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November 2019 TischlerBise Utilities Development Fee Study 4 Utilities Development Fee Study Prepared for: Las Cruces Utilities City of Las Cruces, New Mexico November 18, 2019 Prepared by: TischlerBise FISCAL I ECONOMIC I PLANNING 4701 Sangamore Road Suite 5240 Bethesda, Maryland 20816 800.424.4318 www.tischlerbise.com TischlerBise FISCAL I ECONOMIC I PLANNING TischlerBise 4701 Sangamore Road Suite 5240 Bethesda, Maryland 20816 800.424.4318 www.tischlerbise.com November 2019 Utilities Development Fee Study City of Las Cruces, New Mexico Table of Contents EXECUTIVE SUMMARY....................................................................................................... 1 OVERVIEW....................................................................................................................................................................1 SUMMARY OF CAPITAL IMPROVEMENTS AND IMPACT FEES....................................................................................................1 Figure 1.Summary of City of Las Cruces Impact Fee Methodologies...................................................................2 EXACTIONS...................................................................................................................................................................2 CREDITS.......................................................................................................................................................................2 MAXIMUM ALLOWABLE IMPACT FEES................................................................................................................................2 Figure 2.Summary of Maximum Allowable Utilities Impact Fees........................................................................3 INTRODUCTION TO DEVELOPMENT FEES............................................................................4 DEFINITION...................................................................................................................................................................4 LEGALFRAMEWORK.......................................................................................................................................................4 REQUIREDFINDINGS.......................................................................................................................................................5 UNIQUE REQUIREMENTS OF THE NEW MEXICO DEVELOPMENT FEES ACT.................................................................................6 METHODOLOGIES AND CREDITS........................................................................................................................................7 GENERIC IMPACT FEE CALCULATION..................................................................................................................................5 LAND USE ASSUMPTIONS/DEMAND INDICATORS............................................................... 9 DEMANDFACTORS.........................................................................................................................................................9 Figure 3. City of Las Cruces Persons per Housing Unit........................................................................................10 RESIDENTIAL DEVELOPMENT..........................................................................................................................................10 Figure 4. City of Las Cruces and Dona Ana County Historical Population Growth(2009 to 2019).....................10 Figure 5. City of Las Cruces and Dona Ana County Projected Population Growth(2019-2029).........................11 Figure 6. City of Las Cruces Current Housing Unit Estimate(2019)....................................................................11 Figure 7. City of Las Cruces Housing Unit Projections(2019-2029)....................................................................12 NONRESIDENTIAL DEVELOPMENT....................................................................................................................................12 Figure 8. Employee and Building Area Ratios(ITE)............................................................................................13 Figure 9. 2015 Employment and Distribution by Industry Type.........................................................................13 Figure 10. 2019 Employment and Distribution by Industry Type.......................................................................14 Figure 11. Nonresidential Development Projections..........................................................................................15 Figure 12.Summary of Land Use Assumptions..................................................................................................15 DEMAND FOR WATER AND WASTEWATER FACILITIES..........................................................................................................16 Figure 13. Projected Water Demand..................................................................................................................16 Figure 14. Projected Wastewater Demand........................................................................................................17 WATER............................................................................................................................ 18 Tischl reschl Bise II FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico METHODOLOGY...........................................................................................................................................................ZS WATERDEMAND.........................................................................................................................................................ZS Figure 15. Water Usage by Customer Class(2018)and Levels of Service..........................................................19 Figure 16. Water Facilities Ratio of Service Units to Development Units...........................................................20 Figure 17. Current(2019)Average Daily Water Demand by Land Use..............................................................21 Figure 18. Water Level of Service/Demand Factors(Base Year 2019)...............................................................21 Figure 19. Projected Water Demand..................................................................................................................22 SERVICEAREA.............................................................................................................................................................22 WATER SYSTEM LEVELS OF SERVICE AND COST FACTORS.....................................................................................................23 Figure 20. Water Supply Level of Service............................................................................................................23 Figure 21. Water Usage and Capacity................................................................................................................24 Figure 22. Water Supply Cost Factors................................................................................................................24 Figure 23. Water Transmission Lines Level of Service and Cost Factor..............................................................25 Figure 24. Water Valves Level of Service and Cost Factor..................................................................................26 Figure 25. Water Booster Pumps Level of Service and Cost Factor....................................................................27 Figure 26. Water Storage Level of Service..........................................................................................................28 Figure 27. Water Storage Cost Factor................................................................................................................29 Figure 28. Water Development Level of Service and Cost Factor.......................................................................29 Figure 29.Water Quality Lab Level of Service and Cost Factor: Water Portion..................................................30 CREDIT ANALYSIS FOR WATER SYSTEM IMPROVEMENTS......................................................................................................30 Figure 30. Water Principal&Interest Payment Credit Evaluation.....................................................................31 PROPOSED IMPACT FEES FOR WATER..............................................................................................................................32 Figure 31. Proposed Water Impact Fees............................................................................................................32 Figure 32. Proposed Water Impact Fees:All Meter Types and Sizes..................................................................33 Figure 33. Proposed Water Impact Fees Comparison to Current Water Fees....................................................33 WATER SYSTEM GROWTH-RELATED NEEDS......................................................................................................................34 Figure 34. Water System Needs to Accommodate Growth................................................................................34 PROJECTED REVENUE FROM WATER IMPACT FEE...............................................................................................................35 Figure 35. Projected Revenue from Water System Impact Fee..........................................................................35 WASTEWATER................................................................................................................. 36 METHODOLOGY...........................................................................................................................................................36 WASTEWATERDEMAND................................................................................................................................................36 Figure 36. Wastewater Usage by Customer Class(2018)..................................................................................37 Figure 37: Wastewater Facilities Ratio of Service Units to Development Units.................................................38 Figure 38. Current(2019)Average Daily Wastewater Demand.........................................................................39 Tischl reschl Bise FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Figure 39. Wastewater Demand Factors(Base Year 2019)................................................................................39 Figure 40. Projected Wastewater Demand........................................................................................................40 SERVICEAREA.............................................................................................................................................................40 WASTEWATER SYSTEM LEVELS OF SERVICE AND COST FACTORS............................................................................................41 Figure 41. Wastewater Treatment Level of Service............................................................................................41 Figure 42. Wastewater Treatment Cost Factors................................................................................................41 Figure 43. Wastewater Collection Lines Current Level of Service and Cost Factor.............................................42 Figure 44. Wastewater Lift Stations Level of Service and Cost Factor................................................................43 Figure 45.Water Quality Lab Level of Service and Cost Factor: Wastewater Portion........................................44 CREDIT ANALYSIS FOR WASTEWATER SYSTEM IMPROVEMENTS.............................................................................................44 Figure 46. Wastewater Principal&Interest Payment Credit Evaluation............................................................45 PROPOSED IMPACT FEES FOR WASTEWATER.....................................................................................................................46 Figure 47. Proposed Wastewater Impact Fees...................................................................................................46 Figure 48. Proposed Wastewater Impact Fees:All Meter Types and Sizes........................................................47 Figure 49. Proposed Wastewater Impact Fees Comparison to Current Wastewater Fees.................................47 WASTEWATER SYSTEM GROWTH-RELATED NEEDS.............................................................................................................45 Figure 50. Wastewater System Needs to Accommodate Growth......................................................................48 PROJECTED REVENUE FROM WASTEWATER IMPACT FEE......................................................................................................49 Figure 51. Projected Revenue from Wastewater System Impact Fee.................................................................49 IMPLEMENTATION AND ADMINISTRATION...................................................................... 50 APPENDIX.NEW MEXICO DEVELOPMENT FEES ACT.......................................................... 51 Tischl reschl Bise �V FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico EXECUTIVE SUMMARY Overview TischlerBise was retained by the City of Las Cruces, New Mexico,to prepare an update to the City's Utilities impact fees.The purpose of this study is to meet the requirements of the New Mexico Development Fees Act. The Act provides local government the authority to impose fees and controls the amount, timing, method of assessment,and use of the funds.This analysis is organized to address the requirements of the Development Fees Act, and in so doing, define an equitable and proportionate assessment that will help fund the requisite facilities, without undue burden on new or existing development. Development fees (also referred to as impact fees) are one-time payments used to construct system improvements needed to accommodate new development. An impact fee represents new growth's fair share of capital facility needs. By law, impact fees can only be used for capital improvements, not operating or maintenance costs. Impact fees are subject to legal standards, which require fulfillment of three key elements: need, benefit, and proportionality. ■ First, to justify a fee for public facilities, it must be demonstrated that new development will create a need for capital improvements. ■ Second, new development must derive a benefit from the payment of the fees (i.e., in the form of public facilities constructed within a reasonable timeframe). ■ Third, the fee paid by a particular type of development should not exceed its proportional share of the capital cost for system improvements. TischlerBise documented appropriate demand indicators by type of development for the Utilities' impact fees, which includes both Water and Wastewater impact fees. Specific capital costs have been identified using local data and costs. This report includes summary tables indicating the specific factors used to derive the impact fees.These factors are referred to as level of service standards. Summary of Capital Improvements and Impact Fees The impact fees calculated for the City of Las Cruces represent the highest amount feasible by meter size, or maximum allowable amounts, which represents new growth's fair share of the cost for water and wastewater capital facilities. The City may adopt fees that are less than the amounts shown. However, a reduction in impact fee revenue will necessitate an increase in other revenues, a decrease in planned capital expenditures, and/or a decrease in levels of service. Water and Wastewater impact fees are based on information provided by the Las Cruces Utilities. A summary of methodologies used in the analysis is provided below in Figure 1. Tischl re Blse 1 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Figure 1.Summary of City of Las Cruces Impact Fee Methodologies Fee Category Service Area I Incremental Expansion I Plan-Based Cost Recovery Cost Allocation Water Wells/Supply Utility Service Water Water Support Water Water Transmission Gallons Area Development Facilities Water Storage Utility Service Wastewater Treatment Wastewater Wastewater Area Wastewater Collection N/A Support Gallons System Facilities Exactions Exactions come in many forms and are used to mitigate capital facility needs. Developers may be required to construct infrastructure or municipal buildings, make a cash payment (e.g., impact fees), and/or dedicate land for public use. Also, credits or agreements can be made in which fees are waived when the developer constructs facilities that would have been constructed by the municipality. Exactions are meant to offset growth-related capital costs and are not used to supplement operating expenditures. Credits A general requirement common to impact fee methodologies is the evaluation of credits. Two types of credits should be considered, future revenue credits and site-specific credits. Revenue credits may be necessary to avoid potential double payment situations arising from a one-time impact fee plus the payment of other revenues (e.g., utility rates) that may also fund growth-related capital improvements. Because new development may provide front-end funding of infrastructure,there is a potential for double payment of capital costs due to future payments on debt for public facilities. Credits for existing principal and interest payments are included in the City of Las Cruces' Utilities impact fees because there is outstanding debt for the infrastructure categories in the fee program after the current fiscal year. The second type of credit is a site-specific credit for system improvements that have been included in the Utilities impact fee calculations. Policies and procedures related to site-specific credits for system improvements should be addressed in the ordinance that establishes the development fees. However, the general concept is that developers may be eligible for site-specific credits only if they provide system improvements that have been included in the impact fee calculations. Project improvements normally required as part of the development approval process are not eligible for credits against impact fees. Maximum Allowable Impact Fees A summary of maximum supportable impact fees for Water and Wastewater for the City of Las Cruces are shown in Figure 2. The fees represent the highest amount allowable for each type of housing unit, which represents new growth's fair share of the cost for utility capital facilities providing additional capacity. schl re Blse 2 Ti FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Also shown is a comparison to current Water and Wastewater impact fees and the percentage change.As shown, proposed Water impact fees are calculated to be lower than current fees and Wastewater impact fees are calculated to be higher than current fees. The City may adopt fees that are less than the amounts shown. However, a reduction in impact fee revenue will necessitate an increase in other revenues, a decrease in planned capital expenditures, and/or a decrease in levels of service. Figure 2.Summary of Maximum Allowable Utilities Impact Fees TOTALWATER I WASTEWATER Meter Size(inches) Proposed Current Change Proposed Current Change Proposed Current Change Fee Fee Fee Fee I Fee $2,125 $2,42012.2% $2,726 $1,94340.3% $4,851 $4,36311.2% See each respective chapter for fee schedules by meter type and size. Please note, calculations throughout this report are based on an analysis conducted using MS Excel software. Results are discussed in the memo using one- and two-digit places (in most cases). Figures are typically either truncated or rounded. In some instances, the analysis itself uses figures carried to their ultimate decimal places; therefore, the sums and products generated in the analysis may not equal the sum or product if the reader replicates the calculation with the factors shown in the report (due to the rounding of figures shown, not in the analysis). schl reschl Bise 3 Ti FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico INTRODUCTION TO DEVELOPMENT Definition Development fees, also known as impact fees or development impact fees, are one-time payments used to fund capital improvements necessitated by new growth. Impact fees have been utilized by local governments in various forms for at least fifty years. Impact fees do have limitations and should not be regarded as the total solution for infrastructure financing needs. Rather, they should be considered one component of a comprehensive portfolio to ensure adequate provision of public facilities with the goal of maintaining current levels of service in a community. Any community considering development impact fees should note the following limitations: ■ Impact fees can only be used to finance capital infrastructure and cannot be used to finance ongoing operations and/or maintenance and rehabilitation costs; ■ Impact fees cannot be deposited in the local government's General Fund. The funds must be accounted for separately in individual accounts and earmarked for the capital expenses for which they were collected; and ■ Impact fees cannot be used to correct existing infrastructure deficiencies unless there is a funding plan in place to correct the deficiency for all current residents and businesses in the community. Legal Framework U.S. Constitution. Like all land use regulations, development exactions—including impact fees—are subject to the Fifth Amendment prohibition on taking of private property for public use without just compensation. Both state and federal courts have recognized the imposition of impact fees on development as a legitimate form of land use regulation, provided the fees meet standards intended to protect against regulatory takings. To comply with the Fifth Amendment, development regulations must be shown to substantially advance a legitimate governmental interest. In the case of impact fees, that interest is in the protection of public health, safety, and welfare by ensuring that development is not detrimental to the quality of essential public services. There is little federal case law specifically dealing with impact fees, although other rulings on other types of exactions(e.g., land dedication requirements)are relevant. In one of the most important exaction cases, the U. S. Supreme Court found that a government agency imposing exactions on development must demonstrate an "essential nexus" between the exaction and the interest being protected. (See Nollan v. California Coastal Commission, 1987.) In a more recent case (Dolan v. City of Tigard, OR, 1994),the Court ruled that an exaction also must be "roughly proportional" to the burden created by development. Tischl reschl Bise 4 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico However, the Dolan decision appeared to set a higher standard of review for mandatory dedications of land than for monetary exactions such as development impact fees. Required Findings There are three reasonable relationship requirements for impact fees that are closely related to "rational nexus" or"reasonable relationship" requirements enunciated by a number of state courts. Although the term "dual rational nexus" is often used to characterize the standard by which courts evaluate the validity of development impact fees under the U.S. Constitution, we prefer a more rigorous formulation that recognizes three elements: "impact or need," "benefit," and "proportionality." The dual rational nexus test explicitly addresses only the first two, although proportionality is reasonably implied, and was specifically mentioned by the U.S.Supreme Court in the Dolan case.The reasonable relationship language of the statute is considered less strict than the rational nexus standard used by many courts. Individual elements of the nexus standard are discussed further in the following paragraphs. Demonstrating on Impoct.All new development in a community creates additional demands on some, or all, public facilities provided by local government. If the supply of facilities is not increased to satisfy that additional demand,the quality or availability of public services for the entire community will deteriorate. Impact fees may be used to recover the cost of development-related facilities, but only to the extent that the need for facilities is a consequence of development that is subject to the fees. The Nollan decision reinforced the principle that development exactions may be used only to mitigate conditions created by the developments upon which they are imposed.That principle clearly applies to impact fees. In this study, the impact of development on improvement needs is analyzed in terms of quantifiable relationships between various types of development and the demand for specific facilities, based on applicable level- of-service standards. Demonstrating a Bene it. A sufficient benefit relationship requires that facility fee revenues be segregated from other funds and expended only on the facilities for which the fees were charged. Fees must be expended in a timely manner and the facilities funded by the fees must serve the development paying the fees. However, nothing in the U.S. Constitution or the State enabling Act requires that facilities funded with fee revenues be available exclusively to development paying the fees. In other words,existing development may benefit from these improvements as well. Procedures for the earmarking and expenditure of fee revenues are typically mandated by the State enabling act, as are procedures to ensure that the fees are expended expeditiously or refunded. All of these requirements are intended to ensure that developments benefit from the fees they are required to pay.Thus, an adequate showing of benefit must address procedural as well as substantive issues. Demonstrating Proportionolity. The requirement that exactions be proportional to the impacts of development was clearly stated by the U.S. Supreme Court in the Dolan case (although the relevance of Tischl reschl Bise 5 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico that decision to impact fees has been debated) and is logically necessary to establish a proper nexus. Proportionality is established through the procedures used to identify development-related facility costs, and in the methods used to calculate impact fees for various types of facilities and categories of development. The demand for facilities is measured in terms of relevant and measurable attributes of development. For example, the need for school improvements is measured by the number of public school-age children generated by development. Unique Requirements of the New Mexico Development Fees Act Impact fees in New Mexico are governed by Article 8, Chapter 5 of New Mexico Statutes Annotated (NMSA)—the Development Fees Act.The Act imposes certain requirements for impact fee assessment in New Mexico, including': ■ Capital facility types that are eligible for impact fee assessment; ■ Categories of allowed and prohibited expenses; ■ Impact fee administrative procedures and capital facilities plan update requirements, including conditions under which fees must be refunded (impact fees must, for example, be spent within seven years of collection or refunded); ■ Requirements guiding the City's definition of an impact fee service area (the area within which fees will be assessed); ■ Impact fee analytical requirements that call for preparation of two reports to support the assessment— impact fee Land Use Assumptions, and this Impact Fee Capital Improvement Plan (the IFCIP),which documents the calculation methodology and includes a schedule of impact fees by property type. The IFCIP includes the following: ■ The definition of the impact fee service unit — a standard unit of measure for capital facilities demand planning; ■ A demand equivalency table that shows the rate of service unit generation(capital facility capacity demand), by property type; ■ The number of projected service units attributable to new development (which is a way to quantify the "impacts" of new development; 'See the Appendix for the full text of the New Mexico Development Fees Act. Tischl re Bise 6 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico ■ The cost per service unit (cost to meet demand from a unit of new development); ■ The net cost per service unit (total cost less impact fee reductions); ■ An impact fee net cost schedule that shows the net payable impact fee amount, by property type. The Development Fees Act includes three other noteworthy provisions: 1. Platted (and un-built) lots are guaranteed,for a period of four years,the impact fee rate in effect at the time of platting. This protection expires at the end of four years, after which the current fee rates apply. Lots platted prior to the adoption of the impact fees in this report have no such protection (because fees in this report have not been assessed in the past). Future impact fee updates will have effect only for lots platted after enactment of the new fees (along with lots platted more than four years before the update). 2. Impact fee exemption is specifically disallowed for public entities. 3. The City may waive fee assessment for "qualified affordable housing." Qualified units are those affordable to households earning 80%or less of HUD area median income, and which have total monthly shelter costs of less than 30%of gross household income. Methodologies and Credits Any one of several legitimate methods may be used to calculate impact fees. The choice of a particular method depends primarily on the service characteristics and planning requirements for the facility type being addressed. Each method has advantages and disadvantages in a particular situation, and to some extent can be interchangeable, because each allocates facility costs in proportion to the needs created by development. Reduced to its simplest terms, the process of calculating impact fees involves two main steps: (1) determining the cost of development-related capital improvements and (2) allocating those costs equitably to various types of development. In practice,though,the calculation of impact fees can become quite complicated because of the many variables involved in defining the relationship between development and the need for facilities. The following paragraphs discuss three basic methods for calculating development impact fees and how those methods can be applied. Plan-Based Fee Calculation. The plan-based method allocates costs for a specified set of improvements to a specified amount of development. The improvements are identified by a facility plan and development is identified by a land use plan. In this method,the total cost of relevant facilities is divided by total demand to calculate a cost per unit of demand. Then, the cost per unit of demand is multiplied by the amount of demand per unit of development (e.g., housing units or square feet of building area) in each category to arrive at a cost per specific unit of development (e.g., single family detached unit). Tischl reschl Bise FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Cost Recovery or Buy-In Fee Calculation. The rationale for the cost recovery approach is that new development is paying for its share of the useful life and remaining capacity of facilities already built or land already purchased from which new growth will benefit. This methodology is sometimes used for systems that were oversized. Incremental Expansion Fee Calculation.The incremental expansion method documents the current level of service(LOS)for each type of public facility in both quantitative and qualitative measures, based on an existing service standard (such as square feet per student). This approach ensures that there are no existing infrastructure deficiencies or surplus capacity in infrastructure. New development is only paying its proportionate share for growth-related infrastructure. The level of service standards are determined in a manner similar to the current replacement cost approach used by property insurance companies. However, in contrast to insurance practices, the fee revenues would not be for renewal and/or replacement of existing facilities. Rather, revenue will be used to expand or provide additional facilities, as needed,to accommodate new development. An incremental expansion cost method is best suited for public facilities that will be expanded in regular increments, with LOS standards based on current conditions in the community. Credits. Regardless of the methodology, a consideration of "credits" is integral to the development of a legally valid impact fee methodology. There are two types of"credits" each with specific characteristics, but both of which should be addressed in the development of development fees.The first is a credit due to possible double payment situations. This could occur when contributions are made by the property owner toward the capital costs of the public facility covered by the impact fee. This type of credit is integrated into the impact fee calculation. The second is a credit toward the payment of a fee for dedication of public sites or improvements provided by the developer for which the impact fee is imposed. This type of credit is addressed in the administration and implementation of a development fee program. Generic Impact Fee Calculation In contrast to development exactions, which are typically referred to as project-level improvements, impact fees fund growth-related infrastructure that will benefit multiple development projects, or the entire jurisdiction (often referred to as "system-level" improvements).The first step is to determine an appropriate demand indicator, or service unit, for the particular type of infrastructure. The demand/service indicator measures the number of demand or service units for each unit of development. For example, an appropriate indicator of the demand for utilities is meter size. The second step is to determine infrastructure units per demand unit, often called Level-Of-Service (LOS)standards. In keeping with the utilities example, a common standard is gallons per day per equivalent dwelling unit (EDU).The third step in the generic impact fee formula is the cost of various infrastructure units. To complete the utilities example,this part of the formula would establish the cost per gallon of capacity for utility capacity improvements. Tischl re Blse s FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico LAND USE ' • INDICATORS New Mexico's Development Fees Act states that land use assumptions should include a description of the service area and projections of changes in land uses, densities, intensities, and population in the service area over at least a five-year period (see Section 5-8-2.J). Specifically,the Development Fees Act requires that two analytical documents be prepared before impact fees can be assessed: 1. Land use assumptions must be defined in order to project the quantity of new development in terms of new service units anticipated over a 5-10 year period. 2. An impact fee capital improvements plan must be prepared to show how demand for added capital facility capacity generated by new development is translated into costs, and specifically, cost per new service unit. Demand Factors Person per Housing Unit Factors Household size (persons per housing unit, PPHU) is used to quantify the demand for utility infrastructure from a single family housing unit, which is the Equivalent Dwelling Unit (EDU) in the utility analysis. The 2010 Census did not obtain detailed information using a "long-form" questionnaire. Instead, the U.S. Census Bureau switched to a continuous monthly mailing of surveys, known as the American Community Survey(ACS),which has limitations due to sample-size constraints. For example,data on detached housing units are now combined with attached single units (commonly known as townhouses). To determine household size for a single family unit, data on population, housing units, and households is from the U.S. Census American Community Survey, 1-Year Estimate for 2017. (Note: housing unit estimates from ACS will not equal 100 percent counts of units, nor current estimates as provided below. Instead,these data are used only to derive the custom PPHU factors for each type of unit). As shown below, a single family unit has 2.43 persons in Las Cruces per the U.S. Census. Tischl re Bise 9 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Figure 3.City of Las Cruces Persons per Housing Unit Type of Unit Persons Households Persons per Housing Persons I .- . . Units HousingUnit Si ngl a Fa mi ly 78,457 27,622 2.84 32,261 2.43 Multifamily 20,817 11,554 1.80 14,111 Subtotal 99,274 39,176 2.53 46,372 Group Quarters 2,432 Tota 1 101,706 Percent Pop. in HH 98% Source:US Census American Community Survey 1-Year Estimate,2017 Note:Single unit includes detached,attached,and mobile homes. Residential Development Population Growth Trends Development fees require an analysis of current levels of service. For residential development, current levels of service are determined using estimates of population and housing units. Over the past decade,the City of Las Cruces has experienced slightly higher annual growth rate than Dona Ana County. Over the past ten years, the city has grown by 9,144 residents. The city's estimated population in 2019 is 104,427, almost half of the population of Dona Ana County. Figure 4.City of Las Cruces and Dona Ana County Historical Population Growth(2009 to 2019) Year Dofia Ana County City of Las Cruces Population Population 2009 205,778 95,283 2010 209,233 97,618 2011 210,179 98,327 2012 211,125 99,036 2013 212,071 99,746 2014 213,017 100,455 2015 213,963 101,164 2016 213,825 101,459 2017 215,579 101,706 2018 217,632 103,212 2019 219,686 104,427 Net Increase 13,9081 9,144 nnual Increase 0.73%1 0. Source:ESR1;Mesilla Valley MPO;Economic&Planning Systems Tlschl re Blse 10 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Projected Population Growth Figure 5 illustrates projected population growth through 2029. Projections are consistent with the City's new Comprehensive Plan and provided by Economic & Planning Systems. Las Cruces' population is estimated to grow annually at a rate of approximately 1.2 percent, resulting in a projected increase of 12,965 residents. Figure 5.City of Las Cruces and Dona Ana County Projected Population Growth(2019-2029) Year Dofia Ana County City of Las Cruces Population Population 2019 219,686 104,427 2020 221,739 105,656 2021 223,793 106,900 2022 225,846 108,158 2023 227,899 109,431 2024 229,953 110,720 2025 232,006 112,023 2026 234,060 113,342 2027 236,113 114,676 2028 238,166 116,026 2029 1 240,220 117,392 Net Increase 20,5341 12,965 Avg.Annual Increase I M 0.9% 1.18% Source:ESR1;Mesilla Valley MPO;Economic& Planning Systems Housing Unit Estimate and Projections The current population estimate in the City of Las Cruces and the above household size and population in household figures are used to determine the current estimate of housing units.Current number of housing units within the City is 47,631. Figure 6.City of Las Cruces Current Housing Unit Estimate(2019) Population Estimate[1] 72.14, %Population in Housing Units [2] Population in Housing Units Persons per Housing Unit[2] Estimated Total Housing Units 1 47,631 (11 ESRI,•Mesilla Valley MPO;Economic&Planning Systems (21 US Census American Community Survey 1-Year Estimate,2017 Tlschl re Blse 11 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Projections of housing units are shown below. Residential projections will be used to determine demand for utilities as well as to project revenues from development fees. Housing unit projections are derived from the population projections developed for the City's Comprehensive Plan update and the weighted average household size identified above. Figure 7.City of Las Cruces Housing Unit Projections(2019-2029) Year City of Las Cruces City of Las Cruces I Population Housing Units 2018 103,212 47,077 2019 104,427 47,631 2020 105,656 48,191 2021 106,900 48,759 2022 108,158 49,333 2023 109,431 49,913 2024 110,720 50,501 2025 112,023 51,095 2026 113,342 51,697 2027 114,676 52,306 2028 116,026 52,921 2029 117,392 53,544 Net Increase 12,965 5,913 Source:ESR1;Mesilla Valley MPO;Economic& Planning Systems Nonresidential Development Current estimates and future projections of nonresidential development are detailed in this section including jobs and nonresidential floor area. Base Year Employment and Nonresidential Square Footage Estimates In addition to data on residential development, the calculation of development fees requires data on employment(number of jobs)and nonresidential square footage in Las Cruces.TischlerBise uses the term "jobs" to refer to employment by place of work. TischlerBise analyzed recent employment trends, reviewed data available as part of the Elevate Las Cruces Comprehensive Plan effort, and the U.S. Census Bureau. TischlerBise uses a multi-step process to estimate base year job and nonresidential footage estimates. First, employment estimates are derived using 2015 data from the U.S. Census, On the Map Application and Longitudinal-Employer Household Dynamics Program (LEHD), Origin-Destination Employment Statistics, which is a key data source for employment estimates at the municipal level. However, 2015 is the latest year for which data is available. Second,job estimates are organized by type: Retail, Office and schl re Blse 12 Tl FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Other(includes institutional) and Industrial.Third, estimated nonresidential square footage in the City of Las Cruces for 2015 is estimated using average square feet per job factors shown in Figure 8. Figure 8. Employee and Building Area Ratios(ITE) EmployeesITI I Land Use/Size Demand Wkdy Trip Ends Wkdy Trip Ends Code Unit Per 1,000 Sq.Ft. Per Employee* 1p000 Sq.Ft. Per Emp 110 Light Industrial 1,000 Sq Ft 4.96 3.05 1.63 613 130 Industrial Park 1,000 Sq Ft 3.37 2.91 1.16 862 140 Manufacturing 1,000 Sq Ft 3.93 2.47 1.59 629 150 Warehousing 1,000 Sq Ft 1.74 5.05 0.34 2,941 254 Assisted Living bed 2.60 4.24 0.61 na 320 Motel room 3.35 25.17 0.13 na 520 Elementary School 1,000 Sq Ft 19.52 21.00 0.93 1,075 530 High School 1,000 Sq Ft 14.07 22.25 0.63 1,587 540 Public/Institutional 1,000 Sq Ft 20.25 14.61 1.39 721 565 Day Care 1,000 Sq Ft 47.62 21.38 2.23 448 610 Hospital 1,000 Sq Ft 10.72 3.79 2.83 353 710 General Office(avg size) 1,000 Sq Ft 9.74 3.28 2.97 337 720 Medical-Dental Office 1,000 Sq Ft 34.80 8.70 4.00 250 730 Government Office 1,000 Sq Ft 22.59 7.45 3.03 330 750 Office Park 1,000 Sq Ft 11.07 3.54 3.13 319 760 Research&Dev Center 1,000 Sq Ft 11.26 3.29 3.42 292 770 Business Park 1,000 Sq Ft 12.44 4.04 3.08 325 820 Shopping Center(avg size) 1,000 Sq Ft 37.75 16.11 2.34 427 Source: Trip Generation,Institute of Transportation Engineers, 10th Edition(2017). Results are shown below in Figure 9 by land use type. Nonresidential square footage is estimated by multiplying number of jobs by square feet per employee (e.g., retail jobs at 13,981 x 427 sq. ft. per job = 5,969,887 square feet). Figure 9.2015 Employment and Distribution by Industry Type Land Use . . . . • , Retail 13,981 30% 427 5,969,887 33% Office&Other 26,472 57% 337 8,921,064 49% Industrial 5,595 12% 613 3,429,735 19% Total 46,048 100% 18,320,686 100% i11 U.S. Census, OnTheMap 6.1.1 Application and LEHD Origin-Destination Employment Statistics i21 Trip Generation, Institute of Transportation Engineers, 10th Edition(2017). To determine current(2019) nonresidential square footage and job estimates,TischlerBise obtained data on the total amount of nonresidential square footage in the City from the Elevate Las Cruces Comprehensive Plan data collection at almost 20 million square feet. Current square footage is allocated schl reschl Base 13 Ti FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico to existing nonresidential land uses using the detailed data from 2015. Existing nonresidential square footage is then converted to an estimated number of existing jobs using the square foot per employee factors from above. Figure 10.2019 Employment and Distribution by Industry Type . . . . • , Retail 6,510,505 33% 427 15,247 30% Office&Other 9,725,816 49% 337 28,860 57% Industrial 3,734,553 19% 613 6,092 12% Total 19,970,874 100% 50,199 100% i11 Total square footage from EPS and Halff Assoc.,Elevate Las Cruces;allocated by type from 2015 Summary i21 From 2015 Sum m ary i31 Trip Generation, Institute of Transportation Engineers, 10th Edition(2017). Employment and Nonresidential Floor Area Projections Future employment growth and nonresidential development in Las Cruces are based on projections developed for the Elevate Las Cruces Comprehensive Plan, which projects a total of 25.5 million square feet of nonresidential space by the year 2045. Projections for the development fee study are limited to 10 years, therefore TischlerBise interpolated between the current estimate and the 2045 projection. It is projected that the City will grow by just under 2 million square feet over the next ten years. To project growth in at-place employment,TischlerBise applied the previously discussed square feet per employee factors to the projected increase in square footage.The results of these calculations are shown in Figure 11. Over the next 10 years, Las Cruces is projected to grow by 4,932 jobs and add an estimated 1.96 million square feet of nonresidential development. Tlschl re Blse 14 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Figure 11. Nonresidential Development Projections Year City of Las Cruces City of Las Cruces Nonres Sq.Ft. .b 2018 49,161 2019 19,970,874 50,199 2020 20,158,928 50,672 2021 20,348,753 51,149 2022 20,540,365 51,631 2023 20,733,782 52,117 2024 20,929,020 52,608 2025 21,126,096 53,103 2026 21,325,029 53,603 2027 21,525,834 54,108 2028 21,728,530 54,617 2029 21,933,135 55,132 Net ncrease 1,962,261 Avg.Annual�nc r Source:City of Las Cruces,Elevate Las Cruces Comprehensive Plan (Holff Assoc.,EPS);Tischler8ise analysis Summary of Land Use Assumptions Provided below is a summary of cumulative land use projections used in the development impact fee study. Base year estimates for 2019 are used in the development fee calculations. Development projections are used to illustrate a possible future pace of demand for service units and cash flows resulting from revenues and expenditures associated with those demands. Figure 12.Summary of Land Use Assumptions Multi Year Increments>>> Base 1 2 3 4 5 Population Subtotal Household Population 101,930 103,130 104,344 105,572 106,814 108,072 114,585 12,655 Group Quarters Population 2,497 2,526 2,556 2,586 2,617 2,648 2,807 310 Total Population 104,427 105,656 106,900 108,158 109,431 110,720 117,392 12,965 Net Increase Per Year 1,229 1,244 1,258 1,273 1,289 1,366 Housing Units Total Housing Units 47,631 48,191 48,759 49,333 49,913 50,501 53,544 5,913 Net Increase Per Year 561 567 574 581 588 623 Jobs Total Jobs 50,199 50,672 51,149 51,631 52,117 52,608 55,132 4,932 Net Increase Per Year 473 477 482 486 491 514 Nonresidential Floor Area(KSF) Total Floor Area(KSF) 19,970,874 20,158,928 20,348,753 20,540,365 20,733,782 20,929,020 21,933,135 1,962,261 Net Increase Per Year 188,054 189,825 191,612 193,417 195,238 204,605 schl reschl Base 1s Ti FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Demand for Water and Wastewater Facilities Based on the above projections, demand for Water and Wastewater improvements and facilities can be projected as well. A summary of projected demand is provided below with detail in the respective report chapters. Summary of Projected Water Demand Over the next 10 years, it is projected there will be an increase of 4,491 water customers. Accordingly, water demand is projected to increase by almost 2.0 million gallons per day by the end of the 10-year projection period.Average daily total demand at the end of the 10-year period is projected at 19.4 million average gallons per day. Detail is provided in Figure 13. Figure 13. Projected Water Demand OtherAnnual Increase Cumulative Increase Residential Nonresidential/ Total Grand TotalYear Customers Customers per Day aL per Day per Day Base 2019 32,597 4,518 37,115 17,460,711 1 2020 32,981 4,561 37,541 426 188,574 426 188,574 17,649,285 2 2021 33,369 4,603 37,972 431 190,686 857 379,260 17,839,971 3 2022 33,762 4,647 38,408 436 192,707 1,293 571,967 18,032,678 4 2023 34,159 4,691 38,850 441 194,831 1,735 766,798 18,227,509 5 2024 4,735 39,296 61 2,181 as 963,859 570 6 2025 34,968 4,779 39,747 451 199,099 2,632 1,162,958 18,623,669 7 2026 35,380 4,824 40,204 457 201,341 3,089 1,364,299 18,825,010 8 2027 35,796 4,870 40,666 462 203,491 3,551 1,567,790 19,028,501 9 2028 36,218 4,916 41,133 1 467 205,737 1 4,018 1,773,526 19,234,237 10 2029 36,644 4,96 41,60 07,987 1 4,49 1,981,513 19,442,224 Source:Tischler8ise,using Average Day Demand factors and projected development shown in the Land Use Assumptions. schl reschl Base 16 Ti FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Summary of Projected Wastewater Demand Over the next 10 years, it is projected there will be an increase of 4,251 wastewater customers. Accordingly,the projected wastewater demand increases by approximately 1.2 million gallons per day by the end of the 10-year projection period. Average daily total demand at the end of the 10-year period is projected at almost 12.4 million average gallons per day. Detail is provided in Figure 14. Figure 14. Projected Wastewater Demand Other9W Annual Increase-Ipr--VrCumulative Increase Residential Nonresidential/ Total Grand TotalYear Customers Customers Customers Customers per Day Customers per Day Avg.Gallons per2a.. Base 2019 3,454 47,620 1 2020 31,878 3,487 35,364 403 118,016 403 118,016 11,265,636 2 2021 32,253 3,519 35,772 408 119,309 811 237,326 11,384,946 3 2022 32,633 3,552 36,185 413 120,554 1,224 357,880 11,505,500 4 2023 33,017 3,586 36,603 418 121,857 1,642 479,737 11,627,357 2024 33,406 3,620 37,025 423 123,218 2,064 J111V 11,750,575 6 2025 33,799 3,654 37,453 427 124,477 2,492 727,431 11,875,051 7 2026 34,197 3,688 37,885 432 125,847 2,924 853,278 12,000,898 8 2027 34,599 3,723 38,322 437 127,169 3,361 980,447 12,128,067 9 2028 35,007 3,758 38,765 442 128,545 3,804 1,108,992 12,256,612 10 2029 35,419 3,793 39,212 447 129,924 4,251 1,238,916 12,386,536 Source:Tischler8ise,using Average Day Demand factors and projected development shown in the Land Use Assumptions. schl reschl Bise 17 Ti FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Methodology Water impact fees are derived using the incremental, plan based, and cost recovery approaches. Impact fees are by meter size and calibrated to average daily gallons of water demand for a single-family housing unit (or an Equivalent Dwelling Unit (EDU)). The cost per meter size is based on the net capital costs per gallon of system capacity or per EDU multiplied by the applicable capacity ratio.Water impact fees include infrastructure components for: water wells/supply, transmission, storage, development and support facilities. Impact fees to be paid by multifamily and nonresidential development are derived from capacity ratios according to the size of the new customer's water meter. Capacity ratios are from Las Cruces Utilities. Water Demand Water impact fees use average water usage per Equivalent Dwelling Unit (EDU) as the service unit. TischlerBise obtained water usage data from Las Cruces Utilities to determine demand from residential and nonresidential land uses. Residential customers shown below reflect single units and do not include multifamily housing units.Therefore,the usage figure can be used to derive average daily water demand from an EDU at 315 gallons per day. Detail is provided below in Figure 15. Tischl reschl Bise 1s FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Figure 15.Water Usage by Customer Class(2018)and Levels of Service Annual Sales Avg.Annual Gallons per Test Year 2018 Avg.Customers Avg.GPD (1,000 gal) Customer Residential Customers 3,686,978 32,072 114,959 315 Small Commercial 792,498 3,635 218,019 597 Large Commerci a 1 941,081 432 2,178,428 5,968 Industrial 359,906 18 19,994,778 54,780 San Pablo MDWCA 9,748 1 9,748,000 26,707 Parks 73,390 35 2,096,857 5,745 Parks Non-Potable 12,337 4 3,084,250 8,450 Off Peak 126,481 58 2,180,707 5,975 Reclaimed Water 118,893 6 19,815,500 54,289 Total/Average 6,121,312 36,261 168,813 463 Summary Annual Sales Avg.Customers Avg.Annual Gallons per"Avg.GPD (1,000 gal) Customer Residential 3,686,978 32,072 114,959 Nonresidential/Other 2,434,334 4,189 581,125 1,592 Total/Average 6,121,312 36,261 168,813 463 Source:Las Cruces Utilities, Water Utility Rate Review, Test Year 2018 Ratio of Service Unit to Development Unit Residential water facilities development fees are assessed on a per meter basis, calibrated to average gallons per day per single family unit,which is an equivalent dwelling unit(EDU). Multifamily units should be assessed based on the corresponding meter size and capacity ratio shown below and would establish a ratio of service units to land use. For nonresidential water facilities development fees, capacity ratios by meter size are the appropriate demand indicator for water facilities. Capacity ratios equate .625 (5/8) or.75 (3/4) inch meters (standard single family unit meter)to the average gallons per day for a single-family residential unit. Utilizing average gallons per day is the most efficient way to show a direct relationship between development units, usage, and system capacity. Water facilities development impact fees assessed on nonresidential development are calculated by multiplying the number of gallons per residential unit by the capacity ratio for the corresponding size and type of water meter needed to serve the nonresidential land use. Tlschl re Blse 19 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Maximum flow rate capacity for .625 (5/8) or .75 (3/4) inch meters is 25 gallons per minute (gpm), reflecting the City's transition to induction flow measurement with a Kamstrup meter having a higher maximum capacity than the average bronze main case documented by the American Water Works Association(AWWA).Other types of meters are utilized in the City of Las Cruces with a range of capacities, which are scaled to the capacity for a standard residential meter. Maximum capacity standards for the other meters and sizes are from Las Cruces Utilities and shown below in Figure 16. Figure 16.Water Facilities Ratio of Service Units to Development Units Water DevelopmentResidential Number of Persons per Single Family Unit(EDU) 2.43 Average Gallons per Day per EDU 315 Average Gallons per Person 130 Sources:US Census;Las Cruces Utilities;Tischler8ise DevelopmentAll Capacity Capacity Capacity Ratio Ratio Ratio Kamstrup Elster Master Meter Kamstrup Elster Master Meter Flow IQ EVO Q4 Octave Ultra Flow IQ EVO Q4 Octave Ultra 05MXx3/4' 25 1.00 3/4 32 1.28 1" 55 2.20 1-1/2" 120 4.80 2" 160 220 250 6.40 8.80 10.00 3" 550 500 22.00 20.00 4" 880 1000 35.20 40.00 6" 1400 1600 56.00 64.00 8" 3500 2800 140.00 112.00 Source:Las Cruces Utilities schl reschl Bise 20 Ti FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Current Water Demand Las Cruces Utilities current water usage is estimated based on customer count for Fiscal Year 2019 (as of February 2019) and gallons per customer from the data in Figure 16 above.Total estimated average daily demand is approximately 17.5 million gallons per day. Figure 17.Current(2019)Average Daily Water Demand by Land Use Land Use Class Customers* Gallons per Est d.Water Customer per Da ^ Demand GPD Residential 32,597 315 10,268,055 Nonresidential 4,518 1,592 7,192,656 Total 37,115 17,460,711 *FY19 Actual Customer Count Las Cruces Utilities A City of Las Cruces Utilities, Water Utility Rate Review, Test Year 2018 Projected Water Demand Using current demand factors as summarized below in Figure 18 and the land use assumptions detailed in this chapter,future water demand can be projected. Figure 18.Water Level of Service/Demand Factors(Base Year 2019) 32,597 Residential Customers 47,631 City of Las Cruces Housing Units (HU) 0.684 Customers/HU 315 GPD/Customer 4,518 Nonresidential Customers 50,199 City of Las Cruces Jobs 0.090 Customers/Job 1,592 GPD/Customer Source:Las Cruces Utilities;Tischlereise analysis. Tischl re Bise 21 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Over the next 10 years, it is projected there will be an increase of 4,491 water customers. Accordingly, water demand is projected to increase by almost 2.0 million gallons per day by the end of the 10-year projection period.Average daily total demand at the end of the 10-year period is projected at 19.4 million average gallons per day.This equates to an increase of 6,291 EDUs. Detail is provided in Figure 19. Figure 19. Projected Water Demand Mmi ii M W P�. 2 32,597 4 37,115 17,460, 32,981 4,561 37,541 426 188,574 426 188,574M 17,649,285 599 599 56,030 2 2021 33,369 4,603 37,972 431 190,686 857 379,260 17,839,971 605 1,204 56,635 3 2022 33,762 4,647 38,408 436 192,707 1,293 571,967 18,032,678 612 1,816 57,247 4 2023 34,159 4,691 38,850 441 194,831 1,735 766,798 18,227,509 619 2,435 57,866 5 20AM 34,561 39,296 jW 197,061 963,859 424,570 626 ,061 58, 6 2025 34,968 4,779 39,747 451 199,099 2,632 1,162,958 18,623,669 632 3,693 59,124 7 2026 35,380 4,824 40,204 457 201,341 3,089 1,364,299 18,825,010 639 4,332 59,763 8 2027 35,796 4,870 40,666 462 203,491 3,551 1,567,790 19,028,501 646 4,978 60,409 9 2028 36,218 4,916 41,133 467 205,737 4,018 1,773,526 19,234,237 653 5,631 61,062 10 2029 36,647V 4,962 41,606 473 207,987 4,TK 1,981,513 ,442,224 660 61,722 Source:TischleaRise,using Average Day Demand factors and projected developmentsh-in the Land Use Assumptions. Service Area The service area for the Water Development Fee is citywide within Las Cruces water service area. Tischl reschl Base 22 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Water System Levels of Service and Cost Factors Water Wells/Supply The City of Las Cruces obtains its water from twenty-seven City of Las Cruces Wells and twelve Jornada System Wells, which were recently acquired by Las Cruces Utilities. Grand total water capacity is almost 53 million gallons per day with a firm capacity at 80 percent of the total, or 42 million gallons per day. A summary of current water well/supply is shown below in Figure 20. Figure 20.Water Supply Level of Service City of Las Cruces Wells Jornada System Wells 25 610 878,400 103 LRG-50-S-7 130 187,200 28 500 720,000 106 LRG-50-S-13 600 864,000 29 1800 2,592,000 107 LRG-50-S-11 600 864,000 31 1600 2,304,000 115 LRG-1882-S 90 129,600 32 1100 1,584,000 116 LRG-1882-S-2POD4 150 216,000 33 400 576,000 117 LRG-47-S-3 215 309,600 35 1000 1,440,000 119 LRG-47-S-6 275 396,000 39 500 720,000 120 LRG-47-S-5 150 216,000 40 1250 1,800,000 121 LRG-47-S-4 115 165,600 41 1700 2,448,000 122 LRG-47 85 122,400 42 1400 2,016,000 123 LRG-48 105 151,200 43 1000 1,440,000 125 LRG-48-S-2 175 252,000 46 2500 3,600,000 Subtotal 3,873,600 58 1400 2,016,000 59 1800 2,592,000 61 1200 1,728,000 GRAND TOTAL WELL CAPACITY 52,797,600 62 700 1,008,000 63 2700 3,888,000 FIRM PRODUCTION CAPACITY 42,238,080 65 1250 1,800,000 67 2000 2,880,000 68 500 720,000 69 1000 1,440,000 70 2850 4,104,000 71 2900 4,176,000 18 90 129,600 27 225 324,000 Paz* 400 Subtotal 48,924,000 *Irrigation use;not potable.Not included in capacity figures. *Firm capacity estimated at 80%of total production capacity,per City of Las Cruces Water and Wastewater System MasterPlan Update,2008. Source:Las Cruces Utilities Tlschl re Blse 23 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Maximum day demand is estimated at approximately 35 million gallons per day,assuming a peaking factor of 2, per the Water and Wastewater Master Plan Update and 2013 Impact Fee Study. This results in a utilization factor of 83 percent of firm water capacity as shown in Figure 21. Figure 21.Water Usage and Capacity Estimated Avg. Daily Water Demand (GPD) 17,460,711 Peaking Factor* 2.0 Estimated Max Daily Water Demand (GPD) 34,921,422 Estimated Water Supply Capacity(GPD) 52,797,600 Estimated Firm Water Supply Capacity(GPD)A 42,238,080 Uti I i zati on 83% *Water and Wastewater System Master Plan Update 80%of production capacity,per Water and Wastewater System Master Plan Update Source:Las Cruces Utilities Water Supply Cost Las Cruces Utilities plans to continue to expand water supply capacity from future well development. Below is the current cost per gallon of capacity for water supply based on recent well construction, including drilling and pump house construction. Interest costs are included in the estimates.The resulting cost per gallon is$1.05. Figure 22.Water Supply Cost Factors Water Supply Est. Interest M Cost[2] mmm Well 40-Drilling and Pump Station $2,380,000 $1,071,000 $3,451,000 1,800,000 $1.92 Well 70-Drilling and Pump Station $2,450,000 $1,102,500 $3,552,500 4,104,000 $0.87 Well 71-Drilling and Pump Station $2,450,000 $1,102,500 $3,552,500 4,176,000 $0.85 Total $7,280,000 $3,276,000 $10,556,000 10,080,000 $1.05 i11 Las Cruces Utilities;includes drilling and pump house construction. i21 Interest estimated at 4%over 20 years. i31 Las Cruces Utilities. Tlschl re Blse 24 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Water Distribution Water is distributed in the City of Las Cruces through a system of transmission lines, valves, and booster pumps. Las Cruces Utilities plans to continue to add capacity in the system by expanding components of the water distribution system to accommodate growth. Current levels of service and costs are detailed below in the next series of figures. Atotal of 328,028 linear feet of system transmission lines at a range of sizes from 16 to 36 inches distribute water in the City of Las Cruces. The infrastructure is currently valued at approximately$64 million (costs are appreciated using the Engineering News Record cost index for a Southwest city (Dallas, Texas). This equates to a cost per EDU of$1,147.96. Figure 23.Water Transmission Lines Level of Service and Cost Factor Line Size Linear Feet [1] 2013 Cost/Lin. Ft. 16" 31,982 $140.95 $154.30 $4,934,837 18" 164,496 $153.86 $168.44 $27,706,903 24" 87,815 $179.69 $196.71 $17,274,215 30" 8,727 $210.17 $230.08 $2,007,921 36" 35,009 $305.51 $334.45 $11,708,633 Total 328,028 $193.98 $63,632,509 Current Number of Water EDUs 55,431 Cost per EDU $1,147.96 i11 Las Cruces Utilities i21 City of Las Cruces Water and Wastewater Impact Fee Study,2013,cost updated to 2019 dollars with Engineering News-Record(ENR)Construction Cost Index for south west city(Dallas,TX). Tischl re Bise 25 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Five water control valve stations serve the water system in Las Cruces to regulate and maintain water pressure through the system. Current estimated value for the existing control valve stations total $663,588.This equates to a cost per EDU of$11.97. Detail is provided below. Figure 24.Water Valves Level of Service and Cost Factor Control Valve Station Diameter(inches) West Mesa 36 $96,376 $105,506 Spruce and Triviz 14 $150,336 $164,577 Triviz 14 $150,336 $164,577 Telshor 12 $119,078 $130,358 University and Telshor 12 $90,040 $98,569 $663,588 Current Number of Water EDUs 55,431 Cost per EDU $11.97 Sources:Las Cruces Utilities;City of Las Cruces Water and Wastewater Impact Fee Study,2013,cost updated to 2019 dollars with Engineering News-Record(ENR)Construction Cost Index for south west city(Dallas,TX). schl reschl Base 26 Ti FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico The City is served by 11 booster pump stations with 32 pumps to pump water from lower service zones to higher service zones.The pump stations have an estimated current value of$2.2 million.This equates to $39.02 per EDU. Figure 25.Water Booster Pumps Level of Service and Cost Factor Pump Station No.of Pumps Loma Vista 3 $114,000 $124,799 Jornada 3 $76,000 $83,199 South Jornada 3 $161,500 $176,799 Upper Griggs 3 $190,000 $311,998 Missouri 1 3 $142,500 $116,999 Missouri 2 3 $199,500 $218,398 Telshor 1 3 $76,000 $83,199 Telshor Skid 2 $87,400 $95,679 Telshor 2 3 $104,500 $171,599 Airport 3 $95,000 $155,999 West Mesa 3 $380,000 $623,996 32 $2,162,665 Current Number of Water EDUs 55,431 Cost per EDU $39.02 *Reflects inventory and asset value at time of 2013 Impact Fee Study Sources:Las Cruces Utilities;City of Las Cruces Water and Wastewater Impact Fee Study,2013,cost updated to 2019 dollars with Engineering News-Record(ENR)Construction Cost Index southwest city(Dallas, TX). Tischl reschl Bise 27 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Water Storage Lac Cruces Utilities provides water storage in 13 storage tanks with a total capacity of 27.4 million gallons. The current level of service provided to existing Las Cruces Utilities water customers is 494 gallons per EDU. See Figure 26. Figure 26.Water Storage Level of Service CapacityStorage Tank Name Year Built North Zone 2 2001 2.0 North Zone 1A 1992 2.0 South Zone 1995 2.0 Telshor 1965 2.0 Loma Vista 1964 2.0 North Jornada 1992 2.0 SouthJornada 2009 2.0 Spruce 1970 3.0 Upper Griggs 1962 3.0 Missouri 1956 2.0 Airport Ground 1983 0.4 Airport Elevated 1983 0.5 West Mesa 2000 4.5 Total 27.4 Current Number of Water EDUs 55,431 Gallons per EDU 494 Source:Las Cruces Utilities;City of Las Cruces Water and Wastewater Impact Fee Study,2013 Based on current capacity upgrades in Las Cruces' Capital Improvement Plan, the current cost to Las Cruces Utilities to provide water storage capacity is $1.27 per gallon. This cost is applied to the demand per EDU of 494 gallons in the impact fee schedule to derive new growth's share of the cost for water storage improvements. Tischl reschl Bise 28 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Figure 27.Water Storage Cost Factor Description Capacity Elevated (Airport)Tank Improvements $1,200,000 0.5 $2.40 Missouri Tank Improvements $2,000,000 2 $1.00 Upper Griggs Tank Improvements $2,195,000 3 $0.73 N.Zone 1 Tank Improvements $1,712,000 2 $0.86 S.Zone Tank Improvements $1,096,500 2 $0.55 Subtotal(principal) $8,203,500 9.5 $0.86 Subtotal(interest)[3] $3,869,058 9.5 $0.41 Grand Total Cost $12,072,558 9.5 $1.27 [1]Las Cruces Utilities Capital Improvement Plan(FY2020) [2]Las Cruces Utilities [3]Tischler8ise estimated at 4%interest rate Planned Water Development Las Cruces Utilities operates as a system,and as such, is connected within its system and connects to other water systems, primarily for emergency and redundancy purposes. Las Cruces Utilities plans to continue to expand its system of interconnectors with two projects in Zone I shown below. These projects are anticipated to serve demand over the next 20 years and are allocated to projected water demand over that time period. Estimated total costs and projected net new water demand over the next 20 years are shown below along with the resulting cost per gallon of capacity. Figure 28.Water Development Level of Service and Cost Factor Zone I Interconnect Project 2-Phase B 2020 $1,160,000 Zone I Interconnect Project 3 South-Phase B 2021 $1,450,000 Total $2,610,000 Projected increase in demand (gpd) (20-Year Increase) 4,189,179 Cost per Gallon $0.62 Source:Las Cruces Utilities Capital Improvement Plan(FY2020);Tischler8ise projections. Tlschl re Blse 29 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Water Support Facilities Las Cruces Utilities is currently constructing a Water Quality Lab to provide water and wastewater testing. Per Las Cruces Utilities, the facility will be utilized 30 percent for water testing (with the remaining 70 percent for wastewater testing). Costs are allocated to each fee category accordingly. This facility is anticipated to serve current and future demand over the next 20 years. Level of service and cost factors are shown below. Figure 29.Water Quality Lab Level of Service and Cost Factor:Water Portion Water Quality Laboratory(WQL) 2019 $4,734,222 30% $1,420,267 Total $4,734,222 $1,420,267 Projected Total Water Demand (GPD) (20-Year)l 21,649,890 Cost per GPD $0.07 *Remainder serves Wastewater Source:Las Cruces Utilities;Tischler8ise projections. Credit Analysis for Water System Improvements Las Cruces debt finances some water system improvements, including the purchase of the Jornada Water System and other capacity improvement projects. To avoid potential double payment for water system improvements, a credit is necessary because new residential and nonresidential development that will pay the impact fee will also contribute to future principal payments through utility rates on this remaining debt. As shown in Figure 30, outstanding principal and interest payments for financed water capacity improvements is approximately $21 million, reflecting 100 percent of the Jornada Water System acquisition debt and 20 percent of remaining Water Fund for capacity projects. To derive the credit amount, principal and interest subtotal per year is divided by the total demand (average gallons per day) in the water system in each year. To account for the time value of money, annual payments per gallon of capacity are discounted using a net present value formula based on an average interest rate of 4.0 percent.The total net present value of future debt service payments for capacity improvements is $0.79 per gallon. This amount is subtracted from the gross capital cost per gallon amount to derive a net capital cost per gallon for water facilities. Tlschl re Blse 30 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Figure 30.Water Principal&Interest Payment Credit Evaluation 2016 Bond Series Jornada WND TOTAI CREDIT Year Principal Interest Total P&I Capacity$ Principal Interest TbtaIP&I Capacity$ Capacity$ Pr0j. Credit per Demand 100% 20% P&I GPD Gallon 2020 $279,808 $213,408 $493,216 $493,216 $2,615,590 $1,667,662 $4,283,252 $856,650 $1,349,867 17,649,285 $0.08 2021 $292,924 $199,418 $492,342 $492,342 $2,535,276 $1,574,979 $4,110,255 $822,051 $1,314,393 17,839,971 $0.07 2022 $308,226 $184,772 $492,998 $492,998 $2,850,945 $1,475,075 $4,326,020 $865,204 $1,358,202 18,032,678 $0.08 2023 $321,342 $172,443 $493,785 $493,785 $3,039,638 $1,366,759 $4,406,397 $881,279 $1,375,064 18,227,509 $0.08 2024 $332,272 $159,589 $491,861 $491,861 $2,906,732 $1,256,630 $4,163,361 $832,672 $1,324,533 18,424,570 $0.07 2025 $347,574 $146,298 $493,872 $493,872 $3,129,896 $1,136,700 $4,266,596 $853,319 $1,347,191 18,623,669 $0.07 2026 $360,690 $132,395 $493,085 $493,085 $2,866,946 $1,012,770 $3,879,716 $775,943 $1,269,028 18,825,010 $0.07 2027 $375,992 $117,967 $493,959 $493,959 $2,622,333 $911,491 $3,533,824 $706,765 $1,200,724 19,028,501 $0.06 2028 $389,108 $102,928 $492,036 $492,036 $1,978,337 $817,730 $2,796,067 $559,213 $1,051,249 19,234,237 $0.05 2029 $397,852 $94,659 $492,511 $492,511 $1,935,178 $755,122 $2,690,301 $538,060 $1,030,571 19,442,224 $0.05 2030 $406,596 $85,708 $492,304 $492,304 $2,089,644 $692,498 $2,782,142 $556,428 $1,048,732 19,652,460 $0.05 2031 $417,526 $76,051 $493,577 $493,577 $2,295,776 $623,096 $2,918,873 $583,775 $1,077,352 19,864,969 $0.05 2032 $426,270 $65,613 $491,883 $491,883 $2,412,133 $547,592 $2,959,725 $591,945 $1,083,828 20,079,776 $0.05 2033 $437,200 $54,956 $492,156 $492,156 $2,558,849 $466,611 $3,025,460 $605,092 $1,097,248 20,296,906 $0.05 2034 $450,316 $41,840 $492,156 $492,156 $2,710,543 $377,281 $3,087,825 $617,565 $1,109,721 20,516,384 $0.05 2035 $465,618 $28,331 $493,949 $493,949 $2,712,657 $289,166 $3,001,823 $600,365 $1,094,313 20,738,235 $0.05 2036 $478,734 $14,362 $493,096 $493,096 $2,168,000 $191,856 $2,359,856 $471,971 $965,067 20,962,485 $0.05 2037 $0 $0 $0 $0 $1,646,362 $112,225 $1,758,587 $351,717 $351,717 21,189,160 $0.02 2038 $0 $0 $0 $0 $1,561,021 8,2 $54,636 $1,615,657 $323,131 $323,131 21,4186 $0.02 2039 $0 $0 $0 $0 $0 $0 $0 $0 $01 21,649,8901 $0.00 Total 1$6,488,0481$1,890,7371$8,378,7851$8,378,7851$46,635,8561$15,329,8801$61,965,7361$12,393,1471 $20,771,932 $1.08 Discount Rate 4.0% Source:Las Cruces Utilities;Tischler8ise projections. Net Present Value $0.79 Tischl re Bise 31 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Proposed Impact Fees for Water Input variables for the Water Impact Fees are shown in the upper section of Figure 31. For each component of the impact fee, capital costs per equivalent dwelling unit (EDU) are calculated by multiplying the average number of gallons per residential unit (EDU) by the net capital cost per gallon of system capacity.The net capital cost per EDU of$2,125 is the impact fee for a single family unit, or EDU. Nonresidential impact fees are based on size and type of water meter and their restrictive capacity.Water development fees are calculated by multiplying the cost per EDU by the capacity ratio for the corresponding size and type of water meter. The capacity ratio is calibrated to the maximum flow rate capacity for .625 (5/8) or .75 (3/4) inch meters, the standard for a single family unit (or EDU). The full impact fee schedule by meter type and size is shown in Figure 32. Figure 31. Proposed Water Impact Fees Cost per Gallon of Water Gallons per Water Capital Capacity Day per EDU Cost per EDU Water Wells/Supply $1.05 315 $330.75 Water Transmission $1,198.95 Water Storage $1.27 494 $627.38 Water Development $0.62 315 $195.30 Water Support Facilities $0.07 315 $22.05 Subtotal $2,374.43 Water Credit 1 ($0.79) 315 ($248.85) Water Capital Cost per EDU=> $2,125.58 Water Capital Cost per EDU(Truncated)_> Proposed Fees:5/8 or 3/4 Inch Meter Meter Size(inches) Capacity Ratio ... Fee to Builder Customer Fee to Rate Surcharge Base i 0.625(5/8)or 0.75(3/4) 1.00 $1,063 $595 $468 schl re Blse 32 Tl FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Figure 32. Proposed Water Impact Fees:All Meter Types and Sizes Capacity Capacity Capacity Ratio Ratio Ratio Fee Fee Fee Kamstrup Elster Master Meter Kamstrup Elster Master Meter Kamstrup Elster Master Meter Flow IQ EVO Q4 Octave Ultra Flow IQ EVO Q4 Octave Ultra Flow IQ EVO Q4 Octave Ultra 5/8 x 3/4" 25 1.00 $2,125.00 3/4 32 1.28 $2,720.00 1" 55 2.20 $4,675.00 1-1/2" 120 4.80 $10,200.00 2" 160 220 250 6.40 8.80 10.00 $13,600.00 $18,700.00 $21,250.00 3" 550 500 22.00 20.00 $46,750.00 $42,500.00 4" 880 1000 35.20 40.00 $74,800.00 $85,000.00 6" 1400 1600 56.00 64.00 $119,000.00 $136,000.00 8" 3500 2800 140.00 112.00 $297,500.00 $238,000.00 Source:Las Cruces Utilities Below is a comparison of the updated proposed residential development impact fee amount to the current rate and the calculated difference. Figure 33. Proposed Water Impact Fees Comparison to Current Water Fees Proposed Fees:5/8 or 3/4 Inch Meter Meter Size(inches) Capacity Ratio ... Fee to Builder Customer Fee to Rate Surcharge Base i' 0.625(5/8)or 0.75(3/4) 1.00 $1,063 $595 $468 Current Fees: 5/8 or 3/4 Inch Meter Meter Size(inches) Capacity Ratio Current Water Fee Fee to Builder Customer Fee to Rate Surcharge Base i' 0.625(5/8)or 0.75(3/4) 1.00 I 2 $1,210 $678 $532 Change in Fees: 5/8 or 3/4 Inch Meter eter Size(inches) Increase or Fee to Builder Customer Fee to Rate(Decrease)in Fee s Surcharge Base 0.625(5/8)or 0.75(3/4) ($295) ($148) ($83) ($65) It should be noted that the above schedules/comparisons reflects the City of Las Cruces' current policy of allocating payment of the fee—to the builder (50 percent), customer (28 percent), and rate base (22 percent). This allocation is a policy decision and does not reflect an impact fee requirement or a recommendation of the consultant. Tisch BIS2 33 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Water System Growth-Related Needs Figure 34 lists the 10-year growth needs for water system facilities. Found in the top half of the figure,the current level of services for water system components are listed and applied to growth projections to calculate infrastructure needs to accommodate future growth.The projected cost for water infrastructure to accommodate growth in Las Cruces totals approximately$15 million. Figure 34.Water System Needs to Accommodate Growth Water Standards Water Wells/Supply 315.00 gallons per EDU Water Transmission $1,198.95 cost per EDU Water Storage 494.00 gallons per EDU Water Development 315.00 gallons per EDU Water Support Facilities 315.00 gallons per EDU multi-yearintervab> Water Needs: Base Year 1 2 3 4 5 10-Year Cost per Cost of Future City of La 2019 � 2020 � 202 1 2022 [ 2023 2024 � 210029 Increase Unit D- Projected Increase in EDUs599 605 612 619 626 660 6,291 Water Supply G PD 188,685 190,575 192,780 194,985 197,190 207,900 1,981,665 $1.05 Water Transmission EDUs 599 605 612 619 626 660 6,291 $1,198.95 Wate Storage GPD 295,906 298,870 302,328 305,786 309,244 326,040 3,107,754 $1.27 Water Development GPD 188,685 190,575 192,780 194,985 197,190 207,900 1,981,665 $0.62 Water Support Facilities GPD 188,685 190,575 192,780 194,985 197,190 207,900 1,981,665 $0.07 0 Total Cost of Growth schl reschl Base 34 Ti FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Projected Revenue from Water Impact Fee Projected revenue from the City's Water Impact Fee is shown in Figure 35. A total of 6,291 new water EDUs is projected to be served by Las Cruces Utilities by 2029. Multiplying this growth by the development fee per EDU, projected revenue is calculated ($2,125 per EDU x 6,291 EDUs=$13.4 million).The remaining cost not offset by the impact fee is a result of the credit included in the fee calculation to prevent fee payers from paying twice for comparable improvements. Figure 35. Projected Revenue from Water System Impact Fee Total Cost 10-Year Growth Cost Water Wells/Supply $2,080,748 $2,080,748 Water Transmission $7,542,594 $7,542,594 Water Storage $3,946,848 $3,946,848 Water Development $2,610,000 $1,228,632 Water Support Facilities 1 $1,420,2671 $138,717 Total Expenditures $17,600,457 $14,937,539 Projected Development Impact Fee Revenue Year EDU Base 2019 55,431 Year 1 2020 56,030 Year 2 2021 56,635 Year 3 2022 57,247 Year 4 2023 57,866 Year 5 2024 58,492 Year 6 2025 59,124 Year 7 2026 59,763 Year 8 2027 60,409 Year 9 2028 61,062 Year 10 2029 61,722 10-Year Increase 6,291 Projected Revenue => $13,368,375 Projected Growth Cost=> $14,937,539 Non-Impact Fee Funding=> ($1,569,164) TIscfh BISe 35 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico WASTEWATER Methodology Wastewater impact fees are derived using the incremental and cost recovery approaches. Impact fees are by meter size and calibrated to average daily gallons of water demand for a single-family housing unit(or an Equivalent Dwelling Unit (EDU)).The cost per meter size is based on the net capital costs per gallon of system capacity or per EDU multiplied by the applicable capacity ratio. Wastewater impact fees include infrastructure components for: wastewater treatment, wastewater collection, and wastewater support facilities. Impact fees to be paid by multifamily and nonresidential development are derived from capacity ratios according to the size of the new customer's water meter. Capacity ratios are from Las Cruces Utilities and the American Water Works Association (AWWA)). Wastewater Demand Wastewater development fees use average wastewater usage per Equivalent Dwelling Unit (EDU) as the service unit.TischlerBise obtained wastewater usage data from Las Cruces Utilities to determine demand from residential and nonresidential land uses. Residential customers shown below reflect single units and do not include multifamily housing units. Therefore,the usage figure can be used to derive average daily wastewater demand from an EDU at 176 gallons per day. Detail is provided below in Figure 36. Tisch Blse 36 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Figure 36.Wastewater Usage by Customer Class(2018) Test Year 2018 Annual Sales Avg.Customers Avg.Annual Gallons per Avg.GPD (1,000 gal) Customer Residential 1,929,941 30,088 64,143 176 Small Commercial 415,580 2,427 171,232 469 Large Commerc i a 1 906,638 357 2,539,602 6,958 Industrial 201,715 4 50,428,750 138,161 Industrial High-Strength 43,693 3 14,564,333 39,902 Winterhaven 3,080 1 3,080,000 8,438 West Mesa Park-Industrial 15,859 2 7,929,500 21,725 County/Village 39,013 2 19,506,500 53,442 Mesilla 33,804 1 33,804,000 92,614 Strength Charges 0 6 0 0 Total/Average 3,589,323 32,891 109,128 299 Summary Annual Sales Avg.Customers Avg.Annual Gallons perAvg.GPD 1000 al Customer Residential 1,929,941 30,088 64,143 Nonresidential/Other 1,659,382 2,803 592,002 1,622 Total/Average 3,589,323 32,891 109,128 299 Source:Las Cruces Utilities, Wastewater Utility Rate Review, Test Year 2018 Ratio of Service Unit to Development Unit Residential Wastewater Facilities development fees are assessed on a per meter basis, calibrated to average gallons per day for a single family unit, which is an equivalent dwelling unit (EDU). Multifamily units should be assessed based on the corresponding meter size and capacity ratio shown below and would establish a ratio of service units to land use. For nonresidential wastewater facilities development fees, capacity ratios by meter size are the appropriate demand indicator for wastewater facilities. Capacity ratios equate .625 (5/8)or.75 (3/4) inch meters (standard single family unit meter) to the average gallons per day for a single-family residential unit. Utilizing average gallons per day is the most efficient way to show a direct relationship between development units, usage, and system capacity. Wastewater facilities development impact fees assessed on nonresidential development are calculated by multiplying the number of gallons per residential unit Tlschl re Blse 37 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico by the capacity ratio for the corresponding size and type of water meter needed to serve the nonresidential land use. Maximum flow rate capacity for .625 (5/8) or .75 (3/4) inch meters is 25 gallons per minute (gpm), reflecting the City's transition to induction flow measurement with a Kamstrup meter having a higher maximum capacity than the average bronze main case documented by the American Water Works Association(AWWA).Other types of meters are utilized in the City of Las Cruces with a range of capacities, which are scaled to the capacity for a standard residential meter. Maximum capacity standards for the other meters and sizes are from Las Cruces Utilities and shown below in Figure 37. Figure 37:Wastewater Facilities Ratio of Service Units to Development Units Wastewater l .. Number of Persons per Single Family Unit(EDU) 2.43 Average Gallons per Day per EDU 176 Average Gallons per Person 72 Sources:US Census;Las Cruces Utilities;Tischler8ise Capacity Capacity Capacity Ratio Ratio Ratio Kamstrup Elster Master Meter Kamstrup Elster Master Meter 10 Flow IQ EVO Q4 Octave Ultra Flow IQ EVO Q4 Octave Ultra 5/8 x 3/4" 25 1.00 3/4 32 1.28 1" 55 2.20 1-1/2" 120 4.80 2" 160 220 250 6.40 8.80 10.00 3" 550 500 22.00 20.00 4" 880 1000 35.20 40.00 6" 1400 1600 56.00 64.00 8" 3500 2800 140.00 112.00 Source:Las Cruces Utilities Tischl reschl Bise 38 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Current Wastewater Demand Las Cruces Utilities current wastewater usage is estimated based on customer count for Fiscal Year 2019 (as of February 2019) and gallons per customer from the data in above in Figure 38. Total estimated average daily demand is approximately 11.1 million gallons per day. Figure 38.Current(2019)Average Daily Wastewater Demand Land Use Class Customers* Gallons per Estd.Wastewater Customer per Da ^ Demand GPD Residential 31,507 176 5,545,232 Nonresidential 3,454 1,622 5,602,388 Total 34,961 11,147,620 *FY19Actual Customer Count Las Cruces Utilities A City of Las Cruces Utilities, Wastewater Utility Rate Review, Test Year 2018 Projected Wastewater Demand Using current demand factors as summarized below in Figure 39 and the land use assumptions detailed in this report,future wastewater demand can be projected. Figure 39.Wastewater Demand Factors(Base Year 2019) 31,507 Residential Customers 47,631 City of Las Cruces Housing Units (HU) 0.661 Customers/HU 176 GPD/Customer 3,454 Nonresidential Customers 50,199 City of Las Cruces Jobs 0.069 Customers/Job 1,622 GPD/Customer Source:Las Cruces Utilities;Tischlereise analysis. Tischl reschl Bise 39 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Over the next 10 years, it is projected there will be an increase of 4,251 wastewater customers. Accordingly,the projected wastewater demand increases by approximately 1.2 million gallons per day by the end of the 10-year projection period. Average daily total demand at the end of the 10-year period is projected at almost 12.4 million average gallons per day. This equates to a projected increase in 7,039 equivalent dwelling units (EDU) of demand. Detail is provided in Figure 40. Figure 40. Projected Wastewater Demand Base 2019 31,507 3,454 34,961 1 2020 31,878 3,487 35,364 403 118,01q4O 118,016 11,265,636 671 671 64,010 2 2021 32,253 3,519 35,772 408 119,30237,326 11,384,946 678 1,349 64,688 3 2022 32,633 3,552 36,185 413 120,554 1,224 357,880 11,505,500 685 2,034 65,373 4 2023 33,017 3,586 36,603 418 121,857 1,642 479,737 11,627,357 692 2,726 66,065 5 V4 33,406 3,620 37,025 423 123,218 2,064 602,955 11,750,575 700 3,426 66,765 6 2025 33,799 3,654 37,453 427 124,477 2,492 727,431 11,875,051 707 4,133 67,472 7 2026 34,197 3,688 37,885 432 125,847 2,924 853,278 12,000,898 715 4,848 68,187 8 2027 34,599 3,723 38,322 437 127,169 3,361 980,447 12,128,067 723 5,571 68,910 9 2028 35,007 3,758 38,765 442 128,545 3,804 1,108,992 12,256,612 730 6,301 69,640 9 3, 12 447 1W4 1 4,251 1,238,91 2,386,536 1 INININIIW039 70,378 Source:TischlerBise,using Average Day Demand factors and projected development shown in the Land Use Assumptions. Service Area The service area for the Wastewater Development Fee is citywide within Las Cruces wastewater service area. Tischl reschl Base 40 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Wastewater System Levels of Service and Cost Factors Wastewater Treatment The City of Las Cruces is served by three wastewater treatment plants. Grand total capacity is almost 15 million gallons per day.A summary of current wastewater treatment plants and their capacities are shown below in Figure 41. Figure 41.Wastewater Treatment Level of Service Capacity(mgd) Jacob A Hands WWTP (JHWWTP) 13.5 West Mesa Industrial Park Treatment Faci I ity 0.4 East Mesa Water Reclamation Facility 1.0 Tota 1 14.9 Sources:Las Cruces Utilities;Water and Wastewater Impact Fee Study,2013, City of Las Cruces Water and Wastewater System Master Plan Update,2008. Wastewater Treatment Cost Las Cruces Utilities plans to continue to expand wastewater treatment capacity with improvements at its existing treatment plants. Below is the current cost per gallon of capacity for wastewater treatment improvements including construction cost as well as interest costs. The resulting cost per gallon of capacity is $4.79. Figure 42.Wastewater Treatment Cost Factors Wastewater Facility Cost per Gallon [1] JHWWTP Expansion (Capital Cost) $3.30 JHWWTP Expansion (Interest Cost) $1.49 Total $4.79 i11 City of Las Cruces Water and Wastewater Impact Fee Study,2013,updated to 2019 dollars with ENR Construction Cost Index for south west city(Dallas,TX). schl reschl Base 41 Ti FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Wastewater Collection Wastewater is collected in the City of Las Cruces through a system of collection lines and lift stations. Las Cruces Utilities plans to continue to add capacity in the system by expanding these components of the wastewater collection system to accommodate growth. Current levels of service and costs are detailed below in the next series of figures. A total of 551,005 linear feet of system collection lines at a range of sizes from 10 to 42 inches collect wastewater in the Las Cruces service area. The infrastructure is currently valued at approximately $114 million.This equates to a cost per EDU of$1,793.98. Figure 43.Wastewater Collection Lines Current Level of Service and Cost Factor Line Size Linear Feet 2013 Cost/Lin. Ft. 2019 Cost/Lin. Ft. 10" 172,316 $145.75 $159.56 $27,494,240 12" 152,503 $158.01 $172.98 $26,379,744 15" 114,027 $190.70 $208.76 $23,804,743 16" 31,586 $197.33 $216.02 $6,823,218 18" 17,222 $222.03 $243.06 $4,186,065 24" 6,379 $233.59 $255.72 $1,631,167 30" 18,749 $273.23 $299.11 $5,607,939 33" 5,499 $273.23 $299.11 $1,644,741 34" 2,167 $273.23 $299.11 $648,186 36" 10,831 $397.16 $434.78 $4,709,105 42" 19,727 $495.42 $542.35 $10,699,027 Total 551,005 $206.22 $113,628,175 Current Number of Wastewater EDUs 63,339 Cost per EDU $1,793.98 Source:Las Cruces Utilities,City of Las Cruces Water and Wastewater Impact Fee Study,2013,cost updated to 2019 dollars using Engineering News-Record(ENR)Construction Cost Index for southwest city(Dallas, TX). schl re Blse 42 Tl FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Fourteen lift stations serve the wastewater system in Las Cruces to convey waste to the City's treatment facilities. Current estimated value for the existing lift stations total approximately $5.4 million. This equates to a current cost per EDU of$84.59. Detail is provided below. Figure 44.Wastewater Lift Stations Level of Service and Cost Factor Lift Station No. of Pumps Capacity(gpm) Cost(2013)* Boutz 1^ 1 900 $511,623 $560,089 Boutz 2^ 2 2100 $1,193,787 $1,306,874 Brown 2 323 $183,616 $201,010 Carver(Rios Encantados) 2 111 $63,100 $69,078 Chisholm 2 160 $90,955 $99,571 Frenger 2 950 $540,047 $591,205 Mesilla Park 2 300 $170,541 $186,696 Sandhill 2 1000 $568,470 $622,321 Shadow Run 2 90 $51,162 $56,009 Tortugas 2 240 $136,433 $149,357 University 3 1200 $454,776 $746,785 Inspiration 2 750 $426,353 $466,741 Sanctuary 2 300 $170,541 $186,696 Holman 2 185 $0 $115,129 28 8609 $4,561,404 $5,357,559 Current Number of Wastewater EDUs 63,339 Cost per EDU $84.59 *Reflects inventory and asset value at time of 2013 Impact Fee Study A Boutz 1 and 2 were transposed in the 2013 Impact Fee Study Sources:Las Cruces Utilities;City of Las Cruces Water and Wastewater Impact Fee Study,2013,cost updated to 2019 dollars using Engineering News-Record(ENR)Construction Cost Index forsouthwest city(Dallas, TX).City of Las Cruces Water and Wastewater System Master Plan Update,2008. schl reschl Base 43 Ti FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Wastewater Support Facilities Las Cruces Utilities is currently constructing a Water Quality Lab to provide water and wastewater testing. Per Las Cruces Utilities,the facility will be utilized 70 percent for wastewater testing (with the remaining 30 percent for water testing). Costs are allocated to each fee category accordingly. This facility is anticipated to serve current and future demand over the next 20 years. Level of service and cost factors are shown below. Figure 45.Water Quality Lab Level of Service and Cost Factor:Wastewater Portion Water Quality Laboratory(WQL) 2019 $4,734,222 70% $3,313,956 Total $4,734,222 $3,313,956 Projected Total Wastewater Demand (GPD)(20-Year) 13,763,984 Cost per GPD $0.24 *Remainder serves Water Source:Las Cruces Utilities;Tischlereise projections. Credit Analysis for Wastewater System Improvements Las Cruces has debt financed wastewater improvements to add capacity to the system.To avoid potential double payment for these wastewater system improvements, a credit is necessary because new residential and nonresidential development that will pay the impact fee will also contribute to future principal payments through utility rates on this remaining debt. As shown in Figure 46, outstanding principal and interest payments for financed wastewater capacity improvements is approximately $3.4 million, reflecting 20 percent of remaining Wastewater Fund debt issued for capacity projects per Las Cruces Utilities. To derive the credit amount, principal and interest subtotal per year is divided by the total demand (average gallons per day) in the wastewater system in each year. To account for the time value of money, annual payments per gallon of capacity are discounted using a net present value formula based on an average interest rate of 4.0 percent.The total net present value of future debt service payments for capacity improvements is $0.21 per gallon. This amount is subtracted from the gross capital cost per gallon amount to derive a net capital cost per gallon for wastewater facilities. TISChBISe 44 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Figure 46.Wastewater Principal&Interest Payment Credit Evaluation PrincipalYear ... •D Galion 2020 $868,179 $467,272 $1,335,451 $267,090 11,265,636 $0.024 2021 $895,246 $438,045 $1,333,291 $266,658 11,384,946 $0.023 2022 $936,457 $398,396 $1,334,853 $266,971 11,505,500 $0.023 2023 $979,178 $356,487 $1,335,664 $267,133 11,627,357 $0.023 2024 $1,016,076 $312,465 $1,328,541 $265,708 11,750,575 $0.023 2025 $1,063,277 $267,622 $1,330,899 $266,180 11,875,051 $0.022 2026 $1,102,862 $231,596 $1,334,458 $266,892 12,000,898 $0.022 2027 $678,692 $200,738 $879,430 $175,886 12,128,067 $0.015 2028 $642,655 $180,208 $822,863 $164,573 12,256,612 $0.013 2029 $661,300 $160,890 $822,190 $164,438 12,386,536 $0.013 2030 $684,367 $140,002 $824,370 $164,874 12,517,837 $0.013 2031 $703,012 $118,044 $821,056 $164,211 12,650,530 $0.013 2032 $663,737 $96,784 $760,521 $152,104 12,784,630 $0.012 2033 $685,460 $76,033 $761,493 $152,299 12,920,151 $0.012 2034 $706,605 $54,481 $761,086 $152,217 13,057,109 $0.012 2035 $611,650 $31,734 $643,384 $128,677 13,195,518 $0.010 2036 $162,500 $11,403 $173,903 $34,781 13,335,395 $0.003 2037 $167,500 $5,829 $173,329 $34,666 13,476,754 $0.003 2038 $0 $0 $0 $0 13,619,612 $0.000 2039 $0 $0 $0 $0 13,763,984 $0.000 Total $13,228,754 $3,548,028 $16,776,782 $3,355,3561 1 $0.278 Discount Rate 4.0% Net Present Value $0.21 Source:Las Cruces Utilities;Tischlereise analysis Tischl re Bise 45 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Proposed Impact Fees for Wastewater Input variables for the Wastewater Impact Fees are shown in the upper section of Figure 47. For each component of the impact fee, capital cost per equivalent dwelling unit (EDU) is calculated by multiplying the average number of gallons per residential unit (EDU) by the net capital cost per gallon of system capacity.The net capital cost per EDU of$2,726 is the impact fee for a single family unit, or EDU. Nonresidential impact fees are based on size and type of water meter and their restrictive capacity. Wastewater development fees are calculated by multiplying the cost per EDU by the capacity ratio for the corresponding size and type of water meter. The capacity ratio is calibrated to the maximum flow rate capacity for .625 (5/8) or .75 (3/4) inch meters, the standard for a single family unit (or EDU). The full impact fee schedule by meter type and size is shown in Figure 48. Figure 47. Proposed Wastewater Impact Fees Cost per Gallon of Wastewater Gallons Wastewater Capital Capacity per Day per EDU Cost per EDU Wastewater Treatment $4.79 176 $843.04 Wastewater Collection System $1,878.57 Wastewater Support Facilities $0.24 176 $42.24 Subtotal $2,763.85 Wastewater Credit 1 ($0.21) 176 ($36.96) Wastewater Capital Cost per EDU=> $2,726.89 Wastewater Capital Cost per EDU(Truncated)_> Proposed Fees:5/8 or 3/4 Inch Meter ProposedMeter Size(inches) apacity Ratio Wastewater Fee Surcharge Base e_j 50% 20% 30% 0.625(5/8)or 0.75(3/4) 1.00 $2,726 $1,363 $545 $818 schl re Blse 46 Tl FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Figure 48. Proposed Wastewater Impact Fees:All Meter Types and Sizes K31/4' 71Qp Capacity Capacity Ratio Ratio Ratio Fee Fee Fee aElster Master Meter Kamstrup Elster Master Meter Kamstrup Elster Master Meter EVO Q4 Octave UltraFlow IQ VO Q4 Octave Ultra Flow IQ EVO Q4 Octave Ultra 511!8,!. 25 1.00 $2,726.00 /4 32 1.28 $3,489.00 1" 55 2.20 $5,997.00 1-1/2" 120 4.80 $13,084.00 2" 160 220 250 6.40 8.80 10.00 $17,446.00 $23,988.00 $27,260.00 3" 550 500 22.00 20.00 $59,972.00 $54,520.00 4" 880 1000 35.20 40.00 $95,955.00 $109,040.00 6" 1400 1600 56.00 64.00 $152,656.00 $174,464.00 8" 1 3500 2800 1 140.00 112.00 1 $381,640.00 $305,312.00 Source:Las Cruces Utilities Below is a comparison of the updated proposed residential development impact fee amount to the current rate and the calculated difference. Figure 49. Proposed Wastewater Impact Fees Comparison to Current Wastewater Fees Proposed Fees:5/8 or 3/4 Inch Meter ProposedMeter Size(inches) apacity Ratio Wastew ater Fee] Surcharge Base 0' 0' 0' 0.625(5/8)or 0.75(3/4) 1.00 $2,726 $1,363 $545 $818 Current Fees:5/8 or 3/4 Inch Meter Meter Size(inches) Capacity Ratio Current Fee . Builder Wastewater Fee Surcharge Base 0' 0' 0' 0.625(5/8)or 0.75(3/4) 1.00 $1,943 $971 $389 $583 Change in Fees:5/8 or 3/4 Inch Meter eter Size(inches) Increase or Fee to Builder Customer Fee to Rate (Decrease)in Fee s Surcharge Base 0' 0' 0' 0.625(5/8)or 0.75(3/4) 1 $783 $392 $157 $235 It should be noted that the above schedules/comparisons reflect the City of Las Cruces' current policy of allocating payment of the fee—to the builder (50 percent), customer (20 percent), and rate base (30 percent). This allocation is a policy decision and does not reflect an impact fee requirement or a recommendation of the consultant. schl reschl Bise 47 Ti FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Wastewater System Growth-Related Needs Figure 50 lists the 10-year growth needs for wastewater system facilities. Found in the top half of the figure, the current level of services for wastewater system components are listed and applied to growth projections to calculate infrastructure needs to accommodate future growth. The projected cost for wastewater infrastructure to accommodate growth in Las Cruces totals approximately$19.5 million. Figure 50.Wastewater System Needs to Accommodate Growth Wastewater Standards Wastewater Treatment 176.00 gallons per EDU Wastewater Collection System $1,878.57 cost per EDU Wastewater Support Facilities 176.00 gallons per EDU multi-yearinterval>> Wastewater Needs: Base Year 21 3 4 10 10-Year Cost per Cost of Future City of Las Cruces 2019 20120 � 202 2022 � 2023 � 0 D- Projected Increase in EDUs 1 6711 6781 6851 6921 7001 738 7,039 Wastewater Treatment GPD 118,0961 119,3281 120,5601 121,792 123,200 129,888 1,238,864 $4.79 Wastewater Collection EDUs 671 1 6781 685 6921 700 738 7,039 $1,878.57 Wastewater Support Facilities GPD J J 8 0961 119,3281 120,560 121,792 1231200 1 129,888 1,238,864 $0.24 Total Cost of Growth schl reschl Bise 4s Ti FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Projected Revenue from Wastewater Impact Fee Projected revenue from the City's Wastewater Impact Fee is shown in Figure 51. A total of 7,039 new wastewater EDUs is projected to be served by Las Cruces Utilities by 2029. Multiplying this growth by the development fee per EDU, projected revenue is calculated ($2,726 per EDU x 7,039 EDUs=$19.2 million). The remaining cost not offset by the impact fee is a result of the credit included in the fee calculation to prevent fee payers from paying twice for comparable improvements. Figure 51. Projected Revenue from Wastewater System Impact Fee Total Cost 10-Year Growth Cost Wastewater Treatment $5,934,159 $5,934,159 Wastewater Collection System $13,223,254 $13,223,254 Wastewater Support Facilities $3,313,956 $297,327 Total Expenditures $22,471,368 $19,454,740 Projected Development Impact Fee Revenue Year EDU Base 2019 63,339 Year 1 2020 64,010 Year 2 2021 64,688 Year 3 2022 65,373 Year 4 2023 66,065 Year 5 2024 66,765 Year 6 2025 67,472 Year 7 2026 68,187 Year 8 2027 68,910 Year 9 2028 69,640 Year 10 2029 70,378 10-Yearincrease 7,039 Projected Revenue => $19,188,314 Projected Expenditures => $19,454,740 Non-Impact Fee Funding=> ($266,426) TISCh Blse 49 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico IMPLEMENTATION AND ADMINISTRATION Impact fees should be evaluated and updated to reflect recent data. One approach is to adjust for inflation in construction costs by means of an index like the one published by Engineering News Record (ENR).This index can be applied against the calculated impact fee. If cost estimates change significantly, the City should recalculate the fees. As specified in the New Mexico Development Fees Act, certain accounting requirements need to be met by the City of Las Cruces. Impact fees must be deposited in separate interest bearing ledger accounts(Sec. 5-8-16 NMSA 1978). Fees should be spent within seven years of when they are collected, with the expenditures for system improvements for which the fee was collected. The New Mexico Development Fees Act also provides guidance on refunds(Sec. 5-8-17 NMSA 1978). Credits are addressed in the New Mexico Act in Section 5-8-15 NMSA 1978. Developer reimbursements would be provided for system improvements that have been included in the impact fee calculations. Project improvements normally required as part of the development approval process are not eligible for credits against impact fees. Specific policies and procedures related to credits or developer reimbursements for system improvements should be addressed in the ordinance that establishes the City's fees. The general concept is that developers may be eligible for credits or reimbursements only if they provide system improvements that have been included in the impact fee calculations. If a developer constructs a system improvement that was included in the fee calculations, it is necessary to either reimburse the developer or provide a credit against the fees.The latter option is more difficult to administer because it creates unique fees for specific geographic areas. Based on TischlerBise's experience, it is better for a reimbursement agreement to be established with the developer that constructs a system improvement. Tischl reschl Base 50 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico APPENDIX: • DEVELOPMENT ARTICLE 8 Land Development Fees and Rights 5-8-1.Short title. This act [5-8-1 through 5-8-42 NMSA 1978] may be cited as the "Development Fees Act". History: Laws 1993, ch. 122, § 1. ANNOTATIONS Cross references. — For land use easements,see Chapter 47, Article 12 NMSA 1978. Law reviews. — For article, "Water Supply and Urban Growth in New Mexico: Same Old, Same Old or a New Era," see 43 Nat. Resources J. 803 (2003). 5-8-2. Definitions. As used in the Development Fees Act: A. "affordable housing" means any housing development built to benefit those whose income is at or below eighty percent of the area median income; and who will pay no more than thirty percent of their gross monthly income towards such housing; B. "approved land use assumptions"means land use assumptions adopted originally oras amended under the Development Fees Act; C. "assessment" means a determination of the amount of an impact fee; D. "capital improvement" means any of the following facilities that have a life expectancy of ten or more years and are owned and operated by or on behalf of a municipality or county: (1) water supply,treatment and distribution facilities; wastewater collection and treatment facilities; and storm water, drainage and flood control facilities; (2) roadway facilities located within the service area, including roads, bridges, bike and pedestrian trails, bus bays, rights of way, traffic signals, landscaping and any local components of state and federal highways; Z Source: Ch. 5, art. 8 NMSA 1978, <https:Hlaws.nmonesource.com/w/nmos/Chapter-5-NMSA-1978#lb/a8>, retrieved on 09/12/2019. (Annotations from the source.) Tischl re Bise 51 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico (3) buildings for fire, police and rescue and essential equipment costing ten thousand dollars($10,000) or more and having a life expectancy of ten years or more; and (4) parks, recreational areas, open space trails and related areas and facilities; E. "capital improvements plan" means a plan required by the Development Fees Act that identifies capital improvements or facility expansion for which impact fees may be assessed; F. "county" means a county of any classification; G. "facility expansion" means the expansion of the capacity of an existing facility that serves the same function as an otherwise necessary new capital improvement, in order that the existing facility may serve new development.The term does not include the repair, maintenance, modernization or expansion of an existing facility to better serve existing development, including schools and related facilities; H. "hook-up fee" means a reasonable fee for connection of a service line to an existing gas,water, sewer or municipal or county utility; I. "impact fee" means a charge or assessment imposed by a municipality or county on new development in order to generate revenue for funding or recouping the costs of capital improvements or facility expansions necessitated by and attributable to the new development. The term includes amortized charges, lump-sum charges, capital recovery fees, contributions in aid of construction, development fees and any other fee that functions as described by this definition.The term does not include hook-up fees, dedication of rights of way or easements or construction or dedication of on-site water distribution, wastewater collection or drainage facilities,or streets,sidewalks or curbs if the dedication or construction is required by a previously adopted valid ordinance or regulation and is necessitated by and attributable to the new development; J. "land use assumptions" includes a description of the service area and projections of changes in land uses, densities, intensities and population in the service area over at least a five-year period; K. "municipality" means any incorporated city,town or village, whether incorporated under general act, special act or special charter, and H class counties, including any home rule municipality or H class county chartered under the provisions of Article 10, Section 6 of the constitution of New Mexico; L. "new development" means the subdivision of land; reconstruction, redevelopment, conversion, structural alteration, relocation or enlargement of any structure; or any use or extension of the use of land; any of which increases the number of service units; M. "qualified professional" means a professional engineer, surveyor, financial analyst or planner providing services within the scope of his license, education or experience; Tischl reschl Base sz FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico N. "roadway facilities" means arterial or collector streets or roads that have been designated on an officially adopted roadway plan of the municipality or county, including bridges, bike and pedestrian trails, bus bays, rights of way,traffic signals, landscaping and any local components of state or federal highways; O. "service area" means the area within the corporate boundaries or extraterritorial jurisdiction of a municipality or the boundaries of a county to be served by the capital improvements or facility expansions specified in the capital improvements plan designated on the basis of sound planning and engineering standards; and P. "service unit" means a standardized measure of consumption, use, generation or discharge attributable to an individual unit of development calculated in accordance with generally accepted engineering or planning standards for a particular category of capital improvements or facility expansions. History: Laws 1993, ch. 122, § 2. ANNOTATIONS Cross references. — For establishment of H class county,see 4-44-3 NMSA 1978. 5-8-3.Authorization of fee. A. Unless otherwise specifically authorized by the Development Fees Act, no municipality or county may enact or impose an impact fee. B. If it complies with the Development Fees Act, a municipality or county may enact or impose impact fees on land within its respective corporate boundaries. C. A municipality and county may enter into a joint powers agreement to provide capital improvements within an area subject to both county and municipal platting and subdivision jurisdiction or extraterritorial jurisdiction and may charge an impact fee under the agreement, but if an impact fee is charged in that area,the municipality and county shall comply with the Development Fees Act. D. A municipality or county may waive impact fee requirements for affordable housing projects. History: Laws 1993, ch. 122, §3; 2001, ch. 176, § 1. ANNOTATIONS The 2001 amendment, effective June 15, 2001, added Subsection D. No vested development rights under impact fee ordinance.—Where the municipal impact fee ordinance exempted developers who possessed development rights that vested prior to the ordinance's date of enactment from paying the impact fee; prior to the date the ordinance was enacted, the municipal planning commission approved a site plan for subdivision of land owned by plaintiff; the approved plan established zoning,tract boundaries,vehicle access, bicycle and trail access, public transit access, internal circulation requirements, building heights,setbacks,and common landscape standards; none of the tracts Tisch BIS2 53 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico were platted; and the regulations which were promulgated pursuant to the ordinance defined vested rights as development rights acquired and resulting from building permit approval, final plat approval, preliminary plat approval,or site plan for subdivision or site plan for building permit approval and defined site plan for subdivision as a plat that covers at least one lot and specifies access and building criteria, under the ordinance,a developer receives development rights at the time it receives approval of a reliable platting pattern, the developer's original site plan for subdivision did not confer the development rights necessary to establish vested rights under the ordinance, because it did not provide a reliable platting pattern, and the developer was not exempt from paying impact fees.Andalucia Dev. Corp., Inc. v. City of Albuquerque, 2010-NMCA-052, 148 N.M. 277, 234 P.3d 929. No common law vested development rights. — Where the municipal impact fee ordinance exempted developers who possessed development rights that vested prior to the ordinance's date of enactment from paying the impact fee; prior to the date the ordinance was enacted, the municipal planning commission approved a site plan for subdivision of land owned by plaintiff;the approved plan established zoning,tract boundaries, vehicle access, bicycle and trail access, public transit access, internal circulation requirements, building heights, setbacks, and common landscape standards; none of the tracts were platted; and development of the property was subject to subsequent municipal approvals and the continuance of the project remained entirely within the municipality's discretion,the original site plan for subdivision did not confer a vested development right under common law and the developer was not exempt from paying impact fees.Andalucia Dev. Corp., Inc. v. City of Albuquerque, 2010-NMCA-052, 148 N.M. 277, 234 P.3d 929. 5-8-4. Items payable by fee. A. An impact fee may be imposed only to pay the following specified costs of constructing capital improvements or facility expansions: (1) estimated capital improvements plan cost; (2) planning, surveying and engineering fees paid to an independent qualified professional who is not an employee of the municipality or county for services provided for and directly related to the construction of capital improvements or facility expansions; (3) fees actually paid or contracted to be paid to an independent qualified professional,who is not an employee of the municipality or county,for the preparation or updating of a capital improvements plan; and (4) up to three percent of total impact fees collected for administrative costs for municipal or county employees who are qualified professionals. B. Projected debt service charges may be included in determining the amount of impact fees only if the impact fees are used for the payment of principal and interest on bonds, notes or other obligations issued Tisch BIS2 54 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico to finance construction of capital improvements or facility expansions identified in the capital improvements plan. History: Laws 1993, ch. 122, §4. 5-8-5. Items not payable by fee. Impact fees shall not be imposed or used to pay for: A. construction, acquisition or expansion of public facilities or assets that are not capital improvements or facility expansions identified in the capital improvements plan; B. repair, operation or maintenance of existing or new capital improvements or facility expansions; C. upgrading, updating, expanding or replacing existing capital improvements to serve existing development in order to meet stricter safety, efficiency, environmental or regulatory standards; D. upgrading, updating, expanding or replacing existing capital improvements to provide better service to existing development; E. administrative and operating costs of a municipality or county except as provided in Paragraph (4) of Subsection A of Section 4 [5-8-4 NMSA 1978] of the Development Fees Act; F. principal payments or debt service charges on bonds or other indebtedness, except as allowed by Section 4 of the Development Fees Act; or G. libraries, community centers, schools, projects for economic development and employment growth, affordable housing or apparatus and equipment of any kind, except capital improvements defined in Paragraph (3) of Subsection C [D] of Section 2 [5-8-2 NMSA 1978] of the Development Fees Act. History: Laws 1993, ch. 122, §5. ANNOTATIONS Bracketed material. —The bracketed material was inserted by the compiler and it is not part of the law. The reference in Subsection G to Subsection C of 5-8-2 NMSA 1978,appears to actually refer to Subsection D of that section. 5-8-6. Capital improvements plan. A. A municipality or county shall use qualified professionals to prepare the capital improvements plan and to calculate the impact fee. The capital improvements plan shall follow the infrastructure capital improvement planning guidelines established by the department of finance and administration and shall address the following: (1) a description, as needed to reasonably support the proposed impact fee, which shall be prepared by a qualified professional, of the existing capital improvements within the service area and the costs to Tisch BIS2 55 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico upgrade, update, improve, expand or replace the described capital improvements to adequately meet existing needs and usage and stricter safety, efficiency, environmental or regulatory standards; (2) an analysis, which shall be prepared by a qualified professional, of the total capacity, the level of current usage and commitments for usage of capacity of the existing capital improvements; (3) a description, which shall be prepared by a qualified professional, of all or the parts of the capital improvements or facility expansions and their costs necessitated by and attributable to new development in the service area based on the approved land use assumptions; (4) a definitive table establishing the specific level or quantity of use, consumption, generation or discharge of a service unit for each category of capital improvements or facility expansions and an equivalency or conversion table establishing the ratio of a service unit to various types of land uses, including residential, commercial and industrial; (5) the total number of projected service units necessitated by and attributable to new development within the service area based on the approved land use assumptions and calculated in accordance with generally accepted engineering or planning criteria; (6) the projected demand for capital improvements or facility expansions required by new service units accepted over a reasonable period of time, not to exceed ten years; and (7) anticipated sources of funding independent of impact fees. B. The analysis required by Paragraph (2) of Subsection A of this section may be prepared on a system- wide basis within the service area for each major category of capital improvement or facility expansion for the designated service area. C. The governing body of a municipality or county is responsible for supervising the implementation of the capital improvements plan in a timely manner. History: Laws 1993, ch. 122, §6. 5-8-7. Maximum fee per service unit. The fee shall not exceed the cost to pay for a proportionate share of the cost of system improvements, based upon service units, needed to serve new development. History: Laws 1993, ch. 122, §7. 5-8-8.Time for assessment and collection of fee. A. Assessments of an impact fee shall be made at the earliest possible time. Collection of the impact fee shall occur at the latest possible time. B. For land that has been platted in accordance with the subdivision or platting procedures of a municipality or county before the effective date of the Development Fees Act or for land on which new Tisch BIS2 56 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico development occurs or is proposed without platting, the municipality or county may assess the impact fees at the time of development approval or issuance of a building permit, whichever date is earlier.The assessment shall be valid for a period of not less than four years from the date of development approval or issuance of a building permit,whichever date is earlier. C. For land that is platted after the effective date of the Development Fees Act,the municipality or county shall assess the fees at the time of recording of the subdivision plat and this assessment shall be valid for a period of not less than four years from the date of recording of the plat. D. Collection of impact fees shall occur no earlier than the date of issuance of a building permit. E. For new development that is platted in accordance with the subdivision or platting procedures of a municipality or county before the adoption of an impact fee, an impact fee shall not be collected on any service unit for which a valid building permit has been issued. F. After the expiration of the four-year period described in Subsections B and C of this section, a municipality or county may adjust the assessed impact fee to the level of current impact fees as provided in the Development Fees Act. History: Laws 1993, ch. 122, §8. ANNOTATIONS Compiler's notes. — The phrase "effective date of the Development Fees Act", in Subsections B and C, refers to the effective date of Laws 1993, ch. 122, which was July 1, 1993. 5-8-9.Additional fee prohibited; exception. Except as provided in Subsection F of Section 8 [5-8-8 NMSA 1978] of the Development Fees Act, after assessment of the impact fees attributable to the new development or execution of an agreement for payment of impact fees, additional impact fees or increases in fees may not be assessed for any reason unless the number of service units to be developed increases. In the event of an increase in the number of service units, the impact fees to be imposed are limited to the amount attributable to the additional service units. History: Laws 1993, ch. 122, §9. 5-8-10. Agreement with owner regarding payment. A municipality or county is authorized to enter into an agreement with the owner of a tract of land for which a plat has been recorded providing for a method of payment of the impact fees over an extended period of time otherwise in compliance with the Development Fees Act. History: Laws 1993, ch. 122, § 10. 5-8-11. Collection of fees if services not available. Tischl reschl Base 57 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico Impact fees may be assessed but shall not be collected unless the: A. collection is made to pay for a capital improvement or facility expansion that has been identified in the capital improvements plan and the municipality or county commits to complete construction within seven years and to have the service available within a reasonable period of time after completion of construction considering the type of capital improvement or facility expansion to be constructed but in no event longer than seven years; B. municipality or county agrees that the owner of a new development may construct to adopted municipal or county standards or finance the capital improvements or facility expansions and agrees that the costs incurred or funds advanced will be credited against the impact fees otherwise due from the new development or agrees to reimburse the owner for such costs from impact fees paid from other new developments that will use such capital improvements or facility expansions,which fees shall be collected and reimbursed to the property owner of record at the time the plat of the other new development is recorded; or C. time period set forth in Subsection A of this section can be extended, provided the municipality or county obtains a performance bond or similar surety securing performance of the obligation to construct the capital improvements or facility expansions but in no event longer than seven years from commencement of construction of the capital improvements or facility expansion for which fees have been collected.The municipality or county shall establish written procedures to ensure that the owner of a new development shall not lose the value of the credits. Any refund for fees shall be made as provided in Section 17 [5-8-17 NMSA 1978] of the Development Fees Act. History: Laws 1993, ch. 122, § 11. 5-8-12. Entitlement to services. Any new development for which an impact fee has been paid is entitled to the permanent use and benefit of the services for which the fee was exacted and is entitled to receive prompt service from any existing facilities with actual capacity to serve the new service units. History: Laws 1993, ch. 122, § 12. 5-8-13. Authority of municipality or county to spend funds or enter into agreements to reduce fees. Municipalities or counties may spend funds from any lawful source or pay for all or a part of the capital improvements or facility expansions to reduce the amount of impact fees.A developer and a municipality or county may agree to offset or reduce part or all of the impact fee assessed on that new development, provided that the public policy which supports the reduction is contained in the appropriate planning documents of the municipality or county and provided that the development's new proportionate share of the system improvement is funded with revenues other than impact fees from other new developments. Tischl reschl Bise 58 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico History: Laws 1993, ch. 122, § 13. 5-8-14. Requirement for governmental entities to pay fees. Governmental entities shall pay all impact fees imposed under the Development Fees Act. History: Laws 1993, ch. 122, § 14. 5-8-15. Credits against facilities fees. Any construction of, contributions to or dedications of on-site or off-site facilities, improvements, or real or personal property with off-site benefits not required to serve the new development, in excess of minimum municipal and county standards established by a previously adopted and valid ordinance or regulation and required by a municipality or county as a condition of development approval shall be credited against impact fees otherwise due from the development.The credit shall include the value of: A. dedication of land for parks, recreational areas, open space trails and related areas and facilities or payments in lieu of that dedication; and B. dedication of rights of way or easements or construction or dedication of on-site water distribution, wastewater collection or drainage facilities, or streets, sidewalks or curbs. History: Laws 1993, ch. 122, § 15. 5-8-16. Accounting for fees and interest. A. The order, ordinance or resolution imposing an impact fee shall provide that all money collected through the adoption of an impact fee shall be maintained in separate interest-bearing accounts clearly identifying the payor and the category of capital improvements or facility expansions within the service area for which the fee was adopted. B. Interest earned on impact fees shall become part of the account on which it is earned and shall be subject to all restrictions placed on the use of impact fees under the Development Fees Act. C. Money from impact fees may be spent only for the purposes for which the impact fee was imposed as shown by the capital improvements plan and as authorized by the Development Fees Act. D. The records of the accounts into which impact fees are deposited shall be open for public inspection and copying during ordinary business hours of the municipality or county. E. As part of its annual audit process, a municipality or county shall prepare an annual report describing the amount of any impact fees collected, encumbered and used during the preceding year by category of capital improvement and service area identified as provided in Subsection A of this section. History: Laws 1993, ch. 122, § 16. 5-8-17. Refunds. Tischl reschl Bise 59 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico A. Upon the request of an owner of the property on which an impact fee has been paid,the municipality or county shall refund the impact fee if existing facilities are available and service is not provided or the municipality or county has, after collecting the fee when service was not available, failed to complete construction within the time allowed under Section 11 [5-8-11 NMSA 1978] of the Development Fees Act or service is not available within a reasonable period of time after completion of construction considering the type of capital improvement or facility expansion to be constructed, but in no event later than seven years from the date of payment under Subsection A of Section 11 of the Development Fees Act. B. Upon completion of the capital improvements or facility expansions identified in the capital improvements plan, the municipality or county shall recalculate the impact fee using the actual costs of the capital improvements or facility expansion. If the impact fee calculated based on actual costs is less than the impact fee paid, including any sources of funding not anticipated in the capital improvements plan, the municipality or county shall refund the difference if the difference exceeds the impact fee paid by more than ten percent, based upon actual costs. C. The municipality or county shall refund any impact fee or part of it that is not spent as authorized by the Development Fees Act within seven years after the date of payment. D. A refund shall bear interest calculated from the date of collection to the date of refund at the statutory rate as set forth in Section 56-8-3 NMSA 1978. E. All refunds shall be made to the record owner of the property at the time the refund is paid. However, if the impact fees were paid by a governmental entity, payment shall be made to the governmental entity. F. The owner of the property on which an impact fee has been paid or a governmental entity that has paid the impact fee has standing to sue for a refund under this section. History: Laws 1993, ch. 122, § 17. 5-8-18. Compliance with procedures required. Except as otherwise provided by the Development Fees Act, a municipality or county shall comply with that act to levy an impact fee. History: Laws 1993, ch. 122, § 18. 5-8-19. Hearing on land use assumptions. To impose an impact fee, a municipality or county shall schedule and publish notice of a public hearing to consider land use assumptions within the designated service area that will be used to develop the capital improvements plan. History: Laws 1993, ch. 122, § 19. 5-8-20. Information about assumptions available to public. Tischl reschl Base 60 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico On or before the date of the first publication of the notice of the hearing on land use assumptions, the municipality or county shall make available to the public its land use assumptions, the time period of the projections and a description of the general nature of the capital improvement facilities that may be proposed. History: Laws 1993, ch. 122, § 20. 5-8-21. Notice of hearing on land use assumptions. A. The municipality or county shall publish notice of the hearing conforming to locally adopted regulations governing change-of-zone requests, except as otherwise provided in this section. B. The notice shall contain: (1) a headline to read as follows: "NOTICE OF PUBLIC HEARING ON LAND USE ASSUMPTIONS RELATING TO POSSIBLE ADOPTION OF IMPACT FEES"; (2) the time, date and location of the hearing; (3) a statement that the purpose of the hearing is to consider the land use assumptions that will be used to develop a capital improvements plan under which an impact fee may be imposed; (4) an easily understandable map of the service area to which the land use assumptions apply; and (5) a statement that any member of the public has the right to appear at the hearing and present evidence for or against the land use assumptions. C. The municipality or county, within thirty days after the date of the public hearing, shall approve or disapprove the land use assumptions. D. An ordinance, order or resolution approving land use assumptions shall not be adopted as an emergency measure and its adoption must comply with the procedural requirements of the Development Fees Act. History: Laws 1993, ch. 122, § 21. 5-8-22. System-wide land use assumptions. A. A municipality or county may adopt system-wide land use assumptions for water supply and treatment facilities in lieu of adopting land use assumptions for each service area for such facilities. Tischl re Bise 61 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico B. Prior to adopting system-wide land use assumptions, a municipality or county shall follow the public notice, hearing and other requirements for adopting land use assumptions. C. After adoption of system-wide land use assumptions, a municipality or county is not required to adopt additional land use assumptions for a service area for water supply, treatment and distribution facilities or wastewater collection and treatment facilities as a prerequisite to the adoption of a capital improvements plan or impact fee, provided the capital improvements plan and impact fee are consistent with the system-wide land use assumptions. History: Laws 1993, ch. 122, § 22. 5-8-23. Capital improvements plan required after approval of land use assumptions. If the governing body adopts an ordinance, order or resolution approving the land use assumptions, the municipality or county shall provide for a capital improvements plan to be developed by qualified professionals using generally accepted engineering and planning practices in accordance with Section 6 [5-8-6 NMSA 1978] of the Development Fees Act. History: Laws 1993, ch. 122, § 23. 5-8-24. Hearing on capital improvements plan and impact fee. Upon completion of the capital improvements plan,the governing body shall schedule and publish notice of a public hearing to discuss the adoption of the capital improvements plan and imposition of the impact fee. The public hearing must be held by the governing body of the municipality or county to discuss the proposed ordinance, order or resolution adopting a capital improvements plan and imposing an impact fee. History: Laws 1993, ch. 122, § 24. 5-8-25. Information about plan available to public. On or before the date of the first publication of the notice of the hearing on the capital improvements plan and impact fee,the plan shall be made available to the public. History: Laws 1993, ch. 122, § 25. 5-8-26. Notice of hearing on capital improvements plan and impact fee. A. The municipality or county shall publish notice of the hearing conforming to locally adopted regulations governing change-of-zone requests, except as otherwise provided in this section. B. The notice must contain the following: (1) a headline to read as follows: "NOTICE OF PUBLIC HEARING ON CAPITAL Tischl re Bise 62 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico IMPROVEMENTS PLAN AND ADOPTION OF IMPACT FEES"; (2) the time, date and location of the hearing; (3) a statement that the purpose of the hearing is to consider the proposed capital improvements plan and the adoption of an impact fee; (4) an easily understandable map of the service area in which the proposed fee will be imposed; (5) the amount of the proposed impact fee per service unit; and (6) a statement that any member of the public has the right to appear at the hearing and present evidence for or against the plan and proposed fee. History: Laws 1993, ch. 122, § 26. 5-8-27. Advisory committee comments on capital improvements plan and impact fees. The advisory committee created under Section 37 [5-8-37 NMSA 1978] of the Development Fees Act shall file its written comments on the proposed capital improvements plan and impact fees before the fifth business day before the date of the public hearing on the plan and fees. History: Laws 1993, ch. 122, § 27. 5-8-28. Approval of capital improvements plan and impact fee required. A. The municipality or county, within thirty days after the date of the public hearing on the capital improvements plan and impact fee, shall approve, disapprove or modify the adoption of the capital improvements plan and imposition of an impact fee. B. An ordinance, order or resolution approving the capital improvements plan and imposition of an impact fee shall not be adopted as an emergency measure and its adoption must comply with the procedural requirements of the Development Fees Act. History: Laws 1993, ch. 122, § 28. 5-8-29. Consolidation of land use assumptions and capital improvements plan. A. In lieu of separately adopting the land use assumptions and capital improvements plan for a service area containing not greater than three hundred units, a municipality or county may consolidate the land use assumptions and the capital improvements plan, and adopt the assumptions,the plan and the impact fee simultaneously. TISCh BIS2 63 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico B. If a municipality or county elects to consolidate the land use assumptions and capital improvements plan as authorized by Subsection A of this section, the municipality or county shall first comply with Section 20 [5-8-20 NMSA 1978] of the Development Fees Act and follow the public notice and hearing requirements for adopting a capital improvements plan and impact fee as provided in Section 21 [5-8-21 NMSA 1978] of that act, except: (1) the headline for the notice by publication shall read as follows: "NOTICE OF PUBLIC HEARING ON ADOPTION OF LAND USE ASSUMPTIONS AND IMPACT FEES"; (2) the notice shall state that the municipality or county intends to adopt land use assumptions, a capital improvements plan and impact fees at the hearing and does not intend to hold separate hearings to adopt the land use assumptions, capital improvements plan and impact fees; (3) the notice shall specify a date, not earlier than sixty days after publication of the first notice, and must state that if a person, by not later than the date specified, makes a written request for separate hearings,the governing body shall hold separate hearings to adopt the land use assumptions and capital improvements plan; and (4) the notice shall provide the name and mailing address of the official of the municipality or county to whom a request for separate hearings shall be sent. C. In addition to the requirements of Subsection B of this section,the municipality or county shall comply with all other requirements for adopting land use assumptions, a capital improvements plan and an impact fee. History: Laws 1993, ch. 122, § 29. 5-8-30. Periodic update of land use assumptions and capital improvements plan required. A. A municipality or county imposing an impact fee shall update the land use assumptions and capital improvements plan at least every five years. The initial five-year period begins on the day the capital improvements plan is adopted. B. The municipality or county shall review and evaluate its current land use assumptions and shall cause an update of the capital improvements plan to be prepared in accordance with the Development Fees Act. History: Laws 1993, ch. 122, §30. 5-8-31. Hearing on updated land use assumptions and capital improvements plan. TISCh BIS2 64 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico The governing body of the municipality or county shall, within sixty days after the date it receives the update of the land use assumptions and the capital improvements plan, schedule and publish notice of a public hearing to discuss and review the update and shall determine whether to amend the plan. History: Laws 1993, ch. 122, §31. 5-8-32. Hearing on amendments to land use assumptions, capital improvements plan or impact fee. A public hearing shall be held by the governing body of the municipality or county to discuss the proposed ordinance, order or resolution amending land use assumptions, the capital improvements plan or the impact fee. On or before the date of the first publication of the notice of the hearing on the amendments, the land use assumptions and the capital improvements plan, including the amount of any proposed amended impact fee per service unit, shall be made available to the public. History: Laws 1993, ch. 122, §32. 5-8-33. Notice of hearing on amendments to land use assumptions, capital improvements plan or impact fee. A. The municipality or county shall publish notice of the hearing conforming to locally adopted regulations governing change-of-zone requests, except as otherwise provided in this section. B. The notice must contain the following: (1) a headline to read as follows: "NOTICE OF PUBLIC HEARING ON AMENDMENTS TO LAND USE ASSUMPTIONS, CAPITAL IMPROVEMENTS PLAN OR IMPACT FEES"; (2) the time, date and location of the hearing; (3) a statement that the purpose of the hearing is to consider amendments to land use assumptions, capital improvements plan or impact fees; (4) an easily understandable description and map of the service area on which the update is being prepared; and (5) a statement that any member of the public has the right to appear at the hearing and present evidence for or against the update. History: Laws 1993, ch. 122, §33. 5-8-34. Advisory committee comments on amendments. Tischl re Bise 65 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico The advisory committee created under Section 37 [5-8-37 NMSA 1978] of the Development Fees Act shall file its written comments with the applicable municipality or county on the proposed amendments to the land use assumptions, capital improvements plan or impact fees before the fifth business day before the date of the public hearing on the amendments. History: Laws 1993, ch. 122, §34. 5-8-35. Approval of amendments required. A. The municipality or county,within thirty days after the date of the public hearing on the amendments, shall approve, disapprove, revise or modify the amendments to the land use assumptions, the capital improvements plan or impact fees. B. An ordinance, order or resolution approving the amendments to the land use assumptions,the capital improvements plan or impact fees shall not be adopted as an emergency measure and such adoption must comply with the procedural requirements of the Development Fees Act. History: Laws 1993, ch. 122, §35. 5-8-36. Determination that no update of land use assumptions, capital improvements plan or impact fee is needed. A. If at the time an update under Section 30 [5-8-30 NMSA 1978] of the Development Fees Act is required, the governing body determines that no changes to the land use assumptions, capital improvements plan or impact fees are needed, it may, as an alternative to the updating requirements of Sections 30 through 35 [5-8-30 through 5-8-35 NMSA 1978] of the Development Fees Act, publish notice of its determination conforming to locally adopted regulations governing change-of-zone requests, except as otherwise provided in this section. B. The notice shall contain the following: (1) a headline to read as follows: "NOTICE OF DETERMINATION NOT TO UPDATE LAND USE ASSUMPTIONS, CAPITAL IMPROVEMENTS PLAN OR IMPACT FEES"; (2) a statement that the governing body of the municipality or county has determined that no change to the land use assumptions, capital improvements plan or impact fees are necessary; (3) an easily understandable description and a map of the service area in which the updating has been determined to be unnecessary; Tischl re Bise 66 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico (4) a statement that if,within a specified date,which date shall be at least sixty days after publication of the notice, a person makes a written request to the designated official of the municipality or county requesting that the land use assumptions, capital improvements plan or impact fees be updated, the governing body may accept or reject such request by following the requirements of Sections 30 through 35 of the Development Fees Act; and (5) a statement identifying the name and mailing address of the official of the municipality or county to whom a request for an update should be sent. C. The advisory committee shall file its written comments on the need for updating the land use assumptions, capital improvements plan and impact fees before the fifth business day before the earliest notice of the governing body's decision that no update is necessary is mailed or published. D. If by the date specified in Paragraph (4) of Subsection B of this section, a person requests in writing that the land use assumptions, capital improvements plan or impact fees be updated,the governing body shall cause, accept or reject an update of the land use assumptions and capital improvements plan to be prepared in accordance with Sections 30 through 35 of the Development Fees Act. E. An ordinance, order or resolution determining the need for updating land use assumptions, capital improvements plan or impact fees shall not be adopted as an emergency measure and its adoption must comply with the procedural requirements of the Development Fees Act. History: Laws 1993, ch. 122, §36. 5-8-37. Advisory committee. A. On or before the date on which the order, ordinance or resolution is adopted under Section 19 [5-8- 19 NMSA 1978]of the Development Fees Act,the governing body of a municipality or county shall appoint a capital improvements advisory committee. B. The advisory committee shall be composed of not less than five members who shall be appointed by a majority vote of the governing body. Not less than forty percent of the membership of the advisory committee must be representative of the real estate, development or building industries. No members shall be employees or officials of a municipality or county or other governmental entity. C. The advisory committee serves in an advisory capacity and shall: (1) advise and assist the municipality or county in adopting land use assumptions; (2) review the capital improvements plan and file written comments; (3) monitor and evaluate implementation of the capital improvements plan; (4) file annual reports with respect to the progress of the capital improvements plan and report to the municipality or county any perceived inequities in implementing the plan or imposing the impact fee; and Tischl reschl Base 67 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico (5) advise the municipality or county of the need to update or revise the land use assumptions, capital improvements plan and impact fee. D. The municipality or county shall make available to the advisory committee any professional reports with respect to developing and implementing the capital improvements plan. E. The governing body of the municipality or county shall adopt procedural rules for the advisory committee to follow in carrying out its duties. History: Laws 1993, ch. 122, §37. 5-8-38. Duties to be performed within time limits. If the governing body of the municipality or county does not perform a duty imposed under the Development Fees Act within the prescribed period, a person who has paid an impact fee or an owner of land on which an impact fee has been paid has the right to present a written request to the governing body of the municipality or county stating the nature of the unperformed duty and requesting that it be performed within sixty days after the date of the request. If the governing body of the municipality or county finds that the duty is required under the Development Fees Act and is late in being performed, it shall cause the duty to commence within sixty days after the date of the request and continue until completion. History: Laws 1993, ch. 122, §38. 5-8-39. Records of hearings. A record shall be made of any public hearing provided for by the Development Fees Act.The record shall be maintained and be made available for public inspection by the municipality or county for at least ten years after the date of the public hearing. History: Laws 1993, ch. 122, §39. 5-8-40. Prior impact fees replaced by fees under Development Fees Act. An impact fee that is in place on the effective date of the Development Fees Act shall be replaced by an impact fee imposed under that act by July 1, 1995. Any municipality or county having an impact fee that has not been replaced under that act by July 1, 1995 shall be liable to any party who, after the effective date of that act, pays an impact fee that exceeds the maximum permitted under that act by more than ten percent for an amount equal to two times the difference between the maximum impact fee allowed and the actual impact fee imposed, plus reasonable attorneys'fees and court costs. History: Laws 1993, ch. 122, §40. 5-8-41. No effect on taxes or other charges. Tischl re Bise 68 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico The Development Fees Act does not prohibit, affect or regulate any tax, fee, charge or assessment specifically authorized by state law. History: Laws 1993, ch. 122, §41. 5-8-42. Moratorium on development prohibited. A moratorium shall not be placed on new development for the sole purpose of awaiting the completion of all or any part of the process necessary to develop, adopt or update impact fees. History: Laws 1993, ch. 122, §42. 5-8-43. Purpose;transfer of development rights. A. The purpose of this section is to: (1) clarify an application of existing authority; (2) provide guidelines for counties and municipalities to regulate transfers of development rights consistent with comprehensive plans; (3) encourage the conservation of ecological, agricultural and historical land; and (4) require public notification of transfers of development rights. B. A municipality or county may, by ordinance,provide for voluntary transfer of all or partial development rights from one parcel of land to another parcel of land. C. The ordinance shall identify on a zoning map areas from which development rights may be transferred and areas to which development rights may be transferred. D. The ordinance shall provide for: (1) the voluntary transfer of a development right from one parcel of land to increase the intensity of development of another parcel of land; (2) joint powers agreements, if applicable,for administration of transfers of development rights across jurisdictional boundaries, (3) the method of transfer of development rights, including methods of determining the accounting for the rights transferred; (4) the reasonable rules to effect and control transfers and ensure compliance with the provisions of the ordinance; and (5) public notification to the areas to which development rights may be transferred. Tischl reschl Bise 69 FISCAL I ECONOMIC I PLANNING Utilities Development Fee Study City of Las Cruces, New Mexico E. Transference of a development right shall be in writing and executed by the owner of the parcel from which the development right is being transferred and acknowledged by the transferor. A development right shall not be subject to condemnation. F. As used in this section, "development right" means the rights permitted to a lot, parcel or area of land under a zoning ordinance or local law respecting permissible use,area,density or height of improvements executed thereon, and development rights may be calculated and allocated in accordance with density or height limitations or any criteria that will effectively quantify a development right in a reasonable and uniform manner. G. Nothing in this section shall be construed to authorize a municipality or a county to impair existing property rights. History: Laws 2003, ch. 229, § 1. ANNOTATIONS Cross references. — For property law in general,see Chapter 47 NMSA 1978. Tischl reschl Bise 70 FISCAL I ECONOMIC I PLANNING Tischler ise FISCAL I ECONOMIC I PLANNING 4701 Sangamore Road, Suite 5240 Bethesda, MD 20816 301.320.6900 x12 (w) 1301.320.4860 (f) carson@tischlerbise.com