The Fillmore County Planning Commission held a public hearing on proposed amendments to the county’s Sub-Surface Sewage Treatment System Ordinance at their March 18 meeting.
The language regarding escrow accounts resulted in the most discussion. When a property is sold or transferred the SSTS must be inspected. If a SSTS is found to be non-compliant, it must be brought up to code within 12 months. If this can not be completed prior to the transfer of the property, an escrow account must be established to bring the SSTS up to code.
If a septic system has not been inspected an escrow account in the amount of 150% of an estimated cost of bringing the system up to code must be established. If the system has been inspected and determined to be non-compliant and a detailed estimate has been made to bring the system up to code the escrow account may be established at 115% of the estimated cost.
This 115% amount was the subject of most of the discussion. Zoning Administrator Cristal Adkins said she would be more comfortable to keep the escrow amount required for systems that are deemed non-compliant and with a detailed estimate at 150% of the estimate. There could be huge variables if the buyer wants a different system installer than the one who submitted the estimate. Blake Lea, Feedlot Officer, noted there have been large cost increases for the tank, rebar, and PVC over the last year. It is the wrong time to make this change from a required 150% to 115% of a detailed estimate to bring the system up to code.
Adkins suggested that inspections should be done early in the selling process, as compliance inspections are good for three years. There would be less need for escrow accounts if sellers could plan ahead.
Attorney Greg Schieber, Harmony, presented data from the last two years for his office. A total of 65 septic systems had been inspected with 57% (28) of them deemed non-compliant. Only two of the 28 were upgraded and deemed compliant prior to closing. Of the 26 that had escrow accounts set up for the upgrade, only three had cost overruns. One of the overruns was due to the party intentionally hiring a different contractor in an effort to get the work completed before winter. One was due to an increase in the size of the system and the other a failure to include an electrical hook-up cost.
Schieber argued that with the cost of septic systems, 50% of that cost is real money. The goal of the ordinance is to get septic systems updated and to protect the buyer and the seller. Most surrounding counties require an escrow account of 110% of the detailed estimate.
Bakke said if other counties are okay with 110% we should be okay with 115%. Andy Bisek insisted that additional money held in escrow could be a hardship. Any money not used out of an escrow account is returned after the installer is paid.
Other amended portions of the SSTS ordinance are aimed at closing loopholes that have allowed property with a dwelling to transfer without a septic system inspection when no money changes hands. If a Certificate of Real Estate Value was not required, a compliance inspection must be performed and submitted within 12 months of the date of property transfer. If it is deemed non-compliant, it must be brought up to code within 12 months.
A motion was made to approve the amendments as presented. This requires an escrow account in the amount of 150% when the septic system has not been inspected. When the system has been inspected and deemed non-compliant and a detailed estimate has been submitted, an escrow account can be established at 115% of the estimated upgrade cost.
The motion passed five to one. The amended ordinance language will be sent to the county board for their consideration.