Thursday, March 27, 2008
Mesa del Sol May Be 1st to Pay New Water Fee
By Sean Olson
Journal Staff Writer
Homes and businesses in Mesa del Sol apparently will be the first to get hit by a new Water Utility Authority fee for buying water rights.
Only new buildings constructed outside the water authority's service area will be affected by the rules, which have been incorporated into the water rate ordinance.
The rules will add about $1,250 to the cost of a standard- size home. The fee rises for larger homes, commercial and industrial size projects to as much as $66,000, depending on meter size, said Frank Roth, water authority Senior Policy Manager.
The one-time fee for buildings, called the "water supply charge," will be placed into an account the water authority can only use to buy new water rights or direct toward finding new sources of water.
Lynne Andersen, National Association of Industrial and Office Properties president, said the fees will most likely be passed on to home buyers and business owners.
But as long as the fees are strictly for new developments, Andersen said her organization doesn't object.
"It's just part of whether it pencils into the bottom line (for deciding to start a business)," she said.
Mesa del Sol developer Forest City Covington had objected to a $48 million asking price for water rights needed to serve the development when the subject came up a year ago.
The dispute led to the creation of the new rules, which will now apply to everyone, including Albuquerque Public Schools and other government organizations, that build outside the service area, Roth said.
"That's why we adopted (the rules) through an ordinance, so no developer would get special treatment," Roth said.
The fees were designed to cover the costs of acquiring water rights in the open market, but rising prices have already rendered the fee structure out of date, he said.
The water authority board will be able to adjust the fee structure each year to keep up with the prices, Roth said.
Water rights currently cost between $12,500 and $20,000 per acre foot, he said. Water authority officials said Wednesday an acre foot should serve about six homes.
The water authority's service area was adopted in 2003 when the organization was created, Roth said. It is based on the city of Albuquerque's planned growth strategy a document that highlights areas where the city encourages or discourages different types of growth.
SunCal, developer of the massive Westland property on the West Side, is the only other company to sign a service agreement that includes the new rules.