Item A: City of Coburg Request for Connection to Regional Wastewater Facilities

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Cost Equity Recovery of Capital Asset Investments, New Capital Expansions, and Planning and Study Process Costs This section addresses the costs a prospective sewer customer outside the UGB could expect to be assessed assuming existing and future Eugene-Springfield sewer customers would not absorb or subsidize the costs of providing service outside the planned service area. Eugene-Springfield area sewer customers and property owners have paid for the locally-funded share of the planning, permitting and construction of existing facilities through a combination of property taxes, user rates and connection fees over time. The facilities have been built to serve current populations and future growth within the UGB. Because Coburg is outside the UGB, its wastewater demands have not been planned for as part of the MWMC service district or the local collection systems. While sufficient average dry weather capacity is currently available to connect new customers, an increment of capacity and facilities equivalent to Coburg’s increment of demand would need to be added to the regional wastewater system at some point. In order to establish equity among Eugene-Springfield customers and Coburg, Coburg would need to be assessed for a prorated share of the local (Eugene) and regional (MWMC) system capacity used, as well as for the facilities, buildings, planning, permitting, etc. that are necessary to run the overall regional wastewater program. To assist Coburg in determining whether connection to the regional system would be cost effective in comparison to building its own system, and to provide the elected officials with a starting point for determining potentially appropriate connection (or “buy-in”) costs, SEL directed staff to prepare a rough analysis. The analysis was directed under the premise that costs would be captured in a manner that avoids “subsidies.” This underlying premise reflects sentiments expressed by the elected officials at the June, 2004 JEO meeting, and the requirements under the MWMC IGA, which states that connection fees be charged to create equity among existing and future sewer customers. To provide a “ball park” analysis, but keep it as simple and objective as possible, the scope was limited to the following areas: 1.The capital assets/facilities addressed in the 2004 MWMC Facilities Plan and SDC methodology; 2.The capital assets (existing support facilities) that are not addressed in the MWMC SDC methodology. 3.The Eugene collection system connection costs; 4.The contract costs for major long-range planning studies conducted since 1996 to address future capacity needs through 2025; and 5.The elected officials’ decision-making process and adoption of necessary Metro Plan and MWMC IGA amendments. The simplest approach to this rough analysis was to apply the MWMC SDC methodology to Coburg’s actual and planned wastewater profile, which was provided by Brown and Caldwell engineers. The methodology was applied first to show the actual total of SDCs that would be paid if the equivalent set of customers was located inside the UGB. The Eugene local wastewater SDC methodology (in effect in 2004) was applied similarly, under the assumption Coburg would connect to the Eugene collection system. This analysis resulted in charges summarized below as a “Baseline Comparison.” Page 7