Negotiations between Hopkins Township and the City of Wayland for annexation of about a dozen properties for sewer service have ended. Instead, Hopkins is seeking a “425” tax sharing arrangement with Dorr-Leighton Sewer Authority.

The Dorr Township Board Thursday evening, Aug. 26, will take up the request.

Dorr Township Supervisor Jeff Miling explained, “To do so, it will be necessary for a sewer main to be constructed in Dorr Township from a point where sufficient sewer facilities of the Authority currently exist to the Hopkins Township line, and to enter into a series of agreements for the construction of the line, dedication of the line to the Authority, use of the line in Dorr Township, a payback arrangement to provide Hopkins Township with some reimbursement for costs should Dorr or Leighton Township properties connect to the line and to provide the terms under which the Authority would provide sewer treatment services.

“The 425 agreement is the first of these agreements and lays out the overall framework.

425 Agreements are intergovernmental agreements that cover areas where two or more municipalities cooperate in providing government services and where one municipality transfers authority over some of its territory to another municipality for one or more municipal purposes. Besides laying out the overall framework, this agreement does several things:

“The agreement gives Hopkins Township the right to construct the sewer main needed to connect it to the Authority’s system,” Miling said. “It requires Hopkins Township to dedicate ownership of that main to the Authority when completed and provides that if Dorr Township or Leighton Township properties connect to the main, in addition to other connection charges, the property owner would pay a trunkage fee of $1,000 per REU which would be paid to Hopkins Township to reimburse it for a portion of its cost to construct the main.

“The details will be further laid out in a sewer connection and payback agreement.

“By the agreement, Hopkins Township will also transfer some municipal powers in the designated area of Hopkins Township to Dorr Township. While Hopkins must construct and operate the collection system in Hopkins Township, and Dorr will have no responsibility for this or its cost, the agreement transfers to Dorr the power to adopt rate ordinances and levy and collect rates for the cost of treating Hopkins Township wastewater to the extent Hopkins would fail to make the required payments under a sewer service agreement with the Authority. It also includes the power to levy taxes in the designated area to the extent necessary to collect delinquent charges.

“Basically this gives Dorr direct power to collect these amounts should there be an defaults by Hopkins. This gives the Authority (and Dorr Township as a member of the Authority) strong security for payment of these amounts that goes beyond most municipal arrangements.

“Benefits to the Township for entering into this arrangement with Hopkins Township include the additional revenue that will come to the Authority for using currently unused treatment capacity, which should raise additional revenue to pay for the cost of the plant.”

Hopkins originally expressed interest in establishing a Downtown Development Authority for the properties located on the west side of U.S.-131, from 135^th Avenue to 129^th Avenue. The township was seeking annexation by the City of Wayland for the area to obtain sewer services.

But since then, things have changed.

Wayland City Manager Josh Eggleston said, “The City did reach out last year to the (Hopkins) Township attorney for a 425 agreement (cost/tax share agreement). No response was received. The City has had considerable concern about the capital outlay necessary for the needed infrastructure and the ability of a tax increment financing district to provide enough revenue to cover annual bond payments.

“As far as hearing that Hopkins Township has engaged Dorr Township in discussions is news to me.”