What is the Kirby Lane North Sanitary Sewer Special Assessment District and its history?
The Kirby Lane North Sanitary Sewer Special Assessment District project began in 1999 when the residents of Kirby Lane North and Grace Church Street petitioned the City to connect their properties to the City’s sewer system. A brief summary of the project's history to date is as follows:
December 1999 - The City Council directs City staff to determine feasibility and cost of the proposed Kirby Lane North Sewer Project.
June 2001 - A neighborhood meeting is held to discuss the project.
October 2001 - Requests for proposals are issued by the City for project design.
November 2001 - Design work awarded to Chas. H. Sells, Inc.
December 2001 - Survey and design work begins.
August 2002 - Preliminary design work is completed. A neighborhood meeting is held to discuss the project. This meeting is also attended by residents of Kirby Lane (south of Kirby Lane North), who request that their properties be included in the project.
September 2002 - A revised project design is completed that includes properties of Kirby Lane, south of the originally-planned district.
June 2003 - The City Council adopts a special benefit assessment district law that will allow the project to go forward and the costs to be repaid by special assessments against the benefited properties.
October 2003 - Preliminary design of the entire proposed district is completed. A neighborhood meeting is held where some residents are not in favor due to the cost and inconvenience of construction.
February 2004 - The City receives a petition from 11 Kirby Lane property owners asking that Kirby Lane not be included in the project.
May 2004 - The City Council adopts Local Law No. 1 2004, amending Rye City Code Chapter 128, Local Improvement Assessment, adding Section 128-2 (B):
"Upon a petition filed with the City Clerk requesting that the City undertake a local improvement, duly signed and authenticated by the property owners who own more than sixty-six and two-thirds (66 2/3%) percent of the lots and parcels which would benefit by the requested local improvement, the Council may by resolution provide for the undertaking of such local improvement as provided for in this Chapter."
October 5, 2004 - The City hosts a neighborhood meeting in City Hall to present the proposed project, distribute petitions for approval or disapproval of the project, and answer any questions raised by homeowners in the proposed district.
November 3, 2004 - The City Council accepts a petition from more than 73% of residents in the proposed district approving of the project. The City Council establishes a public hearing date of Wednesday, December 1, 2004.
November 4, 2004 - City officials meet with Chas. H. Sells Inc. to discuss the project and deadlines to meet applicable legal notice and filing requirements, and address issues related to the installation of the water line, sewer, easements, etc. Based on these discussions and to allow maximum participation by avoiding conflicts with holidays, it is determined that the December 1, 2004 public hearing should be re-scheduled for January 2005.
November 17, 2004 - The City Council cancels the public hearing initially scheduled for December 1, 2004 due to the need to complete procedures under State Environmental Quality Review Act (SEQRA).
December 15, 2004 - The City Council declares its intent to be Lead Agency and refers to the Rye City Planning Commission for Advisory Local Waterfront Revitalization Plan (LWRP) Coastal Consistency and Wetland Permit Approval in connection with the Kirby Lane North Sanitary Sewer Special Assessment District. These actions are required by state and local laws. A copy of the Full Environmental Assessment Form (with attachments) is referred to interested and involved agencies as required by law and is available for public review in the City Planner's Office.
December 22, 2004 - By letter dated December 22, 2004, Aquarion Water Company advises Chas. H. Sells, Inc. that all costs associated with the extension of a water main into the proposed Kirby Lane North Sanitary Sewer Special Assessment District has to be borne by the residents.
February 2, 2005 - The City Council schedules a public hearing for February 16, 2005 at the regular City Council meeting regarding the establishment of the Kirby Lane North Sanitary Sewer Special Assessment District.
February 8, 2005 - The Rye City Planning Commission holds a public hearing and consideration of a resolution of approval and advisory LWRP recommendation concerning the proposed Kirby Lane North Sanitary Sewer Special Assessment District. A memorandum is prepared and forwarded to the City Council on February 9, 2005.
February 16, 2005 - The Rye City Council holds a public hearing, which includes a presentation by Chas. H. Sells, Inc., consulting engineers. The Council adopts a resolution establishing the Kirby Lane North Sanitary Sewer Special Assessment District.
February 27, 2005 - The Rye City Planning Commission will consider approving a single wetland permit to cover all properties involved in the project, eliminating the requirement that individual property owners obtain such permit.
What properties are included in the
Kirby Lane North Sanitary Sewer Special Assessment District?
Please see the map
and/or the list of properties. A list
of the properties, including addresses and tax map numbers, is included in the resolution
establishing the district.
How did the City know if homeowners in the
special
assessment district are in favor of, or against, the proposed special assessment
district?
Beginning October 5, 2004 a petition to vote in favor of or against the
proposed special assessment district was circulated among the 30 homes in
the proposed district. The petition had a return date of October 29, 2004. The local law provides that at least 66 2/3% of property owners must
approve of the district but the City reserves the right to establish, or not
establish, a special assessment district. The petition returned a vote of 73%
in favor, indicating strong neighborhood support for the special assessment
district.
What are the future estimated key dates (milestones) of the project?
The following milestones are conservative estimates that assume there may be
delays beyond the control of the City (for instance, waiting for approvals from
Westchester County Health Department, weather-related delays, etc.). The City
will make every effort to expedite the project and complete the project ahead of
the proposed schedule. The milestones are:
February 27, 2005 - Rye City Planning Commission approves a wetland permit for the properties in the Kirby Lane North Sanitary Sewer Special Assessment District.
June/July 2005 - Completion of final project design.
Summer 2005 - Approval of Westchester County Health Department.
September 2005 - Advertisements posted requesting bids for project construction.
October/November 2005 - Receipt and opening of project bids. City Council awards contracts.
November 2005 or March 2006 - Start of construction, dependent on several factors, including but not limited to weather, contractor's ability to mobilize, etc.
June 2007 - Substantial completion of project. Properties connect to sewer system.
What work will be included in the project?
The project will consist of constructing approximately 2,900 linear feet of
eight-inch diameter gravity sewer line, approximately 1,380 linear feet of
four-inch force main, and a sewage pump station to service 30 properties along
Kirby Lane North and Grace Church Street. Additional work will include manholes,
sewer spurs to edge or right-of-way, and restoration of roads and lawns
disturbed by the construction. Portions of the work may require permanent or
temporary easements.
What is the estimated cost of the project?
Total sewer improvement project costs are estimated to be $1,650,000. This
includes $1.4 million of construction costs, $200,000 of design and inspection
fees, and $50,000 for bond issuance costs. An additional $30,800 would be
required if the City can obtain financing through the New York State
Environmental Facilities Corporation ("EFC"). Financing through the
EFC would have the benefit of providing an interest rate subsidy, reducing the
interest expense on the bonds by approximately 50%. The City's Engineering
department has worked with Chas. H. Sells Inc. to develop the construction cost
estimates, and with the City's Finance Department to develop the financing
cost estimates.
How will the project costs be financed?
The City will issue long-term bonds to finance the project's sewer
improvements at a preferred municipal rate, charging the annual cost of the debt
service (principal and interest) against the benefited properties as a special
assessment billed annually with the City's property taxes. The financing and any
charges related to the water improvements is a matter that would be addressed by
the private water company.
What is the estimated maturity (term) and rate on the bonds
financing the project?
The City of Rye currently enjoys a "triple A" (Aaa) rating from
Moody's Investor Services, so we anticipate receiving an excellent rate. The
bonds to be issued would have a maturity of 30 years and the City's financial
advisors estimate that the market rate for Aaa 30 year bonds in 2006 would be
around 5.5%. These estimates will be used in calculating the annual debt
service and estimated annual special assessment charge on the benefited
properties.
The City will be applying for short and long-term funding through the EFC, which (if funding is available) can provide short and long-term financing at substantially below-market rates. If the City is successful in obtaining such funding, the annual special assessment charge would be reduced to reflect the savings.
Why not extend the maturity of the bonds to 40 or 50 years, in order to lower the annual special assessment charge?
New York State Local Finance Law limits the term of sewer improvement bonds to a maximum forty (40) year maturity. Even so, 40-year bonds are rarely issued and as such would have a limited market that would most likely result in higher rates. Credit analysts consider the average life of bonds in determining creditworthiness, which may have a negative impact on the City's enviable credit rating. Perhaps most importantly, the EFC limits the bonds sold through them to 30 years, so the City would not be able to take advantage of preferred rates through the EFC.
What is the estimated annual special assessment that will be charged against the properties in the proposed district?
First, a very important caveat that the annual estimated costs are based on a set of assumptions made by professional staff. The assumed numbers may differ materially from the actual, depending on several factors beyond the control of the City and/or the current knowledge of professional staff.
Based on the current information that there would be 30 properties in the proposed district, with each property ("unit") paying an equal share (1/30) of the annual cost of the district, and assuming that total project costs are $1,650,000 (including all soft costs), we have calculated the following per unit per year special assessment charges to the benefited properties as follows:
If debt is issued with EFC financing:
Assuming a 30-year maximum maturity offered by the EFC and an estimated 5.5% rate subsidized 50% by EFC (an effective rate of 2.75%), the average annual total debt service (principal and interest) costs would be approximately $75,478 or $2,516 per unit. This assumes also that the estimated EFC financing charges of $30,800 are added to the $1,650,000, making the total amount issued by the EFC $1,680,800.
It is also important to note that EFC financing, if available, would provide for interest-free short-term financing until the project is completed.
If debt is issued without EFC financing:
A 30-year maturity at 5.5% would have an average annual total debt service cost of approximately $99,613 or $3,320 per unit.
A 40-year maturity (maximum allowed under NYS Local Finance Law) at 5.7% would have an average annual total debt service cost of approximately $92,063 or $3,069 per unit.
Any of the above would most likely require some short-term financing until or shortly before the project is completed at short-term interest rates available to the City.
Additional notes concerning the above estimates:
The bond interest rates noted above are estimates provided by City's financial advisors. Debt service costs were calculated using level debt service method. EFC financing is dependent upon project eligibility and funding availability. The annual amounts noted above are averages based on total debt principal and interest costs to maturity divided by the number of years to maturity. Total costs per year for EFC financing increase in later years. Total costs per year for non-EFC financing differ (increase or decrease) from year to year.
If the project costs less than the current estimated amount,
will the annual special assessment charge be lower?
The City will issue bonds for the actual project cost, and no more. If the
project costs less than the current estimates, then the amount of the bonds
issued will be less than originally estimated, resulting in a lower annual
special assessment charge.
How can I offer my comments, questions, and suggestions?
A very easy way to offer your comments, questions, and suggestions would be
to use our feedback form. As always, you may
also call, write, or visit us:
Rye City Hall
1051 Boston Post Road
Rye, New York 10580
TEL: (914) 967-7303
FAX: (914) 967-7370
Last Updated 02/17/2005