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North 1 UEP assessment may top $35,000

By CHUCK BALLARO - | Nov 29, 2022


Owners of standard-size residential parcels in the next phase of the city of Cape Coral’s Utilities Expansion Project are looking at assessments of more than $35,000 plus connection costs.

The city estimates that assessments for a 10,000-square-foot lot in North 1 West will be $28,294 — $8,332 for water, $13,949 for sewer and $6,013 for irrigation.

The estimated Capacity Facility Expansion Charge is $6,750 — $1,106 for water, $3,390 for sewer and $2,254 for irrigation, with the city proposing an ordinance that would place these costs on property tax bills for six years for those who choose to finance the cost. The fee would be a non-ad valorem addition to the tax bill, according to a staff presentation to be made to Cape Coral City Council at a 9 a.m. workshop to be held today.

Specifically, the ordinance, also on today’s agenda, would change capital expansion fee financing from a voluntary lien to non ad valorem installments on the tax bill. Delinquent collection would change from an involuntary lien process to non ad valorem installments on the tax bill.

There are approximately 7,300 properties in North 1, which will be divided into West and East Service Areas.

Compared to the South 6&7 UEP nearly a decade ago, this project is expected to cost nearly double that.

Workshop meetings allow council and staff to discuss items of importance to the city without a vote in hopes of reaching a consensus or direction from the elected board.

North 1 will be broken into two parts, east and west, with Del Prado Boulevard serving as the border. North 1 West will be worked on first and is expected to cost about $243 million.

Half of the estimated cost ($122 million) and funding will come from a line extension assessment (SF), while another $86 million will be funded through a Capital Facility Expansion Charge (CFEC).

Transportation ($19 million), Stormwater ($11 million) and Utility Fees ($5 million) will provide the remaining funding.

The city is seeking grants to possibly bring the costs down to property owners. The project received a $1.3 million grant from the South Florida Water Management District, Cooperative Funding Program, for irrigation distribution mains. There is potential to receive additional funds on the next grant cycle, officials said.

The city will use the same methodology as it did with the Southwest 6&7 and North 2 UEPs. The line extension will be based on the Equivalent Parcel (EP) method (1 EP = 10,000 square feet). This means those with oversize lots will pay more. The capital fee is based on the Equivalent Residential Unit (ERU) method.

Property owners will have the option to pay for the UEP assessment through an initial prepayment from March through July of 2023, the adjusted prepayment from August 2023 through July 2024, and billed annually for 20, 25 or 30 years, with the first bill coming out in November 2024.

Initial prepayment for a home on a 10,000-square-foot lot is expected to be $35,044, while the adjusted prepayment will be $37,723. Those who will pay annually will pay an interest rate of 6.5 percent.

Someone who chooses to pay over 30 years at $3,899 per year will pay $116,970 over the term of the loan.

By way of comparison, in 2013, South 6&7 cost $16,758 per EP and CFEC, and North 2 cost $19,382.

The staff presentation will include home sale prices, which have nearly doubled in 10 years, from $210,476 in 2013 to $403,685 in 2021. The presentation compares cost to home price as a percentage — 8% in 2013; 8.7% today.

The public hearing for the Initial Assessment Resolution is set from February 2023, with the homeowner informational meetings happening in either February or March.

The public hearing for the Final Assessment Resolutions and Assessment Rolls and the resolutions to approve the construction and engineering and inspection contracts will be in March, with the notice to proceed expected in April.

City Hall is at 1015 Cultural Park Blvd.