The City constructs sanitary sewer facilities to collect, convey and treat wastewater from developed properties. Subsection C of Section 17.36.020 of the Portland City Code authorizes line and branch charges to recover the costs of constructing local sanitary sewer collectors, the local portion of sanitary trunk lines or interceptors, and sewer laterals or house branches. The following administrative rules provide additional guidance and direction regarding the calculation of these charges.
Section 17.36.135 authorizes the Director of the Bureau of Environmental Services to adopt rules pertaining to the calculation of sanitary sewer line charges.
These administrative rules are organized into two sections. Section 4 provides direction and guidance regarding the calculation of sanitary sewer line charges. The section includes a basic description of the calculation and ten special conditions or circumstances that influence the basic calculation. Section 5 describes two special conditions regarding the imposition of sanitary sewer branch charges.
a. Basic Zone of Benefit. Section 17.36.020(C) states: "The line charge shall be based on the square footage of the property. For properties zoned residential and used predominately for residential purposes, the square footage used for calculating the line charge shall be limited to the lot area within 100 feet of rights of way or easement where sewer has been constructed or is planned for sewer construction…. For all other property, the square footage used for calculating the line charge shall be limited to the lot area within 300 feet of rights of way or easement where sewer has been constructed or is planned for sewer construction." When calculating the zone of benefit, the Bureau shall include the area of property measured at every point along the frontage along the sewer line that provides the route of sewer service.
Explanation: City Council adopted different line charge calculations for residential and non-residential properties based on the following findings:
The 100-foot zone-of-benefit is appropriate for the dense development patterns found in residential areas. Residential areas consist of smaller parcels, a tight network of local streets and closer proximity to local sanitary sewers. However, the 100-foot zone is not appropriate for non-residential areas where the patterns of development are generally larger in scale, occupy larger land areas, and extend deeper into the property. Non-residential areas have fewer parcels on larger lots, deeper lots, and a greater number of landlocked and flag lots.
City policies governing the apportionment of local improvement district costs define two distinct zones of benefit for local sanitary sewer improvements, a residential zone based on 100 feet of depth and a non-residential zone based on 300 feet of depth. The method used to calculate sanitary sewer line charges should be consistent with this long-standing policy. It is unfair and inequitable to continue to use two different methods to calculate the costs of local sanitary sewers, one for local improvement districts and a second for capital improvement projects.
A deeper zone-of benefit is better able to capture non-residential developments that are landlocked or located on flag lots. Such developments benefit from local sanitary sewer service but may avoid line charges based on the previous calculation method.
A Bureau analysis of the estimated line charges for the South Airport Sanitary Sewer Project finds that the City recovers less than 50% of the costs of sewer construction when applying the 100-foot zone of benefit to this predominately industrial area of benefited properties. The 300-foot zone of benefit results in line charges that closely approximate the estimated costs of sewer construction.
b. Extensions beyond the end of the Sewer Line: Section 17.36.020(C) states: "Such street or easement line shall be considered as continuing 100 feet beyond the end of the main line sewer or beyond where the sewer turns away from the property… Such street or easement line shall be considered as continuing 300 feet beyond the end of the main line sewer or beyond where the sewer turns away from the property."
Explanation: This directive anticipates situations where a sanitary sewer collector ends at a point along an abutting right-of-way or easement and the benefiting property ends further along the same right-of-way or easement. The directive reinforces the standard established by the basic zone of benefit that the line charge should be based on all assessable property located within 100 feet for residential properties and 300 feet for non-residential properties. The directive clarifies that the zone of benefit extends in all directions (parallel, perpendicular and all degrees in between) along the route of the sewer collector.
c. Minimum Charge for Flag, Oddly Shaped and Landlocked Property: Section 17.36.020(C) states: "The minimum line charge shall be based on a minimum assumed lot size of 1,200 square feet… The minimum line charge shall be based on a minimum assumed lot size of 3,600 square feet."
Explanation: This directive is intended to ensure that all benefited property pay a fair portion of the costs of receiving sanitary sewer service, even in circumstances where the benefited property is located some distance from the sewer collector. Such properties would pay little or no charge for the benefit of the sewer collector due to the configuration and location of the lot and the method used to calculate line charges. A minimum charge ensures that such property will make some contribution towards the costs of providing the sewer service. The 1200 square foot standard for residential property was derived from an examination of the residential development patterns in the Mid-County Sewer Project and the typical configuration of a residential flag lot. The 3600 square foot standard adjusts the residential standard to conform to the 300-foot zone of benefit established for non-residential properties.
d. Adjacent Uses: Section 17.36.020(C) states: "When an adjacent, developed lot, as defined in Title 33.910 that is under same ownership, is used in conjunction with a neighboring, developed lot that is connecting to the sewer, the adjacent lot shall be charged a line charge for its frontage as described above. This includes but is not limited to improved parking lots, and lots with garages or landscaping."
Explanation: The substantive language in this directive relates to "improved parking lots, and lots with garages or landscaping". The Bureau determined that the benefit of providing sanitary sewer service accrues to all of the activities and improvements that are associated with the development that is connecting to the sewer collector. The Bureau will disregard the organization of parcels for property tax purposes and rather evaluate the extent of the "parcel" for purposes of calculating sanitary sewer line charges based on the extent to which neighboring tax parcels are in common use and/or ownership.
e. Adjustments for Lack of Gravity Service: Section 17.36.020(C) states: "When a sewer is constructed that can not provide gravity service, the line charge shall be reduced by 50% if the property has gravity service to the first floor only and must install a pump for the basement and 75% of the line charge will be reduced if no gravity service is available for the first floor and the property must install a pump. The adjustment should not exceed the costs associated with the installation of a pump system. Property owners may appeal this determination to the Director, or designee, if the pump costs exceed the line charge adjustment."
Explanation: Council established this directive to recognize the substantial costs associated with making a pumped connection to a sanitary sewer collector. The City’s policy and practice is to provide gravity service wherever it is technically and financially feasible. However, there are circumstances where such service cannot be provided. In such circumstances, the pumping discount is intended to provide relief equivalent to the diminished benefit to the property and to provide an offset for extraordinary pumping costs.
f. Adjustments for Development Restrictions. The Bureau shall exclude from the calculation of the zone of benefit areas within the zone that are permanently prohibited from development. In the event that the City removes the prohibition, the benefited property shall be subject to additional line charges based on the area made available for development. The line charge shall be imposed when the property owner, tenant or developer seeks a permit to develop, renovate, reconstruct or redevelop the property that includes any portion of the previously excluded area.
Explanation: This policy recognizes the diminished benefit of sanitary sewer improvements when zoning or land use regulations restrict new development and redevelopment. The policy is limited to those areas located within the zone of benefit that is subject to a permanent restriction of development or redevelopment. The policy provides for future imposition of line charges if restricted areas are made available for development.
g. Limits when a Sewer Lines dead-ends at a Property: In the event that a property is served at a single point of access by a sewer line that dead-ends at the boundary or access easement of a property, the line charge shall not exceed 10,000 square feet for residential property and 30,000 square feet for all other property. The calculation shall be made in the same manner as that used for the basic zone of benefit.
Explanation: This policy is intended to recognize the limited benefit that accrues to a property when a sanitary sewer collector is accessible at a single location as distinct from properties that have access to a sanitary sewer collector at any point along a street right-of-way, access easement or public sewer easement.
h. Corner Lots: In circumstances where a development occupies a corner location, the line charge shall be based on the longer overall frontage for non-residential developments, and the shorter overall frontages for residential properties.
Explanation: See the justification provided for the basic zone of benefit.
i. Subsequent Connections for Properties with Multiple Routes of Service. In circumstances where a property is served by multiple sewer lines, the property shall pay a line charge for each connection based on the zone of benefit for the route of connection. In calculating the assessable area, the Bureau shall not include overlapping areas that were used to calculate previous line charges.
Explanation: Property development should compensate the City for all points of access to sanitary sewers, at the time that each connection is made. However, in determining the amount of compensation, the Bureau should not charge any portion of the property more than once.
j. Limits when Sewer Lines are located in Public Easements: The Bureau identifies two conditions that would necessitate the placement of sewer lines in public easements, and specifies different methods for calculating line charges in each case.
1. Condition 1: Property can receive sanitary sewer service from either a sewer line in a public right-of-way or in a public sewer easement, and the Bureau constructed the sewer lines in the available public sewer easement exclusively for the following purposes: (1) completing a trunk sewer network; (2) serving landlocked developments; or (3) advancing City goals not directly related to providing sanitary sewer service.
Line Charge Calculation: Regardless of the location of the sewer connection, the line charge shall be the lesser of the amount based on access from the public right-of-way and the amount based on access from the public easement. The line charge calculation shall be made in the same manner as used for the basic zone of benefit.
2. Condition 2: The Bureau constructs a sewer line in a public sewer easement for the primary purpose of providing access to a landlocked or interior property, the development cannot be served by a sewer line in a public right-of-way, and the development connects to the sewer line in the easement.
Line Charge Calculation: The Bureau shall calculate the line charge based on the frontage along the sewer line in the public sewer easement in the same manner as used for the basic zone of benefit.
JUSTIFICATION: It is in the public interest to construct local sanitary sewer collectors in the most efficient and economical manner possible. To do so, the Bureau uses existing public rights-of-way to bring sewer lines to developed or developable property. The owner of a property that abuts a public right-of-way has an expectation of being charged for local infrastructure that services his/her property by means of the right-of-way.
However, there are circumstances where topography, hydrology, environmental assets, development patterns and the network of existing public rights-of-way necessitate the construction of sewer lines in public easements. In these cases, the Bureau’s use of a public sewer easement advances the City’s goal of providing sanitary sewer service in the most efficient and economical manner possible. In addition, the use of public sewer easements may make it possible for the Bureau to achieve multiple public goals beyond those of the local sewer improvement. For example, it may be in the best interest of the Bureau to construct sanitary sewer collectors in public sewer easements to avoid the environmental impacts and permitting requirements that come with sewer construction in environmental protection zones or stream corridors, or to protect unique natural resources.
In such circumstances, the property that grants the public easement may be exposed to line charges that are greater than those calculated based on access to the sewer in the public right-of-way. Such increased costs are a direct result of decisions made by the Bureau to advance public goals not directly accruing to the property, and not directly related to providing sanitary sewer service to the property. By providing a method of determining line charges based on the lesser of two calculations, the Bureau provides a means of ensuring that the subject property is not assessed for the costs of public goods that are more appropriately borne by all utility ratepayers.
By contrast, there are circumstances where the Bureau constructs sewer lines in public easements primarily to provide sanitary sewer service to private developments. While there may be other benefits, the sewer line in the public easement is the sole method of providing an appropriate route of service for the private development. These circumstances are similar to that found with a development that abuts a sewer line in a public right-of-way, and the development served via the public easement should pay a line charge calculated in the same manner as used for the development served via the public right-of-way.
Filed for inclusion in PPD September 29, 2004.
Signed by Environmental Services Director September 29, 2004.