Are we raising rates paid by new development?

The Town has evaluated rates for water and wastewater fees and charges.  The results of these analyses indicate that new development impact fees (water tap and sewer tap) are in need of an increase. 

  • The Town commissioned a water utility rate study that was completed and presented in 2020.  The water rate study revealed that user utility base rates needed to increase to cover normal operating costs, chemical and treatment costs, and improvements to aging and outdated equipment.  User fees have been increased to account for these shortfalls. 
  • The new water treatment plant expansion project that will allow for additional treatment capacity to accommodate future growth results in costs that are recovered through the collection of impact fees paid by new development.  The Board of Trustees approved an increase of the water tap fee from $5,500 to $7,500 for a typical 3/4-inch water tap (3/4-inch tap serves most residential homes and many small businesses).  An additional increase to $7,750 is also being considered to further balance the costs paid by new development.  Larger tap sizes are also proposed to increase proportionately. 
  • The wastewater treatment plant is also currently under design for an upgrade to existing process equipment and expansion to accommodate future growth.  The costs of the upgrade and expansion have been evaluated to proposed various funding scenarios that balance the costs paid by existing users through user rates and the impact fees paid at the time of building permit for new development.  Impact fees for a typical 4-inch sewer tap (serves most residential uses and many small business uses) is proposed to increase from the current $7,500 to a proposed $9,700.  Larger sewer tap sizes are also proposed to increase proportionately based on specific uses. 

Residential water and sewer taps currently make up the largest portion of new development impact fees, along with a modest number of new business impact fees.  Although impact fees are collected just one time at the time a building permit is issued, the fees are typically passed on to the homebuyer or business and often rolled into the home mortgage or business loan.  Homeowners and businesses continue to pay for the one-time cost in their monthly mortgage or loan payments.  The homeowner/business also begins paying monthly usage rates beginning at the time construction is complete.  Balancing the one-time impact fee costs is important to ensure the cost burden to homebuyers and small businesses continues to be manageable. 

  • New development projects have significant costs to provide the public infrastructure that serves the development.  The developer pays for the installation of water lines, sewer lines, streets, parks and other improvements at the time of construction.  The developer/builder then also pays the costs of the impact fees at the time a permit is issued.  Continuing to increase impact fees while at the same time the Town is limiting the number of residential permits to stay within treatment capacities could reach a point where developers/builders are unwilling to continue to build in Wellington.  If this cost point is reached that new development is no longer willing to pay the fees, the result could be a slowdown or a stop to new development, shifting the cost of paying for improvements onto existing residents. 

Show All Answers

1. Are we raising rates paid by new development?
2. Is the Town doing anything to slow down growth?
3. Has the cost of our water gone up?
4. Does Wellington’s water meet Water Quality Standards?
5. How do Wellington’s utility rates compare to other communities?
6. Why is there a tier structure and what does it cost?
7. Why did the base rate increase?
8. When was the last time rates were increased?
9. What is the Town doing with the bulk dispensing water machine?
10. What is the average water usage per household in Wellington?
11. What other options will the town pursue to handle the water issues?
12. What water fees and rates are charged for new construction homes? How do new construction fees help pay for water infrastructure?
13. Have you considered incentives for xeriscaping current homes and restrictions on landscaping with new builds?
14. Have you considered conducting a long-term plan that reflects our values and needs for growth and community life?
15. What kind of impact will the new high school/middle school have on the water issue?
16. Will we be charged for 7,000 gallons regardless of how much water we use?
17. Are there other options such as joining another water district or starting our own?
18. What is the timeline for the water rates decision?
19. How is the Town engaging residents to provide input on the proposed water rates?
20. When is the water plant being built?
21. Why is it so expensive and why are there restrictions when other communities are not having the same problems?
22. Where do we get our water from?
23. Can we remove grass lawns to save water?
24. Where can we find an explanation of why rates are being increased?
25. Why aren’t developers charged more to develop in Wellington?
26. Why does my water occasionally have a bad taste or smell?
27. Where can I find Water Quality Reports?
28. Is there a breakdown of my water bill?
29. I need help paying my water bill, who should I contact?
30. What is the different between Water and Wastewater?