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Depending on circumstances, the cost of hooking up to the municipal system, paying sewer impact fees and paying monthly fees can range from just a few thousand dollars to hundreds of thousands of dollars.
Many properties throughout Arizona operate on septic systems or their own sewage treatment plants. Recently, some properties have received notices from governmental authorities informing them that they must abandon their existing sewage system and hook‑up to a municipal system regardless of the cost to the property owner. Depending on circumstances, the cost of hooking up to the municipal system, paying sewer impact fees and paying monthly fees can range from just a few thousand dollars to hundreds of thousands of dollars.
Due to environmental issues and state and federal mandates, many local governments have been forced to construct or expand sewage treatment plants and to expand the area serviced by those facilities. Unfortunately, if your property is within such an expanded area, you may be compelled to abandon your existing sewage system and hook‑up to the municipal system. Typically, you will be given advanced notice to allow you to plan for the hook‑up, to obtain the necessary engineering and, to secure financing, if needed. If you do not voluntarily hook‑up to the sewer system when requested, the government can issue a formal notice demanding that the hook‑up be accomplished within a specified time frame, which can be as little as 90 days. If you then fail to timely comply with the requirement, significant fines and penalties can be assessed against you on a daily basis.
As a property owner, you may have some potential defenses to being compelled to hook up to such a system or to delay the hookup, depending on the particular circumstances. Given the expense involved with abandoning an existing system and hooking up to a new sewer system, a property owner is well advised to consult with professionals, including attorneys experienced in such matters, if a potential mandatory hook up is on the horizon. The following are just some of the many issues that may merit investigation, analysis and negotiation:
- The ordinances authorizing the municipality to require property owners to hook‑up to a sewer system must be analyzed. Such ordinances may require that there be close proximity (such as a stated number of feet) between the property and a new or existing sewer main and an intervening easement or right‑of‑way before a property owner can be compelled to hook‑up to the sewer system. If those criteria are not met, the government may be unable to compel you to hook‑up.
- Portions of many properties may be devoted to different uses. For example, a resort might have hotel rooms, recreational vehicle spaces and designated recreational facilities. Sewer hook-up and use fees can vary depending on these different types of designations. For instance, the hook‑up fee for a hotel room will generally be greater than the fee for a designated RV space. Likewise, the fees for the individual fixtures in a clubhouse may be calculated differently. An analysis of the applicable fee structures and ordinances can help ensure that you are not overcharged by the municipality. In a recent case, a municipality intended to assess a landlord tens of thousands of dollars in sewer fees for its recreational facilities, even though the municipal ordinance did not legally allow for such an assessment!
- If your property is commercial, long‑term planning may be essential to its financial success. For example, if you intend to expand a property and if the property is not yet operating on a municipal sewer system, development plans should be prepared to make certain that the sewer lines and system will have sufficient capacity to serve the expansion. Likewise, the system should be flexible to easily allow for a hook-up to a municipal sewer system without the need to re-plumb areas of the property or pump sewage uphill with expense pumping systems, etc.
- If a rental property owner anticipates that a mandatory sewer hook‑up is on the horizon (even if it is years in the future), the rental documents may need to be modified to address potential issues, such as passing on some of the costs to the residents, who will be the eventual beneficiaries of the enhanced sewer service.
- You may have the ability to negotiate with the municipality on potentially high‑dollar hook‑up fees, access issues, and the like.
Sewer hook up issues can be very tricky, they can have a significant financial impact on landlords and they should be approached in a careful manner. If you find yourself in such a situation, promptly seek competent advise in order to maximize your rights and to protect your investment.