The City of Cottonwood has agreed to abandon a charge to connect to the city water service. The $1,500 connection fee was established by the City Council in 2006 when the municipality purchased the assets of Cottonwood Water Works from the privately held company.
The connection fee had been established as a "pass-through" to the shareholders in the water business as a "growth premium" for each revenue-producing connection for a period of seven years.
City Manager Doug Bartosh explained that the funds did not stop with the city, but were channeled directly into the accounts of Cottonwood Water Works.
Because the seven-year period since the water company purchase has expired, the "growth premium" is no longer in effect and staff had asked the council to remove the fee.
Darold Smith asked from the audience whether the city would retain the fee as an on-going revenue source, and the council said "no."
The council meeting memorandum states, "During the difficult economic times, staff feels removing the charge may spur building of new projects.
Councilman Ruben Jauregui, who had been on the council at the time of the water company purchase called it the "best worst deal we ever made." But he said the $1,500 connection growth fee always bothered him and he is happy to see it expire.
The council approved the motion on a 5-to-0 vote.
Posted: Sunday, February 24, 2013
Article comment by:
Help people here now
So they can afford to drop the $1,500 fee to benefit nonresidents who they want to move here, but don't reduce the sales tax rate back to where it was to benefit the people who are here now.