Building the Foundation to “Dig Once”
SACOG special district convening highlights opportunities for regional collaboration on infill infrastructure

News

January 23, 2023: Unprecedented levels of federal and state funding are available for regional infill development, and collaboration is key to bringing projects to bear. With 28 cities and counties, and more than 350 special districts in the Sacramento region, that can be easier said than done.

The pandemic has made it challenging to find time and space to work on these issues together, despite increasing regional alignment in policy and programs. While supportive policies such as zoning and code updates, reduced parking requirements, and establishing by-right development can help promote infill development, many times the challenge to infill lies in costly physical infrastructure upgrades. To help energize the conversation, SACOG held an in-person convening in December 2022 focused on advancing solutions to infill infrastructure. The convening brought together city and county economic development staff and special district staff from water, waste management, and electricity sectors to share resources, projects, and promising solutions.

The convening featured a panel with speakers from the City of Citrus Heights, Sacramento Municipal Utility District (SMUD), and Sacramento Regional County Sanitation District (Regional San). Each speaker highlighted a different aspect of infill infrastructure issues—and solutions. “I was really impressed by how much interest there was,” says Mike Huot, director of Policy and Planning at Regional San and featured panel speaker. “There is strong interest in what is happening [in the region] and what things we can piggyback on and what we can each do ourselves. We needed more time for discussion.”

Communities across the region rely on their cities and counties to provide transportation, housing, and economic development; and on special districts for many of their critical services, including power, water, and wastewater. The increased focus on infill development has spotlighted the infrastructure upgrades needed to strengthen local and regional resilience and realize greenhouse gas emission reductions. The region’s backbone infrastructure—pipes, electrical lines, roads, broadband cables, etc.—all requires ongoing maintenance, upgrading, and replacing, especially in older areas.

It was no surprise that a lot of the discussion centered on the challenges and opportunities for financing infill infrastructure projects. SACOG’s legal counsel, Best Best & Krieger, shared resources for potentially accelerating and financing infill development, such as Enhanced Infrastructure Financing Districts (EIFDs) and Community Revitalization and Investment Authorities (CRIAs); a couple examples of many place-based economic development strategies.

The City of Citrus Heights highlighted its large multi-use infill development project at the Sunrise Mall, laid out in the Sunrise Tomorrow Specific Plan. Key contributing factors to success so far have been the city’s focus on minimizing risk, providing a quick timeline, developing a phasing strategy, building community support, and demonstrating financial feasibility.

Maintaining flexibility on the ultimate array of land uses is a core principle of the Citrus Heights project, which makes thoughtful planning for infrastructure needs even more important. The plan’s proposed phasing takes in mind the physical constraints of the site (i.e., all water flows downhill) to maximize the mantra “Dig once.” The city’s financing approach is to pursue as many options as possible. Included in that mix was a $160,000 “Early Activation” award from SACOG’s Green Means Go program to help with preliminary engineering of backbone infrastructure and evaluation of infrastructure financing opportunities for the site.

By providing funding to infill development projects, the goal of Green Means Go is to support denser housing and development and increase opportunities for community members to walk or roll to their favorite destinations without having to rely on driving. Similar programs exist at the state level, such as the Infill Infrastructure Grant Program (active through January 31) and REAP 2.0 (closed December 2022), not to mention a bevy of federal opportunities under the Bipartisan Infrastructure Law.

SACOG isn’t the only organization focused on advancing the benefits of infill development. Regional San and the Sacramento Area Sewer District (SacSewer) (which will be merging this year) are both leaders in this area, having defined a separate tier of impact fees for infill communities that are lower than impact fees for new communities. As Huot explains, “It’s a better use of the ratepayers’ money to connect to the existing infrastructure.” Investment in older infrastructure also helps maintain high-quality service and in the long run can help keep fees lower.

Investment in existing infrastructure is a delicate balance, says Huot. “We want to invest enough so [the pipes] don’t cost us more money down the line. If the pipes begin to fail because we haven’t kept them up, fees will be higher.” And that’s not the outcome they’re aiming for. Concentrating on maximizing the use of what’s already in the ground helps make the whole system more efficient overall.

Regional San/SacSewer’s mission to protect public health and the environment also means being a trusted partner for regional sustainability. The districts created a joint program using discretionary funding that does not come from rates or fees called the Confluence Regional Partnership Program. “The Confluence Program allows us to support projects and programs in line with the mission and vision that we couldn’t otherwise fund,” says Huot. Some of the grant opportunities focus on environmental stewardship and education, while others support the economic vitality and job growth in the region through reducing sewer impact fees for qualifying commercial customers. Regional San/SacSewer also have an impact fee waiver program to support the development of affordable housing, where impact fee payments can be deferred for up to two years depending on the type of project. According to Huot, these programs tend to be undersubscribed, which they’re hoping to change by spreading the word with regional partners. It’s an encouraging reminder to look to regional programs like these to make infill projects work, whether that’s housing, commercial, or multi-use.  

As an electrical provider, SMUD does not have an impact fee model—instead, SMUD works with customers on a project-by-project basis to assess what is needed and what it will cost the customer. Electrical service up to the point of connection is paid for by SMUD, but other project-specific costs are the customer’s responsibility. To help offset costs indirectly, SMUD offers incentives and rebate programs for both residential and commercial customers. For utility providers like SMUD that continue to invest and expand operations to better serve the growing region, there are sometimes unique opportunities to support infill development projects—like redeveloping old properties that SMUD has outgrown.

As with water and sewer, there are unique issues for electricity in infill settings. For example, the space required for electrical equipment to be safe and reliable might be larger than a developer would prefer, especially in an infill setting where every square foot is valuable. Safety and reliability come first for SMUD, so that project-by-project discussion is key to resolving issues.

Huot has received follow-up inquiries about the Confluence Program, along with other connections made at the convening. “It’s important to make [these topics] tangible for people. The discussion we started is a pathway for that. Now we need to keep that momentum going,” he says.

SACOG is planning to hold another convening this spring to do just that, in hopes that more cities and special districts join. In the meantime, SACOG will continue to keep an eye on regional funding opportunities and provide support where possible. “Each special district is rightfully focused on their particular area of expertise and their mandate,” says Garett Ballard-Rosa, SACOG senior analyst who manages the Green Means Go program. “It’s really hard for any individual agency to keep track of what’s going on at the state level.” Getting together to share lessons learned and strategize on opportunities to maximize available resources will help make sure nothing is left out and nobody is left behind. In working with partners across the region over the past few years, “there is a lot of alignment,” Ballard-Rosa observes. “We just need to connect the dots and implement.”

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