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April 22nd, 2009
Council moves forward on pro rata proposal

STAFF REPORT

The San Marcos City Council directed city staff to draft a pro-rata assessment ordinance after a presentation on such an ordinance by Charles Swallow, Director of Development Services, at a Tuesday night workshop.

Swallows said the city staff has investigated pro-rata assessment ordinances already on the books in a number of cities. The goal of such a proposal, according to Swallows, is to provide a mechanism by which the city is able to reimburse a developer for the cost of extending water and/or sewer lines to property that extends through or past other properties that would benefit from such lines. The City of San Marcos and/or any developer who extends public utilities to the existing system may be reimbursed.

The city staff is suggesting that such pro-rata utility lines be subject to Council approval. Pro-rata assessments would only reimburse construction costs and the period for such reimbursement would be limited to 10 years from construction completion. The staff also suggested that the city should collect the assessment on benefited properties either at the time the property is platted or at the time of permitting, if platting is not required. The tracts that do benefit from such lines would be assessed based on either a frontage measurement or based on the tract’s area relative to the service area.

Responding to council questions, Swallow explained that tracts not benefiting from the lines would not be charged an assessment, and that the pro-rata section would include that part of the line that would benefit property owners who were not paying for it.

The staff also recommended that the city should retain two percent of the assessment amount to cover administrative costs of the program, and that the city should reimburse the developer within 90 days of the assessment collection.

San Marcos City Manager Rick Menchaca said such a law would be a tool to help the city to reduce its debt ratio.

After a short discussion, the council directed the staff to bring a pro-rata ordinance with the provisions presented and discussed at the Tuesday night workshop.

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0 thoughts on “Council moves forward on pro rata proposal

  1. This is my question, if any of you know the answer: If a developer wants to build a big subdivision and the city extends a very large wastewater line to serve those homes being built in that subdivision, then do the owners of lots along the way HAVE to pay for this large line, and reimburse the developer a portion of his costs for the huge line, say if they wanted to replat into two lots, say, so their child could have a home on the property that is separate? I understand the concept, the advantages for the developer, the advantages for the city, but I don’t understand how current residents might be affected. Will there be unintended consequences that need to be thought through, so that current residents don’t end up being billed for the part of the line that passes their property, whenever they need to replat?

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