homepage logo

UEP supporters, opponents clash over assessment costs, methodology

By Staff | Sep 13, 2008

The Cape Coral City Council will take up the issue of the utilities expansion project in the Southwest 6/7 area again later this month, but it is far from a done deal.

The project to bring potable water, irrigation, and sewer utilities to 6/7 stalled in June when the Council reached a stalemate over the project’s costs.

So far the UEP, which includes plant expansions to increase capacity in addition to setting up local utilities, has $700 million worth of contracted work. The 6/7 portion of the project is slated to cost, in total, $80 million.

The actual construction-related costs for the project were originally $68 million, but after negotiations between MWH, the company overseeing the project, and city councilmembers, the cost was reduced to $60 million.

That means average assessments for 6/7 residents of about $10,500, but critics say there is room for more reductions. Mayor Eric Feichthaler has consistently called for individual assessments to be cut by $1,500.

Councilman Bill Deile also has been an outspoken critic of the project.

“Prices come down because of pressure from the people exerted through the Council,” Deile said.

Those opposed to the project point out that as utilities have moved into a new area in the city, the costs have gone down. The average assessment in the Southwest 4 area was about $17,000 when it began in 2004. Average assessments in the Southwest 5 area, where construction is currently under way, are about $13,600.

MWH officials say shifts in the market drastically affected the prices of commodities and supplies, accounting for differences in cost.

“It was bid at a very bad time,” said MWH representative Jennifer Thomas. She said a housing boom, increased competition from China for supplies such as concrete, and the fallout from Hurricane Katrina created a “perfect storm” that caused the cost of supplies to dramatically increase.

Now the city’s housing crisis — the Cape area’s July foreclosure rate was one in 64, the highest in the nation — has sent construction firms chasing the lowest possible price for a job.

MWH officials say they are sensitive to the harsh economic times being endured in the Cape, and say the city’s deferred payment plans can help people cope with the assessments.

“We realize this is not something that most people have saved for and are ready to pay,” said MWH Project Manager Larry Laws.

Besides the project’s costs, some critics say the methodology of the assessment process should be changed.

Deile’s home, which lies in the SW 4 region, was assessed at $35,000, and he is now suing the city. He says the way lots are assessed should be changed to make exceptions for larger lots.

“It’s arbitrary and capricious. It divides the city up into two sets of people that pay vastly different amounts for that,” Deile said.

His lawsuit with the city, which was filed before he was elected to the Council, is still in the discovery phase.

The Council is set to discuss the UEP Monday, and a vote on 6/7 is scheduled for Sept. 22.