More on the $5.5 million in developer sewer subsidy

Here is some more information on how the city budget is putting $5.5 million into developer subsidies and not transit, public safety, or children.

Matthew,

This was one of several reason that I rejected the budget. I can’t give you a complete list of subsidies because everything is not yet even being tracked by the city. Here is just 1 example that will amount to a around a $5.5 million dollar subsidy in 2015. The most recent capacity expansion at the Waste water treatment plant was done for the exclusive benefit of new development. The spreadsheet attached, shows fee collections and 2015 expenses.  The 2015 expense for this benefit exclusive to new development is $7.5 million, 2015 development charges may approach $2 million.  As such the reset of the city is providing a $5.5 million subsidy to support new development.  Probably greater that 90% of the new land development also requires annual subsidy provide services and fund future capital replacement so there is not even a return on investment on these developer subsidies.  Even within the sewer fund the reality is the subsidy is far greater since the value of sewer connections in not covered either.  Right now families in poverty are paying extra every month so we can fund this $5.5 million subsidy.  I am a huge supporter of responsible development where the development is additive to the community and does not require subsidy.  Unfortunately that is not what the community is getting today.

This same $5.5 million dollars could be used to greatly expand public safety coverage, transit, and access to amenities for low income families.  I feel all three of these are far more important that subsidizing unsustainable development.  The development community is going to have to make a choice as to whether they want to change development patterns or face substantially higher fees. I suspect that our new comprehensive plan will force this issue as well. What is going on today can not continue.

I do support subsidy for true affordable housing however this certainly does not ever include auto oriented new construction single family detached.

I will continue to push that fees that cover expenses for private beneficiaries.  I would however accept a shift to all fees allocated on a per acre basis.  This would provide financial incentive for efficient land use and a penalty for sprawl.

You are already aware of the RPU connection subsidy that we are in the process of eliminating.  There are dozens of other subsidies that still need to be better quantified.

Steve,

Pass this on to the council.

-Michael

Rochester data on developer sewer fees and expenses

The spreadsheet is hard to follow but shows developer fees per year (less than $2 million) and expenses ($7.5 million in 2015). If it is hard to follow it is because there was a bond refinancing in there.

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