If you’re thinking about buying a home in Cape Coral, Florida, it’s important to understand the city’s special assessments and how it works. These one-time charges refer to the installation of potable, sewer, and irrigation water services.
Here’s everything you need to know:
How it started
Founded in 1957, Cape Coral began as a small rural community. Since there were no public utilities such as water, sewer, and irrigation, the city made use of septic tanks and groundwater wells. As Cape Coral’s population continued to grow, more septic tanks were added, especially in growing neighborhoods. The city eventually realized that having too much septic tanks could lead to contamination of their drinking water.
As a result, the city decided to install public water, sewer, and irrigation systems and convert those using septic tanks and well water. This is called the Utilities Extension Project (UEP),
What is the Utilities Extension Project?
In 1999, the city began its Utilities Extension Project, a program that aims to provide and maintain reliable public utility service to its residents. Through this project, all properties within the city limits will be connected to a central water and sewer system.
Homeowners who live in areas with public utilities must pay for the installation through an assessment. Those who have already paid in full are marked as “Assessment Paid.” For developed properties, connecting to these public water and sewer lines is mandatory. Hooking up to the irrigation line, however, is optional.
While the majority of Cape Coral already has public utilities, there are still some areas of the city that are awaiting installation. The Southeast side of Cape Coral, which is the oldest part of the city, was the first area to have public utilities installed, followed by the homes on the southern portion of Pine Island Road. As of now, the northeast quadrant of the city is next for public utility installation.
Cost of assessment
As you search for homes for sale in Cape Coral, the listing will specify whether the assessment has already been paid or if the balance will be assumed by the buyer.
If a potential home isn’t connected to public utilities, be prepared for the relatively high cost. Aside from connecting to the actual utility, you also need to pay for the water, sewer, and irrigation line assessment, the impact fee, and the permits required.
Since the utility pipes installed will run along your street line, the location of your property or lot affects the amount charged on your assessment as well. Corner lots and triple lots, in particular, are more expensive since they have plenty of street frontage. If you’re looking for a more affordable option, properties with more land frontage are ideal. Those who own vacant lots will be charged with the same assessment.
Paying the assessment
There are several payment options for your assessment: Initial Prepayment, Adjusted Prepayment, and the Amortized Payment Option.
If the public utilities are about to be installed in your area, you can pay upfront and avoid assessment interest. Another way is through your property tax bill. Your assessment balance, which is around $800 to $1,000 every year, will be included in your annual property tax bill.
If you sell your home, the new homeowner will continue to shoulder the assessment balance until it is paid in full. Assessments can also be included in your monthly escrow payments or in the prepaid closing terms.
Homeowners or homebuyers who are having difficulty paying the assessment can turn to the Hardship Deferral Program or the Utility Connection Grant Program. The Hardship Deferral Program allows permanent homeowners with a certain total household income to defer the payment of their assessment. The Utility Connection Grant Program, on the other hand, uses funds from a federal grant to shoulder the cost of assessment.
Checking your assessment balance
To find out about the outstanding assessment balance of your potential Cape Coral property or of your current property, check out the city’s GIS (geographic information system) here.
Once you’re on the site, type in the address and click on the “Run Report” link that’s next to the Estimated Loan Payoff button. Another window will pop up. Under the Estimated Payoff Amount (on the right-hand side), tally up that column and there you have it: The total outstanding assessment amount of that particular property.
If the result shows up blank, it could mean that the assessment is already fully paid or that the assessments have not rolled into that particular area.
For more information about Cape Coral properties and assessments, please don’t hesitate to get in touch with the Mike Lombardo team, your Cape Coral real estate experts. Call 239.898.3445 or leave a note here.