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~o <br />Memorandum <br />Excess Capacity Credit Policy <br />November 3, 2005 <br />Page 4 <br />facilities; 3) all sewer connections with similar demands would pay the same <br />availability fee and surcharge; and 4) minimal tracking or review by staff is <br />required because all sewer connections are treated the same throughout the <br />service area. A disadvantage of this approach is that the indirect downstream <br />benefit from sewers being extended into an undeveloped area may be small and <br />difficult to quantify. <br />Determination of the credit: <br />OWASA's engineering staff wculd develop unit construction costs considering <br />recent bid information and developer construction cost reports for the various <br />water and sewer main sizes that could be required to he installed in the OWASA <br />system. These unit cost numbers would become an addition to the OWASA <br />Rates and Fees Schedule, revised on an annual basis and forwarded to the <br />Board for consideration and adoption along with the other OWASA service fees. <br />Water: The amount of the excess capacity credit for an oversized main <br />extension would be determined from the incremental increase in construction <br />cost due to the requirement to install a larger main on a cost per foot basis. For <br />example if the base cost far an 8" main was $105.00 per foot and the developer <br />extended a 16" main which has been determined to cost $150.00 per foot, the <br />excess capacity credit would be calculated as $45.00 times the length of the 16" <br />main extension. <br />Sewer. Same as water <br />Collection of funds for providing excess capacity credits: <br />Funds would be collected from properties that receive a benefit or availability of <br />service from the oversized main or improvement. <br />Water. As noted previously, water main extensions can provide an overall <br />system benefit to all customers connected to the water distribution system, Most <br />of the remaining oversized water main extensions would be constructed at some <br />point in time by OWASA as a capital project in order to meet system demands, <br />increase system reliability, or improve water quality. For the reasons noted, the <br />allowable credit for oversized water main extensions is to be included in the <br />OWASA Capital Improvements Program (CIP). By including the oversized <br />extension projects in the CIP they will be included in any analysis far setting or <br />establishing the water availability and water service fees which are collected from <br />all water customers within the OWASA service area. <br />Sewer: Since sewer main extensions do not normally provide a system benefit, <br />the oversized sewer mains would not be included as part of the capital program. <br />For oversized sewer main extensions, staff would determine the total area of all <br />unsewered drainage basins within the OWASA service area along with the <br />