Agenda - Council Work Session - 08/23/2011

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Utility /Entitlement Fees, Engineering Inspection Fees: Public Infrastructure Inspections by Engineering p. Engineering Inspection Fees: The city does inspection of all public work. A budget is established at the beginning of the project. Based on cost and complexity an escrow is paid by the developer. All inspection costs are charged against escrow. Remaining escrow returned to the developer at the end of the project. City provides design, staking, inspection for public improvements. City contracts for this work and then assesses all cost to benefiting properties -5 years to development, 20 years to others. Assessments include city engineering department time, construction interest, administration fee of 4.9 %, assessment fee 2.4% ($500 max) per unit. Collect an escrow or LOC and bill the developer as costs occur. Everything that needs to be done in a development is paid by the developer. Situational amount of credit needed 150% letter of credit for improvements; City inspects until completion, hourly rate reimbursed at actual cost, estimated 8% of cost for inspections Elk River charges actual engineer inspection time against an escrow account. Any unused funds are returned to the developer/ applicant at the conclusion of the project. Engineers inspect the erosion and public improvements, including plans. We do not allow developers engineer to certify public improvements. The City requires the developer to pay for engineering inspection and the inspection is typically done by the City. This is done through an escrow fund which typically represents approximately 6% of the construction cost and any remaining would be returned at completion. The City also charges a flat fee of 1 -3% of the construction cost to cover City administration of the project. City completes all inspections. City collects escrow and bills all inspection time to developer. City bills hourly and does not commit to a fee because the City does not hire the contractor or control the schedule. City inspects all developer installed improvements. City issues invoices to developer based on time spent. Escrow take is 125% of estimated construction costs (financial escrow) and a 5% construction observation fee Yes. Sample finance plan attached. STAGE 1 Improvements: 125% of estimated valuation of stage 1 improvements (financial guarantee); and 5% charge for Inspection fees and 5% charge for maintenance. Financial guarantee. Total = 135% of valuation. STAGE 2 Improvements: we cover all of the stage 2 improvements in Section B of each scenario Appendix 130 1 P a g e