Public Works engaged AE2S Nexus to calculate an appropriate System Development Fee (SDF) for Phillips 66 Billings Refinery to pay prior to connection to the City's wastewater system.  SDFs are one-time fees that are assessed on new connections and are necessary to provide adequate funding for growth related capital improvements. 

MCA 7-6-1604 requires governmental entities to have an advisory committee to review the calculating, assessing, and spending of system development fees.  The Public Works Board and Public Works staff, along with the assistance of a member of the development committee is currently serving in the capacity of the SDF advisory committee.  The committee met in April 2014 to review the proposed SDF for Phillips 66 and unanimously supports the recommendation being made to City Council.  The attached resolution specifies the proposed SDF calculated for Phillips 66 Billings Refinery.

The City Council must hold a public hearing and then may:

• approve the resolution
• not approve the resolution.  If Council does not approve the resolution, an amended resolution will need to be considered at a future City Council meeting in order to meet the terms of the Pretreatment Service Agreement between the City of Billings and Phillips 66 Billings Refinery approved by Council in July 2013.

The proposed System Development fee will generate a one-time revenue of $1,650,512.20 for the wastewater fund and $66,020.49 in franchise fees for the general fund.

Staff recommends that the City Council conduct a public hearing and approve the proposed resolution adopting the System Development Fee for Phillips 66 Billings Refinery.