The Board of Directors of the Sacramento County Water Agency (SCWA) approved a new cap on Initial Water Development Fee Payments required at the Improvement Plan approval stage of the development process. The Development Fee Program pays for water infrastructure projects within the County’s Zone 40 area.
These fees are paid by developers and have been set at $21,399 per home being built. SCWA collects the fee during the development process. The initial payment is 15% of the total fee, with the remainder collected when the building permit is issued.
Zone 40 was formed nearly 40 years ago as a capital development fund. These funds help build new water systems and ensure there is an adequate water supply for development within Zone 40.
Changing this SCWA section, known as Title 4, allows SCWA the discretion to cap the initial payment of 15% to a maximum of $200,000 per subdivision. Capping the fee will reduce one of the larger upfront costs that are typically financed by developers and help bring down the cost of building homes in Sacramento County.
The cap can be removed during an annual review if SCWA finds a potential reduction in cash flow. Less money would impact SCWA’s ability to plan, design, and construct new water supply facilities needed within Zone 40 for future development.
SCWA has partnered with the Building Industry Association on these changes with a mutual goal of removing the barriers to building cost-effective housing in Sacramento County.