AGENDA #5a
BUDGET WORKING PAPER
TO: W. Calvin Horton, Town Manager
FROM: Roger Waldon, Planning Director
SUBJECT: Status of Water and Sewer Assistance Fund
DATE: April 24, 2002
This memorandum provides a report on the status of the Chapel Hill Water and Sewer Assistance Fund. The current balance in the Fund is $192,000.
HISTORY
Starting in the early 1990’s, the Town Council has set aside funds to help neighborhoods with the cost of connecting to the public sewer system. In 1993, the Town Council used half cent sales tax funds to help pay for sewer improvements in the North Forest Hills, Glen Heights, Mount Bolus, and Sherwood Forest neighborhoods. The Council also used federal Community Development funds to assist with the connection to sewer of lower-income homeowners in these areas.
In 1995, the Town authorized the use of half cent sales taxes for the Severin Street and Markham Drive neighborhoods. State law at that time required, subject to exemption by the NC Local Government Commission, that the Town allocate 30% of the half cent sales taxes for water or sewer projects. This requirement has expired.
On March 27, 1995, the Town Council adopted a resolution revising a policy regarding Town participation in the costs of future sewer projects (please see Attachment 1).
On July 1, 1996, the Town Council adopted a resolution expressing an intent to contribute $192,000 to assist low income homeowners in the Morgan Creek/Mason Farm sewer project area and as a contribution to OWASA for construction costs of the Morgan Creek/Mason Farm project subject to OWASA undertaking the project and subject to an appropriation by the Council in the 1997-98 budget years. These funds remain reserved for this purpose.
On September 9, 1998, the Council adopted a resolution that revised the Town’s sewer assistance policy. This resolution authorized that the Town provide a 20% subsidy to sewer projects for existing neighborhoods with private systems by providing a line item in the Capital Improvements Program budget, with a cap of $4,500 per lot based on the total number of lots in the project which is being subsidized (please see Attachment 2).
In 1999, the Town paid $12,500 for sewer on Patterson Place based on the Council’s revised policy of 1998 and authorization for this neighborhood.
STATUS OF FUND
The balance of funds reserved for the specific purpose of providing financing for water and sewer improvements in residential neighborhoods is $192,000.
The full amount is reserved for the Mason Farm/Morgan Creek area per a July 1, 1996 Council resolution. We note that one of the recent measures in response to the loss of State revenues was the reassignment of interest accumulated in the Water and Sewer Assistance Fund to make up for lost General Fund revenues.
On March 4, 2002, we provided a report to the Council on petitions from residents in the Emily Road/Partin Street neighborhood in Chapel Hill. That report recommended that residents petition the Orange Water and Sewer Authority for provision of public sewer. If submitted to the Authority, the Council could then consider whether it may wish to allocate additional funds to the Water and Sewer Assistance Fund to assist this neighborhood. The report also noted that the Orange Water and Sewer Authority in a letter of February 27, 2002 stated that there is currently no active petition from the Morgan Creek neighborhood for provision of public sewer.
ATTACHMENTS