Consider Use of City Septic System Repair Policy for a Failing Septic System at 16361 Ferret Street NW

Attached to this case is a copy of a policy adopted by the City in 1992, which relates to the repair of failed septic systems.  As is explained in the preamble to the policy its purpose is to insure public health and safety.  Over the years the policy has rarely been used to provide funding for the repair of failed septic systems.  Implementation of the policy has only been in cases where the property owner refuses to address the failure, or where funding for the repair could not be obtained elsewhere.  On August 19, 2009 the Public Works Committee discussed the septic system repair policy in conjunction with a resident request for assistance.  The recommendation of the Committee at that time was to reaffirm the policy, but they also directed staff to research other alternatives for financing such repairs.  The intent of the Committee was to leave the City policy in place, which involves special assessment of the repair, but only as a last resort.

Staff has now been approached by the property owners at 16361 Ferret Street NW due to failures that they have experienced with their septic system.  The City inspected their system on October 31, 2011, and determined that it is failing (see attached letter).  The property owners have developed a design to repair/replace the system and have solicited quotes, but they are unable to afford the estimated cost.  The septic system repair policy was discussed as a potential funding alternative, but all other options must first be investigated prior to its use.  The property owner stated that they have contacted both the state and county to discuss potential opportunities for assistance, but to date have been unsuccessful in securing funds.

In late 2009 the City did exercise use of this policy to repair a failing residential septic system, at which time the policy was reaffirmed by the Council.  The purpose of this case is to determine whether the City Council is interested in utilizing this policy on another failing residential septic system request.  The current economic condition may make this policy more prevalent than what has been experienced in the past.

Staff has learned that there are a couple of local options for assisting with the cost of a septic system repair.  The Anoka County Community Action Program (ACCAP) has emergency assistance monies available for housing related issues, with eligibility requirements based upon family income guidelines.  In 2010 ACCAP disbanded and forwarded all requests for financial housing assistance to the Greater Metropolitan Housing Corporation (GMHC) Housing Resource Center, which administers community block grant funds through a contract with Anoka County.  The eligibility requirements include; home value, age of the unit, residence time within the unit, and family household income.  GMHC currently has a two year waiting period for this program.

The Minnesota Housing Finance Agency is a state agency that works with local communities to distribute funds to residents that meet their eligibility requirements.  They can issue interest free loans to those that meet their criteria, and place a lien on their property for repayment.  If the resident were to remain in the home for a period of ten years the loan would be forgiven.  Unfortunately, since ACCAP was in existence at the time they were going out for contracts with local carriers, Anoka County was not included in the pool and therefore funding within Anoka County is not eligible at this time.

Staff has also contacted several other Anoka County service departments inquiring about potential assistance options, and is currently awaiting responses.  Once received the information will be forwarded to the resident requesting use of the septic system repair policy and the Council.  At this time it appears that a couple of other options may be available; including a "Rebuilding Together Loan" with the County, and "Fix Up Fund Loan" with the state.

If directed by Council to proceed under this policy, staff would solicit quotes from septic system installers while the property owner investigates the alternative funding options identified to determine eligibility.  If they are unsuccessful in securing funds and wish to continue under the City's policy, the appropriate paperwork can be prepared to initiate the improvement (see attached correspondence from the City Attorney).  Due to time constraints associated with the failing system, and the imminent cold of winter approaching, staff would like to expedite this process to the extent feasible.

If all other financing options have been exhausted by the property owner, staff recommends use of the Septic System Repair policy to repair the failing septic system at 16361 Ferret Street NW.

Funding for this program would come from the sanitary sewer enterprise utility fund, and paid back with a special assessment against the property.

Motion to approve the use of the Septic System Repair policy to repair the failing septic system at 16361 Ferret Street NW.

The Council may also consider requiring the property owner to submit evidence that they have investigated all other potential funding options, and are ineligible to receive financing through such programs.