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The current (2015) share of the water infrastructure cost for a new residence to connect to the water system is $46,560. These fees do not include Zone 7 water connection, City meter or connection, Dublin San Ramon Services District (DSRSD) sewer connection, City permit, and LAFCo fees. In addition, the property owners will be responsible for paying the difference between Alameda County and City development fees. Preannexation and Provisions of Sanitary Sewer and Water Service Agreement When an owner of property located outside of the City limits within the HVSP area requests sewer and/or water services, the City grants such a request only after determining that the use on the property to be serviced is consistent with the City's General Plan, that no further subdivision of the property is proposed (irrespective of the owner having received approval from the County for a two lot subdivision), and that the property owner has entered into a preannexation agreement. This agreement allows the owner to connect to the City's sewer and water systems prior to the property being annexed to the City subject to the following requirements: (a) payment of the sewer and water connection fees; (b) payment of all costs associated with extending the sewer and water systems to serve the property; (c) payment of all costs associated with the connection to and use of the sewer and water systems; (d) abandonment of any existing septic system on the property; (e) payment of all City and County processing fees for LAFCo and LAVWMA approval; (f) agreement to support any subsequent annexation initiative that may occur; and (g) agreement to review and approval of new or modified residences. DISCUSSION The City typically requires that properties annex to the City in order to receive City utility services. Although this parcel is minimally contiguous to the City limits on one side, it would require annexation of other parcels to allow for a logical annexation. Sometime in the future this parcel, along with surrounding parcels, could be part of a larger annexation. The proposed preannexation agreement includes language that the owner must vote in favor of any proposed future annexation. The proposed preannexation agreement includes language that requires the property owners to submit development plans for the proposed residence to the City for review and approval prior to obtaining a building permit from Alameda County. A copy of the draft preannexation agreement is attached. The LAFCo Board of Commissioners has requested that the City study the ability and financial impact to extend sewer and water service into the Happy Valley Area of the County. The City has committed to perform the study in 2016. As a cautionary note, it is possible that LAFCo will not approve individual applications for out-of-area service 2 The City's agreement with LAVWMA requires LAVWMA's approval when connections outside of the City's boundaries exceed ten. City staff and LAVWMA staff are resolving how to treat individual connections, such as this, when the total number of connections already previously approved exceeds ten. Page 3 of 4