A. Minimum expansion charges are established for all water connections on real property.

B. The purpose of the expansion charge is to allocate to new customers a share of the nongrant-supported costs incurred by the borough for prior investments in plant and equipment used for the benefit of providing utility services to new areas within the area served by the utility and to allocate to new customers the cost of expanding water treatment or storage facilities to meet demands placed on those facilities by new customers.

C. Revenue received for new customer expansion charges shall be regarded as restricted assets and may be used only for reduction of debt incurred for the water system, for capital outlays to replace water system plant and equipment at the conclusion of its useful life, or for expansion of water treatment or storage facilities.

D. All applicable expansion charges, as set out in HBC 13.04.045, shall be paid in full prior to the final connection of the customer’s service.

E. Expansion charges shall be based upon the size of the line used for domestic or commercial water service. There shall be no expansion charge for fire protection equipment water supply lines.

F. The expansion charge for water service lines larger than four inches shall be negotiated based upon the quantity of water consumed, but in no event shall the expansion charge be less than the charge listed for a four-inch line.