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Ms. Michelotti asked if he was suggesting that there not be any up front costs and that the balance would be amortized over a twenty year period of time. Mr. Smith said that is correct. He said approximately $20,000 in hookup costs are needed to be paid to Zone 7, DSRSD, and to the contractor who installs the pipes and water meters. He said many residents are not in a position to pay this $20,000 and suggested a benefit district be set up to amortize the costs over a twenty year period. A benefit district that would be administered by the City, where the City pays for the infrastructure and hookup costs and then charges the residents over a twenty year period. The second option would be to defer the costs until such time as the property is sold. Ms. Michelotti asked if the costs provided by the benefit district would accrue interest? Mr. Smith said yes, and it would allow people to participate. Ms. Ayala asked if he felt City water and sewer to the Happy Valley area was an asset and if it would improve the value of the properties? She understood he agreed with staff's recommendation on page 23, alternative 37 Mr. Smith said yes. He agreed with equal cost sharing. Ms. Michelotti asked if, under his proposal, someone that was 75 feet away from the water line would be subsidizing someone one-half mile away? Mr. Smith said the major cost is hooking up to DSRSD/Zone 7 and paying for the infrastructure. He felt the residents would not feel they were subsidizing anyone else. If it became a problem, the residents could pay for their own length of pipe. Ms. Ayala asked if the property owners understood the $40,000 would not be going into the City's General Fund, but would be paid to DSRSD and Zone 7. Mr. Smith felt there may be some confusion on that issue. Ms. Michelotti felt certain issues needed to be addressed regarding the amount to be paid, how long it would amortized, and who would be required to pay the balance. Mr. Smith said the proposal is a cap of $20,000. If legal requirements prevent this he asked Council to look at staff's recommendations to make it feasible for the community to participate. In order to make this feasible, do not require any lump sum payment up front. He would like Council to support the Planning Commission's recommendation and put a cap on the amount. Ms. Michelotti would like to know who would pick up the additional cost. Pleasanton City Council 9 06/16/98 Minutes