Rathdrum hookup fees rising

By BRIAN WALKER

Staff Writer

RATHDRUM — The cost for water and sewer hookup fees for new homes in Rathdrum will increase by $2,547 starting Sunday.

The City Council has approved capitalization fee changes that resulted in the total for the four fees to rise from $10,264 to $12,811.

City Administrator Leon Duce said the changes were based on recommendations from a study performed by consultant Welch Comer Engineers and a lawsuit between the city of Hayden and the North Idaho Building Contractors Association over sewer cap fees.

"It was a four-month project updating our fees," Duce said, adding that it had been several years since the fees were examined.

Going forward, Duce said the fees will be evaluated more frequently in house so there's not as steep of increases or decreases at once.

"We don't want to pay a consultant every year to re-evaluate the cap fees, so a spreadsheet was created and we can re-calculate the fees based on changes to our system," Duce said.

The individual fee changes included:

- the water capitalization increasing from $3,635 to $5,661;

- the sewer collection increasing from $1,336 to $3,249;

- the sewer treatment increasing from $2,738 to $3,150; and

- the sewer transmission decreasing from $2,555 to $751.

Capitalization fees are a one-time fee on new growth and expansions to recover a proportional share of the value of facilitates that provide service. The fees are used for capital projects such as water towers and wells.

Builders initially pay the fees when a building permit is pulled from the city, but the cost is ultimately passed on to the owner of the new home.

"It's not a bill that the homeowner sees, nor is it a line item on the house purchase," Duce said.

No one spoke for or against the fee changes at a recent public hearing.

Duce said the sewer transmission fee decreased due to more homes that have come online in recent years and a decreasing value with the city's lift stations.

Duce said Rathdrum and other cities have performed cap fee studies based on findings in the Hayden-NIBCA lawsuit over sewer cap fees.

"The lawsuit in Hayden played a major role in this," Duce said.

A district court judge ruled in February that Hayden must refund builders and homeowners $729,403 due to what NIBCA refers to as an illegal tax collected from April 10, 2010, to March 4, 2016, for 335 new homes built during that time. Hayden is appealing the ruling to the Idaho Supreme Court.

The sewer treatment fee is a pass-through cost from the city of Post Falls, which treats Rathdrum's sewer.

Meanwhile, the city is having Welch Comer re-evaluate the design of a future lift station along Greensferry Road.

"Several developers agreed to fund the lift station project, but when the bubble popped and the economy went down, the developers pulled out," he said. "We've been saving money since then to do this project rather than go to a bond."

A water and sewer extension project to the lift station site west of Highway 41 was recently completed.