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Home My WebLink About4762 Ordinance - Appendix B Exhibit H-IAGENDA REPORT FOR: City Council February 20, 2025 TO: Dave Zabell, Interim City Manager City Council Regular Meeting: 3/3/25 FROM: Maria Serra, Director Public Works SUBJECT: Public Hearing: Local Improvement District No. 152 Final Assessment Roll & Ordinance No. ____ - Local Improvement District No. 152 Final Assessment Roll I. ATTACHMENT(S): PowerPoint Presentation Ordinance LID 152 Findings of Fact and Conclusions of Law II. ACTION REQUESTED OF COUNCIL / STAFF RECOMMENDATIONS: Conduct a Public Hearing MOTION: I move to adopt Ordinance No. ____, approving and confirming the assessments and final assessment roll of Local Improvement District No. 152 for the construction of new sanitary sewer gravity mains, a lift station, force mains and other sewer improvements in the City’s East Urban Growth Area (UGA) (collectively, the “Improvements”), as provided by Ordinance No. 4592, and levying and assessing a part of the cost and expense thereof against the several parcels of land as shown on the final assessment roll. III. FISCAL IMPACT: Project Costs $20,658,671.37 City Contribution -$5,764,435.26 Special Benefits to assessed properties from appraiser (Not including City or other properties) $24,890,000.00 Final Assessment Roll $14,949,945.65 Adjustments -$1,111,262.58 LID Cost (to be assessed to LID participants) $13,838,683.07 EXHIBIT H IV. HISTORY AND FACTS BRIEF: History The East Urban Growth Area (UGA) Expansion Sewer Local Improvement District (“LID”) No. 152 project has been constructed to provide the opportunity to serve all parcels within the expanded UGA east of Road 68. This area encompasses several large parcels (10 acres or more), some of which have short- and long-term development plans already underway. and landowners with meetings of preliminary a held staff City series representatives of the parcels included in the originally proposed LID boundary. On May 2, 2022, Council approved Resolution No. 4174, declaring its intent to order the improvements of the East Urban Growth Area Expansion (sewer mains and lift station) and to form an LID. On May 23, 2022, Council Approved Ordinance No. 4592, which formed LID No. 152 and ordered the sanitary sewer and lift station improvements within the UGA Expansion east of Road 68, estimated the preliminary assessments, and authorized interim and bond financing then with proceeded The City the for pay to Improvements. assessment of the cost and expense of constructing the Improvements against the properties specially benefited by the proposed improvements. To expedite project construction, the unified scope of work was broken into four phases, each of them packaged into a set of bid documents and treated as an individual construction contract.  Phase 1 installed six, bored trench crossings with casings. Three crossings were two railroad, BNSF installed underneath were the installed underneath N. Glade Road, and one was installed underneath N. Railroad Avenue. This construction project totaled $3,178,063.39 and was accepted by the City Council via Resolution No. 4458.  Phase 2 installed gravity sewer main from the north end of the UGA east to N. Glade Road and south along N. Glade Road to the location of the future lift station. This construction project totaled $1,496,859.67 and was accepted by the City Council via Resolution No. 4434.  Phase 3 built a sewer lift station at the corner of N. Glade Road and Burns Road (extended). This project also installed a set of force mains to connect the new lift station system to the existing gravity collection systems located along Foster Wells Road and Capital Avenue, and at Foster Wells Road and Industrial Way. This construction project totaled $3,755,604.36 and was accepted by the City Council via Resolution No. 4524.  Phase 4 installed the remainder of the gravity sewer trunk mains serving EXHIBIT H the properties to the west of the lift station and N. Glade Road. This construction project totaled $6,344,953.40 and was accepted by the City Council via Resolution No. 4525. Supportive of LID 152 project completion are expenses outside awarded construction costs outlined in the above phases. These costs, totaling $5,883,190.55, are integral to project completion and therefore included in final assessment values. Included in this category of expenses are costs associated with engineering, surveying, and geotechnical services, as well as LID specific administration and financing costs. City staff held two subsequent meetings with the owners of the properties involved in the LID No. 152 to share the updated costs as the project progressed. One meeting was conducted as a Pre-Construction meeting, held on August 28, 2023, and the most recent meeting was held towards the end of construction on June 26, 2024. A public hearing to present the Final Assessment Roll was approved by council on January 6, 2025 via Resolution No. 4550. Written notification of the public hearing for the Final Assessment Roll for the East UGA Expansion Sewer LID No. 152 was mailed to all property owners and published in the newspaper during the required timeframe. Costs The total project cost, including interim financing and city participation, is $20,658,671.37. This overall project cost is lower than the cost originally estimated when the LID was formed, $21,494,000.00, as shown in Ordinance No. 4592. The City contribution is for the remaining capacity of the sewer system that is not allocated to property owners within the LID. The City contribution was changed following the property owner assessment adjustments that were previously requested and discussed in early January 2025. Because all property owners were assessed based on a previously-accepted combination of flow and property parcel area, the City used the unallocated flow, combined with property areas calculated by applying the ratio between Landowner totals of area and flow to arrive at an assumed area. The final cost for the City contribution is then calculated accordingly with the hybrid charge of 60% flow (unallocated, remaining Peak Hour Flow from the LID Improvements) and 40% area (Ratio of Landowner Totals). Other properties are receiving reduction adjustments in their assessment amount as a result of previously-received payments or payments received pursuant to preformation agreements, totaling $1,150,000.00. EXHIBIT H The additive cost included in the School District (PSD) final assessment is the result of a change order cost totaling $38,737.42. This change order was previously agreed upon between PSD and City of Pasco and benefitted PSD specifically and not other LID property owners. Accordingly, it was directly allocated to PSD’s final assessment rather than being included in the general costs of the project. The adjustment for the City is for the cost of additional lengths of pipe and manholes extending North from the Northeast corner of the School District property, totaling $55,709.54. LID Process LIDs are a mechanism by which properties that specially benefit from City capital improvements participate in financing the cost of those improvements. Local Improvement Districts provide the opportunity for capital improvements to be financed and paid for over time through special assessments on the benefiting properties. RCW 35.44.030 – 0.45 provide several identified methods, including “zone and termini” methods, by which capital costs can be divided among and assessed against benefitting properties. In addition, RCW 35.44.047 provides that a city may use “any other method or combination of methods to compute assessments which may be deemed to more fairly reflect the special benefits to the properties being assessed.” For this LID No. 152, the District consists of approximately 1,017.4 acres of serviceable land that is currently in the beginning of development. Based on concurrence from property owners the City has utilized a combination of methods to compute assessments. The hybrid assessment method used to calculate both the preliminary and final assessment roll includes a weighted average of two assessment calculations. 60% of the assessment is based upon a property’s sewage flow contribution to the entire sewer system, while the remaining 40% of the assessment is based upon property acreage. The resulting assessments ratably and proportionately distribute the costs of the Improvements to the properties within the District in accordance with the special benefits each property receives. Special Benefit A certified appraiser was hired by the City to prepare a preliminary special benefit analysis to determine how much benefit the sewer project would have on the value of each parcel within the proposed LID boundary. That analysis showed that the benefit to the properties from sewers exceed the proposed assessment to each parcel of property. The appraiser’s findings are documented in the Special Benefit Report (East UGA Expansion LID [2025]). EXHIBIT H The Report’s analysis compared each parcel’s value prior to the extension of sewer became sewer the parcel each after value estimated the with of available. The analysis verified that the special benefit to each parcel with sewer exceeds the final assessment amount for each property within the LID. The assessment roll, as proposed, is consistent with the hybrid mathematical methodology established early in the project: 60% of the assessment is based upon flow contributions to the entire sewer system from each property owner, and 40% of the assessment is based upon acreage area served. Because dedication the under was project as place taken has rights-of-way of construction, assessment amounts were based on its original area. This is shown in the assessment roll provided. V. DISCUSSION: The public notice of this public hearing for Final Assessment Roll for LID 152 was published on the Tri-City Herald on February 5 and 12, 2025. Individual Final Assessment Roll Public Hearing Notices were assembled and mailed to the benefitting/assessed property owners via U.S. mail on 2/10/2025, using the mailing addresses shown on the tax rolls listed with the Franklin County Treasurer. Included in each notice packet were the following items:  Notice letter listing each parcel owned by the addressee along with the total assessment amount calculated for each parcel  Table showing the complete assessment roll for LID No. 152 was letter and address each notices, accuracy of the ensure To the independently checked by two people. Parcel numbers, assessment amounts, and mailing addresses were all confirmed; with the addresses being confirmed on the date that the notices were deposited in the mail (2/10/2025). The City has taken every reasonable step to provide an accurate, up to date assessment by the day that notice is required by law to be given (RCW 35.44.090). The Public hearing provides an opportunity to property owners to object the methodology the revise Council assessment. may the for proposed LID proposed assessments, order a new methodology be considered or applied. Following the to revisions no are if hearing, public this proposed there assessments, Council may consider and adopt the proposed ordinance confirming the final assessment roll. EXHIBIT H 3/03/2025 Pasco City Council Regular Meeting EXHIBIT H East UGA LID 152 Public Hearing Confirmation of Final Assessment Roll 3/03/2025 Pasco City Council EXHIBIT H East UGA Expansion Sewer LID Map 3 EXHIBIT H East UGA Expansion Sewer LID Design and Construction Timeline 4 Schedule Preliminary Design- May 26, 2022 FormationMay 26, 2022 DesignMay 26, 2022 - Phase 1 Construction ContractNovember 24, 2022 Phase 2 Construction ContractNovember 24, 2022 Phase 3 Construction ContractJanuary 24, 2023 Phase 4 Construction ContractMay 8, 2023 Phase 2 Construction AcceptanceMarch 18, 2024 Phase 1 Construction AcceptanceJune 3, 2024 Special Benefit Analysis BeganSeptember 10, 2024 Phase 3 Construction AcceptanceNovember 18, 2024 Phase 4 Construction AcceptanceNovember 18, 2024 EXHIBIT H East UGA Expansion Sewer LID Establishment of LID 152 5 EXHIBIT H East UGA Expansion Sewer LID Preliminary Assessment Roll 6 EXHIBIT H East UGA Expansion Sewer LID Final Assessment Roll 7 EXHIBIT H East UGA Expansion Sewer LID Final Assessment Roll and Preliminary Assessment Roll 8 Name Parcel No. Adjusted Assessment Preliminary Assessment J-14, LLC 114330031 2,324,871.46$ 2,779,325.00$ STRIZHAK'S HAVEN RANCH LLC 114330041 605,951.32$ 724,399.00$ PRO MADE CONSTRUCTION LLC 114330042 601,100.18$ 718,600.00$ GS CATTLE RANCH LLC 114330043 780,992.36$ 905,951.00$ SG LAND MANAGEMENT LLC 114330044 778,462.70$ 903,111.00$ COLUMBIA WATERS FARM LLC 115010032 3,999,464.62$ 4,671,142.00$ SINGH (ETUX), JASBIR 115130046 149,503.27$ 178,727.00$ SINGH (ETUX), JASBIR 115130055 149,503.27$ 178,727.00$ PUD #1 (FRANKLIN COUNTY) 124680038 39,381.79$ 56,244.00$ DARIGOLD, INC 124680044 452,799.96$ 5,184,408.00$ FARM 2005 LLC 114250018 1,685,036.67$ 2,296,919.00$ BIG SKY DEVELOPERS LLC 114330053 BIG SKY DEVELOPERS LLC 114330054 BIG SKY DEVELOPERS LLC 114330052 BIG SKY DEVELOPERS LLC 114330051 PASCO SCHOOL DISTRICT NO. 1 114330059 PASCO SCHOOL DISTRICT NO. 1 114330060 841,464.00$ 1,604,020.02$ 2,054,982.00$ 667,595.45$ EXHIBIT H East UGA Expansion Sewer LID Special Benefit Analysis. 9 EXHIBIT H East UGA Expansion Sewer LID Final Assessment and Special Benefit 10 Name Parcel No. Adjusted Assessment Special Benefit Analysis J-14, LLC 114330031 2,324,871.46$ 3,170,000.00$ STRIZHAK'S HAVEN RANCH LLC 114330041 605,951.32$ 1,230,000.00$ PRO MADE CONSTRUCTION LLC 114330042 601,100.18$ 1,230,000.00$ GS CATTLE RANCH LLC 114330043 780,992.36$ 1,230,000.00$ SG LAND MANAGEMENT LLC 114330044 778,462.70$ 1,220,000.00$ COLUMBIA WATERS FARM LLC 115010032 3,999,464.62$ 4,640,000.00$ SINGH (ETUX), JASBIR 115130046 149,503.27$ 300,000.00$ SINGH (ETUX), JASBIR 115130055 149,503.27$ 300,000.00$ PUD #1 (FRANKLIN COUNTY) 124680038 39,381.79$ 140,000.00$ DARIGOLD, INC 124680044 452,799.96$ 4,120,000.00$ FARM 2005 LLC 114250018 1,685,036.67$ 3,220,000.00$ BIG SKY DEVELOPERS LLC 114330053 116,103.09$ 240,000.00$ BIG SKY DEVELOPERS LLC 114330054 92,397.60$ 250,000.00$ BIG SKY DEVELOPERS LLC 114330052 598,387.96$ 900,000.00$ BIG SKY DEVELOPERS LLC 114330051 797,131.37$ 1,210,000.00$ PASCO SCHOOL DISTRICT NO. 1 114330059 PASCO SCHOOL DISTRICT NO. 1 114330060 1,490,000.00$ 667,595.45$ EXHIBIT H East UGA Expansion Sewer LID After Final Assessment Roll Timeline 11 Estimated Date(s)Upcoming Items Expires: March 18, 2025Expires 10 days after Ordinance confirming assessment roll becomes effective Appeal Period March 23, 2025 – March 30, 2025Must be published in newspaper for two weeks, and mailed out to property owners Notice of Official Final Assessment Expires: April 22, 2025Expires 30 days after first publication in newspaperPrepayment Period May 12, 2025No earlier then 20 days after the prepayment endsSell bonds Earliest: March 8, 2026First Payment is due one year after Final assessment roll Ordinance becomes effective First Payment EXHIBIT H EXHIBIT H State of Washington DEPARTMENT OF LICENSING BUSINESS AND PROFESSIONS DIVISION APPRAISER PROGRAM PO Box 9021 Olympia, WA 98507-9021 STATE OF WASHINGTON (R/4/23) DEPARTMENT OF LICENSING - BUSINESS AND PROFESSIONS DIVISION THIS CERTIFIES THE PERSON OR BUSINESS NAMED BELOW IS AUTHORIZED AS A EVAN RANES 6795 S AGILYSYS WAY LAS VEGAS NV 89113-2324 CERTIFIED GENERAL REAL ESTATE APPRAISER EVAN RANES 1102235 01/03/2023 02/03/2026 License Number Issue Date Expiration Date