the proposed line or facility is a reasonable extension or addition to the water and wastewater utility system; and
(5) funds for participation in the costs of oversizing lines are available from an identified source of funds or that funds will be available to meet the proposed payment schedule.
(C) Requests which are not approved by the Chief Executive Officer of New Braunfels Utilities under (B), may be presented to the Board of Trustees for further consideration at the discretion of the Chief Executive Officer.
(D) Upon approval of the request for reimbursement from recoupment fees, any development on or user of property identified in the approved fee study thereafter that connects to or utilizes the capacity of the water or wastewater line or associated facility for which a recoupment fee has been established shall pay the applicable fee. Recoupment fees shall be collected by New Braunfels Utilities before construction commences on any water or wastewater improvements to serve such land or before connection to the facility, whichever first occurs.
Section 2.06 CONDITIONS OF COST REIMBURSEMENT
(A) A developer or property owner constructing a water or wastewater line or an associated facility that is eligible for cost reimbursement from recoupment fees or cost participation for oversizing may not receive cost reimbursement payment for the line or facility unless the entity complies with each requirement or regulation of New Braunfels Utilities relating to:
(1) the public advertising of the line or facility;
(2) the bidding on the line or facility;
(3) a performance or payment bond for the line or facility; and
(4) a warranty on the line or facility.
(B) The developer or property owner constructing the line or facility is not entitled to receive a cost reimbursement payment from recoupment fee proceeds or cost participation for oversizing lines until the entity submits documentation showing the entity’s compliance with each requirement described by Subsection (A) and the line or facility is accepted in writing by New Braunfels Utilities.
Section 2.07 PAYMENT OF COST PARTICIPATION AND RECOUPMENT FEES
(A) For projects subject to a service extension contract approved by NBU by April 1 of any year, New Braunfels Utilities shall pay the developer or property owner holding the extension contract any eligible cost reimbursement for oversizing, without interest, within 60 days of completion and acceptance of the project by NBU, but no earlier than the following September 1.
(B) For projects for which a service extension contract is approved by NBU after April 1 of any year, New Braunfels Utilities shall pay the developer or property owner holding the extension contract any eligible cost reimbursement for oversizing, without interest, for a completed and accepted project within 60 days of completion and acceptance of the project by NBU but no earlier than September 1 of the next calendar year.
(C) For a period of 15 years following New Braunfels Utilities’ acceptance of the water line, wastewater line, or associated facility, the developer or property owner shall be entitled to reimbursement from the proceeds of the recoupment fees established pursuant to this section, up to the maximum amount of the reimbursement established in the approved recoupment fee study. New Braunfels Utilities may deduct two (2) percent of the amount of recoupment fees collected from the amount of the fees reimbursed to the developer or property owner as an administration fee.
(D) Recoupment fees, which have been collected pursuant to the service extension contract, shall be paid to the developer or property owner annually no later than October 1 of each year, until the term of the agreement expires.
(E) New Braunfels Utilities may establish one or more recoupment fee accounts for purposes of administering the policies of this Article. New Braunfels Utilities shall deposit all recoupment fees collected pursuant to this article into such account(s). Expenditures from such accounts shall be earmarked solely for reimbursement of developers or property owners for the installation of water lines or wastewater lines or associated facilities for which recoupment fees have been established pursuant to this article.
(F) It shall be the responsibility of the service extension contract holder or his assignee to provide to NBU in writing current contact information. NBU will mail reimbursement payments to the last contact of record reflected on it books. In the event that the service extension contract holder or his assignee has not collected recoupment payments or cost participation in oversize lines sent to the contact of record for a period of one year from the date such payments are due pursuant to this section 2.07, such accrued amounts shall become the funds of NBU for purposes of expenditure on cost participation for oversizing lines or other system improvements in NBU’s sole discretion.
2.08 RECOUPMENT FEES FOR NEW BRAUNFELS UTILITIES PROJECT
(A) New Braunfels Utilities may initiate capital projects from time to time involving construction of water or wastewater lines or associated facilities, and may seek to recoup its costs through establishment of recoupment fees.
(B) Prior to establishing fees, New Braunfels Utilities shall cause a study to be prepared that satisfies the requirements of section 2.02. The Board of Trustees shall establish recoupment fees based upon the approved study, with or without modification.
(C) Following establishment of recoupment fees by the Board, any development on or user of property identified in the approved recoupment fee study thereafter that connects to or utilizes the capacity of the water or wastewater line or associated facility for which a recoupment fee has been established shall pay the applicable fee. Recoupment fees shall be collected by New Braunfels Utilities before construction commences on any water or wastewater improvements to serve such land or before connection to the facility, whichever first occurs.
(D) Recoupment fees established under this section may be collected for a period of ten (10) years following final construction by New Braunfels Utilities of the waterline, wastewater line, or associated facility.
This Article II shall not apply to any project for which cost participation for oversizing lines was approved by the Board of NBU pursuant to the rules in effect immediately preceding these rules.