CENTERBURG — Legislation that provides property owners access to village sewer without annexing into the village could affect future growth in the village.
The legislation repeals a 1987 moratorium on properties outside the village connecting to village sanitary sewer facilities.
The Regional Planning Commission’s approval of Table Rock Estates, a 27-lot subdivision on Wilson Road, spurred the new legislation. Each lot will have individual septic and wells.
“The Knox County Health Department has made it clear they will not stop development until we can provide that [sewer] service,” Mayor Greg Sands said. “Even though the EPA said no to 27 septic systems, the developer is doing it.
“The challenge we have is they will not do anything to change that situation until we lift that moratorium.”
Area Development Foundation President Jeff Gottke sounded a note of caution about repealing the moratorium at Monday’s council meeting.
“This legislation is more than just a service delivery issue,” Gottke told council members. “I think it’s a development issue.”
Gottke said villages grow through zoning, development, and annexation policies. Typically, villages can provide many services, such as fire, EMS, water, and police coverage.
“The only municipal service Centerburg has is the sewer delivery,” he said, adding that council members must consider several issues before giving up control of its remaining growth incentive.
Gottke categorized those issues into two areas: potential impacts on growth and potential fiscal impacts.
What are the potential impacts on the growth of the village?
The inability to annex or lack of annexation stifles growth in several ways.
•Lack of financial interest
Gottke said property owners must have a financial interest to annex.
Households remaining in the township will pay a double sewer charge to the village, but they will not pay income tax.
Households annexing into the village will pay regular sewer rates plus village income tax.
Property owners must pay less in income tax than sewer charges to make it financially worthwhile to annex. According to financial modeling, the income needed to exceed the village’s annual sewer charge for a monthly usage of 1,000 gallons is $45,840.
•Potential to be landlocked
Under the proposed ordinance, developers could stay outside the village limits. If property owners surrounding the village sell to a developer in the future, the village could become landlocked.
•Lack of opportunity for growth
Gottke said growth should be balanced between residential, industrial, commercial, and retail uses. The village has little commercial use and no industrial area designated.
If the village becomes landlocked, it must work with what it has within its boundaries. Analyzing the land available and zoning regulations, that means about 450 new homes.
Limited land use options prevent a diversified economy with different income sources.
•Lack of zoning control
Gottke told council members that if a developer chooses not to annex, the village loses control of its destiny to the township.
“Township zoning is much more restrictive in that they have to follow the Ohio Revised Code, unless it’s agriculture. If it’s agriculture, it’s loose,” he said.
The question becomes, “Who do we want our neighbors to be?”
•Limited population
The lack of new properties coming into the village limits the number of people who can become involved in government and other efforts.
What are the potential fiscal impacts on the village?
•Increased sewer collections
If township households choose to use village sewer, the village would receive more sewer collections. If a lot with septic is cheaper, however, there is no advantage for the household to annex into the village.
•Funding future programs
Gottke noted the village relies on other agencies to provide services such as fire, EMS, water, and police coverage.
“But they may not always be there, and the village will have to have enough revenue to provide the services you don’t have to now but may have to later,” he said.
He said that while sewer service to households outside the village provides revenue, that revenue is limited to sewer use. It cannot go into the general fund.
That leaves the general fund without additional money but potentially more obligations.
•Increased demand for village resources
Gottke said growth in the township could create more traffic, parking demand, and street maintenance. Without the income tax from annexation, the general fund can become overburdened.
•Opportunity cost
Gottke said the village could be leaving money on the table by allowing parcels to remain in the township. The village will not collect income tax, inside property tax millage, or incentive funds.
Computer modeling examined the price of 16 houses sold in Hilliar Township over the past 12 months and the salary needed to afford the sale price. Salaries range from $54,000 to $186,293.
Calculations show the village could potentially have collected $13,931 in income tax had the parcels been in the village.
Citing the possibility of building a development such as Liberty Crossing within village limits, Gottke noted the per-unit income tax ranges from $372 to $1,015.
“What kind of money are we leaving on the table?” he asked.
Potential courses of action to protect growth
Gottke outlined several courses of action open to the village:
•Repeal existing legislation and allow parcels to access village sewer at an increased rate. He noted the sewer rate must be high enough so that removing it is an incentive to annex into the village.
•Allow village sewer service for the Table Rock development only and take all others on a case-by-case basis. Gottke said this could be a slippery slope.
•Create a cooperative agreement with the township regarding annexation, sewer service, and other issues.
•Keep existing legislation but add incentives to attract development into the village.
Gottke told council members that you “want to keep those carrots,” those reasons to annex into the village. Carrots include:
•TIF (Tax Increment Financing) districts
•NCAs (New Community Authority)
•Property tax abatements (CRAs: Community Reinvestment Areas)
“I really think a cooperative effort with the township is the smartest way to achieve that balance,” he said.
Council members discussed other issues, including tap, impact, and access fees. Councilman Tom Stewart noted that the cities of Dublin and Columbus have a corridor easement agreement whereby Columbus can access land outside Dublin and avoid becoming landlocked.
A primary concern is that while developers might pay upfront infrastructure costs, the village would be responsible for long-term maintenance. Current sewer revenue pays for current expenses; Centerburg is not putting anything aside for the future.
Council members gave a second reading to the ordinance repealing the moratorium.
