Staff recommends the City Council approve the attached Compensation Agreement with TKJ Development, LLC.

In order to obtain water service, TKJ Development, LLC will extend a 24-inch diameter public water main west along King Avenue West fronting Ridgeline Subdivision.  Ridgeline Subdivision is located at the northeast corner of King Avenue West and South 48th Street West.  The water main pipe size is necessary to serve future development beyond the Ridgeline Subdivision and is a continuation of the pipe size already constructed in King Avenue West.  This water main is considered a general benefit facility that benefits a large number of customers and/or provides service to large areas.  Per City Code (BMCC 26-502, 26-504, and 26-506), general benefit facilities are water lines greater than 12-inches in diameter for commercial developments and are eligible for compensation.  The public main will be larger than 12-inch diameter and the City's policy is to compensate and pay for oversizing of a water main above 12-inches in diameter. Compensation is estimated to be $50,955.00.  The compensation amount could be higher or lower depending on actual costs.

 

The Council may:

• Approve an Agreement for compensation from the City to the Developer. 
• Not approve an Agreement for compensation.  This would be inconsistent with current City practice of compensating for oversizing utility extensions that have general benefit.

Based on review of the quantity of pipe to be installed and information provided by the Developer's agent, staff estimated the oversizing cost of the of water main to be $50,955.00. The extent and timing of the City’s participation in the project costs is determined in conformance with the budget approved by City Council and based on actual quantities installed.  The funds are budgeted annually from water funds specific to compensation agreements.