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Newport to invest in, assess for pricey improvements to draw development

The city has found several areas that could be serviced by sewer and water in the coming years. Submitted illustration

The city has developed a plan to run utilities to all the currently unserved areas of Newport.

Though not all areas will be built out with utilities anytime soon — if ever — an extensive study has shown what it would take to bring water and sewer to the areas not currently connected, including the planned development near Catherine Drive, land to the north of Glen Road andan area west of Century Avenue.

At present, the city council has decided to concentrate on running utilities to the Catherine Drive or Glen Road areas. They are still deciding between two plans proposed in the study. One will bring utilities to Catherine Drive and create a new pressure zone, the second plan will do the same but add connections to an area near Glen Road rather than near the public works facility.

The second plan could be more risky, but could also facilitate more city growth.

"Is that gamble worth it? Because we're asking people to put up a little more money up front to give up opportunity for future (development)," council member Tracy Rahm said.

The additions will cost $3.9 million or $5.1 million, depending on which plan is chosen.

The project will be funded by resident assessments, developer contributions, tax levy, utility funds, land sale proceeds, bonding, or a combination thereof.

Taxes would impacted by the cost of utility extensions, but may not necessarily increase them.

"Once that project builds out ... it appears that that new taxbase is going to offset the investment, in all the cases," Jason Aarsvold of financial advisor Ehlers and Associates said.

Aarsvold said the city would likely have to bond to fund the project, and that they would expect to need about a $3.2 million bond issue for one plan and $4.4 million for the other.

Depending on the plan, the city will assess between $110,000 and $350,000 from residents, and about $856,000 from the developer. The city will be responsible for $1.6 million or $2.5 million.

Residents will be assessed either $10,000 or $35,000 based on lot size. It will cost another $4,500 per unit for homes to hook up to the city's utilities.

Some residents were concerned that when lines are run up to the Catherine Drive area, they will be required to connect with the city's utilities.

"When the pipe goes by, it's time to have a modern system," Mayor Dan Lund said.

Construction for the utility lines in the Catherine Drive area are estimated to take about six to nine months.

The developer, Golden Valley Land Company, have said they anticipate to have the development built out in about four years.

The remainder of the eight-phase plan would allow for further redundancies to the system, add a new well and add an emergency connection to Woodbury's utilities. It would also add utilities along Century Avenue between Glen Road and 65th Street, Bailey Road and Hastings Avenue west of Sterling Avenue, and along Military Road.

All eight phases would cost around $9 million, but not all may eventually be constructed.

"If it doesn't make sense to do those phases, then we shouldn't do them," Lund said. "... I personally don't think they're likely any time soon."

A public hearing on the improvements will be held at a special meeting Oct. 23 at City Hall, and the council will decide in the coming meetings which plan to pursue.