Item 2C: Adoption of Resolution 4964 on SDCs

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ECC UGENE ITY OUNCIL AIS GENDA TEM UMMARY Adoption of Resolution 4964Adopting an Inflationary Adjustment of Systems Development Charges for Parks System, and Local Wastewater System, Stormwater System, and Transportation System; Superseding Administrative Order 58-08-02-F; and Amending Resolution No. 4900 Meeting Date: February 23, 2009 Agenda Item Number: 2C Department: Public Works Staff Contact: Fred McVey www.eugene-or.gov Contact Telephone Number: 682-5216 ISSUE STATEMENT The City Council is asked to adopt a resolution adopting an inflationary increase in Systems Development Charges (SDCs) for the local wastewater, stormwater, transportation and parks systems. The proposed adjustment follows adopted policy for implementing periodic adjustments to SDCs based on adopted cost indices. BACKGROUND Council Action History Effective May 7, 2007, the council adopted the System Development Charges (SDC) Methodologies by Resolution No. 4900 which updated the parks SDC methodology and rates. Resolution No. 4900 has subsequently been amended by Resolution Nos. 4929 (inflationary adjustment to Parks SDC rates effective April 3, 2008) and 4943 (inflationary adjustment to regional wastewater SDC rates effective July 1, 2008). In addition, inflationary adjustments of SDC rates for the local wastewater, stormwater, and transportation systems were adopted by Administrative Order No. 58-08-02-F, effective April 3, 2008. This action is being placed on the Consent Calendar because the resolution adopts a standard periodic adjustment following policies and procedures previously adopted by the council. Financial Considerations SDCs provide a funding mechanism to account for the costs and value of infrastructure system capacity required by new development. The SDC Methodologies adopted by the council provide for periodic adjustments to SDCs to further account for changes in construction and land costs. Periodic adjustments allow SDCs to more closely reflect current costs of providing system capacity to new development. The proposed rate adjustment to the local wastewater, stormwater and transportation systems is based on a single adopted cost index, the 20-city national average construction cost index (CCI) as published by the Engineering News-Record (ENR). The ENR for the prior 12-month period as reported in December, 2008, reflects an increase in average construction costs of 5.7%. Z:\CMO\2009 Council Agendas\M090223\S0902232C.doc