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City may turn to owners of unimproved lots to pay portion of utility costs

By Staff | Mar 3, 2010

Cape Coral City Council could still look to owners of unimproved lots to help pay down $297 million in long-term debt by charging an assessment or reservation fee.
The board also hopes to reduce utility rates, which are scheduled to increase 30 percent this year and 15 percent over the next three years.
The current rate-payers are shouldering the burden for the stalled utilities expansion project and the north RO plant.
With a 17 percent increase looming in October, Mayor John Sullivan previously volleyed an idea on how to reduce the rates by charging a fee to all property owners who have not paid impact fees for being hooked up to city water, roughly $300 – $400 a year, per property.
Concern over the legality of the proposal stalled its progress, but Sullivan said Tuesday the idea could still move forward.
“There might be ways to overcome that,” he said of the legality. “I’ve been working with former Mayor Arnold Kempe to find ways around that.”
District 6 Councilmember Kevin McGrail, whose district would see a lion’s share of the project when it restarted, said his constituents have told him if they were to pay a reservation fee they would like some benefit.
Without the city knowing when, and if, the project will be restarted, it’s unknown whether it can charge an impact fee without providing a service.
McGrail said the key would be outlining a tight timetable to let people know when services are coming.
“If were going to collect this advance fee … they need to have something on the map that says this is when we’re coming with your water,” McGrail said.
There are 75,000 lots in Cape Coral, both with and without homes, that have not paid impact fees thus far, according to Sullivan.
City Attorney Dolores Menendez told council that asking for an advanced fee without that solid timetable is where the proposal flounders.
“There is no plan to serve them, and that has been a stumbling block,” she said.