Office of the Revisor of Statutes
Minnesota Session Laws - 1997, Regular Session
Key: (1) language to be deleted (2) new language
CHAPTER 181-S.F.No. 735
An act relating to metropolitan government; modifying
the metropolitan council cost allocation method for
wastewater services; amending Minnesota Statutes 1996,
sections 473.511, subdivision 4; 473.517; and 473.519.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1. Minnesota Statutes 1996, section 473.511,
subdivision 4, is amended to read:
Subd. 4. [CURRENT VALUE OF EXISTING FACILITIES.] When the
council assumes the ownership of any existing interceptors or
treatment works as provided in subdivision 2 or 3, the local
government unit or units which paid part or all of the cost of
such facility, directly or pursuant to contracts for
reimbursement of costs, shall be entitled to receive a credit
against amounts to be allocated to them under section 473.517,
which may be spread over such period not exceeding 30 years as
the council shall determine, and an additional credit equal to
interest on the unused credit balance from time to time at the
rate of four percent per annum. The amount of such credit shall
equal the current value of the facility computed by the council
in the manner provided in this subdivision at the time the
council acquires it. The original cost of a facility shall be
computed as the total actual costs of constructing it, including
engineering, legal, and administrative costs, less any part of
it paid from federal or state funds and less the principal
amount of any then outstanding bonds which were issued to
finance its construction. The original cost shall be multiplied
by a factor equal to a current cost index divided by the same
cost index at the time of construction, to determine replacement
cost. The cost indices used shall be the Engineering News
Record Construction Cost Indices for facilities or parts thereof
completed before 1930, and the United States Public Health
Service Federal Water Pollution Control Values for Sewer and
Treatment Plant Construction, as applied to facilities or parts
thereof completed in or after 1930. The current value of the
facility shall be the replacement cost depreciated by 2.50
percent per annum from the date of construction of treatment
works and 1.25 percent per annum from the date of construction
of interceptors; and decreased further by a reasonable allowance
for obsolescence if the council determines that the facility or
any part thereof will not be useful for council purposes for at
least the remaining period required to depreciate it fully,
assuming no salvage value. The current value of each such
facility shall be credited to each local government unit in
proportion to the amount of the construction cost paid by that
unit, as determined by the council, taking into account
reimbursements previously made under contracts between any of
the local government units. The council shall prepare an
itemized statement of the amount of credit each local government
unit is entitled to receive under this subdivision, and the
years and amounts of installments of principal and interest
thereon, and shall cause it to be mailed or delivered to the
governing body of each local government unit concerned. All
credits allowed under this subdivision shall be used to finance
current costs allocated to the local government unit by the
council or for other sewer costs, and the credits shall not be
considered as proceeds from the sale of municipal property so as
to permit their use for other purposes. At its option, the
council may make a periodic payment to each local government
unit in the amount of the credits provided pursuant to this
subdivision, in lieu of a credit against amounts to be allocated
to such local government units under section 473.517.
Sec. 2. Minnesota Statutes 1996, section 473.517, is
amended to read:
473.517 [ALLOCATION OF CURRENT COSTS.]
Subdivision 1. [CURRENT COSTS DEFINED ALLOCATION METHOD.]
Except as provided in subdivision 3, the estimated costs of
operation, maintenance, and debt service of the metropolitan
disposal system to be paid by the council in each fiscal year,
and the costs of acquisition and betterment of the system which
are to be paid during the year from funds other than bond
proceeds, including all expenses incurred by the council
pursuant to sections 473.501 to 473.545, are referred to in this
section as current costs, and shall be allocated in the budget
for that year to the respective local government units in the
metropolitan area as provided in subdivisions 2 to 6. The
amount budgeted by the council for any year for a reserve or
contingency fund must be treated as a current cost and allocated
as a cost of operation and maintenance in accordance with this
section. The reserve or contingency fund so established may not
exceed an amount equal to 7.5 percent of the council's waste
control operating budget in total shall be allocated among and
paid by all local government units which will discharge sewage,
directly or indirectly, into the metropolitan disposal system
during the budget year according to an allocation method
determined by the council. The allocated costs may include an
amount for a reserve or contingency fund and an amount for cash
flow management. The cash flow management fund so established
must not exceed five percent of the council's total waste
control operating budget.
Subd. 2. [ALLOCATION OF TREATMENT, INTERCEPTOR COSTS;
ADJUSTED VOLUME.] Except as provided in subdivision 3, the
current costs of all treatment works and interceptors in the
metropolitan disposal system shall be allocated among and paid
by all local government units which will discharge sewage,
directly or indirectly, into the metropolitan disposal system
during the budget year, in proportion to the total volume
estimated to be so discharged by each local government unit,
adjusted as follows:
(a) increased or decreased, as the case may be, to the
extent the council determines, on the basis of such historical
and reasonably projected data as may be available, that the
sewage discharged by one unit will require more or less
treatment to produce a suitable effluent than that discharged by
others;
(b) decreased by any amount of surface water estimated by
the council to be discharged by a local government unit from a
combined storm and sanitary sewer system;
(c) increased by that volume of normal sanitary sewage
which is equivalent for treatment purposes to the volume of
surface water referred to in clause (b), as determined by the
council from available engineering data; and
(d) increased or decreased, as the case may be, by the
amount of any substantial and demonstrable error in a previous
estimate.
Subd. 3. [ALLOCATION OF TREATMENT, INTERCEPTOR COSTS;
RESERVED CAPACITY.] In preparing each budget the council shall
estimate the current costs of acquisition, betterment, and debt
service, only, of the treatment works in the metropolitan
disposal system which will not be used to total capacity during
the budget year, and the percentage of such capacity which will
not be used, and shall deduct the same percentage of such
treatment works costs from the current costs allocated under
subdivision 2 1. The council shall also estimate the current
costs of acquisition, betterment, and debt service, only, of the
interceptors in the metropolitan disposal system that will not
be used to total capacity during the budget year, shall estimate
the percentage of the total capacity that will not be used, and
shall deduct the same percentage of interceptor costs from the
current costs allocated under subdivision 2 1. The total amount
so deducted with respect to all treatment works and interceptors
in the system shall be allocated among and paid by the
respective local government units in the metropolitan area for
which system capacity unused each year is reserved for future
use, in proportion to the amounts of such capacity reserved for
each of them.
Subd. 6. [DEFERMENT OF PAYMENTS.] The council may by
resolution provide for the deferment of payment of all or part
of the current allocated costs of acquisition, betterment, and
debt service of estimated unused capacity which are allocated by
the council to a local government unit in any year pursuant to
subdivision 3, repayable at such time or times as the council
shall specify in the resolution, with interest at the
approximate average annual rate borne by council bonds
outstanding at the time of the deferment, as determined by the
council. Such costs may be deferred only when the council
determines that a substantial portion of the territory of a
local government unit has not been connected to the metropolitan
disposal system, and that the amount of such costs or some
portion thereof is disproportionate to the available economic
resources of the unit at the time. Such deferred costs shall be
allocated to and paid by all local government units in the
metropolitan area which will discharge sewage, directly or
indirectly, into the metropolitan disposal system in the budget
year for which the deferment is granted, in the same manner and
proportions as current costs are allocated under subdivision 2 1.
When such deferred costs are repaid they shall be applied in
reduction of the total amount of costs thereafter allocated to
each of the local government units to which such deferred costs
were allocated in the year of deferment, in proportion to their
allocations thereof that year.
Subd. 9. [ADVISORY COMMITTEES.] The council may establish
and appoint persons to advisory committees to assist the council
in the performance of its wastewater control duties. If
established, the advisory committees shall meet with the council
to consult with such members concerning the acquisition,
betterment, operation and maintenance of interceptors and
treatment works in the metropolitan disposal system, and the
allocation of costs therefor. Members of the advisory committee
serve without compensation but must be reimbursed for their
reasonable expenses as determined by the council.
Sec. 3. Minnesota Statutes 1996, section 473.519, is
amended to read:
473.519 [FEDERAL WATER POLLUTION CONTROL ACT AMENDMENTS OF
1972; SYSTEM OF CHARGES.]
Each local government unit shall adopt a system of charges
for the use and availability of the metropolitan disposal system
which will assure that each recipient of waste treatment
services within or served by the unit will pay its proportionate
share of the current costs allocated to the unit by the council
under section 473.517, as required by the federal Water
Pollution Control Act amendments of 1972, and any regulations
issued pursuant thereto. Each system of charges shall be
adopted as soon as possible and shall be submitted to the
council. The council shall review each system of charges to
determine whether it complies with the federal law and
regulations. If it determines that a system of charges does not
comply, the adopting unit shall be notified and shall change its
system to comply, and shall submit the changes to the council
for review. All subsequent changes in a system of charges
proposed by a local government unit shall also be submitted to
the council for review.
Sec. 4. [APPLICATION.]
This act applies in the counties of Anoka, Carver, Dakota,
Hennepin, Ramsey, Scott, and Washington.
Sec. 5. [EFFECTIVE DATE.]
Section 1 is effective the day following final enactment.
Sections 2 and 3 are effective January 1, 1998, for allocation
of costs on and after that date.
Presented to the governor May 17, 1997
Signed by the governor May 19, 1997, 7:30 p.m.
Official Publication of the State of Minnesota
Revisor of Statutes