Form revised: December 6, 2011

FISCAL NOTE FOR CAPITAL PROJECTS ONLY

Department:	Contact Person/Phone:	CBO Analyst/Phone:
Seattle Public Utilities	Pree Carpenter/386-9754	Karl Stickel/684-8085

Legislation Title: AN ORDINANCE relating to Seattle Public Utilities; authorizing the Director of Seattle Public Utilities to purchase certain real property located at 5560 South Holly Street, Seattle, Washington, and to execute, accept and record deeds and convenient documents and agreements deemed by the Director to be necessary to this transaction on behalf of the City.

Summary and background of the Legislation:  This ordinance authorizes the Director of Seattle Public Utilities (SPU) to purchase the property at 5560 South Holly Street in the Seward Park neighborhood.  SPU’s Combined Sewer Overflow (CSO) program seeks to meet the State of Washington’s National Pollutant Discharge Elimination System (NPDES) permit requirements by reducing the size and number of sewer overflows into receiving water bodies.  Seattle Public Utilities will build an underground storage tank that will reduce CSO events into Lake Washington and bring CSO Basin 45 into compliance with NPDES permit requirements.  Property owners in this area were contacted to identify willing sellers for a property upon which to locate the proposed CSO storage tank.  The owners of the property at 5560 South Holly Street voluntarily agreed to sell their rental property for this purpose.  The negotiated purchase price is $445,000, plus up to $30,000 in additional, related expenses (appraisal, appraisal reviews, title costs, escrow costs, etc.).  No additional appropriation is needed for this purchase. This real estate purchase will be funded by an existing CIP project, the S Henderson CSO Storage Project (ID C3609), using its current appropriation.

There is no immediate rate impact as this project, including property acquisition costs, is fully accounted for in current drainage & wastewater rates. 

Project Name:	Project I.D.:	Project Location:	Start Date:	End Date:
S Henderson CSO Storage	C3609	South Holly Street	2005	2018

Please check any of the following that apply:

____    This legislation creates, funds, or anticipates a new CIP Project.

____ This legislation does not have any financial implications.

_X _   This legislation has financial implications.

Appropriations:

Fund Name and Number	Department	Budget Control Level*	Existing 2012 Appropriation	New 2012 Appropriation (if any)	2013 Anticipated Appropriation
DWF, 44010	SPU	C310 Control Structures	$1,908,000	NA	$4,323,000

*See budget book to obtain the appropriate Budget Control Level for your department.

Appropriations Notes:

No additional appropriation is being sought by this legislation.  This purchase will be funded by the existing S Henderson CSO Storage Project, ID C3609, contained in the 2012-2017 Drainage & Wastewater Fund Capital Improvement Program. This legislation would authorize expenditure of existing appropriations for the negotiated purchase price of $445,000, plus up to $30,000 in additional, related expenses (appraisal, appraisal reviews, title costs, escrow costs, etc.).

Spending Plan and Future Appropriations for Capital Projects:

Spending Plan and Budget	2012	2013	2014	2015	2016	2017	Total
Spending Plan	$2.7M	$2.9M	$6.5M	$18.9M	$20.5M	$18.5	$70.0M
Current Year Appropriation	$1.9M
Future Appropriations		$4.3M	$4.7M	$22.3M	$29.2M	$16.9	$77.4M

Spending Plan and Budget Notes:

SPU’s executed purchase and sale agreement for the subject property includes a requirement that this legislation be passed by the City Council no later than May 21, 2012.  The 2012 Adopted Drainage & Wastewater Capital Budget includes $1.9 million in appropriations for this capital project (C3609:  S Henderson CSO Storage Project). 

Funding Source:

Funding Source (Fund Name and Number, if applicable)	2012	2013	2014	2015	2016	2017	Total
Drainage & Wastewater Fund, 44010	$475k						$475k
TOTAL	$475k						$475k

Funding Source Notes:

This project is funded by the Drainage and Wastewater Fund and is not expected to generate revenue. 

Bond Financing Required:

Type	Amount	Assumed Interest Rate	Term	Timing	Expected Annual Debt Service/Payment
Fixed Rate	$356,250	3.5%	30	12/2009	$19,950
TOTAL

Bond Notes:

No bonds will be issued for this project.  The property acquisition costs, like other project costs within the Drainage and Wastewater Fund CIP, will be funded with a mixture of cash and long term debt.  Proceeds from the most recent DWF bond issue were received in December, 2009.

Uses and Sources for Operation and Maintenance Costs for the Project:

O&M	2012	2013	2014	2015	2016	2017	Total
Uses
On-going	$5k	$5k	$5k	$5k	$5k	$5k	$30k
Sources (itemize)	DWF	DWF	DWF	DWF	DWF	DWF	DWF

Operation and Maintenance Notes:

Costs identified above are preliminary estimates for maintenance of the property and do not include future operations & maintenance costs for a proposed future CSO storage tank.  There are no startup costs associated with the property acquisition.  LEED standards do not apply. 

Periodic Major Maintenance Costs for the Project: 

Major Maintenance Item	Frequency	Cost	Likely Funding Source
Property maintenance (landscaping, etc.)	annual	$5k	DWF
TOTAL	annual O&M costs	$5k	DWF

Funding sources for replacement of project: 

No replacement costs are associated with this proposed property acquisition.

Total Regular Positions Created, Modified, or Abrogated through this Legislation, Including FTE Impact: 

Position Title and Department*	Position # for Existing Positions	Fund Name & #	PT/FT	2012 Positions	2012 FTE	2013 Positions**	2013 FTE **
TOTAL

*   List each position separately

** 2013 positions and FTE are total 2013 position changes resulting from this legislation, not incremental changes.  Therefore, under 2013, please be sure to include any continuing positions from 2012.

Position Notes:

No positions will be created, modified, or abrogated by this proposed legislation.

Do positions sunset in the future? 

N/A

Other Implications:

a) Does the legislation have indirect financial implications, or long-term implications?

The legislation is a step in allowing SPU to meet regulatory requirements in its NPDES permit by constructing a CSO Storage Tank to control CSO events.  Funds to purchase the property and to complete the project are allocated in SPU’s Drainage and Wastewater Fund.  There are cost estimates identified for maintenance of the property which do not include future operations and maintenance costs for a proposed future CSO storage tank.

b) What is the financial cost of not implementing the legislation?

If the legislation is not approved, the project team would return to performing site selection analysis to identify a different parcel for the CSO storage tank.  The most promising alternate site is in Martha Washington Park, which would require City Council approval as a result of Initiative 42.  The project will be delayed and will likely miss the regulatory deadlines.  This delay could cause the City to be subject to enforcement actions by the Department of Ecology and the EPA, including costly fines, until the CSO storage tank project is completed.

c) Does this legislation affect any departments besides the originating department? 

The legislation affects the Department of Parks and Recreation because it will provide a reasonable alternative to locating the CSO storage tank within Martha Washington Park.  Consistent with Initiative 42, Parks desires to keep the CSO storage tank outside of the park.

The Department of Planning and Development and the Department of Transportation would issue permits for construction of the project.

d) What are the possible alternatives to the legislation that could achieve the same or similar objectives?

SPU has studied the basin for nearly two years and has determined that a CSO storage tank is needed either within, or adjacent to, Martha Washington Park.  If SPU is not able to purchase the subject property for construction of the new CSO storage facility, an alternative would be to locate the CSO storage tank within Martha Washington Park.  However, Initiative 42 requires proof no reasonable alternative exists before the facility could be located within the park.

e) Is a public hearing required for this legislation? 

No.  The project team conducted numerous public meetings to select a preferred location for the CSO storage tank.  The team plans to conduct additional future public meetings throughout the project.

f) Is publication of notice with The Daily Journal of Commerce and/or The Seattle Times required for this legislation?

No.

g) Does this legislation affect a piece of property?

Yes.  This legislation authorizes SPU to purchase a private parcel for construction of an underground CSO storage facility. 

h) Other Issues:

None