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4 | P a g e <br /> <br />many cities have adopted system development charges (SDCs) to determine how much new <br />construction will pay for the capacity they require from each infrastructure system (water, sewer, <br />stormwater, transportation, and/or parks). The methodology for SDCs requires cities to make <br />capital improvement plans, determine what costs will be by project, and determine the capacity <br />that is used by each development type. Then the city establishes a rate for each type of unit <br />constructed. Each city can then set a policy of how much of these costs will be paid by <br />developers and how much will not be charged, which means the funds are provided by the city’s <br />general fund or current user fees. These SDCs are set using complex methodologies and <br />intentional conversations about what cities can afford to forego if they do not charge the total <br />cost. They are also dependent on knowing the capacity needs for future development. <br /> <br />All of this means that if a city did not plan for a potential doubling, tripling, or quadrupling of <br />capacity, it is unclear that new units added into older neighborhoods will be serviceable. There <br />may be some capacity left in the infrastructure, but it is finite. The pipes are a certain size; the <br />roads are built to an expected level of travel. Too much redevelopment may require upsizing this <br />infrastructure and there are not plans or funds to do this. SDCs are unlikely to account for this <br />type of development and are based on area-wide projects set out in the capital improvement plan. <br /> <br />Many of our cities are currently struggling to find the funding from many sources to provide for <br />maintenance and improvement of their current systems. The 2017 legislature opened up a large <br />amount of funding for transportation projects, but that is only part of the infrastructure question. A <br />2016 survey by the LOC found that the 120 cities that responded to the survey identified $7.6 <br />billion in water related projects, including drinking and wastewater treatment plants, water <br />storage, stormwater improvements, and water and wastewater line repair or replacement. And <br />that was at 2016 levels of expected development and growth. <br /> <br />To comply with comprehensive planning processes, cities need to plan for these services. <br />Without local knowledge of where these infrastructure deficiencies might make it impossible to <br />allow for the infill required by this legislation, cities cannot plan for the infrastructure facilities that <br />are required under Goal 11 or the transportation systems that need to be in place under Goal 12. <br />The rules that guide cities under the land use system require cities to not set goals for <br />development that cannot be properly serviced, but HB 2001 does not account for the time and <br />need for such planning. <br /> <br />Smaller communities impacted <br />While there is a population threshold for cities required to do this work, smaller communities will <br />still be impacted. Counties over 15,000 in population are also required to provide for this level of <br />development inside their urban growth boundaries, and those UGBs include all of the cities within <br />March 6, 2019, Work Session – Item 1