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Utility assessment pending?: Cape considers new levy on ‘infill’ properties

By Staff | May 21, 2011

Bernie De La Torre lives in Houston but owns a waterfront lot in Cape Coral. He’s been assessed for the pipes in front of his lot in the sourthwest area of the city, but hasn’t paid impact fees because his property is unimproved.
Like an estimated16,000-plus property owners in similar circumstances, De La Torre would be forced to pay an impact fee should city council vote to approve a proposal for these so-called “infill” lots sprinkled through Districts 1 and 2.
De La Torre said he plans on building in the future, so the prospect of paying against those future impact fees don’t bother him too much.
But he does believe the proposal doesn’t address properties in the north that have no services available.
“What I’m not comfortable with is they’re going after people who have already been assessed, meanwhile there’s half the city that’s not contributing,” he said.
Should could council approve the proposal, the assessment on vacant lots in areas where utilities are available would lower water rate increases from a projected 8 percent hike to 3.5 percent for those on the system, according to city staff.
About $91 million in assessment bonds would also repay the $91 million in commercial paper, according to city staff, if the proposal is ultimately approved.
The levy would equate to $5,136 per lot in District 1, and $6,750 per lot in District 2. Property owners would pay the total over 20 years in annual increments added to the tax bills for affected properties.
The levy would first appear in fiscal year 2013.
Budget Administrator Sheena Milliken said the proposal was originally conceived as part of the SW 6/7 portion of the Utility Expansion Project but was dropped when the UEP was put on hold.
She said staff still has a lot of questions to be answered and that staff is carefully working through those questions.
She said a third party, independent consultant will validate their findings and information will be made available to the council, and the public, as the process unfolds. Council is expected to vote on whether staff should continue down that path on June 6.
“I would think it meets the goals of what they indicated they want to do,” she said of the council.
Former Financial Advisory Committee Chair Steve Riggs equated the plan to pre-paying a fee that has yet to be levied.
Riggs added that results of that levy would not be felt by ratepayers for some time.
“This is not something that will be done overnight. A lot of work has to be done,” he said.
The Cape Coral Construction Industry Association said it is keeping an eye on the matter but has yet to take a position.
Bernie De La Torre said he was on the fence about the issue.
But even if it is approved by council, he said it won’t address the larger issue, which is when to restart the UEP.
“I don’t see why they can’t admit they made a mistake by stopping the UEP. The thing to do is restart it,” he said.