Peoria, City of

Arizona

Since 1998, RFC has provided a variety of water and wastewater utility financial and rate consulting services to the City of Peoria.  These services have included utility expansion (development) fees, comprehensive rate and financial planning studies, utility revenue bond feasibility forecast, and an independent valuation of local private water companies located in the City’s corporate boundaries.  In addition, RFC assisted the City in developing and implementing a water resources expansion fee designed to recover the costs of CAP water rights and Non-Indian Agriculture CAP water reallocations from development occurring outside the Salt River Project areas of the City. 

Recently, RFC assisted the City in updating it water expansion, wastewater expansion, and water resources fees in accordance with Arizona Revised Statutes (ARS §9-463.05).  This legislation requires that all existing development fees be replaced by fees adopted under the adoption procedures, guidelines, and requirements of ARS §9-463.05 by January 1, 2014.  Other provisions of ARS §9-463.05 required fee structures be based on an adopted Infrastructure Improvements Plan (IIP) which is a central document disclosing existing infrastructure, available capacity, units of demand, and planning for new infrastructure required to serve development. 

The 2014 expansion fee study included a modified approach to determining the fees which was necessary to address the new legislative requirements and changes in the City’s planning approach to providing utility services to different planning areas.  Specifically, the City’s service area and infrastructure planning have evolved to a point that is more representative of multiple service areas for water, wastewater, and water resources.  Also, since much of the City’s existing utilities capacity was recently constructed and because ARS §9-463.05 requires that available capacity in existing facilities be considered as part of the IIP, the expansion fees were determined based on a combined system buy-in and incremental cost approach.  This hybrid approach considers both existing capacity available and planned capacity necessary to serve development.

RFC submitted a draft Utility Expansion Fee Draft Report in 2013, and the City adopted the IIP and LUA on February 18, 2014.

Letter of Recommendation