Ruling opens rural areas for developers
Private sewage systems means more waterfront property,
but critics see increased urban sprawl

By R.J. King, The Detroit News

Sunday, August 14, 2005

BRANDON TOWNSHIP – New home buyers will soon have more opportunities to live near lakes, streams and nature preserves, but some community leaders say the court case that makes it easier for developers
to build in rural areas weakens their control over urban sprawl.

In 2003, the Michigan Court of Appeals ruled that developers with state permits to build private wastewater treatment facilities no longer had to wait for local approval before selling lots to home builders and merchants.

Over the past 18 months, more developers have been obtaining state permits to operate private facilities to handle waste from toilets, showers, sinks and laundry appliances. The first construction will begin shortly.

"Before the court ruling, we had difficulty bringing certain parcels of land forward for development," said Gilbert "Buzz" Silverman, president of Silverman Development Co. "Now home buyers have more options."

But officials in communities where private plants are in the works say a proliferation of the facilities will hamper their ability to control the development of homes and shopping centers, contribute to urban sprawl and place added stress on roads and other public services.

"Our local home rule is being usurped by the state, which is bowing to a lot of pressure from home builders to expand," said Jim Creech, manager of Oakland Township, where two subdivisions will soon be constructed with private wastewater treatment facilities. "Where we once counted on growth in certain areas over the next 25 to 30 years, those parcels will now be developed within 10 or 15 years, or sooner."

Past guidelines from the Michigan Department of Environmental Quality mandated that developers get state and then local approval for private systems.

Developers and others say some municipalities delayed approval to limit sprawl while effectively forcing developers to pay expensive tap fees -- as much as $15,000 for sewer and water taps for a single-family home -- if they wanted to move quickly on a project.

Officials with the state environmental quality unit declined to comment directly on the ruling by the Michigan Court of Appeals, which decided in late 2003 that a developer near Mount Pleasant could build a private wastewater treatment facility to serve several dozen homes without garnering local approval to maintain a sewage plant.

Alan M. Greene, a real estate attorney with Dykema Gossett in Bloomfield Hills, said developers have been aggressive in pursuing permits to plan and operate wastewater treatment plants to service subdivisions and shopping centers.

"If you look at some of the tap fees that municipalities charge to hook a new home up to the Detroit water and sewer system, it can be expensive," he said. "In some cases, it now makes sense for developers to build their own treatment plants from an economic standpoint."

Tap fees in local suburbs vary widely. In White Lake Township, sewer tap fees range from $10,000 to $15,000 -- a charge often passed on to homeowners. In addition, water tap fees range from $3,700 to $6,300. In Lyon Township, a residential sewer tap costs $8,400, while a water tap is $1,800.

Silverman Development Co. in Bingham Farms recently received approval to develop 93 single-family homes set on 67 acres near the shoreline of Long Lake in Oakland County's Brandon Township.

The $35 million project, called Long Lake Village, will offer homes with an average price of $250,000 along with a small shopping center and 15 acres of nature preserves made up primarily of wetlands and woodlands. Centex Homes in Southfield will build the homes, with the first expected to be completed next year. Private sewer and water systems will serve both the homes and shopping center.

Tim Palulian, planning and building director for Brandon Township, said the community of 15,000 residents receives an average of 75 to 100 permits for new homes annually.

"Before the court ruling, we didn't want to put the full faith and credit of the township on the line to pay for a (private) wastewater treatment plant that might fail," Palulian said. "Now the court has ruled that's the state's responsibility."

Silverman Development has also won approval for a 356-home community in Oakland Township with a private wastewater treatment facility. The builder is Toll Brothers in Farmington Hills.

Jon Caterino, senior project coordinator for Boss Engineering in Howell, which builds and helps oversee private wastewater treatment facilities, said his company has orders for eight such projects, up from one five years ago.

"The MDEQ has strict guidelines on the construction and operation of a private wastewater treatment plant, and a developer must put money in escrow before construction even starts," Caterino said. "Even more money must be placed in escrow once the plant is under operation. The technology has proven that these facilities can be operated safely."

Pete Ostlund, chief of field operations for the Department of Environmental Quality's water bureau, said the state has concerns about the long-term operation and maintenance of private wastewater treatment plants, so they will be overseen by state-certified operators and inspected periodically.

"Those plants contain pumps, chemicals, belts, bearings and concrete -- all of which needs to be maintained," Ostlund said.

Developers say the plants will last indefinitely as long as they are maintained. Homeowner associations in subdivisions with private plants will be responsible for upkeep, Ostlund said.

Depending on the number of homes served by a private treatment plant, annual maintenance fees are around $200 per year. That's on top of other standard maintenance fees that cover private streets within a subdivision, common landscaping and other maintenance.

Green Oaks Township resident Don Blakely, whose subdivision is served by a private wastewater facility, said he hasn't noticed much of a difference from public sewer services that he has used in the past. "It's basically the same thing, other than there's a little plant about 200 yards from our homes," Blakely said.

In most cases, private wastewater treatment facilities are less expensive to operate and maintain than most municipal systems, said Linda Hanifin Bonner, executive director of the National On-Site Wastewater Recycling Association in Edgewater, Md.

On an average basis, a new homeowner can pay a local fee of $10,000 to $30,000 to tap into a municipal sewer and water system, as well as $200 a month for sewer and water services, Bonner said.

By comparison, a new home connected to a private wastewater treatment facility used by several other residences can pay anywhere from $7,500 to $15,000 for a tap and an average monthly fee of $17 for usage. Water services will cost more and are based on several criteria, including location and whether the residences will be served by municipal or well water..

http://www.detnews.com/2005/business/0508/15/B01-279638.htm