Lincoln City Council
Aldermen asked to approve a Sewer Replacement Rebate Program for property owners
Action item to be on the Monday voting agenda

 

[June 02, 2024] 

The Lincoln City Council will meet at 6 p.m. this evening, Monday June 3rd, for the first voting session of the month. Included on the agenda will be a motion to establish a Sewer Replacement Rebate program for residential property owners in Lincoln.

The program will include a rebate to property owners that may be up to 50 percent, but not more than $5,000 for sewer line replacement on privately owned property. The program will specify that the money cannot be used for repair of sewer sections but must be for replacement of sewer from the “foundation to the tap” into the city sewer. Among the stipulations for the rebate is a requirement for three bids on the project, but the bids do not have to be local, and a 20-year life on the rebate. The 20-year life means that the property owner may only apply for funding every 20 years. If the property changes ownership the 20-year clock remains with the address.

At the Tuesday May 28th meeting of the council, Mayor Tracy Welch introduced the topic. He said that the need to create an assistance program for property owners stems from the fact that Lincoln has an aging sewer infrastructure and that some of the sewer connections in the city are quite complicated, and many end with the tap being in the street.

These components add up to very expensive replacements, that put property owners in hardship. He said that sewer replacement can cost in the range of $12,000 to $25,000 and some are even more expensive. When a sidewalk, curb and road have to be dug up to complete the replacement, the property owner is responsible for fixing those city-owned components and that adds a lot to the cost. Welch said what happens often times is that property owners will do a repair on their property but that is just a temporary fix.

Welch said he hears from property owners often about the issues of bad sewer lines, and it is troubling to him when he has to say there is nothing the city can do. He noted as an example a couple who had moved to Lincoln and the first day in their home they experienced a sewer back up that ended up being a huge problem with a huge expense. In order to take care of the problem the couple sold a car to pay the bills.

The proposed rebate program will be funded by the Sewer Enterprise Fund and Welch said the recommendation is to earmark $250,000 per year to rebate awards. If and when the $250K is expended, then the rebate program would be suspended until the next fiscal year.

Waste Treatment Manager Andrew Bowns said that the Sewer Enterprise fund is “healthy,” and the city can afford to set the money aside to assist property owners. He said that the three bids were needed because people often when they find they have a sewer problem rush into making decisions and that is not always a good idea. The three bids will be from licensed experts qualified to do the complete replacement, but as stated earlier do not have to be from local sources.

Bowns added that the $250K is not in the current year budget, but could be added to the appropriations document for 2024-25, and the budget adjusted.

Three departments will sign off on each application. Bowns will sign off on the job, the City Clerk will verify that the owner has no outstanding balances due to the city, and the Zoning office will sign off that there are no outstanding ordinance violations fines.

That section of the rule states: “Only property owners with no outstanding balances/debt/judgement with the City of Lincoln are eligible for rebate requests. If an owner has an outstanding balance/debt/judgement to the city, it shall be city council discretion that approves or denies their request. This must be presented during public participation of the first committee of the Whole meeting after submission of the rebate request.”

Alderman Steve Parrott asked how many sewer replacements occur in the city annually. Bowns said the figure was well over the 50 per year the rebate program will cover. He estimated the actual figure would be closer to 100 per year. He said that he also estimated that there were 20 to 25 partial replacements or repairs that occur annually and that adding the rebate program could entice those property owners to go ahead and do the full replacement. Welch added that this was part of the long-term goal of the project. Getting the sewer lines replaced, “the right way” will be the best thing for the property and will reduce repetitive repairs that prove to be only temporary.

City Treasurer Chuck Conzo said he could certainly work the dollar amount into the upcoming appropriations document but would also want to make the correct adjustment to the city’s budget document. He said he did wonder about the property owners who have sewer line insurance, would that equate to double dipping if they used the insurance and the rebate.

Bowns said that most of the insurance policies he knows of are capped, and the cap is typically well below the total cost of the replacement. He said that the insurance and the rebate combined would probably not cover the cost of many of the sewer line replacement jobs.

He added that there are also cases where that the insurance will deny the claim, in which case without the rebate program the property owner would have no help with the replacement.

The city also discussed that where a sidewalk is involved, there is a remittance for sidewalk repair from the city when the property owner does the work. The council talked about whether that remittance could be applicable, thus providing additional support to the property owner.

Alderwoman Wanda Lee Rohlfs said there were other residual impacts, such as temporary loss of occupancy due to an unusable sewer. Would the rebate cover motel stays or other related expenses? Welch said no, the money could only go toward the sewer replacement.

Alderman Kevin Bateman asked if regarding the sidewalk and street, could the city do the repair then bill the property owner. Welch said that the city needed to take care not to add to the workload of the street department.

Street Superintendent Walt Landers said there was another issue there as well. When the city repairs or replaces sidewalks, they are required by law to make the sidewalk ADA (American Disabilities Act) compliant. The property owner does not have that requirement. He said if it were a corner property for example, the city would have to add the ramp feature to the sidewalk which would add to the overall cost of the project.

During the discussion time, there were several comments and questions regarding looking at the histrionics of a property. Was the owner habitually late with sewer payments? What if they came in and got current just so they could get the rebate then went back to being delinquent?

As discussion wound down, Welch noted that often the council discovers tweaks that need to be done to a program or project after the fact. He recommended that the council approve what will be placed before them on Monday night, and as time goes by if adjustments need to be made, they can consider those changes separately.

The action item will be motion number 9G on the Monday evening agenda. As is always the case, the council has the right to table the motion if they feel they are not prepared to make an informed decision.

[Nila Smith]